Dear Bullion Banks, Please Come Back

by Keith Weiner
Gold Seek

One of our colleagues recently wrote an open letter to Ted Butler. The point was that Monetary Metals gold leasing is a different kind of activity than what is called “gold leasing” in the institutional bullion market. We make it possible for gold owners to lease their metal to gold-using businesses, and thereby earn interest in gold. Today, I want to discuss something that few in the gold community would defend: bullion banks aka market makers.

Where Have the Bullion Banks Gone?

There has been a trend for several years, of bullion banks leaving the market. This is due to country-specific regulatory pressures in some cases, global regulatory pressures, and no doubt, the adverse treatment of gold on the balance sheet under Basel III. Either this trend has hit critical mass, or something else happened around the time of peak government response to COVID-19. But there was unprecedented impact to the gold market. For example, we wrote that for the first time ever (or at least 1996), the expiring gold and silver futures contracts had rising basis).

Continue Reading at…