Goldman’s claim that it held only 3% of the world’s aluminum supply was utterly misleading. I now have determined that it holds in its own warehouses–the Metro subsidiary of Goldman Sachs some amount of aluminum that is less than 25% of the aluminum available for delivery in the U.S.
But, and hold your breath on this one, it could be that Goldman Sachs is holding extensive supplies of aluminum in non-Metro warehouses, warehouses it does not own itself, but belong to other owners. I have asked Goldman to give me the total amounts of aluminum it holds if you add the Metro warehouses to the non-Metro warehouses. To be blunt, I’ve got a feeling they aren’t going to tell me. They are trying to make up their minds right now. So, I am going to venture a guess that when you add the aluminum stores in wholly owned Goldman Sachs warehouses to other warehouses in Detroit that are not owned by Goldman Sachs, it’s possible that Goldman Sachs is storing well over 25% of the aluminum available for delivery in the U.S. That’s a hell of a lot more meaningful for aluminum prices than 3% of the world supply. Let the investigations intensify.
Okay. Mea culpa. I fell for the 3% of global supply instead of pressing to get the percentage of aluminum in the U.S., a far more meaningful number when you consider how holding that much of the American market might possibly, probably, effect the price of aluminum. This is to correct the impression I left on July 25 when I posted “Goldman Sachs Makes $255 Million Storing 3% of Global Aluminum Production.” In fact, now that I think of it, there is the possibility that if you add the daily fee of 48 cents a ton at Goldman’s wholly owned warehouses to those not owned by Goldman, the stream of annual revenues becomes a great deal more than $255 million.