Wednesday, October 22, 2008
The SPDR Gold Shares ETF (NYSE:Arca:GLD) reached a milestone of sorts today as shown below. For every dollar of the gold price there is now one tonne of gold in the trust.
As might be expected, this has much more to do with the price of gold than with changes to the inventory, at least at first glance.
After the "tonnes in the trust" made new highs over the last month as the price of gold was surging, passing the Bank of Japan as the world's lucky number 7 holder of the yellow metal in the process, there has been precious little selling despite the gold price dropping more than $150 as shown below.
That's kind of odd when you think about it, particularly in light of what's been going on in the stock market lately where stock mutual fund redemptions in retirement plans are being credited with accelerating the decline in equity markets.
For gold, the price goes down, but investors don't sell.