It appears that JPM and HSBC's monopoly in the warehousing of tungsten gold is coming to an end. Just two weeks after QEternity was announced, it has become obvious that the only things, literally, that will matter in the future are the ABCDs: Anything Bernanke Can't Destroy. And as a result of a surge in physical purchases, buyers need to store their metal somewhere. Sure enough, one of the the UK's most insolvent banks - Barclays - is more than happy to provide its brand spanking new warehousing services, with the opening of what will be on of Europe's largest PM vaults. From Dow Jones: "Barclays has opened its first precious metals vault in London in a bid to satisfy growing client demand for bullion as a store of value, the bank said Thursday. The vault, which houses gold, silver, platinum, palladium and rhodium and began operating earlier this month, is one of the largest in Europe. While the bank already has extensive trading and clearing capabilities, this is the first time that Barclays has been able to offer its own precious metals storage facility to its customers, having previously relied on third-party storage." Of course, if and when the scramble comes and everyone demands their gold from the vault located in an unknown location, but somewhere in the inner loop of London's M25, Barclays will just say "Ooops." But we will cross that bridge when we get to it.
From DJ:
The vault "is a very significant milestone in the expansion of our physical commodities offering, filling an important gap across metals and energy," said Mike Bagguley, head of commodities and FX at Barclays. "In doing so we further strengthen our metals business, and our presence in the bullion market," he added.
Demand for bullion as an investment vehicle has been rising apace in recent years, with the value of gold almost tripling between the start of the global financial crisis in late 2008 and the metal's record highs of around $1,920 a troy ounce in September last year. According to the World Gold Council, global demand for physical gold bars was 1,159 metric tons in 2011, up 30% on the previous year.
Curious why Ben Bernanke is a goldbug's best friend? Here it is from the horse's mouth:
"Since QE3, the number of enquires we're getting about buying gold have gone up," said Jonathan Spall, product manager for metals at Barclays.
Barclays is not the first, and certainly will not be the last to offer paid confiscation warehousing services:
Aside from the Bank of England, HSBC Holdings PLC and JPMorgan Chase & Co. are the only other banks with their own precious metal vaults in London, which is the center of the global bullion market. Deutsche Bank AG also plans to open a new precious metals vault in London next year.
Wonder where the vault will be located in case you want to "check" the sanctity of its contents? Here:
Like most gold vaults in the U.K., Barclays' facility is located within the area bounded by the M25 road that orbits London. Barclays' vault was designed and built by Brink's Limited UK--a subsidiary of leading global security firm Brink's, Inc.--and is protected by a purpose-built security system.
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Finally, as to who will be able to benefit from the new facility: "The vault caters for institutional investors, sovereign wealth funds, central banks and commercial banks."
In other words, everyone.
So come one, come all, and hand over your gold to Barclays for safekeeping. Pretty please.