Gold ETF Holdings Hit All Time High As Silver ETF Holdings Decline

August 11, 2011

The SPDR Gold Shares Trust (GLD) added 10.22 tonnes of gold since last week as gold prices continue to surge higher.  The GLD now has a net gain in gold holdings of 15.80 tonnes since the first of the year.  The all time high holdings of the Gold Shares Trust was 1320.47 tonnes reached on June 29, 2010.

The value of the GLD during August has increased by 12.1% to $73.9 billion on high volume.  During July, the highest volume day for the GDL was on July 13th when 25.2 million shares traded.  On August 8th, 9th and 10th, volume on the GLD exceeded 40 million shares.  On previous occasions when trading volume in the GLD surged, gold prices either pulled back slightly or consolidated in sideways trading before continuing higher.

All of the fundamental factors that have been pushing gold prices higher for the past decade are now being amplified by a looming currency collapse and sovereign debt crises.  Adding to concerns is the apparent inability of central banks and governments to contain the rapidly expanding financial crisis.

As measured by the closing London PM Fix Price, gold started the year at $1388.50 and closed Wednesday in New York trading at $1796.50, up $51.30.  Gold has gained $407.90 or 29.4% since the first of the year.

Total holdings of all gold ETFs recently reached a record of 2,276 tonnes of gold, valued at $130 billion.  The GLD currently holds 41.7 million ounces of gold valued at $73.9 billion.

GLD - COURTESY YAHOO FINANCE

 

The GLD hit a new all time high in Wednesday trading, closing at $174.58, up $5.97.

GLD and SLV Holdings (metric tonnes)

August 10-2011 Weekly Change YTD Change
GLD 1,296.52 +10.22 +15.80
SLV 9,772.56 -86.36 -1,149.01

Holdings of the iShares Silver Trust (SLV) declined by 86.36 tonnes on the week but have gained 236.41 tonnes since July 1st when silver prices began rallying.

Silver prices have not kept pace with the increase in gold prices as investors worry about reduced industrial demand for silver in a severe economic downturn.  Silver closed Wednesday at $39.39, up $1.58.  Silver began the year at $30.67 and is now up by $8.72 on the year returning investors a gain of 28.4%.

The SLV peaked in late April at the $50 level before prices corrected to the low 30’s.  The SLV has had an average annualized total return of 25% over the past three years.

The iShares Silver Trust currently holds 314.2 million ounces of silver valued at $12 billion.

 

SLV - COURTESY YAHOO FINANCE

As the world economy marches off the edge of the cliff and many wonder why, we look back at some prophetic  thoughts from Bill Murphy, co-founder of the Gold Anti-Trust Action Committee (GATA) in an interview with The Motley Fool in June 2010.

“What’s important for your readership to understand is that the markets have been made dysfunctional by U.S. policy and what these bullion banks are doing. Even Alan Greenspan said recently that interest rates were left too low for too long. Had the gold price been allowed to trade freely, interest rates wouldn’t have been able to stay down as low as they were. It would have been a warning sign for people not to get involved in the behavior that they did … not to go with all of the risks that developed. And there’s a good likelihood that the disaster would have been nowhere near as bad as it was.

“Alan Greenspan called gold a “thermometer.” So they diffused the thermometer by keeping the gold price managed. And what’s important for people to understand now is that the same thing is going on. If we’re correct, it’s going to lead to a bigger catastrophe, because no one has learned any lessons.”

 

 

Comments

By gary on August 12th, 2011 at 7:44 am

the gold manipulators are winning again at 14:43 on Friday 12 Aug, 2011

By The Silver Godfather on August 12th, 2011 at 10:05 am

Good Story, Silver Should start climbing soon.

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