“Runs on vaults” call into question supply of physical gold and silver

The former CEO of the Chicago Mercantile Exchange (CME) can’t get his gold.

Leo Mahlamed was head of the CME – the world’s second largest exchange for futures – for 25 years. Today he remains a board member and chairman emeritus. Yet when he tried to take physical delivery of just two gold contracts last week, the organization that he has given so much of his life to would only give him a warehouse receipt.

This is the new reality of precious metals today. The paper market has imploded on itself, and as a result we’re seeing a “global phenomenon” – an outright frenzy – for real, physical, hold-in-your-hands gold and silver.

Comex depositories are being ravished, with OVER $7 BILLION in gold being removed in the last four weeks. At JP Morgan, their eligible gold plunged 65% in a single 24-hour span, from 402,400 ounces to 141,600 ounces. That’s the lowest amount they’ve ever had on record. From Zerohedge: “Everyone has seen what a run on the bank looks like. Below is perhaps the best chart of what a ‘run on the vault’ is.”

JP Morgan Eligible Gold

The CME sees these “runs on vaults”, and they fear it could happen to them too. In an honest moment, they may even admit that it will happen to them. And because of this very well-founded fear, they’ve chosen to take a public relations hit instead of making good on the gold contracts of one of their most important employees.

If you’ve been considering moving into precious metals, there may not be a better time. Prices haven’t yet fully recovered from their drop the other week. And here at Birch Gold, we still have access to inventory to fulfill your order. But that’s today. Next week? In two weeks? With inventories continuing to be ravished, with these “runs on vaults”… we sure hope we’ll still have access to inventory… we sure think we’ll still have access to inventory… but how can anyone say with any certainty?

Don’t wait until it’s too late. Call us today to protect your savings with gold and silver. Physical gold and silver.

Precious metals on the move

London Fix PM price at week’s end, and change over previous Friday:

  • Gold: $1,471.50, up 4.7%
  • Silver: $24.02, up 1.5%
  • Platinum: $1,483.00, up 4.1%
  • Palladium: $681.00, up 0.6%

In the news

Stunning and massive run on physical gold and silver continues
“What we have seen around the world has literally been a run on physical gold. People all over the world are simply turning in their fiat money for physical gold, and silver as well.” – Keith Barron (link)

Shortages of physical gold now a global phenomenon
“[Investors] are no longer putting any faith in paper gold and this is being seen in all quarters with reports from virtually all continents of demand exceeding supply of physical metal, and some hefty premiums being applied on sales of gold bullion.” – Lawrence Williams (link)

U.S. Mint gold sales surge to highest since 2009 (and have SUSPENDED production of some coins)
“Will the U.S. Mint be able to sell another 35,000 ounces in the remaining week of April, and surpass the all-time monthly record from December 2009? Or will it run out of gold beforehand, and just like it did with the one-tenth ounce American Eagle gold coins, will sales of all bullion denominations be halted in the comings days?” – Zerohedge (link)

Spotlight on Silver

Worldwide silver shortage as premiums on silver Eagles reach 40%
“This growing divide between the paper silver price and real-world price will have to narrow at some point soon. The more big-money investors realize the huge price gap and act on it, the faster the gap will close or soon Comex will default or go broke from offering hefty cash incentives to investors to dissuade them from taking delivery. In the meantime, if anyone can find me some silver Eagles anywhere near the Comex price, I have a boatload of fiat notes to trade. Keep stacking (if you can find any).” – Jason Hamlin (link)

Chart of the week

Comex inventory collapsing
Comex inventory collapsing

The week ahead

  • Frenzy for physical precious metals to continue?
  • U.S. jobs report to be released
  • U.S. Federal Open Market Committee to meet Tuesday and Wednesday
  • European Central Bank to meet Thursday
ecb, Featured, jp morgan, us mint