Behind the magic act...............from Rico

Let's consider what is going on behind the Fed's monthly FOMC magic act. It's a staged 'show' meant to entertain, amuse, and distract the audience.

Big picture is 'physical' vs. 'paper' bullion. One of these has been weighed and found wanting.

- The SGE (Shanghai Gold Exchange) actually walks-the-walk re: physical bullion delivery. The COMEX, well...not so much. It offers 'paper settling' instead.

Let's next drill-down into the COMEX paper shell game. We have a perfect trifecta of "the next MF Global in waiting" happening right now.

- The total COMEX dealer inventory of Gold is now 44.32 tons, yet NONE of the 9.5 tons from May delivery notices or the 30 tons from June have been removed from inventory yet.

- JPM's dealer inventory of Gold (currently 413K oz) has been spoken for...well, MORE than spoken for, 81K oz more right now. Ooopsie! Time for Jamie or Blythe to make an urgent call to Ben, perhaps?

- Effectively, the three major bullion banks have only 30.08 tons of Gold left in their vaults...let's forget hypothecated and/or rehypothecated inventory for a moment (for non-Bankers, that is inventory that has been sold or encumbered many times over...yes, thin air sold and resold for fun and profit).