Really good, insightful article, showing what's going on with gold demand through the lens of the refining business. The upshot: physical demand, for gold to hold outside the financial system, is the strongest area.

The European refiners aren't taking gold ore and turning it into metal ingots; that happens close to the mines.

The core business these days is taking the classic 400-ounce "good delivery" bars, refined to 0.9995 purity, melting them down, removing most of the remaining impurities, and producing "four nines," or 0.9999 pure, kilo bars.

As a gold arb friend of mine in London says: "The 400-ounce bars are over the EasyJet carry-on limit, not of real use to man nor beast. Kilo bars are what people want these days."

The buyers of kilo bars, stamped with fancy Swiss logos, tend to be Europeans or Asians.

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