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A new high for the gold ETF - it's all there, right?
Monday, September 22, 2008
The inventory at the SPDR Gold Shares ETF (NYSEArca:GLD) made a new all-time high today at 710 tonnes, exceeding the level of 706 tonnes reached on just two days in July. If you haven't already caught on to what's happening in precious metals markets these days, let me summarize, "Demand is soaring - prices will follow".
The world's most popular gold ETF now has its sites set on the Bank of Japan who currently holds down the #7 spot on the World Gold Council's Official Gold Holdings at 765 tonnes. After that it's Switzerland at #6 with over 1,100 tonnes.
Given what's happened in recent weeks, overtaking Japan could happen any week - maybe this week. Switzerland will take a little while, but, before you know it we should be hearing about those IMF gold sales again.
Hopefully, all the gold they say is being held for the ETF is really there. According to this report from Vietnam.net, they're having some problems in Saigon delivering gold to buyers on the paper market who then go resell the metal on the physical market where it fetches a higher price.
Over at the SPDR Gold Shares website, they have these wonderful pictures of all the gold that is "held in trust" for GLD shareholders.
Everything they say is in the trust is really there. Right?
4 comments:
Uhm, what's the address of that warehouse?
Hopefully the guys in the warehouse are better at math than the investment bankers.
I hope that you are right about price following demand but if the ETF is marginable then it is shortable. I want to be clear that I do not believe in "naked shorting" just that as long as GLD shares are in custody they can be lent and shorted to buyers with the same custodian who can 'onlend' again them without limit (see documentation at www.isla.co.uk).
"the biggest convenience the ETFs offer is the ability to conjure up a short position to feed into speculative demand with the relative safety that they don't have to face any risk of potential difficulties in making delivery of scarce metallic product because by the nature of it they are short shares, not metal."
http://www.usagold.com/goldenchalkboard/gc_etf.html
Another 15 tonnes today. Now they're up to 724..
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