Bear Market….Reality Check
Whistleblower Andrew Maguire told King World News that massive global physical demand reveals that gold is in fact in a full-fledged bull market and that the gold bear market theory is simply not valid. Do you believe it?
Here is a quick review of his “reality check”:
1. You cannot have a bear market when even the officially reported demand is surging to its highest levels in 18 months.
2. You can’t call it a ‘bear market’ when we see consistent $30 premiums in Shanghai, India, and the Middle-Eastern markets.
3. You can’t have a bear market when bullion banks are actively defaulting on an increasing number of clients who have the audacity to ask for the delivery of their bullion from these LBMA bullion bank vaults. If we were in a bear market they would be trying to rid themselves of this bullion.
4. You can’t call it a bear market when we see extended and increasing delivery bottlenecks and backlogs at the refiners.
So this “bear market” is 100% in the virtual paper market. Yet the underlying physical market has diverged into a full-fledged ‘bull market’ as evidence by hard, official data showing the strongest physical demand in 18 months.
All Things Considered – John’s Commentary:
Always take the time to compare and contrast the paper metals market to the physical metals market. They are not one in the same.
We are still bullish on physical gold and silver. If gold holds out above $1,400, speculative longs will be encouraged to enter the market again. Support for silver is still intact at $22.
Keep an eye on the gold/silver ratio which is currently at 62.02. I am looking for the ratio to move lower into the mid 50’s as silver begins to outperform gold.
