The truth slips out on GLD

[EE_]

Watch at 1:05
http://www.cnbc.com/id/15840232/?video=1492076817&play=1

[Awoke]

Here is a text thread based on the same...

Link to Article (http://gold-silver.us/forum/gold-silver-precious-metals/cnbc-actually-blast-paper-gold!-gata-letter/)


EDIT: Fixed link. -Gaillo

[1970 Silver Art]

Yep. Gold is at a top. Do not buy that barbaric yellow metal. The MSM is always right. Listen to them. :sarc: :sarc: :sarc: :sarc: :sarc:

[Dirty Harry]

"I wouldn't necessarily look at the GLD, because they don't invest in the PHYSICAL GOLD".....

OOPS...........

:ROFL:

[Neuro]

"I wouldn't necessarily look at the GLD, because they don't invest in the PHYSICAL GOLD".....

OOPS...........

:ROFL:
Bbbbb but but they say they do!

[Twisted Titan]

......................

[Awoke]

Some mixed messages going on here.

Now Eric King interviewed Teb Butler, and Ted says that GLD is investing in Physical.

Listen here.
http://www.kingworldnews.com/kingworldnews/Broadcast_Gold+/Entries/2010/5/15_Ted_Butler_on_the_Metals_Market.html

Fast-forward the marker so it is under his lapel on the right, if you don't want to listen to the whole thing.

He says "A lot of physical Gold is being bought in the GLD. Another Uh, Hundred and fifty ounces today, making it almost eight hundred thousand for the week. In the last three weeks they've added two and a half million ounces, almost two and a half million ounces to the GLD, and that's about three billion dollars worth so that's not a tiny amount, and it show a real strong physical demand in GOld."

[TheNocturnalEgyptian]

Did you notice also, the guy who spoke after the guy who said "GLD isn't physical."

The next guy mentioned that a +100$ gain in gold isn't a big deal anymore - because it's a small percentage of the total. i.e. +100$ is a relatively weak gain.

From my perspective, this simply belies that the currency (FRN) is losing ground and purchasing power while the money (gold) remains as strong as ever.

[sirgonzo420]

Did you notice also, the guy who spoke after the guy who said "GLD isn't physical."

The next guy mentioned that a +100$ gain in gold isn't a big deal anymore - because it's a small percentage of the total. i.e. +100$ is a relatively weak gain.

From my perspective, this simply belies that the currency (FRN) is losing ground and purchasing power while the money (gold) remains as strong as ever.


Yeah, I thought that was funny too.

[jedemdasseine]

Read the prospectus.


Thus, for example, when GLD adds a gold bar, there is no assurance that the gold bar really exists unless it is in the vault of the custodian, HSBC. But the prospectus discloses that HSBC uses subcustodians and even sub-subcustodians, and what's worse, "the Custodian is not liable for the acts or omissions of its subcustodians". In other words, if the subcustodian does not have the gold, GLD "Shareholders cannot be assured that the Trustee will be able to recover damages from subcustodians...for any losses relating to the safekeeping of gold by such subcustodian". This means that "Because neither the Trustee nor the Custodian oversees or monitors the activities of subcustodians who may hold the Trust's gold, failure by the subcustodians to exercise due care in the safekeeping of the Trust's gold could result in a loss to the Trust." To be blunt, these disclosures mean that there is no certainty that the gold supposedly owned by GLD really exists. After all, if there was complete certainty that the gold did exist, the objective of GLD would be to provide investors with the opportunity to own gold bullion by investing in shares of an ETF, rather than its stated objective to just track the price of gold.

http://www.safehaven.com/article/2243/where-is-the-etfs-gold





I have been and remain critical of GLD, and have written several reports since its launch five years ago. I consider GLD to be risky because its prospectus says that gold reportedly owned by the fund but stored in subcustodians and sub-subcustodians is not audited and cannot even be inspected to ensure that it really exists. Nor is it insured. Further, the prospectus allows for the possibility that all of the gold supposedly owned by GLD is subject to the considerable numerous risks spelled out on pages 6 through 13 of GLD’s prospectus, including the significant risk that “Shareholders do not have the regulatory protections provided to investors in investment companies.”

GLD presents its financial statement in 10-K reports filed with the Securities & Exchange Commission, and these are revealing. GLD's balance sheet states its major asset to be: “Investment in Gold”. It does not say just: “Gold”. This classification declaring GLD's asset to be an investment in gold rather than gold itself provides an easy hurdle to meet for auditing purposes.

Investments in gold can be nearly anything gold related, and for example, include gold certificates and other promises to pay gold. GLD does not have to prove to its auditor that each share in issue is backed by gold in the vault. Rather, all GLD has to do to satisfy its auditor is to simply show them an account statement (i.e., a piece of paper) from any subcustodian or sub-subcustodian that says gold is owed by them to GLD.
http://goldprice.org/james-turk/2009/03/gld.html

[Sparky]

I don't think it was the truth slipping out so much as that he has no idea what he's talking about. Notice Erin Burnett didn't take him up on the issue? And he likes GDX (and so do I), but GDX doesn't hold any gold either. Why is he okay with that?

Then the other doofus. The SPX is up 30%, so what's the big deal about gold? How about, the SPX is down 20% over the last decade, and while gold is up 300%. No mention of that?!?

I'm sick of these douche bags.