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Matt's Market Insights

 

Gold prices may have declined substantially in 2013, but that didn't dampen the desire to own physical gold. In fact, it may have spurred desire as demand for gold coins surged. According to figures from the World Gold Council, demand for gold coins was up 63% during the first three quarters last year. Sales of Canadian Maple leaf coins were up 82.5% over the same timeframe, and the US Mint sold 14% more American Eagles and a record amount of silver coins in 2013.

 

This further illustrates the separation between the physical and paper markets for gold. Unlike physical gold, the contracts for paper gold, which determine gold's price, are virtually limitless. Any two parties who are interested in placing opposing bets on the metal's price can do so, and in most cases these parties have no desire to own the precious metal in question. They simply want to cash-settle the profits ... Log in or subscribe to continue reading.


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