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Superstorm Sandy Flooded Gold Vault in Manhattan
CNBC ^ | 11/27/2012 | Lori Spechler

Posted on 11/27/2012 2:22:31 PM PST by Attention Surplus Disorder

When Super Storm Sandy flooded lower Manhattan, it also flooded the vaults of at least one gold depository.

REUTERS/Siphiwe Sibeko

Monday, the CME declared force majeure at a precious metals depository in New York, Manfra, Tordella and Brookes ("MTB") effective immediately. This depository is one of five locations listed by the CME for the warehousing of physical gold.

(Excerpt) Read more at finance.yahoo.com ...


TOPICS: Business/Economy; Education
KEYWORDS: economy; forcemajeure; gold; goldvault

1 posted on 11/27/2012 2:22:37 PM PST by Attention Surplus Disorder
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To: Attention Surplus Disorder

Anyone want to bet they don’t find all the gold down there when they conduct an inventory?


2 posted on 11/27/2012 2:24:17 PM PST by Darteaus94025
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To: Attention Surplus Disorder

that’s ok, it’ll still be shiny when it dries. :)


3 posted on 11/27/2012 2:24:33 PM PST by txnativegop (Fed up with zealots)
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To: txnativegop

Unless the paint gets washed off.


4 posted on 11/27/2012 2:32:02 PM PST by bgill (We've passed the point of no return. Welcome to Al Amerika.)
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To: txnativegop

Does tungsten rust?


5 posted on 11/27/2012 2:32:06 PM PST by ecomcon
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To: ecomcon

you know, I do not know if Tungsten rusts. LOL


6 posted on 11/27/2012 2:33:48 PM PST by txnativegop (Fed up with zealots)
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To: txnativegop
Rust? What about float!
7 posted on 11/27/2012 2:36:51 PM PST by Attention Surplus Disorder (This stuff we're going through now, this is nothing compared to the middle ages.)
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To: ecomcon

I can guarantee you that tungsten will not rust. However it might corrode but I do not know that.


8 posted on 11/27/2012 2:37:38 PM PST by Parley Baer
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To: Attention Surplus Disorder

Float? — of course not, don’t be silly :^) LOL


9 posted on 11/27/2012 2:38:59 PM PST by txnativegop (Fed up with zealots)
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To: Attention Surplus Disorder

As long as non of the gold ingots are rusting, no damage.

But, .........


10 posted on 11/27/2012 2:41:27 PM PST by GladesGuru (In a society predicated upon freedom, it is necessary to examine principles."...the public interest)
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To: Attention Surplus Disorder

"...and you made sure the air tanks were destroyed"

11 posted on 11/27/2012 2:44:25 PM PST by Doogle ((USAF.68-73..8th TFW Ubon Thailand..never store a threat you should have eliminated))
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To: GladesGuru; SAJ

But:

One has to ponder at least some...the major effect of declaring “force majeure” is to invalidate deliveries from this particular vault...and the article says it is but one of five. OK, Fine. But an acquirer of physical of gold via futures contract, or, a commercial buyer does not as far as I know have the right to say “I want the gold I buy/take delivery of to come from the vault on Townsend Street and not the one on Canal Street. And being fungible, he/she should not care. These are going to be “so-called” good delivery bars of I think 400 oz. (I have pinged SAJ so he can correct me on anything I posit here)

So...why would they do this? If as the article says it’s “business as usual”, then the CME should make the deliveries from an alternate location, and if said alt location is in NYC, that should be what, a dozen blocks away, tops?

Enquiring minds, that kind of thing...


12 posted on 11/27/2012 2:48:51 PM PST by Attention Surplus Disorder (This stuff we're going through now, this is nothing compared to the middle ages.)
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To: Attention Surplus Disorder

Straight out of “Life After People”


13 posted on 11/27/2012 2:54:21 PM PST by BenLurkin (This is not a statement of fact. It is either opinion or satire; or both)
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To: Attention Surplus Disorder
Wet gold is a mouse fart to this one, the Depository Trust and Clearing Corp. whose flooded vault contained million$ and million$ of PAPER securities, including bearer bonds, those legendary coupon clip money machines. Unless these can be recovered, which means dried and legible, it will become accountants, archivists and lawyers' dream lifetime jobs.

A bearer bond was/is the ultimate in untraceable money and the subject of many an older mystery plot. It has no paper trail and whomever possesses it can cash it or clip it's interest coupons until it matures. If the bond is destroyed, the ramifications are obvious and numerous, how do you prove this wet scrap is it and not something else ...?

Talk about money down the drain ...

Too bad no ziplock sale men thought to call on them a week before ...

14 posted on 11/27/2012 2:58:06 PM PST by SES1066 (Government is NOT the reason for my existence but it is the road to our ruin!)
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To: txnativegop

No problem, move along, just gold sponges stored there. ;-)


15 posted on 11/27/2012 3:04:35 PM PST by Average Al
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To: Attention Surplus Disorder

If there was real gold down in that vault, there should be no problem with the salt water.


16 posted on 11/27/2012 3:49:38 PM PST by jonrick46 (The opium of other people's money.)
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To: Darteaus94025

And I’ll bet those floating bars really freaked them out!


17 posted on 11/27/2012 3:56:57 PM PST by NonValueAdded (Happy 10th FR birthday to meeeeeeeeee)
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To: NonValueAdded

You mean that new ‘Bamagold’?


18 posted on 11/27/2012 4:07:56 PM PST by biff (WAS)
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To: Attention Surplus Disorder
You're right on top of it, ASD.

As regards FUTURES contracts only, the purchasor of a contract who holds said contract to expiration A) can demand physical delivery of the goods specified in the contract, B) cannot demand, or even ask for, a specific source of the goods being delivered (in this case, a depository); the exchange will make this determination itself, i.e. on which warehouse/depository to issue a putchasor's bill (old-fashioned term, still correct, but today we call this a receipt of tender), and C) can insist on hard demonstration (inspections and/or assays) that the goods delivered are up to specification.

400 Troy oz. bars are "good delivery" in the cash market, but not so in futures; the benchmark COMEX/NYMEX gold contract is for exactly 100 oz. When I was in the industry, delivery was in bar form (100 ozT, to be sure): these days I do not know what the devil the delivery looks like. It may be specified in the futures contract (and likely is), but, equally, it may not.

The old 1000 ozT silver contract delivery was a bit of a farce. What the purchasor got (along with wildly inflated "storage" fees, but that's another story for another day) was a formless, shapeless slab of 9999 silver weighing 1000 ozT. To say that this goofy object was "hard to handle" would be a supremely understated view.

The ultimate point on this subject (conspiracy theorists notwithstanding, of course) is that the exchange can and will deliver the contract-specific goods at one or another location and in a manner consonant with the terms of the futures contract. There have been A FEW exceptions to this in physical commodities over the years (the story of the default in Maine White Potatoes in 1978 (give me a year either way in case my memory is failing) is hilarious, and I can tell it truly: I was in the very room where Taggares and J.R. Simplot were on the phone with the president of the old NY Merc, threatening to "bomb" the building with several hundred tons of otherwise "undeliverable" spuds. They weren't kidding, either. Learned some new words that day...).

Nothing mysterious about "force majeure", btw. Just means "we cannot perform on the contract because of circumstances beyond our control". Otherwise known as the "acts of G-d" clause (shrug).

Good trading to you, and best wishes for the season,
SAJ

19 posted on 11/27/2012 4:33:08 PM PST by SAJ (What is the next tagline some overweening mod will censor?)
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To: biff

Tis Gold if I deem it so.

20 posted on 11/27/2012 5:22:34 PM PST by The Sons of Liberty ( Fast and Furious , Benghazi - What's 0bama's current body count?)
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To: Attention Surplus Disorder

An amazing thing happened, some of the “gold” was seen floating away in the storm waters.


21 posted on 11/27/2012 6:12:23 PM PST by count-your-change (You don't have to be brilliant, not being stupid is enough.)
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