“Remember the Alamo!”…’Da Boyz’ Last Stand?

22 June 2019 — Saturday


The gold price began to edge a bit higher starting about an hour after trading commenced at 6:00 p.m. EDT in New York on Thursday evening, but really began to sail around 9:30 a.m. China Standard Time on their Friday morning.  The price was capped at just over $1,410 spot at precisely 10 a.m. CST — and then was tapped a bit lower going into the 10:15 a.m. morning gold fix in Shanghai.  It then traded flat until shortly before 2 p.m. CST — and it was sold lower until shortly after 9 a.m. in London.  From that juncture it began to crawl unevenly higher — and every tiny rally that looked like it would break back above the $1,400 spot price, was carefully turned aside.  I saw it print $1,399.90 spot shortly before 4 p.m. in after hours trading in New York, but that was a high as it was allowed to get.

The high and low ticks in gold were reported by the CME Group as $1,415.40 and $1,386.10 in the August contract.

Gold was closed in New York on Friday at $1,399.00 spot, up $11.10 from Thursday.  Net volume was astronomical for the second day in a row at 502,500 contracts — and there was 17,500 contracts worth of roll-over/switch volume in this precious metal.

JPMorgan et al led silver on a similar price path, except the sell-off was a bit more severe in late Far East and early morning trading in London.  Its rally after that got close to unchanged by the afternoon gold fix in London, but was sold lower at that point.  It continued to crawl higher from there, but was finished down on the day.

The high and low ticks in silver were recorded as $15.555 and $15.195 in the July contract.

Silver was closed at $15.32 spot, down 6.5 cents from Thursday.  Net volume was sky high as well, at 95,500 contracts — and there was a massive 48,000 contracts worth of roll-over/switch volume out of July and into future months.

Platinum was higher by seven bucks by around 11 a.m. China Standard Time on their Friday morning.  But about ninety minutes later, the engineered price decline in that precious metal commenced — and its low tick was set about twenty minutes after the afternoon gold fix in London.  It rallied rather smartly from there until around 1 p.m. in New York — and then traded quietly sideways into the 5:00 p.m. EDT close from there.  Platinum finished the day at $807 spot, up 2 dollars from Thursday’s close.

Palladium was up 12 dollars or so by shortly after 8:30 a.m. CST on their Friday morning — and then didn’t do much until a few minutes before 2 p.m. over there.  It was sold a bit lower from that juncture until 10 a.m. in Zurich — and it began to head higher from there.  The high of the day came shortly after the Zurich close — and it was sold quietly lower until shortly after the COMEX close — and didn’t do much after that.  Palladium finished the Friday session in New York at $1,484 spot, up 19 dollars on the day but, like the other precious metals, would have close considerably higher, if allowed.

The dollar index closed very late on Thursday afternoon in New York at 96.63 spot — and opened down a couple of basis points once trading commenced at 7:45 p.m. EDT on Thursday evening, which was 7:45 a.m. China Standard Time on their Friday morning.  From that juncture the index chopped quietly and unevenly sideways until around 10:15 a.m. in New York.  It began to chop lower from there — and the 96.09 low tick was set around 3:30 p.m. EDT.  It rallied a handful of basis points soon after that, before trading sideways into the 5:30 p.m. close.  The dollar index finished down 41 basis points on the day at 96.22.

It should be obvious that the fairly hefty decline in the dollar index during the New York trading session on Friday, wasn’t allowed to be reflected in precious metal prices.  And it should also be mentioned that there was no currency movements worth of the name on that big price spike at 10 a.m. in Shanghai, either.  All that price movement was strictly a COMEX affair once again.

Here’s the DXY chart, courtesy of Bloomberg, as always.  Click to enlarge.

And here’s the 5-year U.S. dollar index chart, courtesy of the folks over at the stockcharts.com Internet site.  The delta between its close…95.72…and the close on the DXY chart above, was 50 basis points on Friday.  Click to enlarge as well.

The gold stocks, surprisingly, opened unchanged when trading commenced at 9:30 a.m. in New York on Friday morning.  They were sold down to their respective lows by around 10:20 a.m. — and at that point began to rally quietly.  That lasted until about twenty minutes before trading ended — and it’s obvious that some of the day traders closed out their positions going into the weekend.  The HUI closed up only 0.44 percent.  I, along with other readers, were underwhelmed.

The silver equities followed the same general price path as the gold shares, but they were down over two percent by their 10:20 a.m. EDT lows.  However, their subsequent rallies certainly outshone the gold stocks, as they were back in the green by 1 p.m. — and then edged quietly sideways until trading ended at 4:00 p.m. in New York.  Nick Laird’s Intraday Silver Sentiment/Silver 7 Index closed up 0.48 percent.  I was very happy to see this, as it was unexpected…at least by me.  Click to enlarge as necessary.

And here’s Nick’s 1-year Silver Sentiment/Silver 7 Index chart, updated with Friday’s doji. Click to enlarge as well.

Here are the usual three charts from Nick that show what’s been happening for the week, month — and year-to-date.  The first one shows the changes in gold, silver, platinum and palladium for the past trading week, in both percent and dollar and cents terms, as of their Friday closes in New York — along with the changes in the HUI and the Silver 7 Index.

Here’s the weekly chart — and it’s green across the board for a change.  And even though ‘da boyz’ haven’t allowed the silver price to get far…on a percentage basis, silver’s equities have still managed to outperform their golden brethren by a bit.  Click to enlarge.

The month-to-date chart is far more impressive looking — and it should be noted that the equities vastly outperformed the underlying precious metals…the silver equities in particular once again.  Click to enlarge.

Here’s the year-to-date chart — and it’s much improved as well.  JPMorgan’s near death grip on the silver price is even more obvious in this chart — and that’s certainly reflected in the state of the Silver 7 Index.  Platinum is still barely above unchanged, but that’s because ‘da boyz’ have been engineering its price lower over the last month or so.  Palladium continues its climb off its recent lows.  Click to enlarge.

The precious metal complex is certainly in play now — and the four-letter gold word is far more frequent in the main stream financial press these past few weeks.  But the powers-that-be are fighting these rallies with everything they’ve got.  One has to wonder if it will be enough this time.

The CME Daily Delivery Report showed that 2 gold and 102 silver contracts were posted for delivery within the COMEX-approved depositories on Tuesday.

In gold, R.J. O’Brien and Advantage issued 1 contract each — and Advantage stopped both of them.  All transactions involved their respective client accounts.

In silver, there were two short/issuers in total, but the only one that mattered was ADM…issuing 100 contracts.  There were five long/stoppers in total — and the three largest were Advantage, Morgan Stanley — and JPMorgan…with 44, 29 and 22 contracts.  All contracts, both issued and stopped, involved their respective client accounts.  The CME Group stopped 1 silver contract, which they immediately reissued as 5 one-thousand ounce COMEX mini silver contracts — and Advantage picked up all of them.

The link to yesterday’s Issuers and Stoppers Report is here.

So far in June there have been 2,306 gold contracts issued/reissued and stopped — and that number in silver has crept up to 528 contracts.

The CME Preliminary Report for the Friday trading session showed that gold open interest in June declined by 72 contracts, leaving 163 still around, minus the 2 mentioned a few paragraphs ago.  Thursday’s Daily Delivery Report showed that 86 gold contracts were posted for delivery on Monday, so that means that 86-72=14 more gold contracts just got added to the June delivery month.  Silver o.i. in June dropped by 34 contracts, leaving 102 left — and those remaining 102 contracts are out for delivery on Tuesday, as per the above Daily Delivery Report.  Thursday’s Daily Delivery Report showed that 35 silver contracts were actually posted for delivery today, so that means that 35-34=1 more silver contract was added to June.

There was a deposit into GLD yesterday, as an authorized participant added 122,855 troy ounces — and there were no reported changes in SLV.

Ted and I are both of the opinion that these ETFs are owed copious amounts of physical metal that simply isn’t available, or hasn’t been deposited yet.  So in lieu of that, the authorized participants are most likely shorting their respective shares.

There was a sales report from the U.S. Mint yesterday.  They sold 80,000 of those 5-ounce silver coins…400,000 troy ounces worth.  They didn’t report selling anything else.

So far this month, the mint has sold 4,000 troy ounce of gold eagles — 3,000 one-ounce 24K gold buffaloes — and 550,000 silver eagles…plus the above mentioned 5-ounce silver coins.  And except for those 5-ounce coins, the rest of the mint sales are unchanged from this time last week.  Retail demand is still dead.

There was a bit of activity in gold over at the COMEX-approved depositories on the U.S. east coast on Thursday.  Nothing was reported received, but 5,373 troy ounces was shipped out of HSBC USA — and the link to that is here.

It was a very quiet day in silver, as only 6,942 troy ounces were received — and 84,501 troy ounces shipped out.  All of the ‘in’ activity was at Brink’s, Inc.  The ‘out’ activity came from three different depositories, which I’m not about to break out — and if you wish to look for yourself, the link is here.

There was no in/out activity reported at the COMEX-approved gold kilobar depositories in Hong Kong on their Thursday.

Here are two charts that I haven’t posted for many months.  They show the gold and silver holding of all know depositories, mutual funds and ETFs going back 20 years, as of the close of business on Friday.

And as I always point out, the amount of gold in these ETFs roughly follows the gold price…the blue trace on the first chart.  But it’s radically different on the silver chart, as the amount of silver held in these funds has risen almost continuously, even after JPMorgan drive-by shooting that began in the COMEX futures market at 6:00 p.m. EDT on April 30, 2011.  And that’s despite the fact that silver was driven from $50…down to around $15 today.  Click to enlarge for both.

The Commitment of Traders Report, for positions held at the close of COMEX trading on Tuesday, were right on Ted’s estimate in silver — and actually less than what he was fearing in gold.

In silver, the Commercial net short position increased by 9,296 contracts, or 46.5 million troy ounces.

They arrived at that number by adding 4,320 long contracts, but they also added 13,616 short contracts — and it’s the difference between those two numbers that represents their change for the reporting week.

Under the hood in the Disaggregated COT Report, it was all Managed Money traders, plus a bunch more, as the increased their long position by 7,404 contracts — and reduced their short position by 4,971 contracts — and it’s the sum of those two numbers…12,375 contracts…that represents their change for the reporting week.

The difference between that number — and the Commercial net short position…12,375 minus 9,296 equals 3,079 contracts…was made up by the traders in the other two categories, as both reduced their net long positions during the reporting week.

The Commercial net short position in silver is now up to 172.4 million troy ounces of paper silver.

Ted’s not sure what JPMorgan was up to during the reporting week, but just scanning the Producer/Merchant category where they hang out, there wasn’t a significant change.  So if they were up to something, it wasn’t much.

Here’s the 3-year COT chart for silver, courtesy of Nick Laird — and the deterioration should be noted.  Click to enlarge.

Of course if one could see the COT Report as of the close of COMEX trading on Friday, the increase in the Commercial net short position since Tuesday would be significant.  For that reason, Ted puts silver in the bearish category now…but by how much, remains to be seen.

In gold, the commercial net short position increased by ‘only’ 21,828 contracts, or 2.18 million troy ounces of paper gold.

They arrived at that number by increasing their long position by 4,274 contracts, but they also added 26,102 short contracts — and it’s the difference between those two numbers that represent their change for the reporting week.

Under the hood in the Disaggregated COT Report, it was almost all Managed Money traders once again — and almost to the contract.  They sold 22,126 long contracts, but also increased their short position by 770 contracts — and it’s the difference between those two numbers…21,356 contracts…that represents their change for the reporting week.

The difference between that number — and the change in the commercial net short position was only 472 contracts — and that was made up by the traders in the other two categories, although they went about it in wildly different manners.  The traders in the ‘Other Reportables’ category reduced their net long position by 1,271 contracts — and the traders in the ‘Nonreportable’/small trader category increased their net long position by 1,743 contracts.  The difference between those two numbers is 472 contracts, which it must be.

The commercial net short position in gold is now up to 22.39 million troy ounces.

Here’s the 3-year COT chart for gold — and the deterioration, like for silver, should be noted.  Click to enlarge.

Without doubt, the commercial short position in gold has increased massively since the Tuesday cut-off…and Ted’s WAG [wild-ass guess] was around 50,000 contracts.  I think it could be more, but we won’t know for sure for another week.  Gold is back in bearish territory from a COT standpoint as well.  But it and silver could remain in a bearish market structure for a long time under the current circumstances.

In the other metals, the Manged Money traders in palladium increased their net long position in this precious metal by a further 718 contracts.  The Managed Money traders are net long the palladium market by 10,769 contracts…fifty percent of the total open interest.  Total open interest in palladium is 21,581 COMEX contracts, up 2,580 contracts from the previous week.  And as you you already know, it’s a very tiny market.  In platinum, the Managed Money traders increased their net short position by a very hefty 5,021 contracts during the reporting week.  The Managed Money traders are now net short the platinum market by 20,720 COMEX contracts.  In copper, the Managed Money traders decreased their net short position in that metal by 7,329 contracts during the reporting week — and are net short the COMEX futures market by 44,976 contracts, or 1.12 billion pounds of the stuff.

Once again — and as always, it is Managed Money buying and commercial selling that account for virtually 100 percent of the price changes in the Big 6 commodities — and here’s the chart from Nick that shows that tight correlation in gold…at least 95 percent.  Normally I’d post the same chart for silver, but alas, as I said last week, Nick doesn’t have one.  Click to enlarge.

Here’s Nick Laird’s “Days to Cover” chart updated with yesterday’s COT data for positions held at the close of COMEX trading this past Tuesday. It shows the days of world production that it would take to cover the short positions of the Big 4 — and Big ‘5 through 8’ traders in each physically traded commodity on the COMEX. Click to enlarge.

For the current reporting week, the Big 4 traders are short 100 days of world silver production, which is up 2 days from last week’s report — and the ‘5 through 8’ large traders are short an additional 70 days of world silver production, which is unchanged from last week’s report — for a total of 170 days that the Big 8 are short, which is a bit under six months of world silver production, or about 396.8 million troy ounces of paper silver held short by the Big 8.  [In the prior week’s COT Report, the Big 8 were short 168 days of world silver production.]

In the COT Report above, the Commercial net short position in silver was reported as 172.4 million troy ounces.  As mentioned in the previous paragraph, the short position of the Big 8 traders is 396.8 million troy ounces.  The short position of the Big 8 traders is larger than the total Commercial net short position by a chunky 396.8 minus 172.4 equals 224.4 million troy ounces.

The reason for the difference in those numbers…as it always is…is that Ted’s raptors, the 37-odd small commercial traders other than the Big 8, are net long that amount.

As I mentioned in my COT commentary in silver above, Ted is unsure of what JPMorgan did during the reporting week, although it didn’t appear to be too much.  Of course things could have changed drastically since the Tuesday cut-off, but what those changes might be, won’t be know for another week.

The Big 4 traders now in that category are short, on average, about…100 divided by 4 equals…25 days of world silver production each.  The four traders in the ‘5 through 8’ category are short 70 days of world silver production in total, which is 17.5 days of world silver production each.  I would assume that there was a Managed Money or two in the Big 8 category during the reporting week, but they would have certainly disappeared since the Tuesday cut-off.

The Big 8 commercial traders are short 33.2 percent of the entire open interest in silver in the COMEX futures market, which is down a bit from the 34.7 percent they were short in last week’s report.  And once whatever market-neutral spread trades are subtracted out, that percentage would be around the 40 percent mark.  In gold, it’s now 40.9 percent of the total COMEX open interest that the Big 8 are short, down a tiny amount from the 41.7 percent they were short in last week’s report — and something over 45 percent once the market-neutral spread trades are subtracted out.

In gold, the Big 4 are short 51 days of world gold production, up 3 days  from what they were short in last week’s COT Report.  The ‘5 through 8’ are short another 24 days of world production, unchanged from what they were short last week…for a total of 75 days of world gold production held short by the Big 8…up 3 days from last week’s report.  Based on these numbers, the Big 4 in gold hold about 68 percent of the total short position held by the Big 8…up 1 percentage point from last week’s COT Report.

The “concentrated short position within a concentrated short position” in silver, platinum and palladium held by the Big 4 commercial traders are about 59, 66 and 85 percent respectively of the short positions held by the Big 8.  Silver is up 1 percentage point from a week ago, platinum is unchanged from last week — and palladium is up 1 percentage point from a week ago…and at a new record high.

If you look at the above ‘Days to Cover‘ chart above, you can see these percentages for yourself between the red and the green bars for each precious metal.  The grotesque short position of the Big 4 traders, relative to the positions of the Big 8 traders in palladium, should be noted.  It has been at this extreme level for many, many weeks now.

I have a fair number of stories for you today, including several that I’ve been saving for today’s column for length and/or content reasons.  There’s some fairly heavy-duty reading here, including one the comes with a “WARNING” label.


U.S. Manufacturing PMI Plunges to 10-Year Lows, Services ‘Hope’ Lowest on Record

Following (slightly) better-than-expected European PMIs, expectations for U.S. PMIs was for some stabilization after May’s collapse but they did not.

Both preliminary Manufacturing and Services PMIs for June dropped further, edging closer to contraction:

  • Flash U.S. Composite Output Index at 50.6 (50.9 in May). 40-month low.
  • Flash U.S. Services Business Activity Index at 50.7 (50.9 in May). 40-month low.
  • Flash U.S. Services PMI Business expectations fall to 57.8 – the lowest reading on record
  • Flash U.S. Manufacturing PMI at 50.1 (50.5 in May). 117-month low.
  • Flash U.S. Manufacturing Output Index at 50.2 (50.7 in May). 37-month low. Click to enlarge

Commenting on the flash PMI data, Chris Williamson, Chief Business Economist at IHS Markit said:

Recent months have seen a manufacturing-led downturn increasingly infect the service sector. The strong services economy seen earlier in the year has buckled to show barely any expansion in June, recording the second-weakest monthly growth since the global financial crisis.”

Business optimism has also become more subdued, with sentiment about the year ahead down to a new series low amid intensifying worries about tariffs, geopolitical risk and slower economic growth in the months ahead.”

This 3-chart news item was posted on the Zero Hedge website at 9:53 a.m. on Friday morning EDT — and it’s the first of two in a row from Brad Robertson.  Another link to it is here.

Existing Home Sales Tumble YoY For 15th Month — Worst Run Since Housing Crisis

After April’s disappointing drop in all segments of the home-sales data, existing home sales were expected to rebound (again) in May and surprised modestly to the upside.

Existing home sales rose 2.5% MoM to 5.34mm in May (and saw a modest upward revision in April)

However, existing home sales have declined on a YoY basis for 15 straight months…Click to enlarge.

As lower rates have apparently sparked a surge in prices as median home prices to a new record $277,700 – with a 4.8% YoY surge – the biggest spike since Aug 2018.

The purchasing power to buy a home has been bolstered by falling mortgage rates, and buyers are responding,” NAR Chief Economist Lawrence Yun said in a statement.

As Bloomberg notes, recent housing data have offered a mixed picture on the market, with housing starts falling from an April reading that was stronger than initially reported. Home builder sentiment deteriorated in June for the first time this year while permits gained, signaling a more robust pipeline of properties.

This brief 3-chart Zero Hedge article put in an appearance on their Internet site at 10:08 a.m. EDT on Friday morning — and I thank Brad Robertson for sharing it with us.  Another link to it is here.

Doug Noland: Rejoicing Central Banker Capitulation

We’ve reached the point in this most extraordinary cycle where it’s become pretty clear that loose monetary policies have minimal impact on aggregate consumer prices and maximum influence on highly speculative securities and derivatives markets. The Fed is poised to cut rates – perhaps even 50 bps – essentially to sustain market Bubbles. With 10-year Treasury yields nearing 2% – and in excess of $13 TN of bonds trading globally with negative yields – sovereign bond markets have become completely divorced from traditional fundamentals. This equates to governments from Rome to Washington essentially being handed blank checkbooks. And with the (“risk free” sovereign debt) foundation of global finance in market dislocation, how sound are markets for equities and corporate Credit?

Capitalism is in clear and present danger. This sounds extreme – unless you’ve followed the trajectory of developments over the years. How are capitalistic systems to operate with central banks abrogating adjustments and corrections both for market and economic systems? It takes a tremendous amount of wishful thinking to believe that today’s markets will effectively allocate real and financial resources. Sound analysis also points to only more precarious imbalances and maladjustment on a global basis. And with global fragilities increasingly conspicuous, it’s reached the perilous point where markets believe central banks will preemptively flood the global system with liquidity to forestall “risk off” in the markets and recession globally.

President Trump has officially commenced his reelection campaign. He has ample incentive to avert a trade war showdown with China. Chinese finance is nearing the precipice. President Xi has ample incentive to avert a showdown. Yet if these two historic strongmen leaders have irreconcilable differences they have irreconcilable differences. Neither can tolerate any display of weakness or lack of resolve.

If Trump and Xi don’t get negotiations back on track at next week’s G20, there’s a scenario where things could turn sour rather quickly. An unfolding crisis of confidence in China’s money market portends serious trouble ahead for China’s financial and economic Bubbles. The PBOC has been injecting enormous quantities of liquidity into China’s financial system. Much, much more will be required. If there is as much leverage in that system as I suspect, Beijing will be on the hook for Trillions of liquidity injections, bank bailouts/recapitalizations and debt monetization.

It all implies currency vulnerability. The good news for China is that currency values are relative – and the renminbi competes against a throng of structurally weak currencies. Little wonder gold has caught such a nice bid. Quite an equities run into “quadruple witch” option expiration. A decent short squeeze in EM securities markets and currencies. And wild volatility in crude and energy prices. Central Bank Capitulation seems to have unleased wild price instability throughout global markets. Things do get crazy during the late phase of Bubbles. We’re witnessing Bubbles and Craziness in historic proportions.

This week’s commentary from Doug is definitely worth reading.  It was posted on his Internet site in the wee hours of Saturday morning — and another link to it is here.

We Were Cocked & Loaded“: Trump Explains Why He Called Off Iran Strikes in Last Moment

President Trump reportedly gave the order to attack Iran Thursday night in response to its downing of a U.S. drone that Washington claims was in international waters at the time. The U.S. went so far as to maneuver planes and ships into position before the strike was called off.

The operation was underway in its early stages when it was called off, a senior administration official said. Planes were in the air and ships were in position, but no missiles had been fired when word came to stand down” the NYT reports, citing an unnamed official.

As the news of possible military action against Iran emerged, the FAA issued an emergency notice barring U.S. airlines from flying in airspace over parts of the Gulf.

All flight operations in the overwater area of the Tehran flight information region…above the Persian Gulf and Gulf of Oman only are prohibited until further notice due to heightened military activities and increased political tensions,” the FAA said, per the FT.

The FAA order came as United Airlines suspended its Mumbai to Newark flight that passes over Iran.

For what it’s worth, Trump’s decision to cancel the strike will please international officials who had urged the U.S. to exercise restraint.

Still, with Iran set to breach its limits on enriched uranium set out in the Iran deal within the next few days, the prospect of military escalation is hardly off the table.

This unfolding story appeared on the Zero Hedge website at 9:11 a.m. on Friday morning EDT — and was updated several times during the morning.  I thank Brad Robertson for this story as well — and another link to it is here.

America Last: The Real Meaning of the Donald’s Deplorable Aggression Against Iran — David Stockman

In the present era of 24/7 “breaking news”, the journalistic information intermediated by the internet and the cable networks has largely been reduced to noise, devoid of signal. Or at least any historical context beyond the here and now.

The currently threatened escalation of Washington’s economic war on Iran into an actual shooting war is a fraught case in point. Based on the news coverage since the two oil tankers were damaged yesterday you’d think that a crew of bloody-minded aggressors in Tehran had up and decided out of the blue to attack the whole world via disrupting its 18 million barrel per day oil lifeline through the Straits of Hormuz.

The truth of the matter, however, is just the opposite. The blatant aggressor is Washington and the dangerous confrontation now unfolding is utterly unnecessary.

That’s the foundational reality, and it’s far more important to understand than the momentary disputation about whether the Japanese oil tanker got hit by an Iranian mine or incoming projectile of uncertain origin.

Indeed, the Bombzie Twins, Pompeo and Bolton, have been in such heavy war heat for years that you can virtually bet when the dust settles the following false flags and manufactured pretexts for war per Max Blumenthal will have a Gulf of Oman coda:

Remember the Maine, Operation Northwoods, Gulf of Tonkin, Kuwaiti incubator babies, Saddam’s WMD’s, Qaddafi soldiers’ Viagra spree, Last Messages From Aleppo, Douma, burning aid on Colombia-Venezuela bridge…. and now today’s attacks in the Gulf of Oman.

This looooong bare-knuckles commentary by David was posted on the antiwar.com Internet site on Monday — and it’s the first of two in a row from Larry Galearis — and another article that had to wait for today’s missive.  Another link to it is here.

Pompeo, End Times, and False Flag War on Iran

A main issue with wars, indeed Sun Tzu’s first admonition, is that war should be a last resort, not the first as Washington seems to favor. Because one never knows where wars lead once they start. The fear is that Iran, once the United States attacks it, will be faced with the Hobson’s choice – either fire its missiles, it’s main non-obsolete weapon, or risk the U.S. destroying them. Firing them risks conflagration of much of the Persian Gulf oil shipping infrastructure. New technology in cheap mines and drones might also close the Gulf to shipping. This would devastate the world economy much of which depends upon the oil.

Add to this America’s penchant for starting wars, very often based upon lies or false premises. False flag operations mean having an attack blamed upon another nation which actually was not the culprit. Syria’s questionable fault for gassing of innocent civilians was used by Washington to bomb its Air Force. Now Secretary of State Pompeo has set us up by publicly stating that any attack on any American soldier in Iraq or Syria would cause America to attack Iran. He’s put every soldier at risk of death by some Israeli or Saudi fanatic.

Trump now says he does not want war with Iran. But he is surrounded by advisor who do. Both Secretary of State Pompeo and Vice President Pence are profound end times Evangelicals. In 2017 I wrote, Iraq, Syria, Iran…Are We To Destroy Iran Next? about the original neo-conservative program to re-mold the Middle East. A main new concern is Trump’s Secretary of State’s strong evangelical beliefs in the end times. The New York Times describes his beliefs The Rapture and the Real World: Pompeo Blends Belief and Policy. The belief is that a stronger and greater Israel will bring about Armageddon sooner and their rapture straight to heaven without a judgment day. Not all evangelicals are in this camp, e.g. see below about Jimmy Carter, but rather an important sector who moved from forecasting Armageddon to trying to bring it about. Destroying Iran’s being a threat to Israel is thus seen as helping God’s intentions.

The Financial Times explained in “Pompeo’s Global Rapture Tour” the concerns about Pompeo’s beliefs:

Yet I can’t help but feel anxious that both of Donald Trump’s main global envoys, Pompeo and Pence, have a conflict between their private beliefs and what they publicly claim to be doing. Both profess to be pro-Israel for example. Each enthusiastically backed the decision to move the U.S. embassy from Tel Aviv to Jerusalem last year. Each also subscribes to the Christian Zionist belief that the rapture will only come once the Jews have all regrouped in the Holy Land.”

The FT also links to a Guardian article quoting Pompeo, “Pompeo told a church congregation in Wichita three years ago. “It is a never-ending struggle . . . until the rapture. Be a part of it. Be in the fight.” Pompeo’s actions as a “Christian Zionist” are described in a New Republic article “The Christianization of U.S. Foreign Policy.”

WARNING!!!  This is a heavy-duty article whose subject matter has been widely reported on.  I though long and hard about posting this…but decided against self-censorship in this case.  Don’t venture further into this article if you feel it will insult your sensibilities.  You have been warned!!!  This commentary/article showed up on the antiwar.com Internet site on Monday — and for obvious reasons, had to wait for my Saturday column.  I thank Larry Galearis for pointing it out — and another link to it is here.

E.U. leaders remain at odds over top posts, call crisis summit

European leaders failed to agree Thursday on a new top team to lead efforts to reform their union for the next five years, and postponed a decision for a least a week.

The 28 heads of government met for dinner after Brussels’ main political factions refused to fall into line behind a single choice to head the European Commission.

The successor to Jean-Claude Juncker at the head of the E.U. executive is the key leadership role in Brussels, and without a nominee the leaders were also not able to agree the broader package of appointments, forcing them to call a crisis summit for Sunday June 30.

The European Council has had a full discussion of nominations,” summit host Donald Tusk, the president of the leaders’ council, said. “There was no majority on any candidate.”

The new summit comes just two days before the new European Parliament begins its first session, and the leaders are determined to agree on key appointments before lawmakers choose their own speaker.

French President Emmanuel Macron said parliament’s “lead candidate” process for choosing a Commission president is unworkable and that the 28 national leaders must decide.

This news story put in an appearance on the france24.com Internet site at 4:02 a.m. CEST on Thursday morning, which was 10:02 a.m. in Washington — EDT plus 6 hours.  I thank Roy Stephens for sending it our way — and another link to it is here.

Putin, Lavrov and Xi Call for an End to MAD. Lord Russell’s Spectre Frowns

The spectre of nuclear war has long hung over the world like a nightmarish sword of Damocles offering humanity much cause for despair at the dual nature of science as a beautiful source of creative power that uplifts and ennobles on the one hand and acts as a harbinger of death and chaos on the other.

However, it would be wrong to blame science for the crisis which mankind unlocked with the atom, when the reality is that we have never freed ourselves from the pest of oligarchical systems of rule. Going back to records of the Roman, Persian and Babylon empires, such systems have always sought to manipulate the masses into patterns of behaviour of self-policing and constant conflict.

Whether we are talking about the Crusades, European religious wars, Napoleonic wars, Crimean War, Opium Wars, or WWI and WWII, it has always been the same recipe: Get victims to define their interests around material constraints, diminishing resources, or religious/ethnic/linguistic biases that prevent each person from recognizing their common interests with their neighbor and then get them to fight. Classic divide and conquer.

By the close of WWII, that ancient recipe for managed chaos no longer functioned as a new ingredient was introduced into the geopolitical “great game”. This atomic ingredient was so powerful that those “game masters” managing the affairs of the earth from above like detached Olympian gods, understood that they could now be annihilated as fast as their victims and a new set of rules had to be created post haste.

This is yet another worthwhile article that had to wait for my Saturday column.  It appeared on the strategic-culture.org Internet site last Sunday — and another link to it is here.

Russia Will Help Iran With Oil, Banking If Europe’s SPV Payment Channel Not Launched

With Iran increasingly isolated by the West, even by Europe which last year so vocally opposed the U.S. withdrawal from the Iran Nuclear Deal and vowed to create a mechanism that circumvents SWIFT, only to reduce its opposition to zero after Trump threatened to impose sanctions on Europe if it proceeds with its experiment to bypass the dollar, Russia on Friday announced it was ready to help Iran export its crude and ease restrictions on its banking system if Europe fails to launch its dollar-evading SPV, Instex (Instrument in Support of Trade Exchanges) with Tehran, according to Interfax and PressTV.

The three European signatories to the 2015 nuclear agreement, officially known as the Joint Comprehensive Plan of Action (JCPOA), unveiled late in January the direct non-dollar payment mechanism meant to safeguard their trade ties with Tehran following the U.S. withdrawal from the nuclear deal and in the face of the “toughest ever” sanctions imposed by the United States against the Islamic Republic. In its initial stage, INSTEX would facilitate trade of humanitarian goods such as medicine, food and medical devices, but it will later be expanded to cover other areas of trade, including Iran’s oil sales.

However, it has not resulted in any trade deals so far. In late May, the U.S. threatened Europe with “loss of access to the U.S. financial system” if it rolled out the SWIFT-evading SPV, which appears to have crushed Europe’s enthusiasm to pursue alternative financial transactions with Tehran, forcing it to conceded to Washington (again).

Earlier this month, Iranian Foreign Ministry Spokesman Abbas Moussavi said European governments have failed to meet their expectations in implementing INSTEX to protect the JCPOA, criticizing their “lack of will” to deal with America’s pressure against Tehran.

This news item appeared on the Zero Hedge website at 7:05 p.m. EDT on Friday evening — and another link to it is here.

Tales of the New Cold War: The U.S. boasts of a Cyber Attack on Russia — John Batchelor interviews Stephen F. Cohen

Part 1: John Batchelor and Stephen Cohen have taken a respite this week from Russiagate with a return to the Cold War discussion about a dangerous new escalation by Washington into the cyber war area when the US government openly boasted (John Batchelor’s phrase) of a malware attack on Russia’s power grid infrastructure. The news was launched out of America’s premier propaganda source, The New York Times by its major anti Russian spokesperson, David Sanger, and it was as much “news” for President Trump as it was for the citizen.  The professor explains what such an attack really means to a country like Russia: disruption of the domestic electrical grid, dysfunctional water supply, interrupted communications, air command and nuclear response abilities. The U.S. Intelligence Community and Department of Defense ran the attack and Cohen finds it very significant that here was the “war party” finally openly admitting, if not bragging about this attack, and saying that this program has significant risk of escalating the cold war with Russia – as a good thing. This confirms again the danger of this new cold war for the professor and now we know it is also gone digital. The name, Paul Nakasone, Commander of Cyber Command, Director of NSA, and Chief of Central Security Service, is revealed to be behind the attack. In a statement he revealed that: “There was a need to defend forward (because) Russians do not fear us.”

Part 2: John Batchelor gives a brief introduction of what a nuclear war can do and the ability to take down power grids has its place in this process. But Cohen explains that this is essentially thematic in that Americans are now sensitized to hacking and this cyber attack has a kind of familiarity (Russiagate)  for Americans. That this was hidden from Trump means once again that someone else is directing policy against Russia and yet there is no outcry. Batchelor also discusses the possibility that the president’s “football” the electronic device always at hand with launch codes for missiles, could also include signal codes to launch malware. This added to the nuclear launch codes in itself could kill millions with the stoppage of a country’s vital services.

Cohen then asks why this “news” (my italics) was leaked now? He recalls that Trump is supposed to meet Putin at the G20 Meeting, and Russian media is saying that this may be the last chance to normalize relations between the two countries; Cohen suggests that the “attack” on the Russian power grid may be an attempt to disrupt this meeting.

John Batchelor then asks whether there really is a “war party” in Washington and how is it composed? Cohen’s answer: historically it is the Intelligence Community and Department of Defense. Past presidents knew exactly who was involved, and for Cohen this meant that they knew they had an institutional problem about where to find out trustworthy information. Which brought the discussion back to another question about the Sanger article: what was the message they thought the article was delivering to Moscow? The answer is apparently that the message is being taken very seriously (and Putin mentioned it as well. L.), that this is the beginning of Cyber War, and  that the Russians also recognize that this was an attempt to disrupt the meeting of Putin and Trump at the G20 Meeting. He also speculates there is an alliance between the MSM, the Democratic Party and the opponents of détente.


Yes, this grid attack event was a dangerous escalation but I want to add a cautionary element to it. The event is part warning and part hyperbole for the simple reason that there really was not an attack but only the warning of one. With a background of constant flow of nasty threats out of Washington and especially the White House, how seriously should the Russians take this? The Russian official reaction was nonplussed, but the media there consider this a dangerous escalation, and the media, according to Cohen, has a good  focus on official government positions.  Note that RT published a story about American plans to use robotic submarines against China – almost certainly impractical – but it is this kind of rhetoric out of Washington that discredits rather than inspires fear. However, there is a possible confirmation that the U.S. is quite capable of doing something to a country’s power grid. I mention the several major power failures in Venezuela, and just three days ago all of Argentina and Bolivia experienced massive power failures. Could these events be dry runs, or the demonstration to inspire that wanted fear response from Russia? That the power collapse in Argentina and Bolivia occurred almost on top of The New York Times article strongly suggests a connection. Coincidence does not play well here.

John Batchelor also reminds us that Barrack Obama also hinted that the U.S. would counter Russian interference in its own way and suggests that this was what he was talking about. The professor agreed and added that the article also significantly admitted to keeping this event from the president for fear that he might countermand it. Trump was incensed when he read the article, but Cohen found a strange link to the movie, Dr. Strangelove, where in the movie the Americans also announced an attack on Russia.

It’s been many months since there’s been any commentary from these two, let alone relevant commentary.  But this is one them.  As always, I thank Larry Galearis for his excellent executive summary…along with his personal comments.  This was posted on the audioboom.com Internet site on Tuesday.  The link to Part 1 is in the headline — and here.  And the link to Part 2 is here.

King Report: Despite central banking’s price-suppression schemes, gold revolts

Gold is now in revolution against central banks. Historically bonds eventually align with gold. But central banks and governments have cornered the bond market. Gold might have to carry the pitchforks and torches by itself for quite some time.

Gold is telling the world that a critical mass of investors is allocating central bank liquidity to gold because the liquidity is unlikely to be economically effective. This means financial assets, including currencies, are overvalued and too risky.

When gold is in a robust rally, pundits and the financial media have to produce fundamental reasons for the move. Inevitably with gold it is lack of confidence in — take your pick — forex, bonds, central banks, politicians, the world, or all of the above. The Street and media will create the self-reinforcing loop.

It is far too early to guess if or when bonds will join gold in the revolt. The longer that central banks maintain their bond corner, the higher gold should go and the worse the end game should be.

This gold-related commentary by Bill King was posted on his website on Friday — and it’s posted in the clear on the gata.org Internet site.  Another link to it is here.


It turned into a cloudy afternoon as we drove to Wells Gray Provincial Park about an hour north of Kamloops on May 4.  The entrance town is a place called Clearwater.  This is basically a wilderness park.  There’s one main road into it off of the Yellowhead Highway — and at the end, you turn around and go back.  Everything else is walking/backpacking country.  There are no services…you’re on your own…although there is 9-hole golf course — and a clubhouse of sorts near the entrance.  The first shot is looking west down the Clearwater River valley.  The second along the trail to Dawson Falls on the Murtle River — and the third, the falls themselves. Click to enlarge.


Government is a disease masquerading as its own cure.” — Robert LeFevre

Today’s pop ‘blast from the past’ comes to us courtesy of a singing group form Newport, Rhode Island…six siblings [from 8 to 19 years] noted for performing professionally and singing harmonies at an early age, later with their mother.  The group inspired the 1970s television show The Partridge Family.  They stepped up to the microphones in 1967 with a hit that made it to No. 2 on the Billboard charts.  They’re still singing it today — and the current iteration sounds just like the original.  The link is here.

Today’s classical ‘blast from the past’ was one that I stumbled across earlier this week, so I didn’t have to go looking, as reader M.A. sent it our way.  It’s one I haven’t featured before — and so here it is.  It’s Beethoven’s Piano Concerto No. 3 in C minor, Op. 37…which he composed in 1800…but wasn’t premiered until 5 April 1803…with himself as soloist.

For whatever reason, the score was incomplete at its first performance. Beethoven’s friend, Ignaz von Seyfried, who turned the pages of the music for him that night, later wrote: “I saw almost nothing but empty pages; at the most, on one page or another a few Egyptian hieroglyphs wholly unintelligible to me were scribbled down to serve as clues for him; for he played nearly all the solo part from memory since, as was so often the case, he had not had time to set it all down on paper.”

Here’s pianist Alice Sara Ott, with the Radio France Philharmonic Orchestra conducted by Mikko Franck.  She’s not using any sheet music, either.  The link is here.

It was yet another day where JPMorgan et al were at battle stations in the precious metals.  Although gold made it comfortably above the $1,400 spot mark — and would have blow sky high at 10 a.m. China Standard Time on their Friday morning…’da boyz’ simply would have none of that — and once they had engineered the price back below that mark, they were ultra careful about not allowing it trade above there again, let alone close above it.  Ditto for silver.

Gold is now deep into overbought territory — and almost $100 above its 50-day moving average — and $130 above its 200-day moving average.  In silver, those distances can be measured in dimes based on Friday’s closing price.  What’s going on in the other four of the Big 6 commodities is virtually irrelevant.  The war is being fought in the two monetary metals.  Nothing else matters.

Here are the 6-month charts for all four precious metals, plus copper and WTIC.  Besides what I noted in the previous paragraph, the volume bars for the last five days at the bottom of the gold chart shows how savage the fight has been during the last week, especially Thursday and Friday.  That goes for silver as well.  Click to enlarge.

The firepower that the powers-that-be have unleashed in the precious metal market this past week is like nothing I’ve seen before.  The volume numbers have been staggering…the highest I’ve ever seen in the twenty years I’ve been watching this market.

Although gold was up almost 60 dollars on the week — and silver by 45 cents…it’s a given that if JPMorgan et al hadn’t been ever vigilant as short sellers of first and last resort, gold could have easily been up $600 — and silver by $45.

Let me ask you the obvious, dear reader.  How much money would have flowed out of the U.S. equity markets and into the precious metals complex if these rallies in gold and silver had been allowed to run away to the upside?  Enough to blow it sky high — and it still might…as that thin edge of the wedge that I’ve been referring to for the last week or so, just got a whole lot thicker this week.

Here’s the 10-year chart for gold that I took off Nick Laird’s website just now — and from a technical point of view, gold has broken above all major resistance…the $1,360 price mark…a price ceiling that JPMorgan et al have been defending since mid 2016 — and they themselves have engineered.  Click to enlarge.

Well, it got away from them this week — and it remains to be see if they can get this genie back in the bottle any time soon, if ever.

Once again, here’s that Peter Warburton quote from his April 2001 essay that I used earlier this week to show you what central bankers are really up against…”What we see at present is a battle between the central banks and the collapse of the financial system fought on two fronts. On one front, the central banks preside over the creation of additional liquidity for the financial system in order to hold back the tide of debt defaults that would otherwise occur. On the other, they incite investment banks and other willing parties to bet against a rise in the prices of gold, oil, base metals, soft commodities or anything else that might be deemed an indicator of inherent value. Their objective is to deprive the independent observer of any reliable benchmark against which to measure the eroding value, not only of the U.S. dollar, but of all fiat currencies. Equally, their actions seek to deny the investor the opportunity to hedge against the fragility of the financial system by switching into a freely traded market for non-financial assets.

The moment that battle is lost…and it’s inevitable that will be lost at some point…the financial and fiat monetary systems that came into being in 1971 when Nixon “temporarily” denied convertibility in U.S. dollars for physical gold, will be relegated to the dustbin of history.

That’s what’s at stake here — and with central bankers being the sociopathic creatures that they are, they will fight this to very last COMEX contract.  The chance that they’ll ever sacrifice one good delivery bar in support of this fight, is remote at best.  Even though it began almost sixty years ago, they haven’t forgotten the hard lessons learned by the failure of the London Gold Pool back in the 1960s. And with some of the world’s central banks on a gold-buying spree currently, there would be no stomach for it now.

As the headline of my Thursday column stated…”Wednesday: A Foreshock of Things to Come?“…the first major crack in the current fiat system, particularly the U.S. dollar, has appeared.  There will be more to come — and more frequently now.  But at some point in the now not-to-distant future, the final crack will manifest itself — and will be unstoppable.  At that point, everything that we’ve known since childhood about security in our institutions will crash into smouldering ruins.

And as I’ve pointed out on numerous occasions over the years, I’m still not sure whether this “final crack” will come by circumstance, or design.

It may have started this week — and when the final denouement does arrive, the Golden Rule will come into play, as it has through all of history…”He who has the gold…[and silver]…makes the rules.

How did it come to this?

I’m done for the day — and the week — and I’ll see you here on Tuesday.