"Alarming trend in Comex gold and silver inventory data" – "t bullion dealer inventory appears to be reducing dramatically and is not being replaced."

This confirms prior and less comprehensive analysis from Adrian and some others questioning the ratios on the Comex gold and silver inventories.  I'd like to see the same analysis done for the London Gold and Silve exchanges where the massive OTC derivatives markets dwarfs COMEX.

Adrian Douglas: Alarming trend in Comex gold and silver inventory data

"…Submitted by cpowell on Fri, 2010-02-26 04:54. Section: Daily Dispatches

11:50p ET Thursday, February 25, 2010

Dear Friend of GATA and Gold (and Silver):

Having examined six months of delivery and inventory data from the gold and silver divisions of the New York Commodity Exchange, GATA board member Adrian Douglas has discovered that bullion dealer inventory appears to be reducing dramatically and is not being replaced. Douglas, publisher of the Market Force Analysis letter, concludes that this likely indicates a worsening shortage of gold and silver bullion. Douglas has published a report on his findings at the Market Force Analysis Internet site under the headline "Comex Inventory Data Reveal an Alarming Trend" and you can find it here:

https://marketforceanalysis.com/index_assets/COMEX%20Inventory%20Shows%2…

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc. …."

Here is a brief excerpt from Adrian's analysis.  I highly recommend going to the Link below and reading the entire analysis and seeing the charts:

https://marketforceanalysis.com/index_assets/COMEX%20Inventory%20Shows%2…

"…The inventory held in the COMEX warehouses is split into two categories which are “registered” and “eligible”. The registered category is metal that is available to be delivered against warehouse receipts. This is essentially inventory belonging to the commercial dealers. There are many traders on the COMEX  who sell gold or silver short but much of this is for speculative or hedging purposes; they are not doing it because they have gold or silver to sell. However,  there are investors who buy long contracts and want to take delivery. It is, therefore, the commercial dealers, the bullion banks, who provide delivery against such long contracts.

The “eligible” category is inventory that is not available for delivery against futures contracts. It is being stored in the COMEX warehouses by its owners.    Although some of this inventory may belong to the dealers for simplicity I refer to it as “customer inventory”. …"

"… But what is more important is that the data reveals a very shocking trend. That is that the registered (dealer) inventory is being drawn down at a phenomenal rate.   In silver the inventory has dropped by 24% in 6 months while in gold it has dropped an eye-popping 41% in 6 months!  The withdrawal to deposit ratio for registered silver is 14:1 and in gold it is 5:1.  If this rate of drawdown continues the registered inventory of silver will be exhausted in 18.8 months and in just 8.5 months for gold!

This inventory drawdown is very revealing. Over the same period the open interest in gold increased 15% while in silver it increased 19%. By way of an analogy one would not expect a company with increasing orders to decrease its stock levels!Why would the inventory not be replenished when Open Interest is  increasing? The most likely reason is a growing shortage of bullion. …."

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