Dropping as low as $1,264 per ounce on Friday on suddenly heavy volume in U.S. gold futures, gold today "[saw] some quite good physical demand," Bloomberg quotes Bernard Sin at Swiss refining group MKS, refering to wholesaler buying in Asia.
The latest World Gold Council Gold Demand Trends report, which covers the period April-June 2013, confirms again how recent falls in the gold price were due to speculators selling paper gold rather than a decline in actual demand for physical gold.
In August 2011, I wrote to the Financial Services Authority to seek confirmation that the London-based custodians of SPDR Gold Trust (GLD) and iShares Silver Trust (SLV) were being regulated as custodians, despite the fact that physical bullion is not a regulated investment.
Some people may look at the stock market and see economic recovery. Eric Sprott of Sprott Asset Management and Sprott Money looks at myriad other economic indicators and sees an economy still in decline.