The recent hard falls in the price of gold and silver, where hundreds of tonnes of paper gold were sold onto the markets over 2 days on Friday the 12th and Monday the 15th of April dropped the price of gold to nearly 1000 euro an oz by close of business that Monday. Given the slow sideways to negative price movement of the metals for the preceding six months this perhaps represented a final capitulation by professional traders and ETF’s in gold.
What has been so interesting about all of this is the response of individual investors to this dramatic price fall – the period since this price fall has seen the busiest period of the year for most bullion dealers (including ourselves). Supply shortages have developed across the supply chain as customers flooded back into the metals markets to pick up bargains in gold and silver coins and bars. This has been evident worldwide but perhaps most spectacularly in Asia where Chinese and Indian buyers have been falling over themselves to take advantage of this ‘firesale’ in the metals.