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FirstQuaker -> Goldman Commodity Manipulation. (7/28/2011 5:43:29 AM)
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Not happy with manipulating the petroleum markets, it looks like the corporate banking gangsters have now found a new scheme to use.
"A string of warehouses in Detroit, most of them operated by Goldman, has stockpiled more than a million tonnes of the industrial metal aluminum, about a quarter of global reported inventories. Simply storing all that metal generates tens of millions of dollars in rental revenues for Goldman every year. There's just one problem: only a trickle of the aluminum is leaving the depots, creating a supply pinch for manufacturers of everything from soft drink cans to aircraft. The resulting spike in prices has sparked a clash between companies forced to pay more for their aluminum and wait months for it to be delivered, Goldman, which is keen to keep its cash machines humming and the London Metal Exchange (LME), the world's benchmark industrial metals market, which critics accuse of lax oversight. - http://news.yahoo.com/special-report-goldmans-money-machine-warehouses-090810768.html
So now the scheme is to control the metals markets by owning the warehouse facilities and profit off the 'rent' while slow walking commodities delivery?
"Robin Bhar, a veteran metals analyst at Credit Agricole in London says the conflict of interest is so acute he wants U.S. and European anti-trust regulators to weigh in. "I think it makes a mockery of the market. It's a shame," Bhar said. "This is an anti-competitive situation. It puts (some) companies at an advantage, and clearly the rest of the market at a disadvantage. It's a real, genuine concern. And I think the regulators have to look at it.""
However the banksters say -
"Goldman said its warehouse subsidiary Metro International Trade Services has done nothing illegal, and abides by the LME's warehousing rules. "Producers have chosen to store metal in Detroit with Metro," a Goldman spokeswoman said. "We follow the LME requirements in terms of storing and releasing metals from our warehouses." The London Metal Exchange defends its rules. "There is a perception that consumers have not been able to get to their metal when the reality is that it is big banks, financing companies and warehouses that are not able to get to their huge tonnages of metal fast enough," said LME business development manager Chris Evans."
But the reality is that -
"Goldman's warehouse business relies on a lucrative opportunity enabled by the LME regulations. Those rules allow warehouses to release only a tiny fraction of their inventories per day, much less than the metal that is regularly taken in for storage. The metal that sits in the warehouse generates lucrative rental income."
So normal businesses who rely on metals cannot get ahold of them unless Goldman's feels like selling them, either after collecting the proper amount of "rent" or seeing the price rise to their satisfaction?
"Madden estimates that the U.S. benchmark physical aluminum price is $20 to $40 a tonne higher because of the backlog at the Detroit warehouses. The physical price is currently around $2,800 per tonne."
No wonder China and India are surging ahead, where North American and EU businesses can't get the raw materials they need until Goldman's and their peers think the profit they make is right.
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