Since the recent wartime tensions between Russia and the west are unlikely to subside, it is safe to assume that oil and gas prices won’t decrease anytime soon. What can we ascertain from the Gold to Natural Gas ratio and the Gold to Oil ratio?
Continue reading “What Gas and Oil tell us about the price of Gold”
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For the first time in human history, a group of governments and private companies have effectively seized the foreign currency reserve assets of a sovereign central bank. Russia has learnt, the very hard way, that only gold is money and everything else is credit. The sanctions for now do not apply to energy exports, but for how long?
Continue reading “How long before Russia demands settlement in gold for oil and gas exports?”
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Learn why the futures market is not a valid price discovery mechanism for Gold and Silver and what is likely to happen in the future.
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The world discovers the price of commodities via the futures market, where different commodities can be bought and sold almost 24 hours a day. Each transaction represents a contract, at the end of which, the underlying commodity has to be physically delivered or settled in cash. This price discovery mechanism makes complete sense to find the market value of commodities, but utterly fails for Gold and Silver.
Continue reading “How and why the futures market misrepresents the true value of Gold and Silver”
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Six different approaches to measure the price of Gold, if one considers Gold to be a currency.
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Gold is regarded by pundits, financial advisors and mainstream commentators as a commodity, and evaluated as such. However, in the humble opinion of Yours Truly, Gold is an asset with intrinsic value, constant marginal utility and no counterparty risk, making it money and not a commodity. And this begs the question, how should we value and trade Gold if we consider it to be a currency?
Continue reading “Six different approaches to measure the price of Gold”
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