Friday, 11 September 2015

In just TWO days......................from Rico

In just two days the COMEX paper claims ratio has risen from 207:1 to much higher will it go?
- Reminder, next week is the two-day monthly FOMC again so the usual games by the usual suspects can be expected.
Think of it like a game of musical chairs, only played with Gold. And when the music stops. the jig will truly be up....
The COMEX (often lovingly called the CRIMEX for very good reason) now shows the ratio of "open interest" for Gold [read: ownership claims] to "registered" Gold [read: deliverable physical] of 207:1. [228:1]
- This is actually a new record, having that many paper claims per physical ounce, coming at a time when the warehouse is at a 12-year low in inventory.
Two hundred seven owners of the same thing. Rehypothecation defined.Two hundred twenty eight paper owners of the same ONE physical ounce? Makes me wonder if the actual number isn't even greater than the one being reported?
In the context of the obvious and blatant Gold and Silver market manipulation we have been seeing, what could possibly go wrong?
- While I expect the crooks to continue to push the spot markets for both metals around the plate with their limitless amount of notional paper as long as they can, but it only works until it doesn't. Then what?
If all these paper owners (or enough of them) wanted to redeem their claim checks for the physical thing, it could present a small problem.
- But for the "force majeure" clauses buried within the fine print of those claim checks. Paper claims on bullion can be paid with paper Dollars instead of physical.
"Too bad, so sad, we're all out and don't have any more left to give you" will be the story you'll get while you stand there empty-handed.
- When the music stops.....if you do not hold it, you do not own it.

No comments: