If the seemingly coordinated hit on gold prices was supposed to temper the gold bugs lust for gold, lets just say those planners need to go back to the drawing board. First it was Asia that has been selling all types of physical gold and other precious metals.
Their largest gold market sold out and was waiting on new deliveries. Then the US was seeing sales explode and the US mint even suspended sales of the 1/10th ounce gold eagle. Now it seems it is the UK’s turn to join the growing gold panic buying.
The British Royal Mint announced that gold coin sales are triple what they were this month last year. Sales are up 150% from last month as people rush to buy gold at prices they think will be the low. The UK was the last area not hit with a surge of buying and now it seems people across the globe are no longer placing their faith in central banks that seem committed to the race to devalue their respective currencies.
Online sales of gold have also skyrocketed in the face of the rapid sell-off in gold ETFs and futures. Here in the US, online dealers are backlogged week and months. There are even rumblings of vaults running completely out of stock. Owners of major coin dealers are calling it a panic as they say customers are jamming the phone lines to place new retail and wholesale orders. Their thinking is gold is at or near its low and it is only up from here.
Bank of America analysts are backing their claims. They see jewelry demand becoming so pronounced by 2016, that gold will remain above $1500 an ounce even if investors are net sellers.
Therein lies the difference between the physical and paper gold markets. While the massive sell-off in gold futures shook out a lot of investors and precipitated the move down, the physical market demand was more than willing to pick up the slack. Even with outsized premiums over spot.
With every day the passes, Central Banks continue to ramp up their race to the bottom of currency devaluation. Japan recently entered that fray in a big way and even secured the backing of the G-20. Residents of the country were none too thrilled with the move and have rushed to hard assets.
Now that the UK has joined the physical demand craze, it seems the backlog of orders will be enough to keep the gold dealers in a mad scramble throughout the rest of the year at minimum.
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Their largest gold market sold out and was waiting on new deliveries. Then the US was seeing sales explode and the US mint even suspended sales of the 1/10th ounce gold eagle. Now it seems it is the UK’s turn to join the growing gold panic buying.
The British Royal Mint announced that gold coin sales are triple what they were this month last year. Sales are up 150% from last month as people rush to buy gold at prices they think will be the low. The UK was the last area not hit with a surge of buying and now it seems people across the globe are no longer placing their faith in central banks that seem committed to the race to devalue their respective currencies.
Online sales of gold have also skyrocketed in the face of the rapid sell-off in gold ETFs and futures. Here in the US, online dealers are backlogged week and months. There are even rumblings of vaults running completely out of stock. Owners of major coin dealers are calling it a panic as they say customers are jamming the phone lines to place new retail and wholesale orders. Their thinking is gold is at or near its low and it is only up from here.
Bank of America analysts are backing their claims. They see jewelry demand becoming so pronounced by 2016, that gold will remain above $1500 an ounce even if investors are net sellers.
Therein lies the difference between the physical and paper gold markets. While the massive sell-off in gold futures shook out a lot of investors and precipitated the move down, the physical market demand was more than willing to pick up the slack. Even with outsized premiums over spot.
With every day the passes, Central Banks continue to ramp up their race to the bottom of currency devaluation. Japan recently entered that fray in a big way and even secured the backing of the G-20. Residents of the country were none too thrilled with the move and have rushed to hard assets.
Now that the UK has joined the physical demand craze, it seems the backlog of orders will be enough to keep the gold dealers in a mad scramble throughout the rest of the year at minimum.
Trade the Newsroom
