The term "unallocated" is not too difficult to understand. But 99/100 the counterparty risk that goes with it is not explained to the depositor.There is another (disputed, OK!)consequence of depositing your gold in an unallocated account at bigger banks (not the Perth Mint, I am sure!). And that is that these bigger banks use these unallocated deposits to influence the gold price negatively by selling the gold(or 100 times the paper equivalent)to investors. After all, a low, stable gold price is in the interest of the system and the raison d'etre of the Federal Reserve as all critical economic signals are flashing bright green: "All is OK. Well done, more, more, more...you deserve another bonus" ;>)Knowing all of this, nobody in their right mind would deposit gold in an unallocated" account with the bigger banks. The only point of gold is *possession*! But again, nothing of this is explained.
So.. when additional unallocated is purchased, do you have to increase the volume of the pipe or does it just replace 'self owned' unallocated?
We never owned any of the gold in our "pipes", we leased it in from bullion banks. As our clients net purchased unallocated they were/are replacing the gold in our pipes owned by the bullion banks.