Earlier this week we posted about how refiners are melting 400 Oz bars of gold into 31 Oz (1 Kilo). We found this interesting because it indicates widespread gold ownership. That is to say that traders, banks, brokers hedge funds etc, trade physical gold in the form of a London Good Delivery (LGD) bar equal to around 400 Oz, or about $600,000 increments.
As reported, refineries are running on double and triple shifts, melting down LGD bars into 1 Kg bars, worth about $46,000.
Further evidence of the supply and demand strangeness came out today from Casey Research via Credit Writedowns:
As highlighted within the oval, the number of ounces held in trust at GLD peaked in July 2010 and has been in decline since, as the number of shares redeemed has exceeded those created. Concurrent with the exodus of 3+ million ounces from GLD's holdings was the steady rise in the gold price.
