These two charts present the big picture in Gold Supply and Demand the best. When Central Banks are distorting the markets by suppressing the Gold price the increased Demand is overwhelming the diminishing Supply. The Game of Musical Chairs in Fractional Reserve Gold System continues, but it is very close to its logical conclusion with COMEX deliverable Gold being leveraged of 59 times at least.
All games with Gold price manipulation have lead to two most significant outcomes for the Supply and Demand in the Gold market this year. China, Turkey and Thailand are all buying the record amount of Gold and pushing demand through the roof. Brazil and others are joining the club as well or consume all the gold produced like Russia.We can safely add India here even with all efforts to curb the official demand by the Central Bank, amount of smuggling is hardly controlled by the government there.
On another side - of Supply, miners are cutting back production and projects in the pipeline putting more constrains on the market in the future. Barrick Gold is the best example here shelving for now the giant Pascua Lama project in Argentina, reengineering its water treatment facilities and waiting for the better gold prices. This Gold will not come to the market any time soon now. With Gold price dipping below $1300 juniors are packing bags and putting their projects on hold as well.
Two questions are coming to mind here: what all these countries know the others don't about the financial system? And where all this Gold is coming from? Eric Sprott has raised all these questions in his open letter to The World Gold Council and COMEX has issued red flash warning that it is running on fumes now.
GLD and other Gold ETF draw down was addressed by Turd Ferguson in his article very well. With all these sources of gold being withdrawn so fast at this level of gold prices where from the physical gold will come next year?
Comex Registered Gold Falls To New Low at 640,552 Ounces - Claims Per Ounce Still Around High of 59 GLD, MUX, TNR.v, GDX
"Jesse reports another New Low at COMEX. With this rate of outflow COMEX will be empty very soon - can we assume that now higher Gold prices will come to save it?"
Gold Catalyst: COMEX Deliverable Gold Falls to 658,443 Ounces, Claims Per Deliverable Ounce at 55 GLD, MUX, TNR.v, GDX
"Jesse reports the COMEX deliverable Gold inventory which goes on fumes now. Maybe this will be the Catalyst Jim Puplava is looking for the Gold? The Game of Musical Chairs in the Gold Fractional Reserve System is getting more dangerous for its participants by the day now.
As ZeroHedge has put it with the chart above: "when it comes to physical gold and China's appetite for it, one word explains it best:unstoppable."
"China is buying record amount of Gold this year and now you can add countries like Thailand and Turkey into the mix as well. Thailand's biggest domestic gold importer expects to more than double purchases this year to 200 t from 92 t last year. Turkey's gold imports have doubled this year and purchases have reached already 251.4 t from January - the biggest tonnage increase since at least 1995, according to ZeroHedge."