Why are we seeing SPOT and Physical spreads widen?

Discussion in 'Markets & Economies' started by 66rounds, Mar 29, 2020.

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  1. 66rounds

    66rounds Well-Known Member Silver Stacker

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    66rounds, Apr 14, 2020
    #61
  2. Ipv6Ready

    Ipv6Ready Well-Known Member Silver Stacker

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    ‘you could be right, there are bound to be many badly run bullion banks and dealers with no idea.

    $25 to $50 per ounce difference in spot and contracts is not a big deal. When every contract dealer knows that it is simple mechanics of refiners shut down causing shortage. Most will accept delayed delivery if they want physical gold. End of the day there is no shortage of gold, just refined 100oz bars.

    much like I can ring any food wholesaler and buy 25Kg sacks of rice or flour at a steep discount but have to pay inflated prices for 2kg or 5kg bags at supermarkets because of shortage of bagging capacity.

    All CMC has to do is change their 100oz bar only to settle to either 100 and 400 ounce bars and the difference disappears.

    It’s like Macdonald only accepting $10 notes and will only give $10 notes in change and it is the customer responsibility to buy as close to $10 lots..... or not get any change. That policy won’t last long.
     
    Ipv6Ready, Apr 14, 2020
    #62
  3. Ipv6Ready

    Ipv6Ready Well-Known Member Silver Stacker

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    Also only badly run miners, refiners, mints and bullion dealers that need money will be selling more than they have to by contract.

    A well run miner, refiners, mints and bullion dealers would minimise sales to what they are contractually obligated too than sit and wait for $1800 plus and reevaluate.

    Imagine a refiner with 1,000kg of 80% dore in the warehouse they own outright, not refining any and delaying production is better than refining it and selling at $1 per ounce premium for a 999.9 bar
     
    Ipv6Ready, Apr 14, 2020
    #63
  4. 66rounds

    66rounds Well-Known Member Silver Stacker

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    More evidence of comex failure?
     
    66rounds, Apr 16, 2020
    #64
  5. bron.suchecki

    bron.suchecki Well-Known Member

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    It may make make sense for a miner to stockpile, but no well run refiner, mint or bullion dealer actually takes a long (or short) position like that. The other factor is that to sit on stock like that requires funding, and that is costly and hard to get. If they have stock they are going to sell it immediately.
     
    bron.suchecki, Apr 17, 2020
    #65
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  6. wrcmad

    wrcmad Well-Known Member Silver Stacker

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    ​
    Well, I'm glad that's finally settled. ;)    ​
     
    wrcmad, Apr 17, 2020
    #66
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  7. STKR

    STKR Well-Known Member Silver Stacker

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    Removing the majority of your previously listed stock due to "unprecedented demand" and the inability to restock said items is very different to "stockpiling". ;););)
     
    STKR, Apr 17, 2020
    #67
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  8. wrcmad

    wrcmad Well-Known Member Silver Stacker

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    Yeah, right.
    Good story bro.
     
    wrcmad, Apr 17, 2020
    #68
  9. STKR

    STKR Well-Known Member Silver Stacker

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    If they have stock they are going to sell it immediately.

    How does that fit in with your good price gouging story, bro? ;)o_O
     
    STKR, Apr 17, 2020
    #69
  10. wrcmad

    wrcmad Well-Known Member Silver Stacker

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    {deep sigh....}
    You might want to re-read thread starting here.
    As initially stated, this was a fake news story to get permabulls all excited, and as expected gold cost of carry as returned to below 2%pa. ;):)
     
    wrcmad, Apr 17, 2020
    #70
  11. STKR

    STKR Well-Known Member Silver Stacker

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    Good story bro.
     
    STKR, Apr 17, 2020
    #71
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  12. wrcmad

    wrcmad Well-Known Member Silver Stacker

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    Yep. Numbers don't lie. :p
     
    wrcmad, Apr 17, 2020
    #72
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  13. 66rounds

    66rounds Well-Known Member Silver Stacker

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    Please ring Mr Kirkpatrick on (212) 299-2200 and ask him where is all the gold that COMEX is contracted to hold???
     
    66rounds, Apr 17, 2020
    #73
  14. wrcmad

    wrcmad Well-Known Member Silver Stacker

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    Don't need to ask..... the answer is simple:
    COMEX is not contracted to hold any gold, because COMEX does not enter a contract
    with anyone in a gold trade.​
    COMEX is merely a clearing house acting as a 3rd party.
    The contract is between the buyer and seller.
    This topic has been done to death many times on here before.
     
    wrcmad, Apr 17, 2020
    #74
  15. 66rounds

    66rounds Well-Known Member Silver Stacker

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    Must be a magic clearing house if they never have to lay hands on physical to close the contract between buyer and seller. Why choose such a confusing name as Commodities Exchange that implies they exchange physical commodities instead of You Buy, We Lie or something else more catchy.
     
    66rounds, Apr 17, 2020
    #75
  16. wrcmad

    wrcmad Well-Known Member Silver Stacker

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    No bite from me today.
    Not confusing.... couldn't be simpler.
    Do your own homework. :)
     
    wrcmad, Apr 17, 2020
    #76
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  17. 66rounds

    66rounds Well-Known Member Silver Stacker

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    Where's the fun in my own homework? Arguing on a pet rock forum is the only thing getting me through this damn quarantine!
     
    66rounds, Apr 17, 2020
    #77
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  18. Eureka Moments

    Eureka Moments Well-Known Member Silver Stacker

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    Lots of us spent around 7 years arguing amongst ourselves whilst waiting for our pet rock prices to increase. Now that's happening but all every man and his bottle of hand sanitiser wants to talk about is germs and parasites.
    Coincidentally those are two of the words that many of us used to refer to each other as. From 2012-2015 if Spannermonkey didn't rolleyes at someone's post and/or tell them to fk off at least daily GoldPelican would get someone to go visit and check in on him to make sure he was ok. Ah, the memories!
     
    Eureka Moments, Apr 18, 2020
    #78
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  19. Eureka Moments

    Eureka Moments Well-Known Member Silver Stacker

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    I do agree with wrcmad that the COMEX won't disappear up its own arse and turn into a black hole if demand exceeds current holdings at any time. With our current lives, any rush to take possession will be tempered by distancing rules and only one person being allowed to rush the place at a time.
     
    Eureka Moments, Apr 18, 2020
    #79
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  20. alor

    alor Well-Known Member Silver Stacker

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    if you hold on long enuff, your positions would be elevated, just like this little girl

    The girl was playing with friends near the cables as workers were installing them when she was inadvertently suspended in the air.PHOTOS: SCREENGRAB FROM TWITTER
    [​IMG]

    Comex is not all markets, there are other markets that settle gold and not in USD
     
    Last edited: Apr 18, 2020
    alor, Apr 18, 2020
    #80
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