Is a global gold shortage looming? Why is gold leaving London en masse and heading to the US? What is really behind gold breaking its all-time highs? Josh Phair, CEO of Scottsdale Mint, explains the dramatic changes taking place in the gold market, driven by tariff concerns, potential policy changes, and growing geopolitical tensions.
In a recent interview, Phair highlighted significant movements in the gold and silver markets, pointing to growing demand for physical metals in the United States and around the world.
Tariff fears drive gold shipments
Concerns about potential tariffs under a second Trump administration are prompting investors to move their gold to the United States. “The goal was to bring all the metal to the United States,” Phair told Kitco News, noting that banks are trying to minimize risk by ensuring their holdings are within U.S. borders.
This has led to an increase in gold shipments to the COMEX exchange in New York, with inventories rising by nearly 75% since the US election.
London gold market under pressure
Growing demand for gold in the US has put pressure on the London gold market, with waiting times for withdrawals from the Bank of England skyrocketing. According to Phair, “it seems like there's even greater demand here, almost as if someone wants a lot of gold and silver in the US.”
This situation has raised concerns about possible delays and shortages in London.
Invisible forces and possible audits
There is abundant speculation about who might be behind the growing demand for physical gold in the US.
Phair suggested that a new administration might want to conduct an audit of US gold reserves. “Maybe... someone realizes they need to make sure there's an audit, and they want more material?”
He also noted that key figures such as Treasury Secretary Scott Bessent might favor a greater role for gold in monetary policy.
Global rebalancing act
Demand for gold is not limited to the US; BRICS countries are also accumulating significant gold reserves. “Is it that the US simply wants to make sure it maintains the top spot, the number one position in gold?” Phair questioned, noting that the focus has shifted from bitcoin to physical gold. Despite rising gold prices, demand from retail investors has been muted. Phair believes this is due to distractions and limited discretionary income.
However, he predicts that retail investors will return to the market when they realize the changes that are taking place. “You have to wait for people to realize what's going on,” he said.
Gold and silver leasing rates have increased, indicating a tightening of the physical metals market. “Normally, a bank... owns its gold, but it can lease it to someone to use for a short period of time... but right now they want it,” Phair explained. This increase is due to the profitability of delivering gold to the Comex exchange.
The possible imposition of tariffs on gold raises questions about the future of its trade. While some believe that gold is exempt due to its status as a monetary metal, Phair pointed out that banks are acting as if tariffs are a real possibility.
US states are also exploring ways to incorporate gold into their financial systems. “There are more than a dozen states right now with bills on the purchase of gold,” he said, highlighting a possible new wave of gold buyers.
Phair highlighted the rapid pace of change in the market and the difficulty consumers have in keeping up. ‘I've never seen anything like it,’ he admitted, predicting that an explosive decade lies ahead.
The potential of silver
Phair also highlighted the potential of silver, noting that it has significant upside potential due to its industrial uses and growing deficit. “Silver has a lot of opportunities to do well this decade,” he said, predicting increased demand as consumers realize its value.
Central banks, particularly those in BRICS countries, may also consider adding silver to their reserves. Phair pointed to a draft Russian budget report for 2025 that included silver, suggesting broader interest in diversifying into precious metals.
Anna Golubova, Kitco