The Mad Hatter

Now then, now then. Caaaaam down, caaaam down! Could we just have a bit of a reasoned debate about BV for a moment. Is there something in this allocated, insured physical gold holding in Zurich that I'm not getting? If BV go bankrupt, I still own my gold (although it might take a little while to get hold of it). My gold is not an asset of BV. If Viamat go bankrupt, I still own my gold (although it also might take a while to get hold of it). The gold in its vaults is not an asset of Viamat. I'm noticing an increasing number of comments about "electronic gold" or "paper gold". Can anyone convincingly explain that the service BV offers falls into either of these categories? Or am I going to have to fly to Zurich and see the contents of the Viamat vault for myself? In short, does anyone have any evidence that BV does not do exactly what they say they do i.e. hold physical gold securely on behalf of the rightful and legal owners?

Why don't you add up the number of grams you owe and divide it by the amount of money you put in to obtain that weight? That figure then includes the transaction costs, which is a better measure for calculating your final profit. Don't forget to add in your monthly storage charge.

So what will be the effect on the December COMEX contracts at this new price? Does the higher price make it more likely there will be a default or does the higher price indicate that shorts were covering their positions? Or have I been caught with my shorts down 'cos I haven't a clue what I'm talking about?

Bother. And I sold 60g that I mistakenly bought in the London vault thinking I can buy it back in Geneva on the next dip. I wonder if there will be a smackdown at 14:00 today?

So was that surge on news about Citigroup? I must say that was quite exciting. Puts me into a notional profit. Not that I'm selling of course.

Go on, my son! Go for £17,000!

No, not a peak. It peaked around 17,500 ish in October. But it is definitely shooting up at the moment.

A big jump after 13:00. The start of the final flight to safety?

Hmmmm. OK, so the site was down for a bit, but my gold is still physically present in the vault. There is not the equivalent of a run on the bank with allocated gold. I do like the idea of physically holding some gold (esp. for late-night "my precious" moments) but if I need to sell (which I will do when I find a house I want to live in) then BV is a lot more liquid than holding physical at home. I guess the physical at home argument will really come into play if it all goes completely pear-shaped, in which case I might have to go to plan B (escape to Switzerland). The BV site is definitely slow this afternoon. I'm hoping its because it is swamped with buy orders...

Thank you very much for that! I was giggling like an idiot for quite a while.

Thanks, Potatoes. Presumably, your prediction for the final option (orderly deflation) must be the inverse of the product of the percentages of all the other options occurring (or some such mathematical jiggery-pokery), i.e. smaller than a dwarf's winkie after skinny-dipping on a winter's day off Svalbard.

Or another (more severe) bank solvency crisis Or realisation that government savings guarantees are worth diddly squat Or massive inflation Or collapse of several eastern European countries Or default on government debt of just one G7 country (Italy will do) Or the Icelandic mess not being cleared up within three months Or the IMF failing to prevent a country going bankrupt Or some other as yet unknown and unexpected event I would have thought that the worst outcome for gold would be an orderly deflation over several years with nothing else major going pop along the way. We end up with a severe recession/depression and the gubmint fails to reflate. Yes, in those circumstances, cash may very well be king (assuming you can get real returns on interest). Anyone care to post odds on the relative weighting of these possible outcomes?

I get the impression that no private sellers are in the market at all and it's just the BV bots at each price point.

There's hardly any quantity below £17,870 in Zurich.

Aaaargh - what's happening to the spreads in Zurich!