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Phantom gold haunts GLD vault tour

Section: Daily Dispatches

By Joe Morris
Financial Times, London
Thursday, September 1, 2011

The SPDR Gold Trust (GLD) may have sought to defuse conspiracy theorists by opening up its massive London gold vault to CNBC, but instead it opened up a new line of inquiry.

In the segment --

-- reporter Bob Pisani was forced to surrender his cell phone before being driven, not unlike a hostage, in what appears to be a cargo van with its windows sealed by black tarp. "We have no idea where we're going," he says over background music reminiscent of the "Mission Impossible" theme.

Once inside, Pisani holds up a random gold bar, its refiner's stamp clearly legible. (This occurs about 2:10 into the video segment.) As Zero Hedge points out in a blog post today --

-- the serial number on that bar, ZJ6752, does not appear on GLD's most recent bar list, dated August 31. Given that GLD tonnage stayed relatively flat over the previous week, when Mr Pisani's visit presumably occurred, few if any bars are likely to have been removed from the vault in the interim, Zero Hedge notes.

... Dispatch continues below ...


Lewis E. Lehrman on How to Solve the U.S. Debt Problem

Lewis E. Lehrman, chairman of the Lehrman Institute, sponsor of The Gold Standard Now project, advises that to reduce the $1 1/2 trillion U.S. deficit, the Republican Party must initiate an investment program.

Working Americans are not saving, which enables the banks to lead the country into a cycle of debt, leverage, boom, panic, and bust.

Lehrman says: Eliminating the budget deficit of a trillion and a half dollars cannot be done overnight. The proposal by U.S. Rep. Paul Ryan was very dramatic -- one Republican called it radical -- but it was not happily received. The solution, of course, is to design an American program for prosperity, because you can solve these entitlement problems with a growing economy. We need a tremendous program of investment, and investment comes from savings. When you pay savers, middle-income professionals, and working people 0 percent at the bank, you are not going to encourage them to save. Then we are left with a bank cycle of debt, leverage, boom, panic, and bust."

To read more and to sign up for The Gold Standard Now's free, noncommercial, weekly report, "Prosperity through Gold," please visit:

There must be an explanation, but the plot thickens.

"Of course, Pisani may have well shot the documentary some three weeks ago, when gold peaked at 1310 [metric] tons, although we assume he would have then said 1,300 tons held by the warehouse, not 1,200 as he did," Zero Hedge says. "If that is the case, there is a small chance based purely on statistics that ZJ6752 was promptly moved out of the warehouse upon a redemption event. The chance is about 1 in 10,000 or so, but still. ..."

The question, or at least one question, is: When did Mr Pisani pay his visit?

Phantom gold conspiracies haven't seemed to dent demand for GLD, despite BlackRock's attempt a year ago to distinguish itself as the only US-listed gold ETF to be fully allocated daily. (Jeremy Charles, global head of precious metals at HSBC, which houses the vault, tells Pisani: "At no point in time is there a risk to the trust." But GLD's prospectus states that up to 430 ounces of gold can be held in the trust's unallocated account overnight, which would seem to constitute a type of risk.)

Still, the CNBC invite suggests GLD is at least somewhat bothered by the whispers. We could see this episode proving a PR tipping point, ushering in either a new era of openness and access or, alternately, even more secrecy.


Joe Morris is a regular contributor to both FTfm and to ETF Central, the Alchemy forum where this post first appeared.

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Sona Drills 85.4g Gold/Ton Over 4 Metres at Elizabeth Gold Deposit,
Extending the Mineralization of the Southwest Vein on the Property

Company Press Release, October 27, 2010

VANCOUVER, British Columbia -- Sona Resources Corp. reports on five drillling holes in the third round of assay results from the recently completed drill program at its 100 percent-owned Elizabeth Gold Deposit Property in the Lillooet Mining District of southern British Columbia. Highlights from the diamond drilling include:

-- Hole E10-66 intersected 17.4g gold/ton over 1.54 metres.

-- Hole E10-67 intersected 96.4g gold/ton over 2.5 metres, including one assay interval of 383g of gold/ton over 0.5 metres.

-- Hole E10-69 intersected 85.4g gold/ton over 4.03 metres, including one assay interval of 230g gold/ton over 1 metre.

Four drill holes, E10-66 to E10-69, targeted the southwestern end of the Southwest Vein, and three of the holes have expanded the mineralized zone in that direction. The Southwest Vein gold mineralization has now been intersected over a strike length of 325 metres, with the deepest hole drilled less than 200 metres from surface.

"The assay results from the Southwest Zone quartz vein continue to be extremely positive," says John P. Thompson, Sona's president and CEO. "We are expanding the Southwest Vein, and this high-grade gold mineralization remains wide open down dip and along strike to the southwest."

For the company's full press release, please visit: