COMEX and LBMA default?

Thanks to Dick for another gem.

Could a default, or "failure to deliver" in the COMEX or London Bullion Market Association be imminent? It probably has occurred already. There is a widening gap between the prices of paper gold contracts and physical gold bullion, due to price suppression schemes by the bullion banks and central bankers. Jim Willie believes the bifurcation of futures contracts and physical gold prices will occur when the physical shortage of gold is exposed.

http://www.financialsense.com/fsu/editorials/willie/2010/0203.html

The paper gold market and the physical gold bullion market have finally separated in a practical manner, meaning actual gold has almost no role anymore in London paper contract settlement. The absence of gold in London requires extraordinary tactics to settle contracts and to obtain gold bullion. Red tape procedures delay delivery for individuals, and bribes accompany gold delivery demands as standard practice. The London Bullion Market Assn has almost zero gold, its supply having been drained in high volumes since early December, a process currently in acceleration.

The public is unaware of government and central bank intervention in markets. They are also unaware of the pipeline between Wall Street and Washington, DC. The populist anger expressed by Congress and the Obama Administration is manufactured, armed with public opinion polls. You know the best way to eliminate taxpayer-funded banker bonuses? Don't bail out the banks in the first place. The media is complicit, cheerleading green shoots, while ignoring accurate data.

The financial press is critically important precisely now, for not spilling the facts on the current gold market breakdown and divergence. Much of the pressures are hidden though, since the financial press networks report only the official paper-based prices. Do not expect to read in Reuters or Bloomberg or the Associated Press or Wall Street Journal or the New York Times or Investors Business Daily or Barrons that a grotesque gold shortage exists in the London metals exchange or at the COMEX in New York and Chicago. They will not report that London is virtually drained of gold, yet still sells gold contracts. Accurate news reporting would accelerate the breakdown and remove the possibility for time extension. The press will not report that billionaires are emptying their gold bullion accounts at rapidfire pace, out of gross distrust of the bankers, since gold leasing has illegally been standard practice for many years. Imagine selling lumber contracts without wood delivered. Imagine selling mortgages without home titles delivered. Actually, Wall Street did precisely that from 2003 to 2007.