Founders: Notes on Shanghai Gold and Silver Premium
Plus: Unicredit Monthly report
Hey all.. these are some notes made in preparation for a couple interviews on topic am doing.
May polish these and turn them into a post.. may not. Feel free to ask questons in comments and i will do my best to answer/explain myself!
Some are good, some are disorganized. The info may be helpful in understanding the lay of the land between China and the US now
Bonus at bottom. enjoy
VBL
What is going on in Shanghai?
Incessant demand plus China capital controls are distorting the price of Gold upward relative to the Comex price. Due to the de-gloablized nature of the physical market this differential is persistent and widening. The normal arbitrage players, guys like i used to be who take advantage of these price differences are not stepping in
Why aren’t they stepping in?
The market is deleveraging massively. That means less credit for arbitrage and carry trades. Put another way, you have to have the metal handy to sell china and buy comex in an arbitrage now… and there is much less metal handy to do that with. No more credit. This is the crisis of collateral Zoltan warned us of.