Is COMEX Running Out of Gold?
Source: Seeking Alpha, Brian Kelly (5/7/09)
". . .the amount of gold in the COMEX warehouses vs. long positions is at all-time highs."
This incident did pique our interest in the amount of gold in the COMEX warehouses. If Credit Suisse did indeed have a delivery issue it could indicate COMEX warehouse stocks were depleted. We were highly skeptical of this speculation as on any given day over 20 million ounces of gold could be purchased at the London Bullion Market.
Our skepticism was confirmed with the release of the World Gold Council's Q1 report on gold. In the report they provide a chart on the amount of COMEX gold stocks as a percentage of long positions, which clearly shows the amount of gold in the COMEX warehouses vs. long positions is at all-time highs.
In fact, during Q4 2008 the percentage of stocks vs. long positions hit a 5-year high. This occurred while the financial markets were melting down and demand for physical gold was surging. While there have been shortages of coins and small bars the availability of large bars has actually increased as a percentage of long positions.