This interview with Jay Taylor discusses price premia of $130 per oz. of palladium and $80 per oz. of platinum in Shanghai vs. the London/NY markets.
We also discuss how the paper metals markets can fail as real metal markets like Shanghai develop.
Given PGM price premia (PGM inventories aren't held by central banks) that we are seeing in Shanghai, as this moves to silver and gold as well, ultimately sellers of precious metals are going to migrate from London & NY to exchanges that deal in real metal and provide the maximum price. It appears that influence of paper markets is waning and there is a transition to real physical markets taking place.
A palladium mining company will have a hard time explaining to shareholders why they are selling through or using LPPM / NY Comex benchmark pricing when they can, for instance, obtain $130/oz more in Shanghai for palladium.
We also touch on the fact that the discussion re. a new Gold Daily Fixing price is a straw horse discussion as it is not the fixing mechanism in London that is broken. Instead, witness the fact that Goldcore.com noted that in the summer of 2013, there was 280 million oz. of gold traded on the LBMA per day which is 850x the daily global gold mine production rate. It is not the fix that is broken. It is that London and NY are digital instrument markets that trade pretend gold, silver, etc. to manipulate global gold, silver, platinum, and palladium prices.
Length: 30 mins 46 seconds