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COMEX said warning brokers about December Gold squeeze
GATA ^ | 12/13 | Bill Murphy

Posted on 12/13/2008 7:18:14 AM PST by djf

From "Midas" Commentary by Bill Murphy LeMetropoleCafe.com Friday, December 12, 2008

I received a call this morning from a commodities broker who told me that the Comex is alerting various futures firms about the potential of a squeeze on the December contract and is advising the $840 December shorts to exit their positions. That is the remaining open position.

There have been 12,636 notices of delivery. The shorts have until December 31 to make delivery. Normally they deliver early to take in cash and earn the interest. They must be delaying. As I understand the situation, that represents about 40 percent of the gold available at the Comex, and of course someone could enter the scene late, buy February gold, and then spread into December, which would stun the shorts.

My broker friend said his back office said this sort of alert is highly unusual and that the concern is real, not only for gold, but for other commodities too, like copper and palladium, as there is a good deal of talk of taking deliveries there too. But gold is the one for which the advice to cover went out.

This is an extremely productive development and could spur the price of gold up quickly as word spreads. As we all know, buying Comex gold and silver (the cheapest way to buy precious metals) makes all the sense in the world in this financial environment.


TOPICS: Business/Economy; News/Current Events
KEYWORDS: bahog
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To: ProtectOurFreedom
Prices are WAY down for new, virgin scape goats

A dime a dozen!

41 posted on 12/13/2008 8:19:17 AM PST by meyer (We are all John Galt)
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To: PAR35

Another great explanation PAR35. Thanks.


42 posted on 12/13/2008 8:19:42 AM PST by Leonard210 (Tagline? We don't need no stinkin' tagliine.)
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To: Dick Bachert

Thanks for the Bancroft link. A very educational read!


43 posted on 12/13/2008 8:20:10 AM PST by Founding Father (The Pedophile moHAMmudd (PBUH---Pigblood be upon him))
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To: JDoutrider

Want to bet that the world goes crazy when they learn that there isn’t anywhere near the gold quantities available that they have been selling? Another Enron - Madoff crisis where people got greedy.


44 posted on 12/13/2008 8:24:58 AM PST by B4Ranch ( Veterans: "There is no expiration date on our oath, to protect America from all enemies, ...")
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To: roofgoat
All metals have crashed; yet I am paying the same high prices for metal t-posts for my farm. And before I hear “yeah - because your are buying old stock that was when metal was high” - I say BS. The same BS was pedaled about oil prices too.

Actually, some of this pipe (especially the 3/4" which is not popularly used) was probably in stock before the prices ran up, judging from the looks of it.

Anyway, it seems to be the nature of retail - prices can climb quickly in reaction to cost, but they are much slower to decline when costs fall. It is somewhat dependent on demand and competitive forces. Gasoline is the obvious example here, and that is a competitive market with fairly inelastic demand, even if there are only few major players.

I wouldn't expect that copper pipe would drop even as fast as gas has (and that has been deemed slow compared to the price drop in crude oil) since Home Depot, Lowe's, and Ace Hardware don't post their competitive pipe prices out on a sign in front of the store. And really, people don't go from store to store checking prices on this type of thing if they're only going to buy 30 or 40 feet of pipe for a home plumbing project. Even at the high material prices, it's still a lot cheaper sweating your own pipe instead of hiring a plumber.

45 posted on 12/13/2008 8:28:25 AM PST by meyer (We are all John Galt)
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To: AntiScumbag

Another expert:

“No! No! No!
Bear Stearns is fine!!!”

Jim Cramer
Mar 2008


46 posted on 12/13/2008 8:33:21 AM PST by djf (...heard about a couple livin in the USA, he said they traded in their baby for a Chevrolet...)
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To: djf

the money going to the banks is nowhere near to being inflationary,nevermind hyper. That money is being poured into a massive hole and will take some time yet to fill up.


47 posted on 12/13/2008 8:45:17 AM PST by wiggen
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To: djf

A prior FR posting on the COMEX contracts and delivery calls is saying just the opposite result. IF delivery is demanded the COMEX cannot meet the physical delivery demand. The “price” might go up on paper, but the actual value of that paper would crash. If you can’t deliver the physical there is no price that one could ask that people will pay. The market will collapse. If you hold physical gold now, hang onto it. About which see: Vietnam post US pullout.


48 posted on 12/13/2008 8:46:19 AM PST by John S Mosby (Sic Semper Tyrannis)
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To: PAR35
Now, if you or I went around selling a lot of stuff we don't own, we'd be accused of fraud.

Here we go again. It's not selling something you don't own, it's agreeing to provide something in the future. If you provide it as agreed, where's the fraud?

Is every producer who takes orders for his products committing fraud? You can agree to deliver a car with such-and-such options a month from now, or the grain from your harvest 6 months from now, or any of hundreds of other custom or expensive products you don't just fill a warehouse full of like off-the-shelf goods.

If the price of metals skyrockets after you already agreed on the price of the car, or if poor weather cuts your crop yield, it's a risk you took with eyes wide open and you eat the difference (just as you keep the benefits if the reverse happens).

Doom-and-gloom aside, not liking where the price of something traded between individuals voluntarily doesn't make it "fraud"...if you think you can predict where something's going there's nothing stopping you from taking a position either way and being rewarded handsomely.
49 posted on 12/13/2008 8:58:04 AM PST by BobbyT
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To: djf
Another expert:

“No! No! No!
Bear Stearns is fine!!!”

Jim Cramer
Mar 2008

Beware of false prophets......

50 posted on 12/13/2008 9:08:49 AM PST by thinking
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To: djf
Bear Stearns is fine

What you think of Cramer ain't my problem and has nothing to do with my point.

Here's a fact:

Open interest at the Comex as of 12/12 for Dec gold: 811 contracts.

Comex open interest

Here's another fact:

Delivery notices at the Comex as of 12/12 for Dec gold: 37 contracts.

Comex deliveries

Here's another fact:

Total deliverable gold in Comex warehouses: 8,553,831 ounces.

Enough to deliver 85,538 contracts.

Comex deliverable stocks

So, what do we have?

Open December gold contracts that amount to 1% of Comex stocks.

Most of which will be closed without making or taking delivery. Just as usually happens, month after month, Sinclair or any other rabble-rouser notwithstanding. This entire pile of baloney has been propagated and repeated for the last 30 years, ad nauseam.

We may now safely conclude that you are, in fact a tool who will believe anything. It must be true! I saw it on the internet!

51 posted on 12/13/2008 9:14:15 AM PST by AntiScumbag
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To: AntiScumbag

Might want to read the deliveries report again. The 37 deliverable contracts you mention are only from the list of the top 19 brokerages/banks. Total deliver notices for DEC 08 is 12,673 (cumulative).

COMEX can cover this, if the ounces in the deliverable stocks are actually there. It may or may not be physical. Some of it may be paper gold only.


52 posted on 12/13/2008 10:43:52 AM PST by ex 98C MI Dude (All of my hate cannot be found, I will not be drowned by your constant scheming)
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To: Leonard210

BTW, if there are specific words that baffle you with regards to the financial market, then this site has been of assistance to me: http://www.investopedia.com/?viewed=1


53 posted on 12/13/2008 12:12:13 PM PST by mbj
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To: ex 98C MI Dude

Yup.
And open contracts for February of 165,595 which represents sixteen and a half million ounces. Twice what COMEX has, even if you count in the registered stuff, not just the eligible stuff.

I talked to a dealer last week. He flat out said COMEX is busted, there is no way they can keep it going, unless the price of gold totally collapses.


54 posted on 12/13/2008 12:40:53 PM PST by djf (...heard about a couple livin in the USA, he said they traded in their baby for a Chevrolet...)
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To: ex 98C MI Dude
Might want to read the deliveries report again.

Why would I want to do that? I read it right the first time. Cumulative notices have nothing to do with it.

Thanks for demonstrating that you are yet another who has no clue about that of which they speak, a characteristic of many who post here.

55 posted on 12/13/2008 12:42:03 PM PST by AntiScumbag
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To: djf
open contracts for February

LOL.

I see we have yet another dufus who has no clue. That goes for your "dealer" buddy, too.

You conspiracy clowns are rich.

56 posted on 12/13/2008 12:45:16 PM PST by AntiScumbag
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To: AntiScumbag; Admin Moderator

If you want to come on these threads and make comments, possibly educate people if they are rookies, or whatever then feel free.

If you want to come here just because you get your jollies and feel superior by acting all snarky, then you’re an asswipe.

Personally, I trust a dealer at an outfit that is processing 40,000 ounces of silver a week a bit more than some nobody like you.

/rant/


57 posted on 12/13/2008 12:51:49 PM PST by djf (...heard about a couple livin in the USA, he said they traded in their baby for a Chevrolet...)
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To: AntiScumbag

Cumulative notices are the total number of orgs/individuals who have filed to have their contracts converted to physical.

You have absolutely no clue as to how this works, and you are using bluster/insults to cover for your initial mistake. Grow up.


58 posted on 12/13/2008 1:11:26 PM PST by ex 98C MI Dude (All of my hate cannot be found, I will not be drowned by your constant scheming)
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To: ex 98C MI Dude
Cumulative notices are the total number of orgs/individuals who have filed

LOL.

It's neither.

It's the number of contracts upon which delivery notices have been issued by the holders thereof. Since you have obviously never made or taken delivery on a Comex contract and wouldn't even know what tendered or retendered means, I'm going to ignore you and the rest of the ignoramuses on this thread.

It must be true! I heard it on the internets!

59 posted on 12/13/2008 2:07:36 PM PST by AntiScumbag
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To: djf
40,000 ounces of silver a week

Is that supposed to impress someone?

I trade more silver than that on a daily basis and have for about 30 years. Same thing goes for about 10 other markets. My single biggest daily contribution to Comex volume was something a little over 3,000 contracts of gold back in 1980.

You (and your "dealer") don't know what you're talking about.

60 posted on 12/13/2008 2:18:47 PM PST by AntiScumbag
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