Enormous COMEX Silver Deliveries Scheduled For Tuesday

31 August 2018 — Friday

YESTERDAY in GOLD, SILVER, PLATINUM and PALLADIUM


After a brief tick up around 7:30 p.m. EDT in New York trading on Wednesday evening, the spoofing and the algo spinning began — and the gold price was sold lower until 2 p.m. China Standard Time on their Thursday afternoon.  It crawled unsteadily higher from there until a few minutes before 9 a.m. in New York — and that juncture ‘da boyz’ got really serious — and sold it down to its low tick of the day at afternoon gold fix in London — and back below $1,200 spot.  It rallied back to that mark about ten minutes later — and then didn’t do much of anything for the remainder of the Thursday session.

The high and low ticks, which are barely worth looking up, were reported by the CME Group as $1,209.00 and $1,197.20 in the October contract — and $1,214.00 and $1,202.10 for December.

Gold was closed at $1,199.60 spot, down $6.70 from Thursday.  Net volume in October and December combined was very decent at 288,000 contracts — and roll-over/switch volume was only 5,632 contracts on top of that.

The price activity in silver on Thursday was mostly the same as for gold, with the odd variation in early morning trading in London.  The silver price was also capped shortly before 9 a.m. in New York — and then got hammered lower at the 9:30 a.m. EDT open of the equity markets.  It recovered a bit from there, but that rally was capped in short order and, like gold, the price chopped sideways for the rest of the day.

The high and low ticks in this precious metal were recorded as $14.71 and $14.43 in the September contract.

Silver was closed at $14.52 spot, down 20.5 cents from Wednesday’s close.  Net volume in the new front month for silver, which is December, was reported as just over 64,000 contracts — and roll-over/switch volume amounted to 17,295 contracts.

Platinum was sold lower until around 2:15 p.m. CST on their Thursday afternoon…the afternoon gold fix in Shanghai.  It jumped up from there, but all those gains were gone within a few hours — and from that point the price chopped generally sideways in a fairly narrow price range until the COMEX close.  It was sold a bit lower in the thinly-traded after-hours market.  Platinum finished the Thursday session at $788 spot, down 7 dollars on the day.

Like platinum, the palladium price was sold quietly lower in morning trading in the Far East — and also blasted higher right at the afternoon gold fix in Shanghai.  It jumped up a bit more shortly after 10 a.m. CEST in Zurich trading, but that spike obviously ran into ‘resistance’ — and it chopped sideways from there until JPMorgan et al appeared at 9:30 a.m. in New York.  You know the rest.  Palladium was closed on Thursday at $964 spot, up 5 bucks on the day — and would most likely have closed above $1,000 spot if allowed.

The dollar index closed very late on Wednesday afternoon in New York at 94.54 — and after a brief dip of a handful of basis points by around 7:30 p.m. EDT in New York on Wednesday evening, which was 8:30 a.m. in Tokyo on their Thursday morning…began to edge quietly but unsteadily higher.  That lasted until minutes before 2 p.m. China Standard Time on their Thursday afternoon, but by the London open had fallen about 20 basis points to its 94.47 low tick of the day.  It appeared to get saved at that juncture — and roared higher until 9:35 BST.  It then chopped quietly lower until 11:35 a.m. in London — and then didn’t do much until a few minutes before 9 a.m. in New York.  It blasted higher at that juncture — and the 94.90 high tick was set right at the open of the U.S. equity markets at 9:30 a.m. EDT.  It hung around this elevated level until minutes after 12 o’clock noon — and then chopped very unsteadily lower until a few minutes before 4 p.m. EDT.  It crawled quietly higher into the close from there — as the dollar index finished the Thursday session at 94.70 — up 16 basis points from Wednesday’s close.

Without doubt, the powers-that-be used that big dollar ramp job in early morning trading in New York, to hammer precious metal prices lower.  And it should also be carefully noted that as the dollar index began to decline around noon EDT — heading back to about where it started around 9 a.m. EDT, precious metal prices were not allowed to reflect that.

And here’s the 6-month U.S. dollar index — and as I’ve pointed out ad nauseam lately, the current decline in the dollar index is not being allowed to show up in precious metal prices at all.

The gold shares gapped down at the open in New York — and they were at about their low ticks of the day by the afternoon gold fix in London, gold’s low tick of the day.  From that point, they chopped generally sideways for the remainder of the Thursday session.  The HUI closed down another 1.82 percent.

It was the same general price pattern for the silver equities — and Nick Laird’s Intraday Silver Sentiment/Silver 7 Index closed down by 1.87 percent.  Click to enlarge if necessary.

And here’s the 1-year Silver Sentiment/Silver 7 Index.  Click to enlarge as well.

The CME Daily Delivery Report showed that 3 gold and 1 one-thousand ounce mini silver contract were posted for delivery within the COMEX-approved depositories today.  In gold, Advantage issued all three out of its client account — and the CME Group stopped them for its in-house account.  They immediately re-issued them as 30 ten-ounce mini gold contracts, of which 28 were stopped by ADM.  In silver, the mini contract was issued by Advantage — and stopped by ADM as well.  Both transactions involved their respective client accounts.

First Day Notice for Day 1 of September deliveries on Tuesday showed that 371 gold and an eye-watering 3,759 silver contracts were posted for delivery on Tuesday.  In gold, the only short/issuer that mattered was HSBC USA with 353 contracts out of its own in-house/proprietary trading account.  There were five long/stoppers in total — and the three that mattered were Morgan Stanley with 237 for its in-house/proprietary trading account…93 contracts for JPMorgan’s client accounts — and 33 for Advantage’s client account as well.  In silver, there were ten short/issuers in total.  The three largest were HSBC USA with 1,275 contracts out of its client account, JPMorgan with 852 contracts out of their client account as well — and Macquarie Futures with 752 contracts out of their in-house/proprietary trading account.  There were fifteen long/stoppers in total — and the only three that mattered were JPMorgan with 1,305 contracts for its own account, plus another 361 for its client account — and almost tied for second place were HSBC USA and Goldman Sachs with 876 and 869 contracts for their own accounts as well.  [And it remains to be seen whether this silver stopped by HSBC and Goldman for their own accounts, gets reissued at some point further along in the September delivery process — and if it is, who will the stopper be?]  Way down in 3rd/4th place were International F.C. Stone and ABN Amro with 96 and 85 contracts for their respective client accounts.  The link to yesterday’s Issuers and Stoppers Report is here — and it’s definitely worth a look.

The CME Preliminary Report for the Thursday trading session showed that gold open interest in August fell by 31 contracts, leaving zero left, minus the 3 contracts mentioned in the previous paragraph.  Wednesday’s Daily Delivery Report showed that 28 gold contracts were actually posted for delivery today, so that means that 31-28=3 contracts remained — and those are out for delivery today as well…as 3 x 10 = 30 ten-ounce gold mini contracts.  Silver o.i. in August fell by 1 contract, leaving zero open — and since that contract is out for delivery today as per Wednesday’s Daily Delivery report…that completes the August delivery month in both silver and gold.

Gold open interest in September fell by 116 contracts, leaving 503 still open, minus the 371 posted for delivery on Tuesday…as mentioned two paragraphs ago.  Silver o.i. in September crashed by a further 6,857 contracts, leaving 6,214 still around…minus the 3,759 contracts mentioned two paragraphs ago as well.

The September delivery month has started with a big bang, particularly in silver.  More than three times as much silver is being delivered on Tuesday, as was delivered during the entire month of August…as per the headline in my Thursday column.


There was another withdrawal from GLD yesterday, as an authorized participant removed 66,262 troy ounces.  There was yet another deposit into SLV yesterday, as an a.p. added 752,147 troy ounces.

There was no sales report from the U.S. Mint on Thursday.

Finally — and at last, the Royal Canadian Mint has come out with its Q2/2018 report — and their sales were down across the board for not only Q2, but H1 as well.  Gold bullion sales were down 20 percent for the Q2/18 compared to Q2/17 — and 41 percent for H1/18 vs. H1/17.  Silver bullion sales were down 27 percent for Q2/18 vs. Q1/17 — and 15 percent for H1/18 vs. H1/17.  This snip below, from Page 8…click to enlarge…was all they had to say about bullion and numismatic sales for Q2 and H1/2018. The link to the entire Q2/2018 report is here.

There was no physical gold movement, either in nor out, over at the COMEX-approved depositories on the U.S. east coast on Wednesday.  But there was 18,453 troy ounces transferred from the Eligible category — and into registered…16,138 troy ounces at JPMorgan — and the remaining 2,314.800 troy ounces/72 kilobars [U.K./U.S. kilobar weight] came from the International Depository Services of Delaware.  This is probably being transferred for delivery purposes in September.  The link to this is here.

It was much busier in silver, as 2,182,908 troy ounces were reported received — and 1,435,878 troy ounces were shipped out.  There were quite a few depositories involved, so I’ll just hit the highlights.  There were three truck loads…1,824,760 troy ounces…deposited at CNT — and in the ‘out’ category, there were two truck loads…1,155,119 troy ounces…shipped out of HSBC USA.  If you want to see the rest of the silver action, including the transfer of 292,142 troy ounces from the Eligible to Registered category at Delaware, the link to it all is here.

It was very quiet over at the COMEX-approved gold kilobar depositories in Hong Kong on their Wednesday.  They only received 30 of them — and shipped out 252.  This activity was at Brink’s, Inc. — and I won’t bother linking it.

I have a decent number of stories for you today.


CRITICAL READS

More Debt Won’t Make America Great Again — Bill Bonner

Yesterday’s headline news, from Reuters:

U.S. economic growth was a bit stronger than initially thought in the second quarter, notching its best performance in nearly four years, as businesses boosted spending on software and imports declined.

Gross domestic product increased at a 4.2 percent annualized rate, the Commerce Department said on Wednesday in its second estimate of GDP growth for the April-June quarter. That was slightly up from the 4.1 percent pace of expansion it reported in July and was the fastest rate since the third quarter of 2014. […]

But the robust growth in the second quarter is unlikely to be sustained given the one-off drivers such as a $1.5 trillion tax cut package, which provided a jolt to consumer spending after a lackluster first quarter, and a front-loading of soybean exports to China to beat retaliatory trade tariffs.

We stop… and hold our breath.

Is the tax cut really working? Is the economy really strong? Should we stop doubting… put on a MAGA hat… and buy the NASDAQ?

Then… after a moment… we come to our senses.

This commentary by Bill appeared on the bonnerandpartners.com Internet site very early on Thursday morning EDT — and another link to it is here.


“Fallen Angel” Alert: Is Ford’s Downgrade The “Spark” That Crashes the Bond Market?

Back in November, still smarting from a year he would rather forget, Russell Clark and his Horseman Capital, i.e. the “world’s most bearish hedge fund” unveiled what he would short next: according to Clark, the next major source of alpha would be shorting fallen angel bonds, or those investment grade companies in danger of being downgraded to junk.

Citing a recent IMF Global Financial Report, Clark said that “U.S. investment grade debt is very low quality, and could produce some large fallen angels [and] mutual funds are much larger in the high yield market than they used to be. [L]ow rates means the capital losses are much higher than they used to be. And that investors in high yield mutual funds are much flightier than they used to be! Essentially the IMF are telling me that if you get a large enough fallen angel, the high yield market will freak out, and volatility will spike causing volatility targeting investors to dump leveraged positions. Sounds good to me.”

One month later, in the aftermath of of Steinhoff fiasco, in which the ECB found itself long tens of millions of bonds in a company which went from investment grade to deep junk after it was revealed that it may have engaged in occasional fraud, crashing the bonds…

Then, at the start of June, legendary distressed investor Oaktree Capital, joined the bandwagon of fallen angel hunters, saying that the fund “expects to see a flood of troubled credits topping $1 trillion as rising interest rates overwhelm low-quality loans and bonds.”

Speaking at the Bernstein Strategic Decisions Conference, Oaktree Capital’s Chief Executive Jay Wintrob said that when the cycle turns it will be faster and larger than ever as “fallen angels” proliferate, and added ominously that “there will be a spark that lights that fire.”

Picking up on last week’s warnings by Moody’s, in which the rating agency warned of a junk bond default avalanche as rates rise, Wintrob said that the supply of low-quality debt is significantly higher than prior periods, while the lack of covenant protections makes investing in shaky creditors riskier than ever.

This very interesting, worthwhile, but somewhat longish commentary was posted on the Zero Hedge website at 1:53 p.m. EDT on Thursday afternoon — and I thank Brad Robertson for sharing it with us.  Another link to it is here.


Is Filing For Bankruptcy Right For You? — Dennis Miller

A New York Times headline blared, “Too Little Too Late’: Bankruptcy Booms Among Older Americans”. They reference a Consumer Bankruptcy Project (CBP) study, “Graying of U.S. Bankruptcy: Fallout from Life in a Risk Society”:

For a rapidly growing share of older Americans, traditional ideas about life in retirement are being upended by a dismal reality: bankruptcy.

…. Driving the surge …. is a three-decade shift of financial risk from government and employers to individuals, who are bearing an ever-greater responsibility for their own financial well-being as the social safety net shrinks.”

While the NYT is noted for wrapping selective facts inside an article pushing a political ideology, the study appears well-researched. Look at the source data and form your own conclusions.

How bad is the problem?

This interesting commentary from Dennis was posted on his Internet site on Thursday morning — and another link to it is here.


In Venezuela, New Cryptocurrency Is Nowhere to Be Found

To hear Venezuela’s leftist President Nicolas Maduro tell it, this remote hamlet of 1,300 souls is perched on the cutting edge of an innovation in cryptocurrency.

Located in an isolated savanna in the center of the country, Atapirire is the only town in an area the government says is brimming with 5 billion barrels of petroleum. Venezuela has pledged those reserves as backing for a digital currency dubbed the “petro,” which Maduro launched in February. This month he vowed it would be the cornerstone of a recovery plan for the crisis-stricken nation.

But Atapirire residents say they have seen no efforts by the government to tap those reserves. And they have little confidence that their struggling village has a front-row seat to a revolution in finance.

There is no sign of that petro here,” said homemaker Igdalia Diaz. She launched into a diatribe about her towns crumbling school, pitted roads, frequent blackouts and perpetually hungry citizens.

It turns out that Venezuela’s petro is hard to spot almost anywhere. Over a period of four months, Reuters spoke with a dozen experts on cryptocurrencies and oil-field valuation, traveled to the site of the pledged oil reserves, and scoured the coin’s digital transaction records in an effort to learn more.

The hunt turned up little evidence of a thriving petro trade. The coin is not sold on any major cryptocurrency exchange. No shops are known to accept it.

This Reuters story, filed from Atapirire in Venezuela, showed up on their website at 5:14 a.m. EDT on Thursday morning — and the first person through the door with this yesterday morning was Paul Fillion.  Another link to it is here.


Brazil Central Bank Intervenes As Real Crashes Near Record Lows

The bloodbath in Argentina and Turkey is evident in Brazil also where Bloomberg reports that the central bank just intervened for the first time since June 22.

BCB reportedly intervened at 4.20 “to provide liquidity” adding that intervention intensity and frequency will depend on the market. The BCB also attempted to provide some confidence by reaffirming that monetary policy is not directly linked to recent market shocks.

For now, the Real has stabilized.

Additionally, BCB will also offer an additional 30,000 FX swap contracts in auction today from 1:20pm to 1:30pm, according to a statement. Results to be announced at 1:40 p.m. EDT.

This tiny 2-chart Zero Hedge story appeared on their website at 12:24 p.m. EDT on Thursday afternoon — and it’s the second contribution of the day from Brad Robertson.  Another link to it is here.


Argentina raises interest rate to 60% after currency resumes slide

Argentina’s central bank pumped up interest rates by 15 percentage points to 60 percent today after the peso plunged in early trading.

The peso dropped by 15 percent, building on Wednesday’s 7 percent drop — the heaviest since the currency floated in 2015. Today’s selloff leaves the dollar at around ARS39, although trading is volatile.

On Wednesday Argentina’s president Mauricio Macri asked the International Monetary Fund to speed up the disbursement of its $50 billion bailout package.

The above three paragraph are all of this Financial Times of London story that’s posted in the clear.  The rest is behind their subscriber wall.  I found this in a GATA dispatch yesterday.  There was a much more comprehensive Zero Hedge article about this headlined “The Three Letters Behind Argentina’s Collapse: IMF“.  It showed up at 11:25 a.m. EDT yesterday morning — and is courtesy of Brad Robertson.


Italian Bonds Are Tumbling

Whether it is due to contagion from the latest emerging markets selloff, or growing concerns about Italy’s budget demands, another market that has gotten whacked on Thursday is the Italian bond market where BTP futures have reversed earlier post-auction gains, dropping to a day low as risk-off sentiment spreads across markets.

As a result, the Italian curve is bear flattening, with the 2y +14bps to 1.30%…and the 10y BTP yield has jumped +8bps to 3.30%; 5y +5bps to 2.45%.

Futures are selling off across the board.

Today’s selling brings the 10Y yield to the level last seen during the furious May sell-off.

Speaking to Bloomberg, one London-based trader sees selling at the long-end of the BTP curve, though “no specific catalyst evident.”

Should the EM carnage accelerate, keep a close eye on Italy to see if contagion spreads to the weakest of the core markets.

This brief ZH news story was posted on their Internet site at 9:58 a.m. on Thursday morning EDT — and another link to it is here.


Lira Plummets After Turkish Central Bank Deputy Governor Quits

It was already an ugly day for the Turkish Lira, which earlier in the day accelerated its drop for the 4th consecutive session, sending the USD/TRY to the highest level since August 14 when the currency crashed over the weekend to the lowest level on record.

Today’s drop was initially precipitated after Erdogan said on Thursday that Turkey “is not without alternatives” and warning that it won’t “back down over threats.”

In his latest attack on the U.S., Erdogan said that “some do not hesitate openly stating the fact that they are trying to drive us into a corner through the economy. There are surely structural issues in the Turkish economy. We know these issues and are working to fix them.”

Meanwhile, the latest attempts by Turkish authorities to shore up the lira in mid-August that led to a three-day rally in the aftermath, now seem to be losing potency now. And the most recent effort, yesterday’s reintroduction of borrowing limits for banks yesterday – an unwind of what took place just two weeks ago – is proving ineffective.

Then, pouring gas on the fire, the Turkish currency plunged even more, following a Reuters headline that the Turkish central bank deputy Klimici had resigned, and was set to join the Turkish Development Bank.

This rather brief 1-chart article was posted on the Zero Hedge Internet site at 8:01 a.m. EDT yesterday morning — and it’s yet another offering from Brad Robertson — and another link to it is here.


In Rare Meeting, Russia Delivers Intel to U.S. Officials Showing “Planned Chemical Provocation” In Syria

Russia says that its diplomats in Washington formally reached out to U.S. officials and have briefed them on an impending plan by al-Qaeda insurgents in Idlib to stage a false flag chemical attack in order to provoke a Western military strike on Damascus.

This week Moscow has claimed to be in possession of firm intelligence that it says shows armed groups in Idlib are transporting chemicals to area sites, in preparation for the coming major Syrian Army and Russian offensive on the contested province in northwest Syria.

According to RT News, it appears that the State Department previously confirmed that the rare meeting did take place:

Anatoly Antonov, the Russian ambassador in Washington, confirmed to the media on Wednesday that he had met with the US special representative to Syria, James Jeffrey, and David M. Satterfield, acting assistant secretary of state for near eastern affairs.

The attendees of the rare meeting and the fact that it had taken place earlier this week was revealed by U.S. State Department spokesperson Heather Nauert during a daily briefing.

The meeting was reportedly held this past Monday, according to Russian Ambassador Antonov, who told RT it was “constructive and professional“.

We noted previously that Pentagon and U.S. officials have continued pushing the gambit on Syria, with multiple statements last week and this week which appear to be setting the stage to play the “Assad is gassing his own people” card should so much as an inkling of an allegation emerge.

With the dominant al-Qaeda group in control of Idlib, Hay’at Tahrir al-Sham (HTS), facing imminent defeat in what is likely to be a lengthy, grinding final showdown, they have every incentive to claim Syrian government forces are using sarin or another internationally banned substance.

I’m not surprised that the Russian’s would take this step, as it appears that they were being set up for this very event — and are being very proactive.  Good for them, as they’ve obviously learned their lesson from their past experiences with the U.S. on this sort of issue.  This very worthwhile news item put in an appearance on the Zero Hedge Internet site at 3:44 p.m. on Thursday afternoon EDT — and another link to it is here.


Russian Foreign Minister Lavrov Warns West “Don’t Obstruct Anti-terror Ops” as Idlib Assault “Hours Away

Russian Foreign Minister Sergei Lavrov has warned the West not to interfere in Syrian and Russian forces engaged in anti-terror actions in the northwest province of Idlib: “I hope our Western partners will not give in to [rebel] provocations and will not obstruct an anti-terror operation,” he said.

This as Reuters reports that a planned “phased offensive” is imminent and as massive Syrian Army reinforcements and military convoys have been filmed this week heading toward the last major anti-Assad holdout.

Reuters reports based on Syrian pro-government allied sources:

The offensive would initially target southern and western parts of the insurgent territory, but not yet Idlib city, said the source, an official in the regional alliance backing Assad.

“The final touches for the first stage will be completed in the coming hours,” the official added, without saying when it would start.

Lavrov called Idlib a “festering abscess” that needed to be “liquidated” of terrorists and jihadists, according to reports.

I hope our Western partners will not give in to [rebel] provocations and will not obstruct an antiterror operation,” he said in comments made Wednesday.

Mention of “provocations” is a reference to Russian assertions this week that the al-Qaeda group that controls Idlib, Hay’at Tahrir al-Sham, is planning to stage a “chemical attack” incident in order to blame Syrian and Russian forces, in the hopes that the West will intervene militarily against Damascus.

This news story was posted on the Zero Hedge website at 5:58 a.m. EDT on Thursday morning — and I thank Brad Robertson for bringing this article to our attention.  Another link to it is here.


A Book For Our Time, a Time That Perhaps Has Run Its Course — Paul Craig Roberts

American post-WW 2 supremacy, writes Andrei Martyanov in his book, Losing Military Supremacy just published by Clarity Press, has been destroyed by America’s narcissism.

The arrogant hubris of American exceptionalism and the myths that sustain it are subjected to devastating analysis in this long overdue book. Martyanov has no patience with American strategic thinkers, Russian experts, American war myths, and General George S. Patton. No nation has ever assembled a greater collection of ignorant fools than the U.S. — and trusted them with the leadership of the country.

The consequence for America of the unreal image of itself in which the ruling elites live is a “very dangerous decline of American cognitive faculties” and “a complete loss of sound reasoning across the whole spectrum of national activities from foreign policy, to economics, to war, to culture.” The hegemony claimed and pursued by neoconservatives, liberal interventionists, and garrulous patriots is inconsistent with the incompetence and delusion of the ruling American elites.

Take something as simple as military power. Without a modern manufacturing and industrial base, a country has no prospects of being a military power. This fact escaped Wall Street, titans of American industry, and political leaders who enabled the offshoring of American manufacturing and industrial jobs to Asia, thereby building China’s might and deindustrializing the United States, an alleged “superpower” that is dependent on Russian rocket engines and titanium for its aircraft production.

It has also escaped the American elites that the sanctions applied to Russia have built up the capability and self-sufficiency of Russia. Washington’s sanctions make Russia more powerful.

This very interesting book review, a book which the Saker has also spoke of at length,  appeared on Paul’s website on Wednesday sometime — and another link to it is here.  It comes from Brad Robertson as well.


The Impact on the Silver Market of the Auto Sector Electrification

On the surface, the outlook for global silver demand to 2020 is pedestrian, with the total varying very little year to year. Jewellery continues its sluggish recovery from the 2016 fall, coins and bars are under pressure, and photovoltaic (solar cell) is easing after overproduction but ahead of renewed demand. Ethylene oxide is on a strong upward march, but from a very low base.

This is only a small part of the story, however, and the longer-term view is much brighter as technological changes drive different flows through the market. For example, silver demand was for many years dominated by the silver halide photographic sector before the onset of digital technology sent photographic demand for silver into a tailspin. In 1983, 35 years ago, photography accounted for roughly 49% of world silver off-take – now it is just 4%, dropping from over 4,500 tonnes to 1,325 tonnes.

But new technological developments favour  silver, with the electrification of the vehicle fleet prompting a considerable boost for silver demand. The electrical and electronics sector is already benefitting from early changes and there is fresh upside for the use of solar technology in autos – the sector currently absorbs over 3,000 tonnes per annum of silver from a standing start less than ten years ago.

This interesting article contains a lot of pie-in-the-sky assumptions — and that should be kept in mind while you read it.  This silver-related commentary appeared on the lbma.org.uk Internet site — and I thank Malcolm Roberts for pointing it out.  Another link to it is here.


Jim Rickards on Russia’s Gold Reserves

James Rickards, The New York Times Best Selling Author of “The Road to Ruin” discusses U.S. sanctions on Russia, Russia’s gold reserves, and the impacts on the global economy.

This 5:05 minute CNN Money video clip put in an appearance on the youtube.com Internet site back on Sunday, August 26 — and the first person through the door with it was Brad Robertson.  It’s his final contribution to today’s column — and I thank him on your behalf.  Another link to it is here.


The PHOTOS and the FUNNIES

Back to the ‘Big Island’…Hawai’i…one more time.  The eruption at fissure 8 has been over for at least three weeks already, but the incredible photo sequences haven’t ended…and this video is amazing.

Changes at the summit of Kīlauea between April 14 and August 20, 2018, were captured by a USGS–Hawai’ian Volcano Observatory camera. This time-lapse series includes roughly one image per day. The lava lake within Halema‘uma‘u is visible in April, with overflows onto the caldera floor on April 23. The lava lake drains in early May, followed by explosive activity over the next few weeks. Large-scale subsidence of Halema‘uma‘u and the adjacent caldera floor begins at the end of May and ends abruptly on August 2. Summit seismicity and ground deformation are negligible through August 20, 2018. The crater within the caldera is now seven times larger than it was before the onset of subsidence.  This “U.S. Geological Survey” video is certainly worth watching — and the link is here.

A small lagoon has been created at the Pohoiki boat ramp due to long-shore transportation of black volcanic lava ‘sand’ that is accumulating from the jetty to the shoreline.  Click to enlarge.


The WRAP

It was yet another day where ‘da boyz’ were keeping precious metal prices under wraps as August ended — and September deliveries began.  How long they’re going to keep this up remains to be seen.

Here are the 6-month charts for all four precious metals, plus copper and WTIC.  As you can see, they’re certainly keeping silver down, but are having lots of trouble with palladium, as it really wants to fly.  The ‘click to enlarge‘ feature helps with the first four.

And as I type this paragraph, the London open is less than ten minutes away — and I note that the gold price didn’t do much of anything until around 9:40 a.m. China Standard Time on their Friday morning.  It shot a few dollars higher — and then added three dollars more starting at noon over there.  That ‘rally’ got capped/ran out of gas at 1 p.m. CST — and shortly after the 2:15 p.m. afternoon gold fix, the price was tapped lower — and at the moment it’s up $4.10 an ounce.  The price path was mostly similar for silver — and it was up a dime or so by minutes after 2 p.m. CST but, like gold, it was sold off a few pennies — and is currently higher by 6 cents.  Ditto for platinum — and it’s up 4 dollars.  It was mostly similar for palladium — and it’s up 6 bucks as Zurich opens.

Net HFT gold volume in the December contract is about 49,500 contracts — and there’s only 846 contracts worth of roll-over/switch volume on top of that.  Net HFT silver volume is 9,800 contracts — and that’s all in the new December front month.  Roll-over/switch volume in this precious metal is only 166 contracts.

The dollar index had a down/up move that ended at 11 a.m. CST — and then it crawled lower until around 12:50 p.m. CST on their Friday afternoon.  It dropped 12 basis points in the next ten minutes — and that decline was stopped cold at precisely 1:00 p.m. CST.  The index has been chopping very quietly and very unevenly higher since — and is now down only 2 basis points as London opens.

Today, around 3:30 p.m. EDT, we get the latest Commitment of Traders Report for positions held at the close of trading on Tuesday — and I’m not about to hazard a guess as to what the numbers will show for either silver or gold.  If forced to guess, I’d say we’ll some deterioration, but nothing that would change the wildly bullish set up in either precious metal…or the rest of the commodities that the Managed Money traders are massively short in.

And as I post today’s column on the website at 4:02 a.m. EDT, I see that things got a bit more interesting from a price perspective once London and Zurich opened. Gold is now higher by $7.50 the ounce — and silver is now up 14 cents. Platinum and palladium are both up 9 bucks.

Gross gold volume is something over 77,000 contracts — and net of what little roll-over/switch volume there is, net HFT gold volume in the December contract is around 74,700 contracts. Net HFT silver volume is around 14,200 contracts — and there’s only 247 contracts worth of roll-over/switch volume in that precious metal.

The dollar index’s quiet, but choppy rally going into the London open, ended about five minutes before that. It has been heading unevenly lower since — and is down 7 basis points as the first hour of London/Zurich trading draws to a close.

That’s all I have for this time.  Today is the last trading day of the month, so nothing will surprise me when I check the charts when I roll out of bed later this morning.  And for us in North America, it’s the Labour/Labor Day long weekend — and the markets here will be shut tight until Tuesday, but will be open elsewhere.  If something blows up on the weekend in the Middle East — and it just might, it could prove to be the perfect moment for the powers-that-be to let things rip to the upside.

And depending on what happens on the weekend, I may or may not have a column on Tuesday.

Ed