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Thursday, October 10, 2013

Open letter to Andy Bell from BNN Commodities


Hey, Andy!

I see you have Tom Kendall from Credit Suisse on your Commodities report, today at 11:30AM. The title of the segment is "Another Nail In Gold's Coffin", ha ha, ho ho.

I can understand if you simply want to lob this kid a bunch of soft pitches and let him spend most of the half-hour on his favourite talking points, I really do. That's what TV "journalism" has become, after all. It's why most of us people are getting our news from the internet now.

But Andy, if you feel a bit ambitious, might I suggest the following?

1) You could ask Kendall about the data for Chinese gold demand, and which direction is the trend in the data, and how that justifies a bearish gold call. Cos it doesn't, really.

2) You could ask Kendall about the data for primary gold supply, and investment gold supply, and how those trends justify a bearish gold call. Cos they don't either.

3) You could ask Kendall about Indian gold demand, remembering that most gold is now getting smuggled into India. Does Credit Suisse have a good handle on how much smuggled gold is entering India? Or are they simply relying on official government figures?

4) Indian rural farmers make up 60-70% of Indian gold demand, and they're going to see a bumper crop this year. What does Credit Suisse think they're going to do with their money, given they have no banks? Does Credit Suisse think 600 million rural Indians will suddenly decide this year to take a day-long train ride to the nearest city, open a brokerage account, and buy fractional shares of Apple?

5) Ask Kendall the mechanism by which physical gold demand is affected by the US dollar, or by Treasury yields, or by quantitative easing. Because he's probably a really smart guy and I must really be dumb, because I just don't get how any of those things should affect physical gold demand and I must need some 'splainin' to me.

6) Just as an aside, ask Kendall if he has the same outlook for silver and platinum, considering they're industrial metals correlated with world economic growth and he seems to feel gold is the opposite. Would continued Asian wealth creation imply a lower future gold price, given constrained supply? If so, what is the data supporting a theory of reduced Asian gold asset allocation in the future?

I feel this would make for a very informative interview, Andy. What do you say?


5 comments:

  1. Perhaps if Andy Bell was on a 1 year perscription of Growacette he would.

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    1. Ha ha ha! Eet's funny becouse you are suggesting hee haz not any testeecles!

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  2. The whole show can't ask a difficult question. Ohhhh would not want to offend anybody because they are all " experts".

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  3. I am really dissed that I am one of the few that can carry on a converasation on your blog .. Like really does everyone drop by so you can give them how to think today?

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    Replies
    1. There used to be a couple other guys but I guess they're gone now.

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