100 And Counting
This article captures some of the key stories and events that have featured in Alchemist editions 1 to 99, but that we haven’t covered elsewhere in this centenary edition. So, it won’t read as a chronology of Alchemists 1 to 99, but it will help fill in the gaps.
As we reflect back on the history of the Alchemist, we start with a prophetic quote:
"Those who cannot learn from history are doomed to repeat it."George Santayana
Alchemist 1 | June 1995
One of the main headlines in the first edition of the Alchemist was: "Going for Gold? Encouraging signs of life"
At that time, the gold price was $386 per ounce. Wind the clock forward 25 years and the price is nearly five times as high. That certainly sounds pretty encouraging.
Alchemist 4 | May 1996
This includes a review of LBMA’s first Spring Seminar, which was held on 16 May 1996 at the Carpenters Hall in London. Timed to co-incide with the annual LPPM Platinum Week, Stewart Murray, then in his capacity as Chief Executive, not of LBMA, but of Gold Fields Mineral Services, spoke on the subject of ‘Gold and Silver – an End-of Term-Report’. He was joined by Graham Birch of Mercury Asset Management, who spoke on ‘Gold Shares – the Growing Importance of Far Eastern Investors’.
Alchemist 11 | April 1998
Lots of interesting material in this edition. Warren Buffet hits the headlines, with the spot silver price spiking sharply on 3 February 1998 following news that he had built up a substantial long position in silver and intended to take physical delivery of the metal. Transporting the 129 million ounces (129,000 bars) required 190 articulated trucks. It certainly helped keep London vault staff fit. Refer to the Editorial Comment on page 1 by Susanne Capano for further details.
We also see in this edition the launch of ISDA-based documentation for precious metals, helping to establish consistent market practice and conformity of approach across the industry. Read more in the article by Martin Stokes on page 3.
Alchemist 13 | November 1998
Featuring in this edition is the announcement that, in 2000, VAT will be removed on investment gold throughout the (then) 15 member states of the European Union. See article on page 26 by Henry Kozlopage and Dougie Beadle.
Alchemist 16 | June 1999
As the 20th century drew to a close, one of the more controversial events was the decision by the Treasury to sell off nearly half of the UK’s Gold reserves in a series of auctions. In Alchemist 16, June 1999, Clifford Smout, Head of Foreign Exchange, Bank of England, explains the rationale behind in ‘Gold Auctions – The Way Forward’. Two decades later and Adrian Ash revisits this topic in his article in Alchemist 94, July 2019, ‘Gordon’s Brown Bottom 20 Years On’.
Alchemist 17 | October 1999
Peter Smith outlines the plans in place for the precious metals market as the financial markets prepared their Y2K contingency plans as systems rolled over to a new millennia. For those of you too young to remember, the issue was that many computer programs and systems represented four-digit years with only the final two digits, potentially making the year 2000 indistinguishable from 1900, etc. For the precious metals market, this involved no physical metal movements between 2 December 1999 and 7 January 2000. In the end, an issue that had gripped financial systems across the world passed with little disruption.
Alchemist 23 | May 2001
This edition is heavily focused on risk management, with a number of features including ‘Trends in Risk Management for Gold Producers’, ‘Portfolio Risk Management – the Role of Gold’, ‘Success is
Simple – Back to Basics with Risk Management’ and ‘Solid Gold Rate Cuts’ (see extract from this article opposite). We tackled this 100th edition from the perspective of what’s changed (and why), but conversely we can see here that some issues don’t really change.
Alchemist 30 | April 2003
This edition features a fascinating article on ‘Charles Dow’s Six Secrets to Market Success’ (see opposite). Charles found fame as editor of the Wall Street Journal, but is more famously known for establishing the Dow Jones Company, named after him and his business associate, Edward Jones. Charles’ relevance to this modern day may be more obvious to those of you who follow the New York stock market.
Alchemist 35 | September 2004
In this edition, we get an understanding of the growing influence that China was playing in the global gold market as we explore ‘Entering the Hall of Mirrors - Illusion and Reality in China’s Influence on Precious Metals Demand’.
Alchemist 40 | November 2005
‘An Introduction to the Elliott Wave Principle’ is an article that will resonate with many of you traders out there.
Alchemist 44 | October 2006
Moving on to another key sector of the market, we progress onto Alchemist 44, October 2006, in which Dougie Beadle, LBMA consultant, highlights the difference between acceptable and unacceptable stacking of silver bars in a vault.
Alchemist 47 | July 2007
Here comes Alchemist 47, July 2007 and a metal, rhodium, that is certainly talking itself up: ‘200 Dollars per Gram – The Metal that Makes Truffles Seem a Bargain’.
Alchemist 52 | December 2008
The 2008 Annual Conference in Kyoto (covered in Alchemist 52, December 2008) was the first to be held jointly with the LPPM. In his speech at the Conference, Bob Takai provides an ‘Overview of the Japanese Gold Market’.
Alchemist 61 | January 2011
This issue includes a memorable speech by keynote speaker William White, formerly Chief Economist at the Bank of International Settlements, entitled ‘Will This Crisis Never End?’. In it, William recalls a quote from Donald Rumsfied: “There are things that we know we know; there are things that we know we don’t know; but there are also things we do not know that we don’t know.”
It helped William come a close second as the best speaker at the 2010 LBMA Precious Metals Conference.
Alchemist 62 | May 2011
In Alchemist 62, May 2011, Dr Brian Lucey draws on his vast academic research to ask ‘What do Academics Think They Know About Gold?’. As it turns out, quite a lot. Both Brian and his protégé Fergal O’Connor have contributed further articles to the Alchemist since then (see section at the end on the centenary of the Gold Price Auction).
Alchemist 65 | January 2012
Another person who warrants special attention with her rich and fascinating research for the Alchemist is Rachel Harvey, Associate Research Scholar at the University of Colombia. The ‘The Early Development of the London Gold Fixing’, which appears in Alchemist 65, January 2012, provides a remarkable insight into the rituals of the fixing process, which was far from static and in fact evolved over a number of decades.
She also wrote a fascinating insight into the culture of the City in an article in Alchemist 94, July 2019, ‘Genteel Fair Play – The Culture of the London Gold Market'.
Alchemist 67 | July 2012
In 2012, the most important development was clearly the launch of the Responsible Gold Guidance, when it became a mandatory requirement for all Good Delivery List refiners (this is covered in more detail in several articles elsewhere in this edition). The other development that year worth highlighting was the launch of the first Proficiency Testing Scheme as described by Stewart Murray in his article in Alchemist 67, July 2012.
The late, great Jon Spall recalls the background to the end of the historical fixings of the precious metals prices, a truly groundbreaking change that’s worth highlighting even if it has been touched on other features in this edition, including 'Back to the Future with our CEOs', on page 6.
Alchemist 79 | October 2015
Neil Harby explains how LBMA working closely with the Shanghai Gold Exchange (SGE) agrees a new 9999 gold kilobar specification.
Alchemist 80 | January 2016
This issue provides an assessment of new technologies in ‘Gold Bitcoin and New Technologies’ by Elizabeth Ferry.
Alchemist 87 | October 2017
James Steel provides an intriguing insight into the role that gold has played in conflicts around the globe over the centuries.