Market turmoil and precious metals
In currency and stock market turmoil, gold is down about 3% and silver 15%. Should stackers be worried?
The first point to make is that when there are huge stockmarket losses, other unrelated assets become a source of funds to cover them. In that context, the decline in gold from all-time highs is minor so far. Let’s look at the underlying position.
The big negative is the short positions on Comex and London. In the case of London, we must include unknown quantities of fractionally reserved unallocated accounts in European banks. But the visible position is obviously Comex, where the bullion bank trading desks are short. The position at the last Commitment of Traders numbers (30 July, when gold was $2410) is shown in the chart below:
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