Time to buy up more NML, page-14

Some highlights from the document;

"I have always believed that the future price of gold is best understood through long-term irreversible trends. Today’s macro trend changes are part of a looming tectonic shift that started decades ago, and have not been adequately reported by the mainstream media."
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"Under the Gold Shariah Standard, which was adopted at the end of 2016, gold trading has been approved in the $1.88 trillion Islamic finance business."
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"Another monumental change is the growing importance of the Shanghai Gold Exchange (SGE). The contracts on the new exchange will be physically settled, and will be traded between bullion banks, refiners, producers and trading houses. In China, gold is money and is accepted as such by the general population."
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Gold trading in London and New York is really the trading of large quantities of synthetic derivatives of gold, which are completely detached from the physical markets but which are distorting the price of gold. These derivatives are fractionally backed gold positions, of which about 99% is cash settled. There is no purchase of physical gold.
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"In contrast, the Shanghai Gold Exchange is a physical spot price exchange that requires the seller to actually own the physical gold that they are selling; what a novel idea. Physical delivery is the norm, not the exception. The uncontrolled naked shorting of futures contracts, so prevalent on the COMEX, is not allowed."
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"Sergey Shvetsov, Deputy Chairman of Russia’s central bank, recently said that 'the major gold-producing nations are tired of an international gold price that is determined in a synthetic trading environment having little to do with the physical gold market.'

In November 2017, China, India, Russia, Brazil and South Africa, the major producers and users of gold, agreed to establish their own gold trading system using their own currencies, thereby by-passing the US dollar. Implementation will begin in 2018."

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"Annual mine supply is about 2,800 tonnes, and it has been in decline since peaking in 2016. It is projected to decline by 76% by 2029. New mines take about 19.5 years to go into production. No new major discoveries over 3 million ounces have been made since 2009."



"As a result, the only adjusting factor for increased demand is an adjustment in price. With the global financial system experiencing a condition not seen since 1929 of a simultaneous triple bubble in stocks, bonds and real estate sitting on a historically unprecedented pile of $270 trillion of unpayable government debt, subprime auto debt, student loan debt, margin debt and consumer debt, in addition to a very dangerous mountain of over $600 trillion of derivatives, conditions are set for a major market correction.

This will result in a massive increase in the price of gold as investors flee to the safety of gold.

What is the possible magnitude of this price increase?

In the 1960s, most investors and financial institutions held about 5% of their portfolios in gold."



'"Today, individual investors and institutions hold less than 0.5%. If global investors reallocated just 5% of their financial assets to gold that would be $14.7 trillion of increased demand trying to purchase less than $1.8 trillion of privately held gold bullion. The current price would have to rise by at least 8-fold to $10,560 per ounce. However, there is far less than $1.8 trillion of above-ground bullion, as most of this privately held gold is owned by the world’s wealthiest families for generational wealth preservation, and is not likely to be sold at any price."