Bullion Star/Koos Jansen/10-19-2016
MK note: Koos Jansen has done considerable ground-breaking research over the years, in particular with respect to Chinese gold demand. In this article, he establishes by inference that there is considerably more demand for physical gold than what the mainstream statistical services are reporting to us. Second, he goes on to establish a direct correlation between net physical gold bullion net flows in and out of the United Kingdom and the price of gold. The chart above shows that correlation, and it is an interesting one. He also says that a similar correlation exists between private investor demand for gold coins and bullion and the price.
It all makes sense, and I would recommend spending some time with the analysis posted above to anyone looking to gain a clearer and deeper understanding of how the gold market operates in the here and now. We are often asked why the price of gold does not respond to surges in demand. Well, apparently it does if you know where to look to find the correlation. Jansen states that the supply and demand reporting services are leaving out the most important part of the gold pricing mechanism – the ebb and flow of gold metal through London and the London Bullion Marketing Association.
