by David Kranzler
Investment Research Dynamics
I found it amusing that Zerohedge tried to take credit for reporting the problem of a physical gold shortage on the LBMA and Comex earlier last week. Several of we “gold bugs” have been discussing and reporting on this issue since before the virus crisis exploded. The Comex has been settling contracts that stand for deliver through EFT and PNT transactions by which the counterparty accepts cash payment or the transfer of the Comex obligation to London for several months.
GATA’s Chris Powell expounded on this in a must-read essay on Friday: “What the heck are those mysterious ‘exchange for physicals,’ the mechanisms by which contracts to buy gold on the New York Commodities Exchange are neither fulfilled by delivery on the Comex nor settled for cash there but transported for supposed delivery elsewhere?