‘immoral, But Not Illegal’: Metal Warehousing Games In The Spotlight – Yahoo Finance

Habitat for Humanity home burglarized, “They knew who they were stealing from” | Q13 FOX News

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Chris Wibbelman, Metro president and chief executive, rejected the report’s findings in testimony to lawmakers on Thursday, saying the business has played by the rules. Still, the details reignited a years-long debate on how the ownership of warehouses has transformed the metals market. Madden has repeatedly called on regulators to ban trading houses, like Glencore and Trafigura, and banks from owning storage sheds. Massive 100,000-tonne cancellations of warrants in Detroit and Vlissingen in the Netherlands, where Pacorini Metals, Glencore’s storage business, has the majority of its sheds, have roiled the market since 2010. ‘Q MANAGEMENT’ The first alarms were sounded within Metro as early as December 2010 when Mark Askew, then vice president of marketing, said he was worried about rumors that a big cancellation of warrants was aimed at blocking other customers in the queues, the report showed. That was just months after the first of six such merry-go-round deals that saw the wait time balloon to as long as two years, with millions of tonnes stuck in queues. “I remain concerned, as I have expressed from start, regarding ‘Q management’ etc” he wrote in an email to Wibbelman.
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Senate probe says Goldman, other banks exploited commodity markets – Yahoo Finance

Those keys got the crooks into the storage shedswhere all the tools are kept on site, but getting into the house wasnt so easy. Theres three pry marks there, said Budd pointing to a damaged windowsill. In the first burglary on Thursday the crooks got inside through a window. But the boot print on the front door shows they found a quicker way in over the weekend. Volunteers found the front door of the home wide open. This has been a community project for us and a lot of people have put a lot of hours into it, said Budd. It more upsetting for them that somebody would steal from the organization and not realize where theyre stealing from. Once the thieves got inside they stole a brand new refrigerator and dryer.
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Goldman Sachs’ metal storage unit paid customers to boost queues -report – Yahoo Finance

The strategy started shortly after Goldman bought the company when Metro became concerned owners of metal were removing metal to store elsewhere, leading to a loss of revenue. In September 2010, DB Energy Trading, a unit of the German bank, agreed the first merry-go-round deal, involving 100,000 tonnes of aluminum, most of which was loaded out of one warehouse and into another. Deutsche Bank and Metro confirmed the existence of transaction, but said there was never any contract. The impact was immediate: the wait time to get metal on Sept. 15, 2010, was 20 days. A week later, on Sept.
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MERRY-GO-ROUND The impact of banks on commodity prices seized the spotlight in July 2013 when the New York Times detailed what it called a “merry-go-round of metal” involving the movement of aluminum between warehouses by Metro International Trade Services – a Goldman Sachs subsidiary – as a way to exploit London Metal Exchange (LME) pricing regulations. Metro soon became the center of controversy after big consumers such as MillerCoors LLC and Coca-Cola Co accused warehouses and their owners of exploiting the LME storage rules to boost rental income, distort supplies and inflate physical prices of aluminum. The Senate report released on Wednesday supported the claim that Metro took advantage of pricing rules and created long queues of aluminum, which in turn drove up its market value. The committee probe found that a major reason why it took longer to move aluminum out of Metro’s Detroit warehouse operation was a number of large warrant cancellations by a small group of financial institutions, including Deutsche Bank, London hedge fund Red Kite, commodities trader Glencore, J.P. Morgan and Goldman. Senior bankers from Goldman, J.P.
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