Another Day…and More Salami Slicing Courtesy of JP Morgan et al

03 May 2017 — Wednesday

YESTERDAY in GOLD, SILVER, PLATINUM and PALLADIUM


NOTE:  My webmaster did a minor upgrade to WordPress on the weekend, which is the platform that I use to generate my daily column.  In the process — and for no reason that made any sense to us, or to the folks at WordPress — a number of subscribers could no longer log in and read my column by clicking on the link to my home page in the e-mail version.

Until we have a permanent fix, the way around this is to go to my home page and log in with your user name and password.  This ‘fix’ worked for every one of these accounts my webmaster checked.  Enter your user name and password manually — and try it that way before you hit the ‘Contact Me’ tab.

Sorry about the inconvenience.  Computer systems are great, until issues like this arise.

Ed


It was ultra quiet in Far East and early London trading on their Tuesday’s.  That lasted until 1 p.m. BST in London, which was twenty minutes before the COMEX open.  At that point the price was tapped lower — and the low tick of the day, such as it was, came at 9:15 a.m. in New York.  It rallied quietly from there until around 3:10 p.m. in the very thinly-traded after-hours market — and then moved sideways into the 5:00 p.m. close.

I shall dispense with the low and high ticks again today.

Gold finished the Tuesday session in New York at $1,256.90 spot, up 80 cents.  Tuesday’s low tick was a new intraday low for this move down, but wasn’t enough to even touch gold’s 50-day moving average.  Net volume was very decent at a hair under 160,000 contracts.

The silver price wandered quietly higher in Far East trading on their Tuesday — and was up 13 cents at its high, which came shortly before 10 a.m. BST in London.  An hour later the price was headed lower — and its down/up spike low tick came a minute or so after 10:30 a.m. in New York.  Not a lot happened after that.

The high and lows were reported by the CME Group as $17.015 and $16.80 in the July contract.

Silver closed in New York on Tuesday afternoon at $16.815 spot, down 1.5 cents from Monday.  JP Morgan et al set a new intraday low and closing low price for this move down in the process.  Net volume was pretty heavy once again at just over 53,000 contracts.

The two spikes lower in price only occurred in the spot month.  Here’s the New York Spot [Bid] chart so you can see the price ‘action’ in New York yesterday.

The platinum price traded a small handful of dollars above unchanged for all of Far East and morning trading in Zurich.  Then, like gold, ‘da boyz’ showed up twenty minutes before the COMEX open, which was 2 p.m. in Zurich, and its low tick was set near the close of COMEX trading.  It rallied a few bucks after that, before trading sideways for the rest of the Tuesday session.  Platinum finished the New York session at $924 spot, down 5 dollars on the day.

Palladium traded flat to lower during the Far East trading session, but began to chop unsteadily higher starting about an hour and change after Zurich opened.  It tried to rally a few times, albeit very weakly, in New York trading, but that activity wasn’t allowed to develop into anything.  Palladium finished the day at $817 spot, up 2 bucks from Monday’s close.The dollar index closed very late on Monday afternoon in New York at 99.15 — and began to head lower as soon as trading began at 6:00 p.m. in New York on Monday evening.  It was saved from falling below the 99.00 mark twice in Far East trading…once just before noon — and the other around 2 p.m. CST — and again on a number of occasion in morning trading in London.  Then starting around noon BST, it began to chop higher, with the 99.22 high tick coming around 10:20 a.m. in New York.  It chopped unsteadily lower from there until it 99.92 low tick was set around 5 p.m. EDT.  It gained a couple of basis points from their — and finished the Tuesday session at 98.95 — down 20 basis points from Monday’s close.

And here’s the 6-month U.S. dollar index chart…

The gold shares opened down a hair, but were back in positive territory to stay very shortly after that.  Their respective high ticks came a minute or so before 11 a.m. EDT — and then they chopped quietly lower from there.  It was obvious that there were some day trading shenanigans going on at the close — and there’s been a fair bit of that recently.  The HUI closed up 0.53 percent.

The silver equities followed an identical price path as the gold stocks, except they started trading from deeper in negative territory — and they didn’t rally enough to close in positive territory as the Tuesday trading session moved along.  After the jumping around in the last twenty minutes of trading, Nick Laird’s Intraday Silver Sentiment Index closed down 0.38 percent.  Click to enlarge if necessary.

The CME Daily Delivery Report showed that 131 gold and 313 silver contracts were posted for delivery within the COMEX-approved depositories on Thursday.  In gold, the big short/issuer was Canada’s Scotiabank with 126 contracts out of its in-house [proprietary] trading account.  It doesn’t have a client account.  There were eight long/stoppers — and JPMorgan stopped 17 for its client account.  In silver, the only two short/issuers of note were ABN Amro and International F.C. Stone with 195 and 48 contracts out of their respective client accounts.  The biggest long/stopper was International F.C. Stone with 137 for its client account — and in distant second place was HSBC USA with 80 contracts for its client account as well.  ADM was in third spot with 33.  JP Morgan stopped 10 for its client account.  The link to yesterday’s Issuers and Stoppers Report is here.

The CME Preliminary Report for the Tuesday trading session showed that gold open interest in May declined by 86 contracts, leaving 332 left, minus the 131 mentioned above. Monday’s Daily Delivery Report showed that only 8 gold contracts were posted for delivery today, so that means that 86-8=78 gold contracts disappeared from May without either making or taking delivery.  Silver o.i. in May dropped by 361 contracts, leaving 1,103 still around, minus the 313 mentioned in the previous paragraph.  Monday’s Daily Delivery Report showed that 535 silver contracts were actually posted for delivery today, so that means that another 535-361=174 silver contracts just got added to the May delivery month.

Along with the 168 contracts added to May on Monday, this addition of 174 contracts yesterday, is really starting to add up to serious amounts of silver.  If Ted doesn’t have something to say about this in his mid-week review today, he’ll certainly mention it in his Saturday missive.

There was no reported change in GLD yesterday, but there was another deposit in SLV — and this one was a biggie, as an authorized participant added a chunky 3,502,050 troy ounces.  Without doubt that was deposited to cover an existing short position.

In the last six business days there has been 9.6 million troy ounces of silver added to SLV.  The next SLV short position report will be out in a week — and all the silver added during the last week of April will be in that report.  But the 4.6 million troy ounces that was added on Monday and Tuesday, won’t…because it’s past the cut-off date.

The folks over at Switzerland’s Zürcher Kantonalbank updated their website with the goings-on inside their gold and silver ETFs as of the close of business on Friday, April 28 — and this is what they had to report.  Their gold ETF added 5,948 troy ounces — and their silver ETF rose by 25,495 troy ounces.

It was pretty quiet in gold over at the COMEX-approved gold depositories on the U.S. east coast on Monday.  They only reported receiving 3,665.214 troy ounces/114 kilobars [SGE kilobar weight] — and all of that went into Brink’s, Inc.  Nothing was shipped out.

It was busier in silver, as 601,565 troy ounces were received, but only 54,890 troy ounces were shipped out.  Except for the one good delivery bar that ended up in Delaware, the rest of the ‘in’ activity was at CNT.  Of the ‘out’ activity, there was 24,852 troy ounces shipped out of Delaware — and the rest…30,038 troy ounces…came from Canada’s Scotiabank.  There was also a transfer of 584,701 troy ounces out of Eligible and into the Registered category over at CNT.  The link to all of the above silver action is here.

It was all zeroes over at the COMEX-approved gold kilobar depositories in Hong Kong on their Monday, as they were closed for Labour Day.

Here are two charts that Nick Laird passed around very late on Tuesday afternoon Denver time — and they show gold and silver bullion coin sales from the U.S. Mint…updated with April’s data.  The gold coin chart includes both gold eagles and gold buffaloes.  Nick’s included comment read…”April was a quiet month for sales.”  That’s an understatement!  They were a disaster.  Sales in both were the lowest in five years — and you can’t count the months that were lower, because they occurred in December, which are cut-off months for the mint as they go into production for the new year.  Click to enlarge for both charts.

I don’t have all that many stories, but there is a longish Chris Martenson interview in here that’s very much worth your while.


CRITICAL READS

Auto Bloodbath: Every OEM Misses April Sales Estimates as Inventories Continue to Soar

After an abysmal March print and growing speculation on wall street that auto sales are looking less like a “plateau” (Ford’s label not ours) and more like a debt-fueled bubble on the verge of an epic collapse, auto investors were looking toward April auto sales for signs of hope.  Unfortunately, the “hope” trade failed to materialize as every single, major auto OEM missed their April sales estimates in fairly spectacular fashion.

inventory days are still trending higher as OEMs continue to push product on to dealer lots even though sale through to end customers has seemingly stalled.

GM, one of the few OEMs to actually disclose dealer inventories in monthly sales releases, reported that April inventories increased to 100 days (935,758 vehicles) from 98 days at the end of March and just 71 days (681,402 vehicles) in April 2016.  But please don’t worry because GM would like for you to know that their soaring inventories are normal and “reflect strong sales“…no really, here’s the quote from their press release:

As planned, GM’s inventories reflect strong sales, lower car production and strategic, launch-related growth in truck and crossover stocks.

Meanwhile, GM’s incentive spending also soared YoY to 11.7{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} of their average transaction price (ATP) versus 10.3{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} last year. And Ford also announced on their sales call that average incentive spending was up about $300 YoY.

And, as one industry observer notes, the combination of rising inventory levels, higher incentive spending and pending model changeovers in coming months could imply that the auto industry could unravel in fairly short order.

This news item appeared on the Zero Hedge website at 6:11 p.m. EDT on Tuesday evening — and I thank Richard Saler for pointing it out.  Another link to it is here.  There was a Bloomberg story about this headlined “Big Summer Shutdowns Loom for U.S. Auto Plants as Sales Sputter“…which I found on Doug Noland’s website.


Are American Debt Slaves Getting in Trouble Again?

American consumers are holding $1 trillion in revolving credit, mostly in credit card debt. So how well is this segment of consumer debt holding up?

Synchrony Financial – GE’s spin-off that issues credit cards for Walmart and Amazon – disclosed on Friday that, despite assurances to the contrary just three months ago, net charge-off would rise to at least 5{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} this year. Its shares plunged 16{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} and are down 27{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} year-to-date.

Credit-card specialist Capital One disclosed in its Q1 earnings report last week that provisions for credit losses rose to $2 billion, with net charge-offs jumping 28{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} year-over-year to $1.5 billion.

Synchrony, Capital One, and Discover – a gauge of how well over-indebted consumers are managing to hang on – have together increased their Q1 provisions for bad loans by 36{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} year-over-year. So this is happening.

This article was posted on the wolfstreet.com Internet site on Monday sometime — and I pulled it from a Zero Hedge article yesterday.  Another link to it is here.


Puerto Rico sued by spate of creditors, in latest blow to teetering island

Puerto Rico and its federal financial oversight board faced a handful of lawsuits from stakeholders on Tuesday, which could ultimately push the ailing U.S. territory into bankruptcy, and more are expected in the coming days.

The lawsuits, filed just hours after the expiration of a freeze on creditor litigation, include complaints from holders of Puerto Rican sales-tax-backed debt, from general obligation bondholders and from bond insurer Ambac Assurance Corp.

Holders of the sales-tax-backed debt, known as COFINA bondholders, in their lawsuit allege that the island’s debt-cutting plans violate the U.S. Constitution.

The general obligation bondholders, whose debt is guaranteed by the island’s constitution, are demanding payment on $242.5 million of debt defaulted upon since July, and damages and interest of more than $102 million.

This Reuters article, filed from New York, showed up on their Internet site at 6:04 p.m. EDT on Tuesday evening — and I lifted this from a Zero Hedge piece as well.  Another link to it is here.


Brad Birkenfeld: Lucifer’s Banker…a whistle-blower’s account of exposing massive fraud at UBS

Just how bad is the ongoing fraud in the banking system? Get ready for a mind-bowing exposé by a former insider at UBS.

Brad Birkenfield, author of Lucifer’s Banker: The Untold Story of How I Destroyed Swiss Bank Secrecy, recounts the efforts he uncovered by his employer to help its clients cheat the U.S. government out of tens of billions in taxes.

But despite his working with the government closely to expose the gigantic conspiracy between U.S.-based tax cheats and the giant Swiss bank, UBS, the so-called Justice Department went after Mr. Birkenfeld for abetting tax evasion by one of his clients. After spending thirty months in Federal prison, he was released and three weeks later, received a whistle-blower check for $104 million, the largest such check ever from the IRS Whistle-blower Office.

This 45-minute audio interview with host Chris Martenson is depressing to listen to.  The corruption at the top levels of banking, finance and government is frightening.  It was was conducted by Chris Martenson over at the peakprosperity.com Internet site at the end of March — and was posted on that website on April 15.  If you haven’t the time for it today, it will appear in my Saturday column as well.  It’s an absolute must listen for sure — and I thank Scott Otey for sending it our way.  Another link to this interview is here.


Italian Government Approves Alitalia Bankruptcy, Bonds Collapse

Earlier we reported that Italy’s national carrier, Alitalia, did what many expected it to do after last week’s rescue plan, which would have cut 1,700 jobs and slashed pay, failed and filed for bankruptcy. What was less expected is that just hours after filing, the Italian government approved the bankruptcy process following a short cabinet meeting, an outcome that will lead to either Alitalia’s sale or liquidation, raising the possibility that Alitalia it will follow in the path of KLM and Iberia in ending a storied history as one of Europe’s major standalone airlines.

Why the speedy decision to grant administration proceedings caught many investors, and certainly bondholders by surprise, is that as we noted earlier, the carrier is losing about €1 million ($1.1 million) a day and without government support risks running out of cash by the middle of May. The government has already thrown it a short-term lifeline, a bridging loan of up to 600 million euros to see it through the bankruptcy process. Absent a sale – which looks highly unlikely – or a nationalization, up to 12,000 workers are likely to lose their jobs, potentially resulting in another major shock to the Italian economy.

This is precisely the scenario that the Italian Economic Development minister warned about last Sunday:  “A [sudden closure] would be a shock for GDP much greater than the scenario that we are looking at: a brief period of six months covered by a bridging loan from the government so as to find a buyer who could provide services that Italians need as travelers,” he said in an interview with Sky TG24 television.

On the other hand, outraged at repeated bailouts that have cost taxpayers more than 7 billion euros over a decade, many Italians are urging the government to resist the political temptation to rush to its rescue again. They got their wish, if only for now.

This Zero Hedge story showed up on their Internet site at 1:43 p.m. on Tuesday afternoon EDT — and another link to it is here.


U.S. Senate Quietly Drops Russian Sanctions Bill, Focuses on Iran Crackdown

Much to the likely chagrin of the mainstream media, and Democratic Party blame narratives everywhere, Politico reports that the leaders of the Senate Foreign Relations Committee have reached a decision that’s sure to disappoint Russia hawks: They’re not taking up a Russia sanctions bill anytime soon.

Instead, Committee Chairman Bob Corker of Tennessee and ranking Democrat Ben Cardin of Maryland have agreed to move forward on a measure to counter Russian influence in Eastern Europe without using sanctions as well as an Iran sanctions bill.

The measure to counter Russian influence is expected to draw from a bill put forward by Cardin in January but will strip the measure of its sanctions. The Iran sanctions bill was introduced in March by Corker and has bipartisan support. It’s in retaliation for Iran’s ballistic missile development, support for U.S.-designated terrorist groups and human rights violations. Cardin’s sanctions bill is co-sponsored by 10 Republican defense hawks, including Sens. John McCain of Arizona, Lindsey Graham of South Carolina and Marco Rubio of Florida. Cardin spokesman Sean Bartlett confirmed the agreement in an email.

This Zero Hedge article put in an appearance on their Internet site at 8:21 a.m. on Tuesday morning EDT — and another link to it is here.


Vladimir Putin blasts western hypocrisy while standing next to Angela Merkel

President Putin lambasted European leaders for their total lack of concern for the victims of the Odessa Massacre which took place three years ago today.

Standing next to Germany Chancellor Merkel, The Russian President reminded Merkel that,

Ukrainian nationalists forced helpless people into the Trade Unions House and burned them alive.

    The international community should never forget about this incident and never allow anything like it to happen in the future.

Angela Merkel’s government helped draft the infamous 21 February agreement in 2014 which immediately led to an illegal coup against President Viktor Yanukovych. Her credibility on the wider Ukrainian problem is therefore deeply tarnished.

This worthwhile news story was posted on theduran.com Internet site around 10 a.m. EDT yesterday morning — and it’s definitely worth reading, especially if you’re a serious student of the New Great Game.  Another link to it is here.


Sergey Lavrov and Rex Tillerson to meet next week.  Is reconciliation back on the table?

A day prior to the resumption of the Astana Peace Talks on Syria, Russian Foreign Minister Sergey Lavrov and US Secretary of State Rex Tillerson have held a phone call to discuss each side’s position on Syria and other pressing matters. America has no official role in Astana, but will be keenly interested in the results of this round of discussions.

The Russian Foreign Ministry released a summary of the conversation’s subject matter as well as confirming a meeting between the two diplomats next week,

Certain issues of bilateral relations were discussed. The schedule of the upcoming Russian-American contacts [was discussed as well], in particular, the meeting on the sidelines of the ministerial Arctic Council talks in Fairbanks (US) was confirmed to be held on May 10-11. The heads of foreign services also exchanged opinions on the Astana international talks on Syria which is to be held on May 3-4”.

Rex Tillson had previously visited Moscow for the first time as Secretary of State in April. The meeting came shortly after President Putin said that after America’s illegal bombing of Syria on the 6th of April, Russia-U.S. relations had “eroded”.

During his press conference with Sergey Lavrov, Rex Tillerson maintained his professionalism, but ultimately he was widely seen as losing the factual and logical arguments with Lavrov.

This is another story from theduran.com Internet site — and it comes courtesy of Roy Stephens.  This one appeared there on Monday sometime — and another link to it is here.


China demands “immediate” halt to THAAD deployment in South Korea

Beijing has called for an immediate stop to the deployment of the U.S. Terminal High Altitude Area Defense (THAAD) anti-missile system to South Korea and is ready to protect its interests, according to the Chinese Foreign Ministry.

Foreign Ministry spokesperson Geng Shuang voiced the government’s position against the move during a briefing on Tuesday.

We oppose the deployment of the U.S. missile system to South Korea and call on all parties to immediately stop this process. We are ready to take necessary measures to protect our interests,” he said, adding that “China’s position on the THAAD issue has not changed.”

The spokesperson didn’t specify what protective measures China had in mind. However, responding to the THAAD installation, China announced on Thursday that it will stage live-fire exercises and test new weapons to protect its security.

This news item showed up on the rt.com Internet site at 11:58 a.m. Moscow time on their Tuesday morning — and was updated about ninety minutes later, which was around 1:30 p.m. Moscow time…6:30 a.m. in Washington — EDT plus 7 hours.  I thank ‘aurora’ for passing it around — and another link to it is here.


March Swiss gold exports show India number one again — Lawrie Williams

The latest export figures for gold for the month of March from the Swiss Customs Administration show that India, once again, was easily the top recipient, taking 55.6 tonnes – more than gold flows from Switzerland to Hong Kong and China combined.  Hong Kong imported 24.3 tonnes and the Chinese Mainland 24.0 tonnes directly.  These latter figures confirm our now oft-stated observation that Hong Kong gold flows can no longer be considered a proxy for total Chinese imports with perhaps 40-50{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} now flowing directly into the Chinese Mainland by avoiding Hong Kong altogether.

See the excellent chart below from www.goldchartsrus.com which sets out the principal recipients of the Swiss gold exports on a country-by-country basis.  Note also that India, Hong Kong and China alone accounted for around 74{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} of Switzerland’s total gold exports, while Asia and the Middle East accounted for just under 88{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e}, emphasising the continuing flows of gold from West to East.

As for India itself, this is very much a continuation of the pattern seen earlier in the year suggesting that gold demand in the country, which used to be the world’s No. 1 consumer, is picking up significantly from the very low levels of a year ago when they were affected by a prolonged jewellers strike and the withdrawal of 100 and 50 rupee notes (India is very much a country which runs on cash).  March is the third month in a row where India has topped the list of recipients of Swiss gold exports and has taken in 119 tonnes of Swiss gold in the first quarter of the year.

This worthwhile commentary by Lawrie put in an appearance on the Sharps Pixley website on Tuesday sometime — and another link to it is here.


A sovereign tale of gold’s historic undervaluation — Mike Kosares

British officials are trying to trace the owner of a trove of gold coins worth a ‘life-changing’ amount of money found stashed inside a piano. A coroner investigating the find on Thursday urged anyone with information to come forward. . . Anyone wanting to make a claim has until April 20, when coroner John Ellery will conclude his inquest.” – Associated Press, London, U.K.

The above notice was originally posted in the public interest at USAGOLD’s online daily newsletter. Unfortunately, as you have just read, the coroner’s due date is passed. Thus, if you happen to be the frugal individual who stashed that life-changing amount of money in the piano (a total of 913 old British sovereigns in hand-stitched pouches) and neglected to make your claim, you are now officially out of luck.

When I first read about the gold hidden in the piano, put away no doubt for a rainy day, I was reminded of the settlement between King Ibn Saud of Saudi Arabia and a consortium of oil companies on rights to that country’s vast oil riches in the early 1930s. That too involved a stash of British sovereigns – 35,000 of the roughly one-quarter ounce gold coins.

British sovereigns happen to be one of the most sought-after, accumulated and stored pre-1933 gold coins in the world, so it is no surprise that forgotten hoards of the coin turn up every once in a while, nor is it a surprise that Ibn Saud would have asked to be paid in these highly liquid, universally acceptable gold coins.  We sell many thousands of this item annually.  Some go into safe deposit boxes.  Some get buried out on the property.  Some get stashed in the piano.  Most are kept in the event of a social, political or financial breakdown, or some other unexpected calamity, against all of which the gold British sovereign has been a direct hedge for centuries.

This longish, but very interesting gold-related commentary is definitely worth reading if you have the time and/or the interest.  It was posted on the usagold.com Internet site on Monday, but had to wait for today’s column, as Tuesday’s column was already bursting at the seams.  Another link to it is here.


Silver miners must know their market is rigged but are too afraid to protest — Bill Rice Jr.

As silver is again being pushed down hard and good for no market-related reason, I can’t help but wonder what the mining company executives are thinking. One thing we know. They won’t protest. Two reasons are typically given for this “grin and bear it’ attitude:

1) The bullion banks doing the rigging also provide the miners’ much-needed financing. The miners can’t get on the wrong side of these guys.

2) Governments supporting the rigging also can harm mining companies in any number of ways, such as permitting, environmental regulations, OSHA-type violations, audits, etc.

I’ve come to believe that the miners know that their markets are rigged but they are simply afraid to protest this. They fear retaliation.  The governments and the bullion banks are bullies who threaten the existence of anyone who might challenge their goals or call them out.

Also, as top managers of mining companies are paid very well, they have even less of an incentive to take a chance and fight back. These people live very comfortably even as the price of their product is kept lower than it would be in a free market.  [Emphasis mine. – Ed]

That last paragraph sums it up nicely.  To top it off, the executives of the really big mining companies are already so rich that they don’t care — and to hell with their stockholders.  All the silver miners know this price management scheme is going on, but won’t do a thing about it, with First Majestic Silver being the notable exception.  The rest are complicit by their very silence.  This commentary by Bill appeared on the gata.org Internet site yesterday — and another link to it is here.


Banks say gold price-fixing data errors entitle them to do-over

Barclays and three other banks told a New York federal court Monday that they didn’t waste its time when requesting a second shot at tossing a case over their alleged conspiracy to manipulate the price of gold, saying investors’ use of flawed data in the suit justifies a do-over.

Barclays Bank PLC, HSBC Bank PLC, Societe Generale, and the Bank of Nova Scotia again asked the court for permission to renew their dismissal bid, fighting against investors who say their suit still supports allegations of collusive trading even after admitting the complaint included flawed data analyses.

Plaintiffs’ suggestion that defendants ‘should accept th[e] result’ of the motion to dismiss and ‘move on’ despite newly discovered falsehoods that go to the heart of plaintiffs’ claims is not only wrong on the substance, it is also procedurally improper,” the banks said.

Investors originally filed their putative class action in March 2014, alleging the banks conspired to manipulate the London gold fix, a benchmark used to determine the price of gold and gold derivatives. A New York federal judge upheld claims against the banks in October, finding there was circumstantial evidence that they agreed to restrain trade.

I’ll be very surprised if this lawsuit doesn’t end up with the rest at some point — and that’s in the dumpster.  Ground Zero of the price management scheme, as Ted Butler has so correctly pointed out, lies within the COMEX futures market, the CME Group that administers it — and JP Morgan.  This story from Law 360 showed up in its entirety in a GATA dispatch yesterday — and there is no link to the actual hard copy.  But another link to the dispatch is here.


The PHOTOS and the FUNNIES

Here’s a bird that I’ve not heard of before — and after reading about it, I’m not surprised, as it’s on the Critically Endangered Species list.  Fewer than 100 adults are assumed to currently exist in the wild — and has been close to extinction since 1994.  It’s the Bali myna, or Bali starling as it’s sometimes called.


The WRAP

How did the American people ever reach this point where they believe that U.S. aggression in the Middle East will make us safe when it does the opposite? How did the American people ever reach the point where they believe that fighting unconstitutional wars is required to protect our freedoms and our Constitution? Why do we allow the NSA, CIA, FBI, TSA, etc. to destroy our liberty at home, as part of the Global War on Terror, with a pretext that they are preserving our liberty?

Why are the lying politicians reelected and allowed to bankrupt our country, destroy our money, and enter wars without the proper consent? Why do the American people suffer in silence and not scream “Enough is enough!”? We’ve had enough of the “humanitarian do-gooders” and the proponents of “American exceptionalism” who give us nothing but war, economic suffering, and less freedom. This can and must be stopped.” – Ron PaulSwords into Plowshares: A Life in Wartime and a Future of Peace and Prosperity


It was another day of salami slicing in all four precious metals.  ‘Da boyz’ set new low closes and/or new intraday closes in all of them yesterday, although they weren’t overly large slices.

Ted is still very concerned about the situation in gold –and rightly so.  They appear to be “toying” with its moving averages at the moment, is what he said — and I agree.  Why they aren’t slamming the price lower at times like this is not obvious, but I’m sure they have their reasons.  Maybe they’re waiting for the Fed news this afternoon.

So we remain on tenterhooks until this situation is resolved one way or another.

Here are the 6-month charts for all four precious metals, plus copper, once again — and you can review yesterday’s handiwork by JP Morgan et al for yourself.  You’ll notice that silver is now very oversold — and Ted feels that the clean-out in silver is very far advanced…but how far advanced still remains to be seen.  The click to enlarge feature helps a bit with the first four charts.

And as I type this paragraph, the London open is less than ten minutes away — and I note that the gold price held steady a hair below unchanged until shortly after 12 o’clock noon in Shanghai on their Wednesday morning.  Then the price began to drift lower — and it’s down $2.30 an ounce at the moment.  Silver spent all of the Far East trading session a few pennies above unchanged — and it’s up 3 cents. Platinum was up 2 dollars until around 12:30 p.m. in Shanghai — and at that point it caught gold’s disease — and it’s down 2 dollars now.  Palladium was up a few bucks as well, but is now up only a dollar as Zurich opens.

Net HFT gold volume is very quiet at just over 16,000 contracts — and that number in silver is approaching 5,500 contracts.

The dollar index chopped quietly around unchanged until shortly before noon CST on their Wednesday morning — and now it’s in ‘rally’ mode — and up 11 basis points as London opens.  I would suspect that the current price action may be currency related, but with the volume as light as it is, one shouldn’t read too much into it.

Well, my secret wish was fulfilled yesterday, even though it was painful to watch — and that was that silver had a new low close.  All of yesterday’s volume data should easily make it into this Friday’s Commitment of Traders Report — and the companion monthly Bank Participation Report.  Both should be a sight to see when they show up on the CFTC’s website on Friday.

The biggest improvement will be in silver, of course — and Ted is hoping/expecting a bigger improvement in the Commercial net short position than we had last week.  I know he’ll have something to say about it in his mid-week commentary this afternoon — and I will include his thoughts in Friday’s column.

And as I post today’s column on the website at 4:02 a.m. EDT, I note that the gold price continues to edge lower — and is now down $3.70 the ounce as the first hour of London trading comes to a close.  The silver price really got leaned on shortly after London opened — and it’s down 6 cents currently.  Platinum is lower by 5 dollars, but palladium jumped higher — and at one point was up 5 bucks an ounce.  But that wasn’t allowed to last — and it’s now been driven back to unchanged.

Net HFT gold volume is approaching 22,500 contracts, which is still pretty light — and that number in silver is now up to 8,400 contracts.

The dollar index hasn’t done much during the first hour of London trading, but is off its high by a bit — and up only 7 basis points at the moment.  ‘Da boyz’ are obviously out and about despite what the currencies are doing.

Today, at 2 p.m. EDT, the smoke goes up the chimney at the Fed — and I certainly expect that we’ll see some ‘reaction’ in the precious metal markets, most of it courtesy of ‘da boyz’.  There’s been very little news about this on the Internet so far this week — and I’m sort of wondering why that is.  Maybe the poor sales report from Apple yesterday afternoon will make a difference.  We’ll certainly know more later today.

That’s all I have for my Wednesday column — and I’ll see you here tomorrow.

Ed