WHAT IS GLD COMPLAINT GOLD?
UNDERSTANDING GLD-COMPLIANT GOLD
The gold business, as we practise it, is very simple. Rule Numero Uno: Forget the jargon! In the system - not in the system. Registered gold - unregistered gold. Allocated gold - unallocated gold. The terms are confusing and unhelpful; more importantly, they are not used by professional gold buyers and sellers. Don't believe me? Visit the extensive LBMA website and put "registered gold" or "system gold" - or, for that matter, "bullion officer" - into the search engine. You'll not come up with a single hit
Here's all you need to know:
We purchase gold bullion manufactured to GLD specifications with regard to purity and weight - AND WE DO IT SIGHT UNSEEN. We don't view the metal; we don't test the metal; we don't receive shipments of the metal; we don't transport the metal. Of course, we need to be extra-vigilant to ensure that we acquire genuine product only - and not counterfeit or "salted" gold bars. So we only purchase inventories that have a good "chain of custody" (sometimes referred to as a "chain of integrity"). In other words, gold that has been manufactured in an LBMA-certified refinery AND is being safe-kept in a bank vault or bank-supervised warehouse or LBMA-approved security facility - or an internationally recognized gold depository like, say, Brinks or Metalor
In truth, not much gold is held in bank vault storage. That's because - well, most bank vaults are simply not large enough to accommodate a forklift truck. So banks normally hold their customers' GLD assets in outside warehouses maintained under the bank's "care, custody and control". For example, HSBC, Hong Kong has four bank-supervised warehouses on Stonecutters Island in Victoria Harbor. Stonecutters Island, by the way, is known for having lots and lots of snakes, mostly brown cobras and bamboo snakes. Now that's what I call safe and secure storage!
Well, that's our gold business in a nutshell!