"if you can't see the difference between the mass ETF selling that was seen when gold was crushed & the Asian demand for that same gold, then you really are a long way from understanding the gold market."
I think I can tell the difference between buying and selling.
Yes. ETFs have been selling physical gold and the Chinese have been buying physical gold. But the ETF don't sell directly to the Chinese and it is what happens in between that interests me. It is the parties who hold and hedge that physical gold in the wholesale market who decide what the price of gold is.
The WGC tracks the changes in wholesale inventories under the category “OTC Investment and Stock Flows”.
According the notes this is made up of “Partly statistical residue, the data is largely reflective of demand in the opaque over-the-counter (OTC) market with an occasional contribution from fabrication inventories.”
This is where the gold sold by the ETFs is parked before it is sold to the Chinese.
The WGC monitors the changes in these inventories, but doesn't tell us how large they are. I don’t think they know. I think that there are very few outside the banks who know, but there are many who can guess.
My view is that the physical inventories held in this category are quite large, and until we see lots on successive minus numbers under that category in the WGC table, gold is likely to remain range bound.
I notice that seventeen people gave you a TU. Do they understand what this is about, or are they just barracking?
