Summary
- Gold bulls have remained patient despite years of price suppression, criminal manipulation, and minimal legal consequences for market manipulation.
- Other asset classes have reached bubble valuations, while gold has held value but has yet to reflect the full impact of excessive monetary policies and exploding government debt.
- The Federal Reserve's recent rate cut signals deeper underlying economic issues, likely worse than publicly acknowledged.
- Gold would need to double in value to reach fair parity with the U.S. stock market, potentially marking a shift where gold outperforms stocks.
- Gold derivative traders are predicting further price increases for gold in both the short and medium term.
- India, the second-largest gold market, imported nearly 160 metric tons of gold in August 2024, highlighting strong demand ahead of the wedding season and benefiting from recent tax cuts.
- India also imported nearly 1,400 metric tons of silver in August 2024, despite local record-high silver prices, reflecting robust demand amidst global silver supply deficits.
- The U.S. retail gold market remains largely under-allocated, with many Americans unaware of gold's potential value, despite historical data supporting a 20-25% allocation.
- The gold-silver ratio remains at historically high levels, but anticipated supply deficits in silver may eventually drive the ratio lower as silver catches up to gold.
Gold bulls have been very patient as well as chair Powell.
Waiting through years of humiliating price suppression criminality with next to no criminal prosecutions and mere paltry fines from time to time, never matching damages persistent price rigging commercial bank desks have inflicted on the bullion saving the public at large.
Other overvalued asset classes have gone into historic bubble valuations, and while gold bullion has steadily held value it has yet to begin accounting in earnest for the absurd amounts of profligate monetary policy measures, exploding government deficit levels, and unsaved for promise piles in the $100s of trillions coming due this decade into next.
The fiat Federal Reserve kicked off their rate cutting cycle this week with a 50 basis point cut signaling to prudent market onlookers that things underneath the surface are likely worse than being collectively lied about generally.
Gold still has to nominally double from here so that in relative terms versus the current US stock market bubble 1:1 parity again is reached, which on a long timeline I'd argue is perhaps fair value. The rollover on this chart is only getting started. And after such a long period of stocks overvaluing gold, get ready to see an era where gold goes into massive relative premium to stocks in time.
Some western financial rags are pointing out the obvious, this one in Canada for instance. The fiat Canadian dollar price per gold is already closing in on $3,500 oz up north.
In the USA, the retail price for a 1 gram gold bar is already in the $3,000 oz range. So that $100 fiat Fed note only gets you a tiny gram of gold bullion now. Before all is said in done in the bullion bull, that will prove value stored in that 1 gram over that paper $100 note.
Leveraged gold derivative traders on the COMEX are calling for technical parabolic moves and that gold likely still has further to run in the short even medium term.
Meanwhile in the world's second largest gold bullion demand market. August 2024 import data for both gold and silver this week, point to robust demand levels moving into their wedding season likely helped spurred by India's recent cutting of import taxes on bullion imports.
Western financial media originally reported India's gold imports last month at 131 metric tons, but Metals Focus apparently updated that figure publishing today that August 2024 India imported nearly 160 metric tons of gold, or just over 5 million troy ounces.
Indians have lived through generations of fiat currency folly and thus they see beyond local nominal price highs at the bigger store of value gold remains over devaluing fiat currency units.
Looking at 21st Century Indian gold import data by month, nearly 160 metric tons imported las month is historically high regardless of local record nominal price high levels.
Gold hitting record price highs in India is unlike in the west, an actual leading headline on the news.
Turning to silver import levels last month in India. They apparently imported nearly 1,400 metric tons of silver last month alone. That is nearly 45 million ounces in a global market experiencing wide and persistent new line and refined supply deficits. Another way to put it, that is 45,000 of these industrial sized 1,000 oz bars went into India last month.
Apparently silver prices at local record high levels is not deterring India from importing last month alone an amount of silver that the US Mint used to sell in one entire year during its early 2010s American Silver Eagle sales heydays.
Final interesting note was that around 600 metric tons of the Indian silver imports last month, or nearly 20 million ounces came from London warehouses.
On the other side of this short break, we'll delve into the potential for a future silver catchup and outperformance rally versus typical bullion bull onset leading gold. Where might the spot GSR eventually collapse toward?
And a bit of typical misinformation western financial commentators continue making in terms of proper gold bullion allocations.
The spot silver and gold markets rallied through the close of this week's trading.
The spot silver price closed just over $31 oz while the spot gold price finished the week above $2,600 oz for the first time ever.
The spot gold silver ratio actually went up one to close at 84 with gold's strength at the close of this week.
Mark me as not shocked to see the FBI now reports nearly half of ongoing reported financial fraud complaints are in the crypto market imploding in real time.
Not surprising after having lived through years in this golden age of frauds, that more than $5.6 billion in reported crypto frauds are piling up thus far in 2024. This is still only the start in my studied opinion.
Billionaire gold bull John Paulson was on CNBC this week, and it was really the only worthwhile coverage of gold to highlight this week as gold remains in a stealth bull market still in the United States. Near no one owns any still.
Western fiat financialized media are still using the ancient 10% gold allocation thesis born from the last bull market peak era during the early 1980s.
Whereas backtested data over this full fiat currency era beginning in 1968 actually points to owning 20 to 25% gold bullion allocations in one's liquid net worth, on a risk to reward basis when backtested against US bonds and US stocks over the last 56 years of data.
The ongoing fact is westerners are still generally gold illiterate and have next to no gold allocations collectively regardless of the bullish fundamentals we hammer the table with here on a weekly bullion market update basis.
In terms of the current spot gold silver ratio, we are still at historically high nose bleed levels. And while we continue coiling at levels higher than the spot gold silver ratio peak during the 2008 global financial crisis.
It is understandable that given the power that gold is already leading this current gold bull market with, at some point massive supply deficits in silver are going to drive the spot GSR back towards levels last seen during the pip squeak 2008-2011 bull run and possibly to crazier levels beyond in time.
That is going to be all for this week's SD Bullion Market Update.
As always to you out there.
Take great care of yourselves and those you love.
