Finally…a Quiet Day. But Are JP Morgan et al Done Yet?

11 May 2017 — Thursday


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The gold price didn’t do much of anything during the Wednesday trading session anywhere on Planet Earth.  But a more accurate way of stating it would be that it wasn’t allowed to do much of anything.  Its high tick came at the noon silver fix in London — and it was mostly down hill until precisely 3:00 p.m. EDT in the thinly-traded after-hours market.  It rallied a small handful of dollars during the next thirty minutes — and traded sideways into the 5:00 p.m. New York close from there.

The high and low ticks definitely aren’t worth looking up.

Gold finished the Wednesday session at $1,218.80 spot, down $2.30 on the day, but that was not a new close, nor was a new intraday low price set, either.  Despite the lack of price action, net volume was pretty heavy at just under 165,000 contracts…along with very decent roll-over volume out of June.

Silver wasn’t allowed to do much, either.  But a bit of a rally developed shortly after the morning gold fix in London — and that was capped at, or just after, the noon silver fix.  From there it pretty much received the ‘gold treatment’ for the rest of the day.

The low and high ticks are barely worth looking up, but the CME Group recorded them as $16.145 and $16.345 in the July contract.

Silver was closed in New York yesterday at $16.17 post, up 1.5 cents on the day — and the first positive close in more than three weeks.  Like in gold, net volume was surprisingly high at 65,000 contracts.

The platinum price traded flat until noon in Zurich — and then it chopped unsteadily higher until noon in New York, six hours later.  It traded mostly flat for the rest of the day from that point onward.  Platinum closed at $910 spot, up 7 dollars from Tuesday’s close.

Palladium didn’t do a thing until the Zurich open.  At that point it was sold down to its low tick of the day, but began to rally quietly soon after, with the $804 spot high tick coming around 10:30 a.m. in New York.  From there it was sold back to unchanged on the day — and it closed there…at $796 spot.

The dollar index closed very late on Tuesday afternoon in New York at 99.54.  It fell down to the 99.40 mark by 9 a.m. in Shanghai on their Wednesday morning.  It traded pretty flat from there until shortly after 9 a.m. in London — and then began to rally quietly, but unevenly higher from there.  Its 99.72 high tick was set around 2:20 p.m. in New York — and it sagged a bit from that point into the close, finishing the Wednesday session at 99.63 — up 9 basis points from Tuesday’s close.

And here’s the 6-month U.S. dollar index which, as you know, I mostly post for entertainment purposes only.

The gold stocks gapped up two percent at the open — and continued to their respective high ticks, which came around 10:40 a.m. in New York trading.  They faded a bit from there during the next hour — and then chopped quietly sideways into the close.  The HUI closed higher by 1.95 percent.

Nick Laird’s Silver Sentiment/Silver 7 Index closed higher by 2.76 percent.  Here’s the 6-month chart.  Click to enlarge.

It’s obvious that the ‘smart money’ is buying big here — and I must admit that I can’t blame them, as it sure looks like the bottom to me.

The CME Daily Delivery Report showed that 10 gold and 55 silver contracts were posted for delivery within the COMEX-approved depositories on Friday.  In gold, there were no issuers and stoppers worth mentioning.  In silver, the two short/issuers were ABN Amro once again with 35 — and International F.C. Stone with 20 contracts.  ABN Amro was also the largest stopper with 28 contracts — and ADM picked up 22, both for their respective client accounts.  The link to yesterday’s Issuers and Stoppers Report is here.

The CME Preliminary Report for the Wednesday trading session showed that gold open interest in May dropped by 35 contracts, leaving 40 still around, minus the 10 contracts mentioned just above.  Tuesday’s Daily Delivery Report showed that 43 gold contracts were actually posted for delivery today, so that means that 43-35=8 more gold contracts were added to the May delivery month.  Silver o.i. in May fell by only 2 contracts, leaving 230 still open, minus the 55 mentioned in the previous paragraph.  Tuesday’s Daily Delivery Report showed that 39 silver contracts were actually posted for delivery today, so that means that 39-2=37 more silver contracts were added to May.

Silver contracts issued and stopped so far in May: 4,286….Number of additional silver contracts added to the May delivery month so far: 1,016….remaining silver open interest in May: 175  And at the rate silver contracts are being added to May, it will take the rest of the month to deliver the remaining open interest.  Never have I seen a delivery month in silver like this.

There were no reported changes in GLD again yesterday, but the big surprise was in SLV, as an authorized participant…most likely JP Morgan…deposited an eye-watering 3,832,847 troy ounces.  Without doubt, this silver was used to cover an existing short position yesterday.

This counterintuitive activity in GLD and SLV…like everything else silver-related these days…is a screaming red flag that nobody except Ted — and by extension, myself — are talking about at all.  Why is this so???

As Ted kindly pointed out on the phone yesterday afternoon, I posted the changes in the short positions in both GLD and SLV from data that was two weeks old, in my column on Wednesday — and I will make amends now, but using the correct information this time.

The short position in SLV declined from 15.13 million shares/troy ounces, down to 13.92 million shares/troy ounces, which is a drop of 8.0 percent.  The short position in GLD also declined…from 1,055,520 troy ounces, down to 917,716 troy ounces — a drop of 138,360 troy ounces, or 13.1 percent.  I’m much happier with these ‘new’ numbers, than the ones I posted in yesterday’s column.

Without doubt the short position in SLV is much smaller now, considering the fact that 8.3 million troy ounces of silver have been added to SLV since the April 28 cut-off of the above short report from the the folks over at

There was a very decent sales report from the U.S. Mint for a change.  They sold 2,000 troy ounces of gold eagles — 1,000 one-ounce 24K gold buffaloes — and 450,000 silver eagles.

I heard back from Steven Higgins at the Royal Canadian Mint.  My e-mail to him on Tuesday night stated:  “After a re-read of what you said in the first sentence…are you saying that both gold and silver bullion coin sales are “mostly maple leafs”…or is that comment only applicable to silver maple leafs?

This was his almost immediate reply, which came at 11:20 p.m. EST on Tuesday night — and long after the mint was done for the day.  This is what he said: “Maple Leaf is our main products for gold and silver. Both gold and silver ‎are mostly Maples.  We don’t provide a precise proportion.

So it’s a given that the gold and silver maple leaf sales numbers from the RCM are ‘contaminated’ with other bullion products.   But by what amounts — and which bullion products — is not for us to know, obviously.  So these “sales numbers” in their quarterly and annual reports aren’t quite what they appear to be, but are certainly a good proxy for bullion sales at the mint.

I may have more on this tomorrow or Saturday.

Over at the COMEX-approved gold depositories on the U.S. east coast on Tuesday, the magnificent sum of 97.995 troy ounces…one good delivery bar…was shipped out of Brink’s, Inc. — and that was it.

It was much busier in silver, as 1,201,541 troy ounces were received — and 1,065,161 troy ounces were shipped out the door.  All of the ‘in’ activity was at Canada’s Scotiabank, as two container loads were dropped off there.  Scotiabank also shipped out a container full as well…600,956 troy ounces.  Another 462,195 troy ounces departed HSBC USA — and one good delivery bar…1,018 troy ounces…was shipped out of Brink’s, Inc.  A link to all that action is here.

It was pretty quiet over at the COMEX-approved gold kilobar depositories in Hong Kong on their Tuesday.  Only 160 were shipped in — and another 255 were shipped out the door.  All of this activity was at Brink’s, Inc. — and I shan’t bother linking it.

I have an average number of stories for you today — and I’ll happily leave the final edit up to you.


U.S. Commerce’s Ross says 3 percent GDP growth not achievable this year

The U.S. economy will fall short of the Trump administration’s goal of 3 percent growth this year and will only achieve that when its regulatory, tax, trade and energy policies are fully in place, Commerce Secretary Wilbur Ross said on Tuesday.

The GDP target “is certainly not achievable this year,” Ross told Reuters in an interview. “The Congress has been slow-walking everything. We don’t even have half the people in place.

But Ross said it ultimately could be achieved in the year after all of Republican President Donald Trump’s business-friendly policies are implemented. He noted that delays were possible if the push for tax cuts was slowed down in Congress.

Ross also signaled the Trump administration would try to use existing tools to aggressively enforce trade rules and insist on fairer treatment for U.S. goods, rather than adopt the slash-and-burn approach Trump discussed on the campaign trail in 2016.

The comments appear to represent another move to the center by the administration, with Ross acknowledging that trade deficits for things like imported oil are “blameless” and not inherently bad.

This Reuters news item, filed from Washington, was posted on their Internet site at 4:37 a.m. EDT on Wednesday morning — and I extracted it from a Zero Hedge article that Brad Robertson sent our way.  Another link to it is here.

FAANG stocks gain…rest of S&P 500 lose:  “The Great Narrowing” of the S&P 500

The new 1{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e}” gained $260Bn since March 1, the 99{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} lost $260Bn.

Over the past ten weeks – so since March 1, 2017 – five stocks in the S&P 500 index have gained a total of $260 billion in market value, the infamous FAANG stocks: Facebook, Apple, Amazon, Netflix, and Google (now Alphabet).

By any measure, $260 billion is a massive surge in valuation for just five stocks, or 1{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} of the S&P 500, in just ten weeks.

And the rest of the S&P 500? On March 1, the index closed at 2,394. Today it closed at 2,397. In those ten weeks, it went absolutely nowhere. Which means this: the remaining 495 stocks in the index lost as much in total market capitalization as the FAANG stocks gained.

Wow!  This article by Wolf Richter put in an appearance on the Internet site yesterday — and it’s definitely worth reading.  I thank Richard Saler for pointing it out — and another link to it is here.

Jeff Gundlach makes bets against U.S. stocks, and for emerging markets

Jeff Gundlach said Monday he has a pair trade betting on further gains for emerging markets and against U.S. stocks.

Gundlach said he is long the iShares MSCI Emerging Markets ETF and short the SPDR S&P 500 ETF specifically.

The CEO and chief investment officer at DoubleLine Capital was speaking from the Sohn investment conference in New York.

In an eclectic presentation that meandered from philosopher Friedrich Nietzsche to early 20th century art to the misnomer of “passive” investing, Gundlach came around to the notion that emerging markets likely will be outperforming the U.S.

Should that happen, it also has other investing implications, he said.

This CNBC news item was posted on their Internet site at 5:31 p.m. EDT on Monday afternoon — and there’s a 5:54 minute video interview with Jeff embedded.  There may be more than one video played back to back.  I thank Ken Hurt for finding it for us — and another link to it is here.

What’s really going on between Goldman Sachs and the federal government?

Just for laughs, let’s start out with this idea — that Goldman Sachs acts as an agent of the federal government. Let’s see if I can persuade you.

For starters, it wasn’t too long ago that then-President-elect Donald Trump vowed to drain the swamp — before he went ahead and hired six Goldman executives to clog up the drains.

Last week, The Post’s Kevin Dugan broke the fascinating story that the Justice Department’s investigation into possible rigging of U.S. Treasury Department securities offerings was focusing on Goldman — which, sources told Dugan, had won an astonishing percentage of government bond auctions from 2007 to 2011.

They don’t lose many,” one person who has seen the bid data told Dugan, who wrote that the prices Goldman offered for Treasury bonds would be slightly higher than offers from other banks and would typically be submitted “at the end of the auction.

OK, was Goldman just getting lucky? And was it making these last-minute bids, which would drive interest rates lower and set the tone for the whole bond market, simply to generate a profit?  Or was something else going on?

This commentary by John Crudele was posted on The New York Post‘s website in the wee hours of Tuesday morning — and I found it in this morning’s edition of the King Report.  Another link to it is here.

Bitcoin — Your Newest, Most Powerful Tool of Subversion

Murray Rothbard often described the government as a “gang of thieves writ large.”

His description captures the State’s true essence… coercion.

Any government, anywhere in the world, and at any time in history is simply a group of people with a monopoly on coercion in a certain geographic area. That’s it.

It doesn’t matter if it’s a democracy, monarchy, dictatorship, or something else.

Government is not about selfless public servants advancing some vague common good. It’s about brute force.

They don’t teach this in public schools. But it’s true.

This commentary about bitcoin by International Man senior editor Nick Giambruno was posted on their website yesterday — and be forewarned that there’s a big infomercial at the end.  Another link to it is here.

Warren Pushes Trump Administration on Plan to Break Up Megabanks

U.S. Senator Elizabeth Warren is eager to pursue legislation that would break up Wall Street megabanks and has pushed the issue with members of the Trump administration.

We’re certainly reaching out to the administration,” Warren, a Massachusetts Democrat, said in an interview with Bloomberg Television airing Wednesday. “‘So far we’ve had some good conversations and that’s what I want to see happen. I’m ready. Because you know, this is one of those basic things — folks on Wall Street may resist it. But most of the American people get it.”

At issue is the Glass-Steagall Act, a Depression-era law repealed in 1999 that had separated investment and commercial banking. Warren says reviving it would make the financial system safer, while protecting consumers from Wall Street’s risky market bets. President Donald Trump and other administration officials, including top White House economic adviser Gary Cohn, have also spoken favorably of reinstating some version of the law.

Warren has repeatedly introduced a bill that would prohibit big banks from having a retail and an investment business, which would probably force firms like JPMorgan Chase & Co. and Citigroup Inc. to split apart. In the Bloomberg interview, she said her legislation would help smaller banks and investment firms compete with bigger rivals, while simplifying financial regulations.

This Bloomberg story showed up on their website at 4:00 a.m. Denver time on Wednesday morning — and it’s from Zero Hedge via Brad Robertson.  Another link to it is here.

Lavrov Scoffs At America’s “Humiliating Situation

Russian foreign minister Sergei Lavrov is holding a press conference following his discussions in The Oval Office with President Trump, who described it as a “very, very good” meeting.

President Trump “clearly stated his desire for businesslike” relations with Russia, according to Russian Foreign Minister Sergei Lavrov, who met with President Trump Wednesday.

Lavrov began…

First of all, we have discussed our cooperation on the international stage. It’s been confirmed that despite all the difficulties, our countries can and must act together to help solve key problems on today’s international agenda.

Lavrov says Russian President Vladimir Putin “doesn’t want to follow lead of those who poison our relations to the point of no return.”

This interesting Zero Hedge story was posted on their website at 1:29 p.m. EDT yesterday afternoon — and I thank Brad Robertson for sending it along.  Another link to it is here.

Moodys Slashes Ratings on 6 Canadian Banks, Fears Asset-Quality Deterioration, Soaring Household Debt

Amid Poloz-described “unsustainable prices” in various cities, and just days after the collapse of Canadian mortgage lender Home Capital Group and our discussion of the dire state of Canadian savers (and their record household debt), Moodys has cut the ratings on six of Canada’s largest banks because of “ongoing concerns that expanding levels of private-sector debt could weaken asset quality in the future.

As a reminder, even Bank of Canada Governor Stephen Poloz noted that Toronto is out control tonight while answering questions following a speech in Mexico City…

pretty sure recent gains in Toronto home prices were not sustainable and that the city’s housing market had elements of speculation

Financial stability is part of the Bank of Canada’s monetary policy decision making, but the central bank’s primary mission is inflation targeting,… it would be odd to use interest rates to target home prices in just one city.”

Perhaps Mr. Poloz,  but, as we showed previously, it doesn’t take a genius to figure out that this will end in tears.  Even the big Canadian banks are fretting. “Let’s drop the pretense. The Toronto housing market and the many cities surrounding it are in a housing bubble,” Bank of Montreal Chief Economist Doug Porter warned clients. But the bubble’s deflation would push the city into a fiscal and financial sinkhole.

This longish Zero Hedge article contains some first-rate charts, which are worth a look if you have the interest.  This story appeared on their Internet site at 8:11 p.m. EDT yesterday evening — and another link to it is here.

Barclays chief apologises to shareholders for trying to identify whistleblower

Jes Staley has apologised to Barclays shareholders for the “error” that the bank’s chief executive admitted he had made in trying to uncover the identity of a whistleblower.

Seeking to take the sting out of the bank’s annual meeting on Wednesday, Mr Staley said: “I feel it is important that I acknowledge to you – our shareholders – that I made a mistake in becoming involved in an issue which I should have left to the business to deal with.

I have apologised to the board, and I would today like to apologise to you as well, for that error,” said the 60-year-old American who was hired to run Barclays in December 2015.

The Barclays board has given Mr Staley a formal reprimand and promised to cut his pay by a “very significant” amount for ordering the bank’s security team to try to identify a whistleblower who had made allegations about a recently recruited colleague.

Another sociopathic personality type run amuck.  All large banks/corporations have sociopaths of one shade or another running them, so why should Barclays be any different?  At least this one got caught with his hand in the cookie jar.  This Financial Times story, which is posted in the clear, showed up on their website very early on Wednesday afternoon in London — and it’s another Zero Hedge article courtesy of Brad Robertson.  It’s worth reading — and another link to it is here.

Oslo is the most expensive city in the world to grab a beer

Deutsche Bank analysts collected data on the prices of various services for a recent report to clients. Among them, they included how much it costs to get a beer (500 mL or 1 pint) in a neighborhood pub in an expat area of a given city in 2017.

Beers are the cheapest in Prague, Czech Republic ($1.30), Johannesburg, South Africa ($1.70), and Lisbon, Portugal ($2.00). On the flip side, they are the most expensive in Oslo, Norway ($9.90), Singapore ($9.00), and Hong Kong ($7.70).

As for American cities, New York City was the most expensive, with the average beer costing $7.40. Boston wasn’t too far behind, at $7.20.

Check out the full list below…

Well, dear reader, this is probably today’s top story!  This tiny news item showed up on the Internet site on Wednesday sometime — and I thank Swedish reader Patrik Ekdahl for finding it for us.  Another link to it is here.

Obama Takes Private Jet, 14-Car Convoy to His $3.2 Million Climate Change Speech in Italy

Just yesterday we noted that President Obama pocketed $3.2 million for a 1.5-hour speaking gig at a climate change conference in Milan…an exorbitant fee, by anyone’s measure, which Dilbert creator Scott Adams most accurately described as a “pre-bribe.”

And while we’re certain that Obama’s motivation to appear in Milan had absolutely nothing to do with the money, but rather was born out of a pure concern for Mother Earth, we do find his travel arrangements, in light of that genuine environmental concern, somewhat ironic.

Apparently, according to the Independent Journal Review, it takes a private jet, 14-car motorcade, 300 police and multiple helicopters patrolling overhead just to get one man to a conference…quite the carbon footprint.

And here is a fun video of Obama’s entourage….

Climate change is great if you’re rich!  This Zero Hedge piece was posted on their website at 5:30 p.m. EDT on Wednesday afternoon — and I thank Brad Robertson for bringing it to our attention.  Another link to it is here.

At retirement dinner, Eric Sprott praises GATA’s work

Sprott Asset Management founder and philanthropist Eric Sprott, honored last night in Toronto at a retirement testimonial dinner sponsored by the company, praised GATA’s work and called on GATA Chairman Bill Murphy and your secretary/treasurer to stand and be recognized. Some people in the audience of about 200 actually applauded, through the audience consisted mainly of ordinarily respectable people from the Canadian financial industry. Of course they may have just been trying to be polite and to humor Sprott. But some later confessed to following GATA’s work and to have been persuaded by it.

Sprott went on mischievously to contrast what he called “the GATA table,” at which Murphy and your secretary/treasurer were seated with Sprott Asset Management’s John Embry and economist Ian Gordon of Longwave Group, with what he called “the World Gold Council table,” at which two former chairmen of the council were seated: Franco-Nevada founder Pierre Lassonde and Goldcorp Chairman Ian Telfer. Sprott noted that during the dinner no rolls had been thrown from the GATA table toward the World Gold Council table.

Civility and cordiality were maintained though Lassonde repeatedly has dismissed complaints of gold market manipulation and has insisted that central banks couldn’t care less about gold while GATA has dismissed the World Gold Council as an accomplice with central banks in gold price suppression, a facilitator of “paper gold” and the shorting of the monetary metal.

Telfer and Lassonde are both strong with the Dark Side of The Force, as they sold out to the powers-that-be decades ago.  If they hadn’t, they would never have been allowed to reach the positions in the gold world that they have today.  This commentary from Chris, along with an embedded link, put in an appearance on the Internet site yesterday afternoon — and another link to it is here.

Gold Imports by India Said to Rise More Than Four-Fold in April

Gold imports by India gained more than four-fold in April driven by jewelers restocking in anticipation of a recovery in sales during the wedding season that will last till mid-June.

Shipments rose to 98.3 metric tons last month from 22.2 tons a year earlier, according to a person familiar with provisional data from the finance ministry, who asked not to be identified as the data aren’t public. Imports were affected a year earlier because of a strike by jewelers to protest an excise tax on jewelery made and sold locally. Finance Ministry spokesman D. S. Malik declined to comment on the data.

Indian demand recovered this year as cash supply improved following measures taken by the government to curb unaccounted-for money, a move labeled as demonetization. Annual purchases may be at the higher end of an estimated range of 650 tons to 750 tons in 2017, according to the World Gold Council. Sales during the auspicious gold buying day of Akshaya Tritiya at the end of April were about 5 percent higher than last year, Sreedhar G. V., managing director at Sree Rama Jewels, said.

After demonetization, the entire country was at a standstill,” Sreedhar, a former chairman of the All India Gems & Jewellery Trade Federation, said by phone from Bengaluru. “Now since the money flow has started and gold prices have also come down, there has been good demand in the market.”

This gold-related news story was posted on their website at 2:14 a.m. Denver time on Wednesday morning — and I found it on the Sharps Pixley website.  Another link to it is here.

China’s private investor gold surge seen as strong signal

The 30{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} rise in China’s private investor gold demand in the first three months of this year is seen as “a very strong signal” by World Gold Council member and market relations head John Mulligan, who views this market as being one of good potential ongoing growth.

The rise in China’s private investor gold bar and coin demand to 106 t was the main contributor to a 9{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e}-higher overall global retail investment market demand rise to 289.8 t, which is worth more than $11-billion.

Playing a role in strengthening demand in China were local premiums at a level of more than $14/oz above the global spot price of gold.

But despite the demand surge, per capita investment in gold in China remains low, and Mulligan sees Chinese demand as a staying trend over the longer term.

Also important is the ongoing strength of European gold demand of 61 t in the three months to the end of March,  which was 9{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} up on the first quarter of 2016.

This article, filed from Johannesburg on Wednesday, showed up on the Internet site — and it’s another gold-related news item I found on the Sharps Pixley website.  Another link to it is here.

China and India step up to the gold demand plate — Lawrie Williams

As always appears to be the case, statistics on gold demand can be contradictory which is perhaps why gold’s fundamentals are so difficult to tie down.  Take the World Gold Council (WGC)’s latest Gold Demand Trends report which suggests global gold demand fell by 18{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} (228 tonnes) during Q1, compared with the admittedly very high (record) figures achieved in Q1 2016.  But within the report there do appear to have been some major anomalies.

Firstly, the slump in assessed demand was largely for two reasons – sharply reduced gold ETF inflows and a fall in Central Bank gold reserve increases.  But, it should be noted, that gold inflows into the ETFs did remain positive over the quarter and the Central Bank figures were skewed by China’s non reporting of any gold reserve changes since its currency was accepted as part of the IMF’s Special Drawing Rights (SDR) in October last year.  In Q1 2016, China had announced additions of 35.2 tonnes to its official reserves – some 15{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} of the fall in assessed gold demand during the latest quarter.  If one takes China out of the equation other Central Bank gold additions came to a positive 7.4 tonnes – and on its reserve reporting track record China’s zero reserve addition figure has to be considered suspect.

Coming back to Central Bank shortfalls, can we believe the China figures at all?  One should recall that up until July 2015 China only reported any reserve increases at five of six year intervals maintaining the pretence that it was not adding to its reserves monthly, as it obviously was.  But, in the immediate run up to the IMF decision to re-jig its SDR make-up to include the yuan, the Asian nation began announcing monthly reserve increases.  Once the yuan officially became a part of the SDR, China has reported zero gold reserve increases.  Can this just be coincidence?

China is known to favour building its gold reserve as an important facet of securing its place in the global trade picture and its whole gold reserve adding policy has always been shrouded in secrecy.  Some China-watching  analysts will argue that, in fact, its real gold reserve is far higher than the officially stated figure of 1,842.6 tonnes.  After all it has been the world’s largest gold producer for some years now.

This very worthwhile commentary from Lawrie was posted on the Sharps Pixley website yesterday — and another link to it is here.


Today’s ‘critter’ is a rather nondescript denizen of the woods just about everywhere in northern North America — and that’s the ruffed grouse.  Although they can be spotted on occasion, the most likely way you’ll know they’re around is when the male is ‘drumming’.  The sound is unmistakable — and unforgettable.  Click to enlarge.


While the biggest single change in the composition of the concentrated COMEX short position has been the defection of JP Morgan to becoming net long by virtue of its physical metal accumulation, there are some other more subtle changes, including the complete absence of any economic legitimacy to the current short position. In essence, there are no legitimate shorts on the COMEX, in terms of miners hedging future production or those hedging against existing physical inventory. The big shorts, apart from JP Morgan, appear to be mostly foreign banks according to CFTC data and definitely not miners from the earnings statements from public mining companies. The speculating foreign banks are precisely the type of short sellers most likely to panic when silver prices start to rally and it begins to take hold on them that JP Morgan is no longer the shorts’ protector and short seller of last resort.”

I have been studying the silver manipulation for more than 30 years — and over that time I have seen it spread to other commodities, certainly to gold, copper, crude oil and just about every market where the technical funds have risen as a potent market force to be manipulated and harvested. But no market has been as manipulated as has COMEX silver, thanks to the level of concentrated short selling compared to real world supplies. The recent selloff has affected many commodities and I do expect a vigorous turn up in gold, copper, crude oil, platinum and other markets once the technical fund selling is complete, but the rally to come in silver should far outdistance any other commodity rally.” — Silver analyst Ted Butler: 10 May 2017

It was finally a day with no price pain in any of the precious metals, as none of them set either intraday lows, or closed at a new low.  I would suspect that we’ve seen the bottom of these engineered price declines, but it’s not something I’d bet the ranch on.

However, it should be noted that the precious metal equities have been doing very well for themselves over the last few days — and I’m always happy when the bargain hunters are feasting, a they are now.

Here are the 6-month charts for all four precious metals, plus copper — and for once, there’s not a lot to see.  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 has been chopping higher in fits and starts all through Far East trading on their Thursday, but appears to have been capped just minutes after 2 p.m. China Standard Time.  Currently it’s up $2.80 an ounce.  The same can be said of silver — and it’s up 8 cents at the moment.  After trading flat until 10 a.m. in Shanghai, platinum began to move higher as well — and is up 6 bucks.  Palladium traded sideways until around 1:30 p.m. CST — and it is now in rally mode too, and up 6 dollars as well.

Net HFT gold volume is approaching 27,000 contracts — and that number in silver is 6,500 contracts.

The dollar index has been chopping mostly sideways since trading began at 6 p.m. in New York on Wednesday evening — and it’s currently down 8 basis points.

Well, where to from here?  Beats me.  If this is the bottom, then a rally of some substance will inevitably follow — and unless JP Morgan decides to step in as short buyer and long seller of last resort as they always have, then things could get interesting in the COMEX futures market…as per what Ted had to say in his quote at the start of The Wrap.

All we can is sit here and wait to see what develops.  I’m still “all in” — and like you, I await future events with some hope.

And as I post today’s missive on the website at 4:02 a.m. EDT, I note that ever since the gold price was capped shortly after 2 p.m. in Shanghai, it has been sold a bit lower by ‘da boyz’ — and after an hour of trading in London, it’s only up $1.90 an ounce.  Silver’s price got capped at the same time, but it has been trading mostly flat since — but is currently up 10 cents.  Platinum is still up 6 bucks — but palladium by only 4 dollars now.

Net HFT gold volume is coming up on 32,000 contracts — and that number in silver is just over 8,100 contracts.

The dollar index is down 11 basis points.  Not that it matters what it’s doing, of course, because if the powers-that-be are mucking about in the COMEX futures market, they’ll do as they please regardless.

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