CME President on Gold: “They Don’t Want Certificates, They Want the Real Product”

What’s interesting about gold, when we had that big break two weeks ago we saw all the gold stocks trade down significantly, we saw all the gold products trade down significantly, but one thing that did not trade down, was gold coins, tangible real  gold.  That’s going to show you, people don’t want certificates, they don’t want anything else.  They want the real product.

- Terrence Duffy, President and Executive Chairman of CME Group Inc,. on Bloomberg TV yesterday (April 29, 2013)

I’m actually still in a state of shock that the head of the CME Group would make such an observation and in such blunt terms.  I mean the guy admits that volume on his exchanges suck, yet basically claims paper gold (one of their marquee products) is becoming irrelevant.  In my mind there are two likely explanations for this.  1) This is how he has started to feel personally and he is loading up on physical gold rather than his company’s paper products and would like some cover if that is ever unearthed. 2) This is what people close to the gold market are telling him and he’d rather make it clear he understands that paper is paper and gold is gold and that there is a big difference.  So “caveat emptor” if you are hanging around the COMEX.

His comments on gold come in at the 0:40 mark.  Simply stunning.

13 thoughts on “CME President on Gold: “They Don’t Want Certificates, They Want the Real Product”

  1. Pingback: CME President on Gold: ‘They Don’t Want Certificates, They Want the Real Product’

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  3. Maybe he is just trying to sucker people into buying before the next smack down. There is no way he would admit that without an ulterior motive.

  4. I’m going with CYA. Facts are facts and the physical demand vs paper price should just be plain embarrassing to the industry.

  5. If he wanted to sucker people into buying, it would be into paper, not physical, no? There hasn’t really been much of a smackdown in the physical, considering premiums.

    Reason 1 sounds likely. Seems supportive of Jim Sinclair’s argument that paper gold is becoming irrelevant. Doesn’t that mean that eventually the metals futures contracts will be settled in dollars rather than metal? If so he’ll be able to say futures traders were forewarned.

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  13. Question – Rumor of fact? There are articles floating around noting that the former CME CEO attempted to cash in 2 contracts of gold (200 oz) in the form of the actual physical gold. The report(s) note that he was denied; instead, he was handed a certificate.

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