Email of the day (1)
Comment of the Day

October 25 2011

Commentary by Eoin Treacy

Email of the day (1)

on a response to the renewal questionnaire:
"I like everything about Fullermoney. I regret that the long-term charts in many instances do not go back for a longer period of time, especially with regards to gold and silver, and I would love to see charts on gold coins, in particular the classical ones (Eagle & Liberty in the US, the Kruger Rand, the English Sovereign, the French Napoleon and the Mexican Peso, the Swiss Vreneli and the Russian Tchernev) because in today's world it is the change in premiums that reflects the price and premiums of these coins that reflect the popular as opposed to financial entities' interests or fears.

"I also believe that with the huge confusion created by the rapid ups and downs of currencies and the weakening of the dollar influence sporadically, gold expressed in Swiss francs and in Euros would also be very interesting to have in the charts.

"Looking forward to seeing you in November at the Chart Seminar"

Eoin Treacy's view Thank you for your generous feedback and I am also looking forward to renewing our acquaintance at The Chart Seminar. The chart library is capable of plotting a little more than 50 years of data. In most cases this is usually more than ample because our data feed from Bloomberg does not generally have longer time series than that. To draw a 50-year chart, choose a suitable instrument and a line or candle chart. Click on the Charting tab located in the charcoal bar above the chart area. Select 'Monthly' from the Sample dropdown menu and '50 Years [max]' from the Period dropdown menu. Then hit Apply.

We have a chart for British gold sovereigns in the Chart Library and I added a chart for American Eagle one ounce gold coins. In an effort to ascertain if the premium or discount of gold coins to gold prices is a reliable indicator I created a chart of Gold/American Eagle Gold coins. The ratio trades in a very narrow band suggesting the American Eagles almost never move to a meaningful premium over spot gold prices.

This chart of Gold / British Sovereigns is potentially more instructive. Sovereigns have been underperforming the gold price for much of the last decade. May was generally a quiet period for gold prices but British Sovereigns pulled back rather sharply. They subsequently rallied and have mostly kept pace with the gold price.

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