Gold & Silver Still on Sale

[edit] A long time subscriber tells me Central Fund is merging w/ Sprott, which was one of the “competing vehicles” I had in mind when I wrote the *’d rejoinder after the chart. A quick look shows Sprott’s gold (-.61%) and silver (-1.14%) selling at modest discounts as well.

So says the chart of gold and silver bullion fund CEF, which sports a discount to NAV. Gold bugs don’t really believe in the rally yet; and I am talking about the still intact rally from December 2015. Volume has been diminishing and you can buy this bullion right now at a discount to the fund’s net asset value. That discount has shrunk to only -1.9%, but it beats what was going on from 2002 to 2013 when over enthusiastic bugs were often paying anywhere from 10% to 20% premium. Look at all that volume back then; they couldn’t wait to get in (at any cost). *

Some guy named Buffett (I think his name is?) talks about buying what others hate, not what they love. On balance I wouldn’t say they outright hate gold and silver right now, but they still don’t like it very much. After all, why buy some stupid, old fashioned money sitting in a vault somewhere when you can buy data bits (coins) on the internet? It’s a long, slow process getting the masses’ heads straight. Enjoy the macro for what it is as it plays out.


* It’s certainly possible that today’s lower volume is at least in large part due to more competing vehicles out there to the Central Fund. Volume on gold and silver has been strong.

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