physical supply drying up

while the world watches COMEX, physical gold is getting scarce

you could see this coming months ago if you had eyes to see

when the worlds central bankers started scaling back selling, and in the last month became net buyers, physical supply could not meet demand.

evidence of this in a media report today:

"Despite high prices physical demand seems to be recovering a bit," said Eugen Weinberg, an analyst at Commerzbank. "Together with higher investment interest, it's providing a good picture."

India's gold purchases have picked up as the festive season gathers pace in the world's largest consumer.

"At the moment we see signs of scarcity in some places," Weinberg said of the physical market in Asia. "It's surprising that some places need to wait some weeks for their deliveries."

So the battle for domination of gold pricing between the physical market and COMEX and other derirative OTC markets plays out

At the end of this article you will comments by one of the most knoledgable fellows in the gold industry, Jeff Christian

http://www.cpmgroup.com/freelibraryhome/CPM_Group_Market_Commentary_31_March_2009.pdf