0:00 - Intro0:57 - Options and Gold6:36 - Comex Deliveries11:45 - Who is taking delivery?15:00 - Run on the Comex17:42 - Gold Hypothecation20:24 - Manipulation28:50 - Gold Price and Central Banks31:49 - Stimulus and Gold Higher?36:00 - Junior Miners41:53 - Takeover Targets44:09 - Junior Considerations45:58 - Economy is Weak
Tom welcomes David Kranzler of Investment Research Dynamics back to the show. David discusses how banks like JP Morgan leverage commodity market options via manipulating prices via massive amounts of paper contracts. This manipulation is a source of massive profits for these bullion banks and is permitted because it benefits Central Banks. These shock and awe hits to the market are designed to shake out weak participants.
There are indications that a larger population of retail investors are looking to take physical delivery. However, many Comex deliveries remain on the exchange for safekeeping. The Comex encourages this by charging lower fees for storage than other vault services. If a run on those stored bars was to occur, there could be a default.
David outlines how the miners are cheaper now than at any point in the last twenty years. For example, the HUI index should be much higher based on the price gold has reached.
David discusses what he defines as a junior mining company. Large-cap companies are waiting until the last minute to decide who they should buy. A lot of these junior companies with good prospects will be taken over by the majors.
Dave Kranzler spent many years working in various Wall Street jobs. After business school, he primarily traded junk bonds for a large bank. Dave graduated from Oberlin College with majors in Economics and English and he also has an MBA from the University of Chicago, with a concentration in accounting and finance. Currently, he co-manages a precious metals and mining stock investment fund in Denver. He has nearly thirty years of experience in studying, researching, analyzing and investing in the financial markets. His daily articles can be found at his site, Investment Research Dynamics.