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University of Texas Takes Delivery Of $1 Billion In Physical Gold
Zero Hedge ^ | 04/16/2011 | Tyler Durden

Posted on 04/16/2011 5:15:45 PM PDT by The Magical Mischief Tour

Tipping points are funny: for years, decades, even centuries, the conditions for an event to occur may be ripe yet nothing happens. Then, in an instant, a shift occurs, whether its is due a change in conventional wisdom, due to an exogenous event or due to something completely inexplicable. That event, colloquially called a black swan in recent years, changes the prevalent perception of reality in a moment. This past week, we were seeing the effect of a tipping point in process, with gold prices rising to new all time highs day after day, and the price silver literally moving in a parabolic fashion. What was missing was the cause. We now know what it is: per Bloomberg: "The University of Texas Investment Management Co., the second-largest U.S. academic endowment, took delivery of almost $1 billion in gold bullion and is storing the bars in a New York vault, according to the fund’s board." And so, the game theory of a nearly 100 year old system of monetary exchange has seen its first defector, but most certainly not last. With an entity as large as the University of Texas calling the bluff of the Comex, the Chairman, and fiat in general in roughly that order, virtually every other asset manager is now sure to follow, considering there is not nearly enough physical gold to satisfy all paper gold in existence by a factor of about 100x. The proverbial Nash equilibrium has just been broken.

(Excerpt) Read more at zerohedge.com ...


TOPICS: Business/Economy; Crime/Corruption; Foreign Affairs; Government; US: Texas
KEYWORDS: gold; hedge; prepping; texas; ut
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1 posted on 04/16/2011 5:15:51 PM PDT by The Magical Mischief Tour
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To: The Magical Mischief Tour
If there's ever a demand for delivery of all the paper gold some very large Wall St firms and mid-sized sovereign funds will collapse.

They don't have it. It's been sold, dozens of times.

2 posted on 04/16/2011 5:21:55 PM PDT by Mariner (USS Tarawa, VQ3, USS Benjamin Stoddert, NAVCAMS WestPac, 7th Fleet, Navcommsta Puget Sound)
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To: The Magical Mischief Tour

The only way to own gold is to possess it physically. If there is ever a run on gold those who own gold “stock” other than mines will be screwed and those who have physical gold will be rich.


3 posted on 04/16/2011 5:22:20 PM PDT by microgood
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To: The Magical Mischief Tour
Somewhere between 200-300 tons-- a routine annual transaction for central banks. Sorry but I'm not panicking.
4 posted on 04/16/2011 5:25:28 PM PDT by hinckley buzzard
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To: The Magical Mischief Tour

What do the Keynesians in UT’s economics department think?


5 posted on 04/16/2011 5:25:38 PM PDT by JimWayne
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To: hinckley buzzard

But the University of Texas is not a central bank. And university trustees tend to be very conservative. So this is certainly a significant event.

If other boards of trustees start doing the same thing, it could add up pretty quickly.


6 posted on 04/16/2011 5:31:54 PM PDT by Cicero
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To: onyx; penelopesire; maggief; hoosiermama; SE Mom; Fred Nerks; Red Steel; seekthetruth; ...

Worth the read

http://www.zerohedge.com/article/golden-tipping-point-university-texas-takes-delivery-1-billion-physical-gold


7 posted on 04/16/2011 5:31:58 PM PDT by STARWISE (The overlords are in place .. we are a nation under siege .. pray, go Galt & hunker down)
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To: hinckley buzzard

Just how long has the University of Texas been a central bank?

I missed that memo.


8 posted on 04/16/2011 5:32:27 PM PDT by null and void (We are now in day 814 of our national holiday from reality. - That 3 AM phone call? Voicemail...)
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To: The Magical Mischief Tour

I bet they can turn it into straw.


9 posted on 04/16/2011 5:33:48 PM PDT by mountainlion (America land of the free because of the Brave.)
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To: microgood

Yes, but the problem with physical gold is that it can be stolen. And counterfeited.


10 posted on 04/16/2011 5:37:32 PM PDT by Brilliant
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To: STARWISE

HOLD GOLD!


11 posted on 04/16/2011 5:39:49 PM PDT by onyx (If you truly support Sarah Palin and want to be on her busy ping list, let me know!)
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To: Brilliant

And if push comes to shove, I wouldn’t trust the owners of the NY vault.


12 posted on 04/16/2011 5:49:33 PM PDT by Pining_4_TX
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To: xzins
...considering there is not nearly enough physical gold to satisfy all paper gold in existence by a factor of about 100x.

I don't expect a run on the banks, but this is why buying gold is a bad idea. Only the real big players actually have possession of it.

13 posted on 04/16/2011 6:00:34 PM PDT by wmfights (If you want change support SenateConservatives.com)
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To: hinckley buzzard

It’s not huge. If others follow suit, though - and they will - it will become huge. It’s called a cascade effect in some circles, and this could be the start...


14 posted on 04/16/2011 6:00:55 PM PDT by piytar (Godwin's rule is null and void. If you don't know what I mean, you aren't paying attention...)
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To: The Magical Mischief Tour

How can you take delivery when the Gold is in NY with a bunch of crooks?


15 posted on 04/16/2011 6:01:41 PM PDT by taxtruth (Don't end the fed,jail the fed!)
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To: The Magical Mischief Tour

Uh, is this another way for the left to launder money? There is no reason for a university to possess the gold.


16 posted on 04/16/2011 6:03:41 PM PDT by freekitty (Give me back my conservative vote; then find me a real conservative to vote for)
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To: Pining_4_TX

Fedgov can just take it. Anytime. Leave a little paper with Obama’s sig on it.

How many divisions does UT have?


17 posted on 04/16/2011 6:04:29 PM PDT by Leisler (11% GDP of borrowing this year alone, gives 2% GDP boost! Woohoo!)
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To: wmfights

I do accept gold’s historic position as a hedge to inflation, but I do not believe that gold has an intrinsic value that approaches its financial value. Therefore, in a crisis it has no real value.


18 posted on 04/16/2011 6:04:56 PM PDT by xzins (Retired Army Chaplain & proud of it: Truly Supporting the Troops means praying for their Victory!)
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To: Leisler

Being a bunch of sissy liberals, the only division they have is the limp-wrist division.


19 posted on 04/16/2011 6:06:28 PM PDT by Pining_4_TX
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To: hinckley buzzard

There are no more monster boxes of silver left to buy.

It’s getting bad out there


20 posted on 04/16/2011 6:09:46 PM PDT by mylife
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To: microgood
The only way to own gold is to possess it physically

If so, then the University of Texas board of trustees does not own any.

21 posted on 04/16/2011 6:10:52 PM PDT by RegulatorCountry
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To: freekitty; Arrowhead1952; wolfcreek; basil

That gold won’t be in NY for long. Austin has more underground mil-secure space than you can imagine.

Looks like Perry’s going to be minting some state coin?


22 posted on 04/16/2011 6:11:30 PM PDT by txhurl
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To: FReepers
Is This You Too?

“I do so enjoy these money raising pleas. Too bad you kicked off so many patriots back in the day that criticizing the big spending Bush was a cardinal sin on the so called conservative free republic.

Nope, I will happily continue to freeload information from this site. If the lights go dark, well, so be it...”

Become A Monthly FR Donor

23 posted on 04/16/2011 6:13:50 PM PDT by DJ MacWoW (America! The wolves are at your door! How will you answer the knock?)
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To: The Magical Mischief Tour
Fascinating hyperbole. We might be using Texas Dollars someday. But as for "every fund manager" following suit, and the implied short squeeze of recent fantasy, this might be hyperbole.

it was once illegal to own gold in the US. If it appears the current regime is in danger of being capsized, the powers that be will apply incentives and penalties as it sees fit to keep the ship afloat. Don't know if it will succeed, but it will have to try to "protect" the order upon which the entire civilized world is accustomed. If there's going to be any regime changing, it going to SDRs (either actual or analogous) with an initial gold backing, as my favorite blog has suggested, IMHO.

Definitely a cool development and an intriguing move by Texas.

24 posted on 04/16/2011 6:23:43 PM PDT by the invisib1e hand (You is what you am.)
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To: taxtruth
How can you take delivery when the Gold is in NY with a bunch of crooks?

because most people in this city are not crooks, @sshat.

25 posted on 04/16/2011 6:29:46 PM PDT by the invisib1e hand (You is what you am.)
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To: hinckley buzzard

Somewhere between 200-300 tons—


6,643 bars of bullion, or 664,300 ounces


26 posted on 04/16/2011 6:35:33 PM PDT by deport
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To: deport

What do you make of this?

Besides a brooch, or hat, of course :)


27 posted on 04/16/2011 6:43:18 PM PDT by txhurl
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To: txhurl

Johnnie!!!


28 posted on 04/16/2011 6:46:17 PM PDT by null and void (We are now in day 814 of our national holiday from reality. - That 3 AM phone call? Voicemail...)
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To: The Magical Mischief Tour

Taking delivery to a vault in NYC is no different than taking paper delivery.

In a couple of years, New York will be under no obligation to allow its gold to be internationally transferred to Texas, regardless of who paid for it.


29 posted on 04/16/2011 6:47:56 PM PDT by BobL (PLEASE READ: http://www.freerepublic.com/focus/f-news/2657811/posts))
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To: The Magical Mischief Tour

That’ll buy a lot of football players.


30 posted on 04/16/2011 6:48:01 PM PDT by dfwgator
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To: txhurl

31 posted on 04/16/2011 6:48:56 PM PDT by null and void (We are now in day 814 of our national holiday from reality. - That 3 AM phone call? Voicemail...)
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To: wmfights
“I don't expect a run on the banks, but this is why buying gold is a bad idea. Only the real big players actually have possession of it.”

If or when TSHTF The “Big Players" will have it taken away from them by some one bigger and nastier than them by whatever force is necessary.

32 posted on 04/16/2011 6:49:02 PM PDT by mongo141
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To: wmfights
“I don't expect a run on the banks, but this is why buying gold is a bad idea. Only the real big players actually have possession of it.”

If or when TSHTF The “Big Players" will have it taken away from them by some one bigger and nastier than them by whatever force is necessary.

33 posted on 04/16/2011 6:49:28 PM PDT by mongo141
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To: The Magical Mischief Tour
Well they need to spend it on the FB team....

They suck!

34 posted on 04/16/2011 6:51:54 PM PDT by Osage Orange (I knew what I was feeling, but what was I thinking!)
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To: BobL
In a couple of years, New York will be under no obligation to allow its gold to be internationally transferred to Texas, regardless of who paid for it.

Internationally?

35 posted on 04/16/2011 6:53:00 PM PDT by Osage Orange (I knew what I was feeling, but what was I thinking!)
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To: deport

That is about 20 ton.


36 posted on 04/16/2011 6:53:36 PM PDT by Big Horn (Rebuild the GOP to a conservative party)
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To: txhurl
What do you make of this?


Some one named Bass at work.... I really don't have a clue.

37 posted on 04/16/2011 6:59:51 PM PDT by deport
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To: Big Horn

That is about 20 ton.


Yep a little more than Bevo can pull around in the ox cart.


38 posted on 04/16/2011 7:02:36 PM PDT by deport
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To: taxtruth

How can you take delivery when the Gold is in NY with a bunch of crooks?>>>>>>>>

I suspect ornery alumni will insist it be moved to Texas as it should be.


39 posted on 04/16/2011 7:06:11 PM PDT by dennisw (nzt - "works better if you're already smart")
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To: wmfights

I dont know about that. I own physical gold and silver, in my possession. I am not a central bank. I dont have a ton of the stuff, but it doesn’t take much to take possession.


40 posted on 04/16/2011 7:06:11 PM PDT by Vermont Lt (How long before the Mall becomes Tahifir Sq?)
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To: freekitty

They can own whatever they want.....they do not need to present you with a reason.


41 posted on 04/16/2011 7:06:11 PM PDT by Red in Blue PA (Let's apply the "reasonable man" standard to gun laws. How many would stand?)
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To: The Magical Mischief Tour

…and promptly paints it burnt orange.


42 posted on 04/16/2011 7:08:59 PM PDT by RichInOC (Palin 2012: The Perfect Storm.)
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To: deport

The comments at the article are very informative.

I suspect, or hope - this is actually an add-on: UT already had 500m AU - that the gold will be incrementally stocked in some very secure places around the city soon.


43 posted on 04/16/2011 7:25:35 PM PDT by txhurl
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To: the invisib1e hand

And what happens to all those pieces of paper folks are holding instead of real gold when the U-Know-What hits the fan? Can’t barter much with a piece of paper...


44 posted on 04/16/2011 7:31:06 PM PDT by TheBattman (They exchanged the truth about God for a lie and worshiped and served the creature...)
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To: Mariner
If there's ever a demand for delivery of all the paper gold some very large Wall St firms and mid-sized sovereign funds will collapse. They don't have it. It's been sold, dozens of times.

Silver as well - just ask JP Morgan. Comex and PM ETFs are the most laughable creations in financial history.

45 posted on 04/16/2011 7:54:52 PM PDT by RobertClark (On a long enough timeline the survival rate for everyone drops to zero.)
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To: mylife
There are no more monster boxes of silver left to buy.

Very true. But....for spot plus 75%, I'll sell you as many as you would like. Supply an demand is a Bi$%h.

46 posted on 04/16/2011 7:57:49 PM PDT by RobertClark (On a long enough timeline the survival rate for everyone drops to zero.)
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To: xzins

I agree. Gold has properties that make it a good conductor and some other industrial applications. It also makes nice looking jewelry that doesn’t corrode. Platinum does the same.

However, neither metal, in and of itself, has any distinguishing property to make it more valuable than any other item of similar characteristics. Its value is based solely on people’s desire to posses it.

Money is a medium of exchange that represents work. Whether its wampum, seashells, gold, or US dollars, the only value it has is that people agree to use it in exchange for work.

While the US dollar and economy are under very serious pressures, there is no reason to chicken little the situation and demand gold be the silver bullet </very bad pun>.

Remain calm, demand a significant decrease in government spending, and keep working. Spend and save prudently.


47 posted on 04/16/2011 8:57:22 PM PDT by SpirituTuo
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To: The Magical Mischief Tour

http://www.kitco.com/images/live/gold.gif


48 posted on 04/16/2011 9:48:05 PM PDT by matthew fuller (TRUMP RESONATES WITH AMERICANS, INDEPENDENTS, and PATRIOTS!)
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To: wmfights
"Only the real big players actually have possession of it. "

And what exactly stops you or me from buying American Eagles, Canadian Maple Leafs, or Kruggerands...(etc)?

49 posted on 04/16/2011 9:54:46 PM PDT by matthew fuller (TRUMP RESONATES WITH AMERICANS, INDEPENDENTS, and PATRIOTS!)
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To: jiggyboy; PA Engineer; blam; TigerLikesRooster; Cheap_Hessian; CJinVA; Jet Jaguar; ...

GoldBug Ping.


50 posted on 04/17/2011 12:28:05 AM PDT by Jet Jaguar
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