I also find all this lease-rate stuff confusing
I seem to have picked up that there are two ways to express lease rates - the actual leasing cost (equivalent to APR, say - I think this is properly called the forward-rate) and the discount from LIBOR (ie, the expected percentage gain for the borrower compared with the value of money - assuming the price of gold remains constant). Note that this latter approach has cheaper borrowing expressed as a positive lease-rate. I thought the Kitco lease information was expressed as the discount from LIBOR. This would mean that they're not actually paying you to borrow the gold - quite the reverse .. At the moment the quoted lease rate is negative, suggesting that gold has a higher lending rate than LIBOR.
Or, put another way, this would suggest that at the moment gold is being valued higher than money by the markets. Isn't this a bullish sign for gold?
(Still, gold is being lent out at lower rates than banks are lending money to each other... perhaps they do value money higher after all...)
Kitco quotes a lease of -0.07ish for Friday, which is only just negative, but at least it is negative. The spike for Friday's lease rate at -2.5ish (if it isn't just an anomaly) could mean that there was strong interest in borrowing gold (say, to roll-over a short, perhaps because of an expected increase in the price of gold because of news leaked that was to be announced over the weekend...), but few willing to lend it (say, because of a perceived risk that the lenders wouldn't return the gold, or the day's allocation for leasing being fulfilled ... or perhaps too many people are now hoarding gold...)
Or is the above the reason I should stay with cash in the BS...
[hello all - my first post so be gentle... ]