Gold and Silver are commodities with high stockpile-to-restock ratio. This means that there is a large stock of Gold and Silver compared with the yearly increase in those metals from mining.
Backwardation in this kind of asset is extremely significant. It means that traders are unwilling to enter into a contract to buy Gold at a distant date - even though there is notionally a lot of Gold available in the system.
Which is another way of saying - they don’t think they will get what they paid for. Gold backwardation would be a sign of a run on the LBMA bullion system - and the trainwreck collapse of the global fiat system.
I guess I don’t understand the whole spot price vs. future price thingie. I mean even as things sit today, the “quoted” {who in the world puts quotes around “quoted”?) spot IS NOT what you would pay for the real deal.
If people revolted against buying futures, doesn’t it make sense that current spot would skyrocket?
But this gal says it means the relationship between gold and the dollar is done. Kinda like the “spot” is meaningless, even though it’s in a sense, more meaningful then the future price.
My head hurts!
>> Gold backwardation would be a sign of a run on the LBMA bullion system - and the trainwreck collapse of the global fiat system.
...or it could simply be a sign that the gold bubble is bursting.
your third point is not supported by your first two points