The monthly gold demand in 2016 for Chindia (China and India) has averaged roughly 250 metric tonnes per MONTH. That demand alone accounts for ALL of the annual global mining output on our planet Earth. The volume of physical gold withdrawn from vaults of the Shanghai Gold Exchange (SGE) in November accounted for 215 tonnes, the highest amount in ten months. Year to date SGE withdrawals have reached 1,774 tonnes. What is particularly important about this data is that the East settles daily with the physical metal. The West uses paper settlement with very little actual metals involved in settlement.

The net result is a divergence between the spot price of gold (and silver) at the Shanghai Gold Exchange vs. the LBMA and the Comex. At the close of trading today in China, an ounce of gold was worth over $63.00 more in China than in the US. Similarly, a troy ounce of silver in China was valued at $2.01 higher than the West. The lower the spot prices in the West the greater the demand that emanates from the East. This creates tremendous strain on Western warehouse inventories.

Clearly, the divergence in spot prices between the East vs. West is growing and demands attention. The physical metals are worth more than the paper instruments attached to them. Individuals interested in taking advantage of the lower prices in the US ought to seriously consider doing so sooner rather than later.

For anyone interested in a live chart designed to display the growing divergence in the spot prices of precious metals between the West and the East, go to