Tuesday, September 22, 2015

LAWRIE WILLIAMS: The COMEX gold warehousing debate - the truth

"...But here he is drawing on the factual position of COMEX ‘registered’ gold stocks – which are stocks held in COMEX warehouses and which are immediately available against contracts requiring delivery of physical gold.
See below the latest chart from Nick Laird’s www.sharelynx.com site detailing the COMEX registered gold position – and which demonstrates Holter’s concerns:

Those refuting Holter’s concerns point to the other category of COMEX warehoused gold – the ‘Eligible’ stocks which are at a hugely higher level and far more than sufficient to cover any likely demand for physical gold out of the warehouses for years to come.  But this is not comparing ‘apples with apples’.  Gold in the ‘Eligible’ category will include gold held by gold refiners, investors, fabricators, producers or by the bullion banks on behalf of clients.  A good explanation of how the system works can be seen by accessing a 2013 article on bullionvault.com:https://www.bullionvault.com/gold-news/comex-gold-stocks-072420136

As this article points out: “Eligible gold stocks may or may not ever become registered stocks. Why? Because the warehouse is still a warehouse and the owner may simply want to vault their metal securely, before using it to meet demand elsewhere – for manufacturing, or from investors in another marketplace, such as Asia. This eligible gold may belong to an investor, a refiner, a hedge fund, a bank or producer. Many times these people are holding the metal for their end customers. And it may move at any time, and is much more flexible than the warehouse receipts that are registered stocks.”

What this means is that although ‘Eligible’ stocks may be many times bigger than ‘Registered ‘ stocks all this means is that they are held in COMEX warehouses and meet COMEX standards and specifications.  They may thus not necessarily be available for transfer to the ‘Registered’ category as they may belong to third parties who are using the warehouses for storage, not for trade.  This fact has been glossed over by those refuting Holter’s opinions that the situation is ‘beyond dangerous’.  What is effectively unknown here is exactly what proportion of the ‘Eligible’ stocks is actually available for transfer into the ‘Registered’ category at short notice to meet immediate demand..."

at  http://news.sharpspixley.com/article/lawrie-williams-the-comex-gold-warehousing-debate-the-truth/238150/

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