The comex which is not known as a physical market has been averaging around 1.8 million oz per delivery session.(18,000 contracts)
The total OI is averaging around 500,000 contracts. The percentage that turns into physical is around 3.6% of all OI outstanding.
The LBMA is known to the world as the real physical market. If you assume at worse a 4% turn of paper into real gold, one gets
24.7 million oz x .04 = 1 million oz of physical per day or 5 million oz per week or 260 million oz per year.
The world produces around 73-75 million oz per year. From these two exchanges, the jewellers and hoarders (investors in physical) must be satisfied.
You can now visualize that the world does not produce enough gold to satisfy everyone and that central banks must supply their above ground
gold to satisfy everyones needs.
It light of the huge demand for gold, it is difficult to comprehend the massive shorting that the bankers engage themselves time and time again.
As foreign gold loving nations seek and obtain gold from the LBMA and ship it to their shores, you can visualize a time when the LBMA runs out and everyone
turns to the last bastion of some physical, the comex.
The turnover at the LBMA is simply mindboggling and is indicitive of some massive physical shortages throughout the world.
OK, we shall now proceed to the big economic stories of the day:
Yesterday, morning you could hear the groans from the Obama administration with this announcement at 8:30 am:
Please remember that the consumer is 70% of GDP. The consumer is strapped and cannot buy. This is why spending dropped 1.2%.
From John Williams in his analysis on spending, the CPI and the huge decline in M3: