Bullion Shortage and Spot Prices Tell Two Different Gold Stories

Source:

German gold dealers say demand has skyrocketed this past week to 10 times normal so no more orders can be taken for the foreseeable future. "The demand exceeds our capacities by a great deal," said Heiko Ganss, head of precious metal company Pro Aurum.

...The British Evening Standard ran a story over the weekend that said demand in Germany had grown 10-fold and dealers were not taking any more orders:

German gold dealers say demand has skyrocketed this past week to 10 times normal so no more orders can be taken for the foreseeable future.

"The demand exceeds our capacities by a great deal," said Heiko Ganss, head of precious metal company Pro Aurum.

"The requests cannot be satisfied right now," a dealer from the Düsseldorf WGZ Bank confirmed.

"Demand for gold as a conservative investment has risen dramatically," said Stephan Henkel. "right now the demand is about 10 times as high as in normal times."

Gold deliveries now take between four and six weeks.

This was confirmed by the Berlin daily Tagesspiegel, which reported in a very insightful article that German gold dealer Pro Aurum has closed its mail-order business due to demand never seen before.

One reportedly has to wait four weeks to take delivery of one kilo gold bars.

Physically backed gold ETCs (Exchange Traded Commodities) see heydays as well, according to a story at investegate:

Physically-backed gold ETCs saw $93m of net inflows, equivalent to 106,000 ounces of gold, in the six business days up to October 6, the largest weekly increase during the past 10 weeks, while silver also saw net inflows.

Despite a fall in gold prices last week, the ETCs' total assets reached $4.5bn, equivalent to 5,340,000 ounces. So far this year the products have seen $992m in inflows, equivalent to 1,530,000 ounces, an increase of 30%...

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