JPMorgan et al ‘Slice the Salami’ in All Four Precious Metals

04 October 2016 — Tuesday


The gold price really didn’t do a lot yesterday until at, or just after the COMEX open.  It got leaned on a bit at that point, with Monday’s low tick coming a minute or so before the 1:30 p.m. COMEX close in New York.  It crawled higher from there until around 4:20 p.m. in the thinly-traded after-hours market — and then had a lot of those gains vanish by the 5:00 p.m. close.

It was another day where the gold price traded mostly within a ten-dollar price range — and the high and low ticks were recorded as $1,322.60 and $1,311.80 in the December contract.

Gold was closed in New York on Monday afternoon at $1,311.20 spot, down $4.70 on the day.  Despite the fact that a new low tick was set for this move down, net volume was pretty light at a bit under 111,500 contracts.161004gold

Like gold, silver tried to rally in early morning trading China Standard Time on their Monday, but that didn’t last.  All the gains were gone — and then some by 1 p.m. CST, as it touched the $19 spot mark.  The price crawled higher until shortly after 10 a.m. in London — and at that point rallied back above unchanged.  The rally was capped right at 11 a.m. over there — and it was a long, slow slide until its low tick of the day was set, like gold, just minutes before the COMEX close.  The decline was so linear it all the appearances of an algorithm of some sort running in the background for seven hours and change.  After it’s low tick was set, it followed a price path very similar to gold’s from that point onward into the close.

The high and low tick in this precious metal was recorded as $19.385 and $18.75 in the December contract, another intraday move of more than 3 percent.

Silver was closed at $18.785 spot, down 36 cents on the day.  Net volume was pretty decent at just over 51,000 contracts, as it was a new low close for silver yesterday after its latest run-up through its 50-day moving average.161004silver

And here’s the 5-minute silver tick chart courtesy of Brad Robertson as usual.  There was some volume associated with the 20 cent sell-off that occurred during the Shanghai lunch hour on their Monday, plus some more in the one-hour rally between 10 and 11 a.m. in London.  After that, all the volume that mattered came during the COMEX trading session, which began at 6:30 a.m. Denver time on the chart below — and fell back to background levels around 12:30 p.m. MDT, which was 2:30 p.m. in New York.

The vertical gray line is 10:00 p.m. Denver time, midnight in New York — and noon China Standard Time [CST] the following day in Shanghai—and don’t forget to add two hours for EDT.  The ‘click to enlarge‘ is a must here.161004-5-minute-silver

After palladium’s tiny rally in the Far East met the same fate as gold and silver’s, it was sold down and traded five dollars or so below unchanged until shortly before noon in Zurich — and thirty minutes before the COMEX open.  Then, like silver, it was sold lower in a very linear fashion.  It was bounced off its $1,000 low tick price several times before the COMEX close — and then rallied a few dollars after that.  Platinum finished the Monday session in New York at $1,004 spot, down $21 from Friday’s close.161004platinum

After chopping mostly sideways for five hours or so, palladium was sold down its Far East low tick around 2 p.m. Shanghai time on their Monday afternoon.  The subsequent rally topped out at the $723 spot mark shortly afternoon the noon silver fix in London and, like the rest of the precious metals, ‘da boyz’ sold it down to its $704 spot price mark shortly after 11:30 a.m. in New York.  It began to rally in fits and starts starting around 12:30 p.m. EDT — and finished the day at $714 spot, up 9 bucks from Friday’s close.  It closed yesterday 10 bucks off its low tick, but 9 dollars off its high.161004palladium

The dollar index closed very late on Friday afternoon in New York at 95.44 — and jumped up about 10 basis points the moment that trading began at 5:00 p.m. EDT on Sunday afternoon in New York.  Then it chopped quietly sideways until around noon in London.  It began to rally unsteadily at that point, but really took off around 8:45 a.m. in New York, with the 95.80 high tick coming shortly before 10:30 a.m. EDT.  It sagged a bit until 2:20 p.m. — and then rallied a bit into the close, finishing the Monday session at 95.76 — and up 32 basis points from its close on Friday.

Here’s the 3-day U.S. dollar chart so you can see Monday’s action in some context.161004intraday-gif

And, as usual, here is the 6-month U.S. dollar chart for entertainment purposes only.161004-6-month-usd

The gold stocks open unchanged, poked their collective noses above unchanged for a few minutes — and then headed lower.  Their respective lows came just before 2:30 p.m. in New York — and then rallied about a percent during the rest of the day.  The HUI finished down 2.05 percent.161004hui

It was more or less the same for the silver equities, except they bottomed out shortly after 12:30 p.m.  They bounced along the bottom from there until they too caught a bid — and that happened at 3 p.m. EDT, as Nick Laird’s Intraday Silver Sentiment/Silver 7 Index closed down only 1.63 percent.  Click to enlarge if necessary.161004silver-7

The CME Daily Delivery Report showed that 758 gold and 1 lonely silver contract were posted for delivery within the COMEX-approved depositories on Wednesday.  In gold, the only short/issuer worthy of the name was S.G. Americas with 732 contracts.  There were twelve different long/stoppers in total.  Macquarie Futures picked up 374 contracts for its own account.  Goldman was next with 270 contracts…80 for its clients and 190 contract for its own account.  In third spot was JPMorgan with 64 contracts for its own account as well.  The lone silver contract was stopped by Macquarie Futures.  The link to yesterday’s Issuers and Stoppers Report is here.

The CME Preliminary Report for the Monday session showed that the open interest in gold for October fell by 3,176 contracts, leaving 1,282 contracts still open, minus the 758 mentioned above.  Friday’s Daily Delivery Report showed that 3,005 gold contracts were posted for delivery today, so that means that 3,176-3,005=171 short/issuers in gold were let off the delivery hook by those holding the long side of those contracts.  Silver o.i. for October dropped by 6 contracts, leaving 196 contracts still open, plus the 1 contract mentioned in the previous paragraph.  Friday’s Daily Delivery Report showed that 11 silver contracts were posted for delivery today, so that means that 11-6=5 more silver contracts were added to the October delivery month yesterday.

There were no changed in GLD yesterday — and as of 7:46 p.m. EDT yesterday evening, there were no reported changes in SLV, either.

There was a sales report from the U.S. Mint to start off the new month.  They sold 5,000 troy ounces of gold eagles — 1,000 one-ounce 24K gold buffaloes — and 185,000 silver eagles.

Here are two charts that Nick passed around on Sunday showing silver eagle and gold eagle/buffalo sales for the U.S. Mint updated with September’s sales data.  As you can tell, gold coin sales were rather impressive, but silver eagle sales were anything but.  Click to enlarge.161004us-gold


It was a pretty busy day in gold over at the COMEX-approved depositories on Friday.  There was 188,007 troy ounces received, plus 58,195 troy ounces shipped out.  Of the amount received, there was 96,450.000 troy ounces/3,000 kilobars [U.K./U.S. kilobar weight] received at Brink’s, Inc.  There was 19,579,350 troy ounces/609 kilobars shipped out of Manfra, Tordella & Brooks, Inc. — and all 609 of those bars ended up at Canada’s Scotiabank.  Scotiabank also shipped out 11 kilobars as well.  All these kilobars were the U.K./U.S. 32.150 troy ounce weight as well.  And, for the first time, there was a shipment into the Malca-Amit USA, LLC depository.  It’s been registered as a New York COMEX gold depository for at least year, but their cupboards were bare up until Friday.  They received 71,978 troy ounces.  The link to all this action — and more — is here.

There was decent in/out activity in silver as well.  There was 642,382 troy ounces received — and 609,440 troy ounces shipped out.  JPMorgan wasn’t involved in any of it.  A link to that activity is here.

It was reasonably uneventful over at the COMEX-approved gold kilobar depositories in Hong Kong on their Friday.  The received 1,192 of them, but only shipped out 137.  All of the activity was at Brink’s, Inc. — and the link to that, in troy ounces, is here.

Here’s a chart that Nick Laird passed around yesterday evening — and it dovetails nicely with the Reuters story on India’s gold imports in September that appears at the bottom of the Critical Reads section — and here’s the link if you don’t want to scroll down.  This is the 5-year chart showing India’s September gold imports in some context — and there’s no doubt about it, gold imports are down drastically in 2016.  Click to Enlarge.161004india-gold

I have a very decent number of stories for you today, so I hope you have the time to spend on the ones that interest you.


U.S. Ends Fiscal 2016 With $1.4 Trillion Debt Increase: Third Largest in History — Simon Black

The United States government closed out the 2016 fiscal year that ended a few days ago on Friday September 30th with a debt level of $19,573,444,713,936.79.  That’s an increase of $1,422,827,047,452.46 over last year’s fiscal year close.

That debt growth amounts to roughly 7.5{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} of the entire US economy.  By comparison, the Marshall Plan, which completely rebuilt Western Europe after World War II, cost $12 billion back in 1948, or roughly 4.3{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} of US GDP at the time.

The initial appropriation for the WPA, perhaps the largest of Roosevelt’s New Deal “make work” programs that employed millions of people, cost  6.7{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} of US GDP.  And, more recently, the US $700 billion bank bailout at the beginning of the 2008 financial crisis was the equivalent of 4.8{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} of GDP.  So basically these people managed to increase the national debt by a bigger percentage than the cost of the New Deal, Marshall Plan, and 2008 bank bailout.

What exactly did you get for that money?

This Simon Black commentary was picked up by Zero Hedge at 8:02 p.m. EDT on Monday evening — and as West Virginia reader Elliot Simon said in his covering e-mail…”What difference does it make?”  He would be right about that.  Another link to this article is here.

Larry Summers floats idea of sustained stock purchases by government

Former U.S. Treasury Secretary Lawrence Summers floated the idea of continuous purchases of stocks as a potential ingredient in a recipe for the developed world to strengthen economies struggling with subdued growth and inflation.

Among the proposals that deserve “serious reflection” is the purchase of a “wider range of assets on a sustained and continuing basis,” Summers said in a lecture at a Bank of Japan conference in Tokyo on Friday. “I’m not prepared to make a policy recommendation at this point,” he told reporters later.

Summers, who also served as a top economic adviser to President Barack Obama, reiterated his concerns about “secular stagnation,” where trend economic growth rates have been reduced and neutral interest rates are lower than historic norms. To the extent that low neutral rates are in part the consequence of investors preferring fixed-income assets and steering clear of riskier options, policy makers can combat that by buying risk assets, he said.

Another attempt to manage markets with an ‘open mouth’ policy.  This Bloomberg story appeared on their Internet site last Friday — and I found it in a GATA release over the weekend.  Another link to this article is here.

Six Impossible Things Before Breakfast — Jeff Thomas

Alice laughed. “There’s no use trying,” she said. “One can’t believe impossible things.”

“I dare say you haven’t had much practice,” said the queen. “When I was your age, I always did it for half an hour a day. Why, sometimes I’ve believed as many as six impossible things before breakfast.”   Alice in Wonderland

We live in an age when the level of deceit and propaganda is at an all-time high. Joseph Goebbels, Vladimir Lenin, and others did their best to force-feed propaganda to the masses, but they were rank amateurs compared to the spin doctors employed by the political leaders of today. They’re masters at convincing people of impossible things.

Whenever I listen to Americans discuss their country, I find people that are eager for more news and information, yet most, without even knowing it, accept much of the dogma they’ve been fed on a daily basis by their government and the media, even if, to outsiders, the assumptions are preposterous. Only those who make a concerted, ongoing effort to see through the smokescreen seem to keep clear.

This commentary by Jeff showed up on the Internet site yesterday — and it’s worth reading.  Another link to it is here.

Dr. Paul Craig Roberts: On Syria and Washington’s Psychopathic WWIII Gamble

This 53:31 minute audio interview with Paul showed up on Internet site on Saturday.

I’ve listened to the whole thing already, but the most interesting bit starts at the 14:30 minute mark — and runs for the next 11 or 12 minutes.  You have to wait briefly for the entire mp3 file to download — and once that has occurred, you can forward the interview to that time — and start from there.

But if you want to listen to the whole thing, it’s worth it, but I’m just helping you to cherry-pick it.  I thank Larry Galearis for sending it along.

U.K. P.M. Announces “Great Repeal” Legislation Negating E.U. Power Over U.K.; Article 50 Deadline Set to March

U.K. prime minister Theresa May has announced a “Great Repeal” bill that will strip the E.U. of all authority over U.K. Law.

The legislation is the First Step Towards Britain Leaving the E.U.

Anyone who thought she would ignore the Brexit vote was mistaken. Instead, May has become a cheerleader for Brexit.

The legislation will overturn the 1972 European Communities Act — the domestic law that gives the E.U. powers in Britain — Mrs. May told the Sunday Times.  It will also convert existing E.U.-based laws into purely domestic legislation.

This news item appeared on the Internet site early on Sunday morning EDT — and I thank Roy Stephens for pointing it out.  Another link to this story is here.

Britain starts Brexit; now so might banks — George Hay

Britain’s newly updated timetable for leaving the European Union starts the clock ticking for jittery London-based foreign banks. U.K. Prime Minister Theresa May’s Oct. 2 revelation that the official two-year process will kick off by March at the latest adds much-needed clarity to the timing of Brexit. It also makes banks more likely to start shifting staff.

The likes of Goldman Sachs and JPMorgan still don’t know what kind of deal the U.K. will get from its negotiations.  Even if May were to outline her negotiating objectives and strategy in detail, financial groups wouldn’t know if they face a “hard” Brexit whereby they are no longer able to do business with European counterparties, or an equivalent regime that could preserve most of the access to the single market.  It depends how generous the remaining 27 member states want to be.

The worst-case scenario would be to wind up locked out of doing certain kinds of business once the two years is up.  That means, though, that the time to start moving has already passed.  Relocating a big chunk of staff is a process that could take at least three years, according to one senior banker.  The process for U.K.-based firms to gain equivalence could take a lot longer than that.

This opinion piece by Reuters columnist George Hay showed up on the their website on Monday sometime — and it comes courtesy of Richard Saler.  Another link to it is here.

French Unemployment Soars: Will Hollande Keep His Word or Will He Humiliate Himself?

France is bucking the trend among the major economies in the eurozone, with its closely-watched unemployment rate hitting a 12-month high in August.

Europe’s second largest economy is sticking out like a sore thumb, with almost every other country in the 28 member E.U. trimming or holding its jobless rate.

France’s jobless rate inched up to 10.5 per cent this month according to figures from Eurostat. That’s risen steadily from 9.9 per cent in May and defied the broader eurozone-wide trend where unemployment is hugging five-year lows at 10.1 per cent.

French unemployment has become a lightning rod in the country’s political debate after incumbent president, Francois Hollande, has vowed to only stand for re-election next year if the rate falls into single figures.

The International Monetary Fund has warned France’s “structural unemployment” is set to remain elevated as the country is hampered by burdensome regulations and high tax levels.

This is the Michael Shedlock spin on a Financial Times story that was picked up by the folks over at the Zero Hedge website at 10:30 a.m. on Monday morning EDT — and I thank Richard Saler for sending it along.  Another link to this new item is here.

Germany’s Merkel cannot afford to bail out Deutsche Bank: media

German Chancellor Angela Merkel cannot afford to bail out Deutsche Bank given the hard line Berlin has taken against state aid in other European nations and the risk of a political backlash at home, German media wrote on Saturday.

The government denied a newspaper report on Wednesday that it was working on a rescue plan for Germany’s biggest bank, as its shares went into a tailspin fueled by a demand for up to $14 billion from U.S. authorities for mis-selling mortgage-backed securities before the financial crisis.

Germany, which has insisted Italy and others accept tough conditions in tackling their problem lenders, can ill afford to be seen to go soft on its flagship bank, the Frankfurter Allgemeine wrote.

Of course Chancellor Merkel doesn’t want to give Deutsche Bank any state aid,” it wrote in a front-page editorial. “She cannot afford it from the point of view of foreign policy because Berlin is taking a hard line in the Italian bank rescue.”

The Munich-based Sueddeutsche Zeitung wrote that Merkel would be breaking a promise to taxpayers if she were to bail the bank out, which could spell disaster for her re-election bid next year as the anti-immigration AfD party gains ground. “A state aid package would drive voters into the arms of the AfD,” the Sueddeutsche wrote in an editorial.

This Reuters article, filed from Frankfurt, was posted on their Internet site at 6:12 a.m. on Sunday morning BST, which was 1:12 a.m. in New York — EDT plus 5 hours.  I thank Swedish subscriber Patrik Ekdahl for pointing it out.  Another link to this news item is here.

Deutsche Bank, Paschi, Nomura staff charged over false accounts, market manipulation

Six current and former managers of Deutsche Bank AG — including ex-asset and wealth management head Michele Faissola — along with former executives at Nomura Holdings Inc. and Banca Monte dei Paschi di Siena SpA were charged in Milan for colluding to falsify the accounts of Italy’s third-biggest bank and manipulate the market.

A judge in Milan approved a request by prosecutors to try 13 bankers on charges over separate derivative transactions Paschi arranged with the securities firms, said a lawyer involved in the case, who attended the closed-door hearing Saturday, where the decision was announced.

The charges deal another blow to Deutsche Bank, which is seeking to reassure investors and clients that it will be able to withstand pending U.S. penalties over the bank’s sale of mortgage-backed securities and its dealings with some Russian clients. Monte Paschi, the world’s oldest bank, restated its accounts and has been forced to tap investors twice to replenish capital amid a surge in bad loans and losses on derivatives. It’s now attempting to convince investors to buy billions of soured debt before a fresh stock sale.

Deutsche Bank’s Dario Schiraldi, Matteo Vaghi and Marco Veroni as well as Monte Paschi’s Daniele Pirondini and Marco Di Santo will go to trial, which is scheduled to begin on Dec. 15.

Why should anyone be surprised?  This news item put in an appearance on the Bloomberg Internet site on Saturday morning Denver time — and I found it on the Internet site on Sunday.  Another link to it is here.

Moscow suspends U.S.-Russia plutonium disposal agreement

Russia suspended its 16-year agreement to dispose of weapons-grade plutonium Monday, citing what a statement called Washington’s unfriendly actions.

The United States and Russia, the two powers with the most nuclear weapons, agreed in 2000 to reduce their plutonium stockpiles by removing “no less than 34 metric tons of weapons-grade plutonium” from their respective defense programs by means of irradiating it with mixed oxide fuel. The amount of plutonium scheduled for disposal could build 17,000 nuclear weapons.

The Plutonium Management and Disposal Agreement came into force in 2011, but on Monday, Russian President Vladimir Putin, in a decree suspending the pact, noted a “fundamental change of the circumstances and the emergence of a threat to strategic stability as a result of unfriendly actions by the United States towards Russia, and the United States’ inability to ensure compliance with the assumed commitments to utilizing excessive weapons grade plutonium under international treaties.

The decree did not specify which U.S. actions Putin regards as hostile.

The above four paragraphs are all there is to this UPI article, filed from Moscow, which showed up on their Internet site at 8:48 a.m. EDT on Monday morning — and I thank Roy Stephens for sharing it with us.

U.S. Suspends Diplomatic Relations With Russia on Syria

What last week was just a not-so-thinly-veiled-threat lobbed by John Kerry to the Kremlin has, now that Russia suspended its participation in a Plutonium cleanup accord with the U.S., become official, and as the State Department announced moments ago, the U.S. has now suspended bilateral discussions, i.e. diplomatic relations, with Russia over Syria, escalating the conflict in the war-torn nation to a level last seen in late 2015.

This is not a decision that was taken lightly,State Department spokesman John Kirby said, cited by AFP, accusing Russia and its Syrian ally of stepping up attacks on civilian areas. Kirby said the Russian and U.S. militaries will continue to use a communications channel set up to ensure their forces do not get in each others’ way during “counter-terrorism operations in Syria.”

And U.S. diplomats will suspend discussions with Russia on reviving a September 9 deal reached between U.S. Secretary of State John Kerry and Russia’s Foreign Minister Sergei Lavrov. Under that protocol, a truce came into effect on September 12 but it collapsed within a week amid bitter recriminations and a surge of fighting in the five-year-old civil war.

While we await the Russian response, we can’t help but note that the drums of (global, non-proxy) war in Syria are beating ever louder. The next escalatory step from the U.S. at this point would be to send U.S. troops in Syria, which would be promptly met with a matched retaliatory response by Russia, and perhaps China too, which as reported several weeks ago, informally joined the conflict on the side of Syria’s president Assad when it said it would provide “aid and military training” to Syria’s current president.

This story, which is definitely worth reading, even if you’re not a serious student of the New Great Game, showed up on the Zero Hedge website at 3:24 p.m. EDT yesterday afternoon — and it’s another offering from Richard Saler.  Another link to this news item is here.

NATO’s War on Russia: The Winds Howl Before The Storm

A few weeks ago I wrote, “I have been a defence lawyer most of my working life and am not used to gathering evidence for a prosecution, but circumstances impelled me to open a file for the prosecutor of the International Criminal Court, or perhaps some future citizen’s tribunal, in which is contained the evidence that the NATO leaders are guilty of the gravest crime against mankind, the crime of aggression. I would like to share with you some brief notes of interest from that file, for your consideration.

Article 8bis of the Rome Statute, the governing statue of the International Criminal Court states:

For the purpose of this Statute, “crime of aggression” means the planning, preparation, initiation or execution, by a person in a position effectively to exercise control over or to direct the political or military action of a State, of an act of aggression which by its character, gravity and scale, constitutes a manifest violation of the Charter on the United Nations.

So I have reopened the file I am preparing for the prosecutor of a future peoples’ tribunal or, a miracle, a really independent prosecutor at the International Criminal Court, to lay war crimes charges against the United States and its NATO and other allies, their leaders and military officers, for the crime of aggression and all the other crimes they commit on a daily basis against many different countries.

The new charges concern their involvement in the political coup carried out in Brazil against the socialist government there, elected by the people, essentially robbing the Brazilian people of their democracy and independence as a nation, their continued and dangerous provocations in Asia against China and North Korea, which they are directly threatening with nuclear annihilation by flying B1 and B2 bombers over the peninsula, ongoing provocations of NATO forces in the Baltic and the Balkans, all threatening Russia, and committing crimes against the peoples of the Donbas republics and now Crimea, that is, Russia itself. But the most dangerous of all is their invasion of Syria to protect and assist their ISIL or Daesh proxy forces. The presence of U.S., British, French, Canadian, Israeli and other forces in Syria is of course illegal and constitutes the crime of aggression. There are no excuses or justifications for the crime of aggression. Their aggression also constitutes a complete repudiation of the U.N. Charter, which requires all disputes to be settled peacefully, and forbids the use of force for any reason outside the parameters of the U.N. mandate.

I was going to save this for Saturday, but it’s so important that I thought I’d stick it in today’s column, as Saturday is a long way away.  This must read commentary by Canadian lawyer Christopher Black was posted on the Internet site yesterday — and I thank ‘aurora’ for passing it around on Monday evening.  Another link to it is here.

Iraqis Use 9/11 Bill to Demand Compensation from U.S. for 2003 Invasion

In light of a bill passed by the U.S. Congress allowing families of 9/11 victims to sue Saudi Arabia, Iraqis have asked their parliament to demand compensation for the US invasion of Iraq.

After the U.S. Congress passed the Justice Against Sponsors of Terrorism Act (JASTA), which overrides the principle of sovereign immunity to allow families of 9/11 victims to sue Saudi Arabia, an Iraqi group has requested parliament to prepare a lawsuit seeking compensation from the U.S. for the invasion of Iraq.

The “Arab Project in Iraq” lobby group “sees their opportunity to ask for compensation from the United States over violations by the U.S. forces following the U.S. invasion that saw the toppling of late President Saddam Hussein in 2003,” the Al-Arabiya news channel reported on Saturday.

This Sputnik News item was picked up by the Internet site at 1:47 p.m. Moscow time on their Sunday afternoon, which was 5:47 a.m. in Washington — EDT plus 8 hours.  Another link to this story is here — and I thank I thank John Bastian for sending it along.

Meanwhile, Saudi Stocks Crash Near 7 Year Lows

Despite the Deutsche-driven bounce in Western markets on Friday, the ‘panic in The Kingdom’ that we highlighted earlier in the week is accelerating fast. Following demands from officials for banks to reschedule loans to clients affected by last week’s decision to cut salaries and bonuses for state employees, Middle-East bank stocks are collapsing and Saudi’s Tadawul Index is back near its 2009 lows

The weakness – despite crude strength – was driven by Saudi Arabia’s central bank decision to direct local lenders to reschedule the consumer loans of clients affected by last week’s decision to scrap the bonuses and allowances of many state employees. As Bloomberg reports:

The Saudi Arabian Monetary Agency, as the central bank is known, said in a statement on its website on Sunday that the step was part of efforts to “reduce pressure on borrowers” whose income was cut by the government’s Sept. 26 package of measures to further trim spending.

The agency said local banks must obtain the client’s approval before rescheduling a loan. Borrowers should present proof that their income has been affected by the recent cuts to the nearest bank branch, the regulator said. Loans taken after the cabinet decision to end the payments won’t be rescheduled.

This interesting 5-chart Zero Hedge take on a Bloomberg news item appeared on their Internet site at 9:45 p.m. on Sunday evening EDT — and it’s the third and final offering of the day from Richard Saler, for which I thank him.  Another link to this ZH piece is here.

India tax evasion amnesty uncovers hidden billions

A tax evasion amnesty in India has prompted tens of thousands of people to declare more than $9.5bn (£7.3bn) in undeclared income and assets.

Finance minister Arun Jaitley said the four-month window that ended on Friday brought in 64,275 declarations.

All were offered immunity from prosecution in return for paying tax, a surcharge and a penalty.

It is estimated that the government could raise nearly $4.5bn (£3.4bn) from the scheme.

Undeclared income or “black money” is a huge issue in India.

Even I was amazed when I read this story.  It appeared on the Internet site on Saturday sometime — and I thank Patrik Edkahl for his second contribution to today’s column.  Another link to it is here.

China seeking to succeed where Japan failed in yuan’s global push

As China’s yuan takes the first steps toward becoming a global reserve currency, Japan offers a lesson on how hard it is to rival the dollar’s supremacy.

The Japanese yen’s share of global reserves reached a record 8.5 percent in 1991 as the nation’s post-War industrial boom made its economy the world’s second-largest. But its economic decline soon resulted in its clout shrinking as the euro gained ground and the greenback re-asserted its dominance. While the yen is still ranked third for trading and fourth for payments, it now accounts for just 4 percent of world reserves, compared with the dollar’s 64 percent and the yuan’s 1 percent.

The yen’s failure to dent the U.S. currency’s primacy illustrates the precarious mix of policy, political will, and prosperity needed for the yuan to come even close to dislodging the dollar. Like China, Japan struggled with the degree of openness needed to promote global use of its currency. By the time its markets became more accessible to foreigners, the bursting of its asset bubbles and consequent “lost decade” — coinciding with China’s dizzying rise — relegated the yen to its also-ran status as a reserve currency.

The main lesson is that it is impossible to have a major reserve currency like the dollar or euro unless you are willing to sustain a high degree of financial market openness over a very long period of time,” said Arthur Kroeber, the Beijing-based founding partner and managing director at Gavekal Dragonomics, a research firm.

This Bloomberg news item was posted on their website early Friday morning Denver time — and it’s another article that I found embedded in a GATA release.  Another link to it is here.

Goldcorp slumps most among major gold miners on Mexico shutdown

Goldcorp Inc. fell the most among large gold producers after the Vancouver-based company said it was halting work at one of its biggest mines amid a labor protest.

Four days after saying a blockade at the Penasquito mine in Mexico wasn’t affecting operations, the company announced a “controlled shutdown.” The shares lost as much as 5.4 percent and were down 4.6 percent at 3:31 p.m. in Toronto, making it the worst performer on the BI Global Senior Gold Valuation Peer Group.

The protest by a trucking contractor follows transport-policy changes and cost-saving efforts by the company. Goldcorp has taken legal steps, including filing criminal charges against protest leaders who are refusing to meet, the company said. The decision to suspend operations was made after the blockade prevented the company from bringing in food, water, and fuel to the 750 people on site.

This news item showed up on the Bloomberg website at 1:39 p.m. MDT on Monday afternoon — and it’s another story, along with the one that follows, that showed up in a GATA release yesterday evening.  Another link to it is here.

India’s gold imports drop for ninth month

India’s gold imports fell for a ninth straight month in September as weak retail demand and higher discounts prompted banks and refineries to cut overseas purchases of the bullion, provisional data from consultancy GFMS showed today.

Lower demand from the world’s No. 2 gold consumer could weigh on global spot prices that have risen by 24 percent so far in 2016, but help the south Asian country to reduce its trade deficit. Gold is one of India’s biggest expenses on its import bill.

Gold imports in September are estimated at 30 tonnes, down 43 percent from a year ago, GFMS data showed. Imports in the first nine months of 2016 slumped 59 percent from a year ago to 268.9 tonnes, according to GFMS.

Gold is trading at a heavy discount also due to rising supplies from unofficial channels. Smuggling of the precious metal has risen in India since the government imposed a 10 percent import duty in 2013.

This gold-related news item appeared on the Reuters Internet site at 3:53 p.m. IST on their Monday afternoon — and it’s another story I found on the Internet site.  Another link to it is here.


I received a couple of photos from reader Ken Hahm on the weekend.  They were taken with his Motorola smart phone if you can believe it.  I have his praying mantis photo today — and his toad photos will have to wait until tomorrow.  The pics have a surprisingly large file size, a bit over 2.0 megabits, however it really falls down in the resolution and bit depth department.  But, having said that, it makes up for it with stunning depth of field, which most fixed focal length cameras have to have, especially the smart phone/iPhone types.  I tried to crop this tighter, but the limits on the photo became apparent almost immediately.  But it’s a great photo just the way it is — and the ‘click to enlarge’ feature doesn’t help one bit.161004-2016-10-03-1



If you tell a lie big enough and keep repeating it, people will eventually come to believe it. The lie can be maintained only for such time as the State can shield the people from the political, economic and/or military consequences of the lie. It thus becomes vitally important for the State to use all of its powers to repress dissent, for the truth is the mortal enemy of the lie, and thus by extension, the truth is the greatest enemy of the State.” — Joseph Goebbels

JPMorgan et al took fairly decent slices out of all four of the precious metal salamis yesterday, particularly silver and platinum.  It’s impossible to tell whether this will, or can continue to the downside, because even though the positioning in the COMEX futures market in all four has been beyond preposterous for most of the year so far, ‘da boyz’ haven’t engineered a price decline of any consequence to date.

Here are the 6-month charts for all four precious metals, so you can see yesterday’s price action clearly.161004-6-month-gold


As far as gold and silver are concerned, we seem to be in some sort of holding pattern, but if there is a reason, it remains hidden to me.  I’m presuming, as Ted is, that JPMorgan et al are still in control of precious metal prices, but if that’s the case, their activities since the Brexit vote remain an unsolved mystery up to this point.

All we can do is await developments.

And as I type this paragraph, the London open is less than ten minutes away — and I see that gold traded higher by a buck or so until 8 a.m. China Standard time on their Tuesday morning.  A new low tick was set for this move down at 11 a.m. CST over there.  It rallied from that low until around 1:30 p.m. in Shanghai — and has rolled over since.  Gold is down $2.40 the ounce currently.  Silver have been chopping around either side of unchanged throughout the Far East trading session — and is down 3 cents at the moment.  Platinum is down 3 bucks at the moment.  Palladium was down 5 buck at one point, but rallied back to unchanged shortly before the Zurich open, but got hit hard at that juncture — and is now down 4 dollars.

Net HFT gold volume is just over 26,000 contracts, which is nothing out of the ordinary — and that number in silver is just under 7,800 contracts — and there’s nothing to see there, either.  The dollar index began to rally almost the moment that trading began at 6:00 p.m. in New York yesterday evening. It made it as high as 95.95 by around 10 a.m. CST, fell back a bit, but began to rally anew shortly after 1 p.m. in Shanghai.  At the moment its back above the 96.00 mark at 96.03 — and up 29 basis points as London opens.

I’ve been watching the situation in Syria with dread over the last week or so — and the stories in my Saturday missive, coupled with that article by Canadian lawyer Christopher Black in today’s Critical Reads, shows you just how close we are to an all out proxy war, or worse.

And yet none of this is allowed to show up in the prices of precious metals.  There is an attempt on most days during the Far East trading session, but those quiet rallies are mercilessly dealt with before the real paper games begin anew in London and New York.

As to when a black swan may show up, it appears that whatever it is, it will have to be a big one before the powers-that-be will allow to influence gold and silver prices.

And as I post today’s effort on the website at 4:00 a.m. EDT, I see that the gold price was taken down another few bucks to another new low — and is down $3.60 at the moment.  Silver was down 7 cents at one point, but is only down 3 now.  And now that Zurich has been open an hour as well, platinum is currently down 4 dollars — and palladium is still down 3.

Net HFT volume has blown out to just over 40,000 contracts — and that number in silver is now up to just over 10,000 contracts.  The dollar index continues to rally strongly — and is up 42 basis points and just off its current high tick.

Today, at the close of COMEX trading, is the cut-off for Friday’s Commitment of Traders Report — and I’m hoping for further improvement once the Tuesday session is done, but it’s a tough market to call when ‘da boyz’ are ever present — and you don’t what their real agenda is.

But with the dollar index currently up a decent amount, I’m somewhat surprised that ‘da boyz’ haven’t hit the precious metals harder than they have currently.  That certainly may change as the Tuesday trading session continues, especially when the New York bullion banks swing into action at the COMEX open.

That’s all I have for today — and I’ll see you here tomorrow.


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