This may have been a set-up. There's been a lot of noise lately about the potential for delivery failure on the Comex, right? So, why wait for that to happen? Orchestrate an apparent failure, then produce the gold thus casting doubt on your detractors.

I'm wondering if these short sellers had swap agreements in place that would trigger when they actually got a delivery notice. Would such an agreement, say with a major central bank, be recognized as fulfilling the cover rule? I can see how it might, since a central bank is unlikely to default on such an arrangement. I can also see how the seller might turn out to be the buyer - in other words, the gold simply makes a round trip via the swap leaving the impression that enough gold exists to fulfill all contracts.

The more I think about it, the more likely this seems.

ebear