In light of the recent inability of the Federal Reserve to return Germany's physical gold to them in any acceptable fashion (timing, quality, etc...) it reminded me of when the financial "journalists" laughed at the fact that the University of Texas took the advice of Kyle Bass and actually took physical delivery on their gold futures contracts.
If you recall, back in 2011 Bass had the university take delivery on ~$1 billion dollars worth of physical gold.
Here was his reasoning back then (still laughing now?)
"The COMEX had a bout $80 billion dollars of open interest between futures and futures options. And in the warehouse they had $2.7 billion of deliverables. So $80 billion in open interest, 2.7 billion in deliverables, we're going to own it a long time - that's an easy one, you're going to go get it."
"When I talked to the head of deliveries, and I said what if like 4% of the people want delivery? -- He says oh Kyle, that never happens"... Indeed