Anonymous ID: aeabbc March 31, 2020, 11:20 a.m. No.8637116   🗄️.is 🔗kun

COMEX Can't Find Any 400 Oz Bars For Its New Gold Futures Contract

 

With continuing problems besieging the tag team COMEX – LBMA paper gold markets where the front month gold futures contract (now June) continues to trade above the London spot price of price, the contango that emerged a week ago between the New York – London ‘gold price discovery’ duopoly shows no sign of abating. While the pricing suggests that the core ailment relates to bullion bank liquidity problems faced by market makers in the London ‘gold’ market, this didn’t stop the London Bullion Market Association (LBMA) rushing out a statement last Tuesday, March 24, in an attempt to shift focus to CME’s COMEX, saying that:

 

Notwithstanding that on Tuesday 23 March, the London market had seen gold bid-ask spot spreads blowing out to US$ 100 and LBMA market makers breaching their responsibility to actively provide two-way price quotations, the LBMA forged ahead with pinning the blame on COMEX, and bizarrely offered to support COMEX to ‘facilitate physical delivery in New York’. What this meant, said LBMA-embedded news wire Reuters, was that: “the LBMA and executives at major gold-trading banks asked CME to allow 400-ounce bars to be used to settle Comex contracts” Next day, Wednesday March 25, the CME played out its part of the script, announcing the launch of a “new gold futures contract with expanded delivery options that include 100-troy ounce, 400-troy ounce and 1-kilo gold bars” but a contract which still has a unit size of 100 ounces, identical to the COMEX flagship GC 100 contract.

 

Who launches a new exchange traded product in the middle of the biggest financial crisis for generations? Only a set of panicking bankers it would seem. And who has a fully developed new gold futures contract waiting in the wings to roll out the day after the gold market blows up? The same panicking bankers. Unbelievably, the CME has christened this new contract as the ‘Gold (Enhanced Delivery) futures contract” (code 4GC) which will, according to the CME script “enable delivery in New York City of Kilo, 100 oz and 400 oz bar sizes for maximum flexibility.” With COMEX gold futures de facto physically deliverable in name only and loco London gold never delivered on to the COMEX despite the disinformation campaign from the LBMA, the last thing on the minds of the CME-LBMA axis is ‘delivery in New York City’.

 

While the mechanics of the new 4GC contract are left for future analysis, some people may be asking how can a 400 oz gold bar, the kind that are held by central banks, be used to physically settle a gold futures contract with a unit size of 100 ozs. For that the CME has rolled out one of its more sleight of hand tricks, introducing the CME’s Accumulated Certificates of Exchange (“ACE”) mechanism, an illusion which Penn and Teller would be proud of. “A 400 oz bar”, says the CME “cannot be used to facilitate delivery of a single contract with a unit size of 100 oz due to its larger size.”

 

This means there are ZERO ounces of gold in the COMEX vaults in the form of 400 oz gold bars.

 

A totally new meaning to holding all the ACEs.

So what does all of this mean? Is there not even one vaulted 400 oz gold bar in the whole of New York? Why is COMEX rushing in a new contract deliverable in 400 oz gold bars when it is reporting that there are zero 400 oz gold bars in its approved vaults. Is this all just a smoke and mirrors exercise with the bullion bankers in London and New York laughing over champagne as mainstream new reports claim the very same bankers are scrambling to charter private jets laden with gold bars from London to New York?

And finally, are JP Morgan vault staff currently scrambling to rush 400 oz gold bars across the tunnel between the NY Fed gold vault and Chase Manhattan gold vault under Liberty Street in southern Manhattan? Inquiring minds would like to know.

https://www.zerohedge.com/commodities/comex-cant-find-any-400-oz-bars-its-new-gold-futures-contract

 

the reports produced by the bullion dealers and participants are patently false-and always have been. It has been nothing moar then a paper trail that back ups the lies.