In Part I, we discussed the concept of arbitrage. We showed why defining it as a risk-free investment that earns more than the risk-free rate of interest is invalid. There is no such thing as a risk-free investment, and in...
In Part I, we discussed the concept of arbitrage. We showed why defining it as a risk-free investment that earns more than the risk-free rate of interest is invalid. There is no such thing as a risk-free investment, and in...
The popular view today is based on the linear Quantity Theory of Money. It seems to be common sense. If more units of a currency are issued, then the value of each unit should fall. Many people may not think...
Professor Tom Fischer has written three papers[1][2][3] about gold backwardation and arbitrage. Across these three papers, he makes a case against the ideas of Professor Antal Fekete. I write this response solely on my own behalf. I do not speak...
In Part I, I made several points. First, that in the last gold bear market, miners capitulated after prices were low and falling for a long time. Then they sold massive amounts of their future production forward. Years into the...
I coined the term temporary backwardation in March of last year. This is what I said:
But in the “new normal”, post 2008, the expiring gold or silver future often flirts with or even slips into backwardation for a period before...
Hedging is a controversial topic, probably as controversial as any I have written about. Nevertheless, I want to share my thoughts and hopefully add something new to the topic.
It is general knowledge that the gold miners had adopted hedging during...
Gold conspiracy theorists have a new bogeyman. Inventories of gold bars held in the COMEX warehouses are falling. This fact is offered to support the stale allegations of “fractional gold” and “manipulation”. They have been predicting a “signal failure” that...
A quick glance at the data for ounces held by each Exchange Traded Fund (ETF) shows that right after the crash of 2008, ounces began to pour into GLD. Ignoring a little jitter, there was no significant outflow until 2013....
Let’s take a look at a few graphs of the dollar, from Feb 1, 2013 through Friday May 17, 2013. Yes, I said graphs of the dollar. I’ve priced the dollar in gold first (of course), then silver, the euro,...
