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F(r)actions Of Gold
F(r)actions Of Gold
The junction of that dyad format is wholesale collateral. It is a difficult and dense topic because it plumbs the very depths of the wholesale arrangement – factors like leasing, swaps and collateralized lending through binary bespoke arrangements.It is there that I think it helps to form the narrative, however, starting by reviewing what the BIS was up to in late 2009 and early 2010. I am going to borrow heavily from an article I wrote in April 2013 that describes the events in question but this is one of those times when you should read the whole thing.
Back in July 2010, the Wall Street Journal caused some commotion when it happened to notice in the annual report for the Bank for International Settlements the sudden appearance of gold swap operations to the tune of 346 tons. Subsequent investigation by media outlets, including the Financial Times, reported that the BIS had indeed swapped in 346 tons of gold holdings from ten European commercial banks. That was highly unusual in that gold swaps are typically conducted between and among central banks.
…click on the above link to read the rest of the article…
The Mystery Of Dubai’s Vaporized Gold: The Plot Thickens
The Mystery Of Dubai’s Vaporized Gold: The Plot Thickens
Earlier this week, we told a fascinating story about an unprecedented, multi-year smuggling ring involving Turkey, Iran, and Dubai (as well as China, Russia and countless other nations) which saw corruption reaching to the very top of the political and financial establishment: from president Erdogan in Turkey, to one of Turkey’s richest people, Iran-born Riza Sarraf, to Sheikh Sultan Bin Khalifa Al Nahyan, the son of the ruler of Abu Dhabi and one of the world’s richest people. The smuggled object in question was gold, billions of dollars worth of gold.
The focus of the story was the previously unknown Dubai gold trading house, Gold.AE, until recently managed by one Mohammed Abu-Alhaj, which as we showed was the primary conduit by which Turkish physical gold found its way “legally” in Dubai, from where it subsequently left for Iran but not before pocketing millions in “commissions.”
As we reported, Gold.AE – a subsidiary of Gold Holding, the largest gold-focused investment holding company headquartered in Dubai – and the company perhaps best known for launching gold ATMs in the Emirates back in 2010…
… announced a few days ago that it had suddenly and unexpectedly gone out of business, after an inquiry by minority shareholders announced that the entire old “management team abruptly resigned with no notice” and that “there had been substantial withdrawals from the company’s account to the personal accounts of some of the management and the majority shareholders.”
In other words, the company which was used as a cover for billions in gold transactions over the last several years in the Turkey-Iran gold smuggling trade, was suddenly not only insolvent but had been thoroughly plundered of all its holdings, including a thorough plundering of client accounts.
Think the Corzining of MF Global, only on steroids, goes to Dubai.
…click on the above link to read the rest of the article…
