real
gold for every 124 ounces that speculators think they own because they
have paper contracts for it. To prevent panic among investors, a few
days later, Comex reported that, miraculously, it’s eligible gold
reserves jumped by a whopping 78% overnight, from 362K ounces to 643K.
Worried investors went back to sleep thinking that the problem had been
solved. However, the new “available” gold did not come from an influx of
the real thing, but from an accounting trick performed by JPMorgan. The
bank simply took 276,000 ounces of its “eligible” gold (meaning
registered to specific parties and not to be used for fulfillment of
futures contracts) and reclassified it as “eligible” gold (meaning it
can be delivered for fulfillment of contracts. Presto! Crisis solved –
at the expense of those naive souls who think that banks can be trusted
to honor their contracts. ZeroHedge 2015 Aug 6 (Story)
Saturday, August 8, 2015
Accounting Trick Averts Gold-Shortage Crisis
A few days ago, a Comex (Commodity
Exchange) gold-warehouse report showed that the availability of
registered gold was down to a mere 10 tons, the lowest it has been in
modern times. That means there is one ounce of real
gold for every 124 ounces that speculators think they own because they
have paper contracts for it. To prevent panic among investors, a few
days later, Comex reported that, miraculously, it’s eligible gold
reserves jumped by a whopping 78% overnight, from 362K ounces to 643K.
Worried investors went back to sleep thinking that the problem had been
solved. However, the new “available” gold did not come from an influx of
the real thing, but from an accounting trick performed by JPMorgan. The
bank simply took 276,000 ounces of its “eligible” gold (meaning
registered to specific parties and not to be used for fulfillment of
futures contracts) and reclassified it as “eligible” gold (meaning it
can be delivered for fulfillment of contracts. Presto! Crisis solved –
at the expense of those naive souls who think that banks can be trusted
to honor their contracts. ZeroHedge 2015 Aug 6 (Story)
real
gold for every 124 ounces that speculators think they own because they
have paper contracts for it. To prevent panic among investors, a few
days later, Comex reported that, miraculously, it’s eligible gold
reserves jumped by a whopping 78% overnight, from 362K ounces to 643K.
Worried investors went back to sleep thinking that the problem had been
solved. However, the new “available” gold did not come from an influx of
the real thing, but from an accounting trick performed by JPMorgan. The
bank simply took 276,000 ounces of its “eligible” gold (meaning
registered to specific parties and not to be used for fulfillment of
futures contracts) and reclassified it as “eligible” gold (meaning it
can be delivered for fulfillment of contracts. Presto! Crisis solved –
at the expense of those naive souls who think that banks can be trusted
to honor their contracts. ZeroHedge 2015 Aug 6 (Story)
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