CME Declares Force Majeure Due To “Operational Limitations” On NYC Gold Depository

“Extend and pretend” will also likely be seen in the U.S. – with
obvious ramifications for the medium and long term outlook of the

Today’s AM fix was USD 1,747.25, EUR 1,349.54, and GBP 1,090.46 per ounce.
Yesterday’s AM fix was USD 1,747.25, EUR 1,347.56, and GBP 1,090.87 per ounce.

Silver is trading at $34.08/oz, €26.41/oz and £21.34/oz. Platinum is trading at $1,620.50/oz, palladium at $666.40/oz and rhodium at $1,065/oz.

 Cross Currency Table – (Bloomberg)

Gold edged up $1.30 or 0.07% in New York yesterday and closed at $1,748.40. Silver traded off and recovered climbing to a high of $34.16 and finished with a gain of 0.12%.

Gold moved slightly upward today after Greece’s creditors reached a new bailout deal, which will help fund emergency aid for Athens.

The 34.4 billion euro in aid plus reducing interest rates on the bailout loans expect to cut Greek debt to 124% of GDP.  The interest rates have been dropped to 50 basis points above the interbank rate so countries like Italy and Spain will be lending at a loss.

The Eurozone’s dangerous  but easy policy choice of “extend and pretend” continues which is bullish for gold in the coming months.

Mark Carney has been named as the new governor of the Bank of England by Chancellor George Osborne.

Mr Carney, the governor of the Canadian central bank, will serve for five years and will hold new regulatory powers over banks.

Carney would be considered something of a monetary dove.  The Goldman Sach’s alumni’s appointment means that ultra loose monetary policies will likely continue at the Bank of England leading to weakness in sterling – especially versus gold.

The US Commodity Futures Trading Commission said that institutions and hedge funds slightly raised their bullish bets on silver and gold futures in the week ending November 20th.

The White House and Republicans are still in a stalemate over the fiscal cliff. The White House press secretary said that President Obama is still waiting for a realistic proposal to look at.

“President Obama would be open to proposals that closed loopholes or capped deductions,” Carney said, “so long as raising the top tax rate remains on the table.”

Obama has asked for $1.6 trillion in higher revenues to pay down the debt. In the 2011 debt ceiling negotiations, Republicans were considering a plan that would involve only $800 billion in new revenue or half what is needed to avoid the cuts and pay down the deficit.

“Extend and pretend” will also likely be seen in the U.S. – with obvious ramifications for the medium and long term outlook of the dollar.

The Chinese Ministry of Industry and Information Technology said that China aims to produce between 420 and 450 tonnes of gold bullion in 2015, up about 25% from 2011, while consumption may reach 1,000 tonnes at that time.

XAU/EUR Currency, 1 Year – (Bloomberg)

CME Group declared a force majeure at one of its New York precious metals depositories yesterday, run by bullion dealer and major coin dealer Manfra, Tordella and Brooks (MTB), due to “operational limitations” posed by Hurricane Sandy.

MTB has “operational limitations” following Hurricane Sandy and can’t load gold bullion, platinum bullion or palladium bullion, CME Group Inc., the parent of the Comex and New York Mercantile Exchange, said today in a statement.

MTB must provide holders with metal at Brinks Inc. in New York to meet current outstanding warrants in relevant delivery periods with compensation for costs, Chicago-based CME said.

The CME said that MTB will not be able to deliver metal as the lower Manhattan company deals with “operational limitations” almost a month after the arrival of Hurricane Sandy.

MTB is one of five depositories licensed to deliver gold against CME’s benchmark 100-troy ounce gold contract, held 29,276 troy ounces of gold and 33,000 troy ounces of palladium as of Nov. 23, according to data from CME subsidiary Comex.

In a notice to customers on Monday, CME declared force majeure for the facility, a contract clause that frees parties from liability due to an event outside of their control.

CME said that individuals holding MTB warrants or certificates for a specific lot of metal stored in the depository, may receive gold delivered from Brinks Co. (BCO) in New York. MTB is responsible for any additional costs incurred by customers receiving metal from Brinks, CME said.

“This shouldn’t have a material impact on the way market participants are doing business,” a CME spokesman said. “They’ll still contact MTB if they want to take delivery on contracts,” and MTB will arrange for delivery through Brinks according to Dow Jones Newswires.

In a notice posted to its website dated Nov. 12, MTB said the firm “sustained substantial damages” following Hurricane Sandy’s arrival in New York City on Oct. 29, and had curtailed its operations.

The force majeure will remain in effect until further notice from the exchange, the CME said. The delivery period for CME’s December-delivery precious metals futures begins on Friday.

XAU/GBP, Daily – (Bloomberg)

15 comments on “CME Declares Force Majeure Due To “Operational Limitations” On NYC Gold Depository
  1. ronron says:

    the old wet gold trick. :-)

  2. ronron says:

    maybe browns bottom was the biggest scam in history?

  3. Zerk says:

    This only confirms a prediction made by many people. The day the short squeeze will be really serious, we can easily imagine an internet warfare that wipes out a few servers and a golden opportunity to stop all deliveries due to “Force majeur”.

  4. Steven says:

    When the bulk of the metal holdings are paper and the bulk of the real metal is in strong hands the use of Force Majeur to wipe out the paper holders and let the metal debtors off the hook will be done. It is the nature of the people running the system to do such a thing and that is why you do not own any thing if you do not posess it and defend it.
    Even bonds and the official currency are no refuge from politically correct criminality.

  5. Nak says:

    Deliveries being affected due to a Natural Disaster, just imagine what chaos a man-made event would cause.

  6. Travis says:

    My sons mother is a dumb $Ιuт!

  7. Vonda Bra says:

    Published on Nov 26, 2012 by SGTbull07

    THE MADNESS OF A LOST SOCIETY 3 !!!! – Micro-Doc (11:38)

    “Another ‘Black Friday’ has come and gone. And it has left us with further evidence of the complete madness of the populace of our nation. America has been dealt a fatal blow by corporate greed, Bankster malfeasance and the insidious nature of collectivism — and it’s all been done to us by design.

    The once proud and independent people of the United States have, in large part, been reduced to servants of the State. As Aldous Huxley famously noted, “People can actually be made to LOVE their servitude.”

    Featuring Mike Krieger, Rob Kirby, Chris Duane, Gerald Celente, Bill Murphy and many others, ‘Madness 3′ offers one last ‘fair warning’ for those with the eyes to see and the ears to hear…”

  8. Bruce says:

    Black Friday Shoplifter Death and Other Past Shopping Sales Incidents: The Worst Ever?
    “No amount of merchandise is worth someone’s life,” said Walmart spokesperson Dianna Gee in a statement.

    (apparently unaware of Walmart’s sourcing procedures)

  9. Bruce says:

    Black Friday may not save November sales – MarketWatch

    (I would have thought it would take more time to get results)

  10. Vonda Bra says:

    End of SILVER MANIPULATION to IMPLODE JPMORGAN – Bill Murphy Full Interview
    By Elijah Johnson, on November 27th, 2012

    ” …For years JPMorgan has been accused of silver price suppression. In this interview, Bill Murphy, chairman of the Gold Anti-Trust Action Committee, makes a bold prediction on how soon JPMorgan’s latest silver scandal will break. Will the revelation of this scandal implode one of the largest banks in the world? If so, what will happen to the price of silver? ..”

    Find out all this interview:

  11. Youri Carma says:

    So what happened to the gold? It went wet LOlz

  12. Ken says:

    Let’s see…29,276 oz. of gold would fit in a cube about 14 inches on a side. (and weigh about a tonne), but if it is in Comex 100 Oz bars – 293 of them at approx. 7.5 x 2.5 x 0.5 inches – I am sure that it is no problem to ship a few of them.
    Farce Majeur

  13. Brady says:

    Canada has barley noticed the debasement of curency and the relationship that has with our own housing bubble. Instead we have our own version of the Simpsons mayor Quimby declareing today Toronto Argonauts day, although his seat has been declared vacant by the court, due to his own petty fraud.

  14. Idaho Silver says:

    Hip Waders. Didn’t they think to wear Hip Waders?