Friday, November 27, 2009
December open interest is 44,366 contracts. This represents 4.4 million ounces vs. the 2 million "eligible" -available for delivery - ounces of gold in today's Comex inventory report. Anyone holding a long position had to be ready for a delivery notice on Monday, meaning their futures account has to be fully funded and ready to pay for delivery as of Monday. It remains to be seen how this will play out over the month of the December. Technically, last "notice to deliver/delivery" day is 12/31. I have yet to understand how the delivery notices are assigned (i.e. notices can be assigned anytime from Monday to 12/31), and unassigned contracts can be sold up to 12/30 or tender for cash, but if every single one of those 44,366 contracts has the intent of taking physical delivery, the Comex has a problem.
Posted by Dave in Denver at 2:59 PM