by Dave Kranzler, Investment Research Dynamics:
The move by Modi to eliminate large-denomination cash bills from India has set off an unanticipated physical gold buying frenzy that has driven Indian ex-duty import premiums in the mid-$30’s. It’s the widest I’ve seen in them in the many years I’ve been tracking that data (via John Brimelow’s Gold Jottings report). “”I’m getting non-stop calls from unknown numbers from people asking for gold,” the jeweller told a Reuters reporter in an interview inside his shuttered showroom..”
Ditto for China. The SGE premium last night was $12.59 to spot gold. As Brimelow describes: “In this case the high premiums probably simply reflect capacity constraints among Chinese import dealers. Possibly there is a Trump/devaluation effect boosting local appetite, besides of course the price decline.”
My personal view is that, given the extreme amount of paper being launched at the LBMA and Comex right now, and given that the price of gold seems averse to going any lower (at least for now), the worst of the beat-down is over. Too many people are looking “down” right now…Eric Dubin has also called a “double bottom in gold.” He and Jason discussed the precious metals market, among many other topics in their lates Welcome to Dystopia episode, which you can access here: The Bottom Is In.
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