amazing how smart everyone is after the fact!, page-9

Utsstudent

"When I talked to the head of deliveries at COMEX NYMEX, I was like, 'What if 4% of the people want deliveries?' He said, 'Oh Kyle, that never happens. We rarely ever get a 1% delivery.' And I asked, 'Well what if it does happen?' And he said,'Price will solve everything'"

Kyle Bass is "retail".

The important thing to remember about gold futures is that 99% of sellers don't have the gold they are "selling" and 99% of buyers don't have the money to pay for the gold they are "buying".

They want exposure to the price, and where they want to deliver or take delivery, it is usually cheaper and more convenient to settle on an EFP (exchange for physical) basis away from the CME.

In the 30 years I have been watching futures, I have only seen one delivery where price didn't "solve everything". That was in cattle futures at the end of a drought ...