The worldwide gold battle between paper sellers and physical buyers rages on into its second week…and the physical forces are winning big time!! Ever since the world banking elite two weeks ago attempted to terrify physical precious metals owners by flooding the paper markets with over $50 billion of naked sell orders, something really strange has happened.
Instead of panicking and selling their physical gold and silver, private investors have gone on one of the greatest single precious metals buying spree in memory. As reported here , buying demand has surged so dramatically that wholesale brokers and retail dealers on all continents have already or soon will, if this trend continues, exhausted nearly all available inventory.
As this trend continues unabated, another very frightening trend that was first reported several weeks ago, has accelerated at the COMEX and other mega-bank bullion depositories; namely, a giant draw down in warehouse inventories. How gigantic you ask?
Consider these glaring statistics: During the first ninety days of this year, and without any announcement, gold stocks on deposit at the COMEX warehouse nosedived by the largest figure ever recorded for one quarter. Combined drainage of physical gold reached nearly two million ounces, or about $3 billion at current prices. Reporting on this situation, chart guru Nick Laird, commented:
“Eligible stocks which are owned in LBMA/COMEX good delivery form are being drawn down — which means they are being removed from the warehouses. As to how and why they are [being] removed, that is a mystery. [Up until now], eligible stocks were on the continual increase throughout the bull market. Now that trend has changed.”
However, if the banking elite thought that the recent frightening $200 plus two day drop in the paper gold price would loosen the grip of the gold bugs and maybe help swell the depleted coffers of the COMEX, LBMA, and other large bullion banks, they were shocked and disappointed. The plunging inventories of the COMEX have continued this week and are metastasizing to the world’s largest fund depositories. Precious metals publisher, Tekoa Da Silva, is reporting that in the last four weeks, gold bullion deposits held for ETFs, various funds, and futures exchanges have “collapsed by over 5.5 million ounces, or in dollar terms, by over seven billion dollars…The largest physical removals reported by the COMEX at 1.4 million ounces, or nearly $2 billion, and the GLD [the world’s largest gold ETF], which reported total inventory removal of nearly 4 million ounces, or roughly over $5.6 million.”
Here is a chart depicting the extended gold inventory collapse at COMEX warehouses.
But the massive liquidation of gold stocks has not been confined to the COMEX. Liquidation of physical reserves has been going continuing this year at various major bullion banks, the largest of which are JP Morgan Chase and Scotia Moccata Depository. Here are the charts for these companies:
JP Morgan Chase has reported that its gold stockpiles have dropped by over 1.2 million ounces, which equates to a staggering $1.8 billion dollars worth of physical gold removal from its vaults during the last 120 days.
Scotia Mocatta’s gold stockpile removals were nominally smaller in size when compared to JP Morgan Chase’s, but registered in at over 650,000 ounces of gold, or over $1 billion dollars worth that has been removed from its vaults in just the last 90 days.
What is important to understand from these charts is that the draw down in gold inventories started before the recent paper price beat down. In other words, this appears to be a very orchestrated removal of physical gold. Where is it going? We are not exactly sure but we can tell you where it is NOT going. It is not going to any of the wholesale depositories or retail bullion dealers throughout the world. Their shelves are almost completely bare of silver and beyond extremely thin for gold bars and coins sought by frenzied individual buyers worldwide.
Here is a just a guess where we think this gold may be hiding. It could well have been rounded up to satisfy large angry world clients in Asia, the Middle East, and elsewhere who have threatened to blow up the Bernie Madoff Ponzi scheme shortages at various international trading exchanges unless they are made whole with physical delivery on their investments.
Another possibility is that the gold is being sequestered in some place like Basel, Switzerland, or some other nefarious IMF enclave, as future backing for a possible new world reserve currency that will be rolled out as major world currencies and markets collapse under their non-repayable debts.
These are just guesses, you understand, but somehow, they seem to have the ring of plausibility. At any rate, it should be obvious by now that the only gold and silver that you can trust actually exists is that which you can hold in your own hands. As for the rest of it, it’s anybody’s guess.
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Written For: Liberty Gold and Silver News Blog
