23 July 2019 — Tuesday
YESTERDAY in GOLD, SILVER, PLATINUM and PALLADIUM
It was certainly a ‘nothing’ day in gold on Monday, as it opened without fanfare in New York at 6:00 p.m. EDT on Sunday evening — and proceeded to chop very quietly sideways in a very narrow range everywhere on Planet Earth yesterday. It rallied a bit after the 1:30 p.m. EDT, but wasn’t allowed to close in positive territory.
The high and low ticks certainly aren’t worth looking up.
Gold finished the Monday session in New York at $1,424.00 spot, down $1.00 from Friday’s close. For a change, net volume was nothing special at just over 215,500 contracts — and there was a bit over 40,000 contract worth of roll-over/switch volume out of August and into future months.
Silver opened very quietly on Sunday evening as well, but jumped up a bunch in mid-morning trading in the Far East. There was a bit more jumping around about thirty minutes either side of the 2:15 p.m. afternoon gold fix in Shanghai — and then it didn’t do a whole lot of anything until a slightly positive price bias began shortly after 9 a.m. in New York. That lasted until 3:00 p.m. in after-hours trading — and then it was sold lower into the 5:00 p.m. close from there as well.
The low and high ticks aren’t worth looking up in this precious metal, either.
Silver was closed at $16.335 spot, up 15.5 cents on the day. Net volume was way up there at a hair under 95,000 contracts — and there was 4,210 contracts worth of roll-over/switch volume on top of that.
Platinum’s price path was very similar to silver’s, so I shan’t dwell on the play-by-play in this precious metal. Platinum finished the day at $846 spot, up 2 bucks from Friday.
Palladium began to edge unevenly higher once trading commenced at 6:00 p.m. in New York on Sunday evening — and its Far East high was set at 2:00 p.m. China Standard Time on their Monday afternoon. It was sold generally lower from the until the equity markets open in New York yesterday morning. Then away it went to the upside. That lasted until a minute or so before the COMEX close at 1:30 p.m. EDT — and it was sold down a few dollars from there. It then traded flat until the market closed at 5:00 p.m. Palladium was closed at $1,511 spot, up 23 dollars on the day.
The dollar index closed very late on Friday afternoon in New York at 97.15 — and opened unchanged once trading commenced at around 6:35 p.m. EDT on Sunday evening. It traded slightly above unchanged until a weak rally of sorts began around 11:45 a.m. BST in London. It crept very quietly and very unevenly higher until the 97.30 high tick was set around 3:45 p.m. in New York — and it didn’t do much of anything after that. The dollar index finished the Monday session at 97.26…up 11 basis points from Friday’s close.
It would appear most likely that both gold and silver were sold a bit lower in after-hours trading in New York yesterday once the dollar rally topped out.
Here is the DXY chart courtesy of the Bloomberg. Click to enlarge.
And here’s the 6-month U.S. dollar index chart, courtesy of the folks over at the stockcharts.com Internet site. The delta between its close…96.94…and the close on the DXY chart above, was 32 basis points on Monday. Click to enlarge as well.
The gold stocks opened up a bit once traded began at 9:30 a.m. in New York on Monday morning. They crept unevenly higher until shortly before the COMEX close — and then sold off quietly until the markets closed at 4:00 p.m. EDT. The HUI closed higher by 0.41 percent.
The rally at the open yesterday was a bit more enthusiastic in the silver equities, but once the initial rush was over they chopped very unevenly sideways for the rest of the day. Nick Laird’s Intraday Silver Sentiment/Silver 7 Index closed up 1.23 percent. Click to enlarge if necessary.
And here’s Nick’s 1-year Silver Sentiment/Silver 7 Index chart updated with Monday’s doji. Click to enlarge as well.
The CME Daily Delivery Report showed that 1 gold and 293 silver contracts were posted for delivery within the COMEX-approved depositories on Wednesday.
In gold, the lone contract was issued by Advantage — and stopped by JPMorgan….with both transactions involving their respective client accounts.
In silver, there were four short/issuers in total, with the two largest being HSBC USA and International F.C. Stone, with 121 and 120 contracts…HSBC from its in-house/proprietary trading account — and International F.C. Stone with 120 contracts from its client account. In distant third and fourth place were JPMorgan and Advantage, with 20 and 32 contracts from their respective client accounts as well. Of the five long/stoppers in total, the three largest were JPMorgan picking up 168 contracts for its client account, the CME Group with 88 for its own account — and Advantage with 24 for its client account.
The contracts stopped by the CME Group were immediately reissued as 88×5=440 one-thousand ounce mini COMEX silver contracts. Of that amount, there were 350 contracts stopped by ADM — and the remaining 90 were stopped by Advantage.
The link to yesterday’s Issuers and Stoppers Report is here.
The CME Preliminary Report for the Monday trading session showed that gold open interest in July fell by 18 contracts, leaving just 9 open, minus the 1 gold contract mentioned a few paragraphs ago. Friday’s Daily Delivery Report showed that 19 gold contracts were actually posted for delivery today, so that means that 19-18=1 more gold contract was added to July — and that’s probably the one out for delivery tomorrow. Silver o.i. in July rose by 77 contracts, leaving 399 still around, minus the 293 mentioned a few paragraphs ago. Friday’s Daily Delivery Report shows that 61 silver contracts were actually posted for delivery today, so that means that 77+61=138 more silver contracts just got added to the July delivery month.
There was another rather large deposit into GLD yesterday, as an authorized participant added 150,921 troy ounces. But that pales in comparison to the gargantuan 8,939,278 troy ounces that was deposited in SLV.
Since June 1, 2019…there has been 43,881,427 troy ounces of physical silver deposited into SLV. And that doesn’t even include the millions of ounces of silver that have been pouring into other silver funds over the same time period.
Ted has his hunches as to where this silver is coming from — and why — and I’m not about to disagree with him. But equally important is the question as to who’s been buying all this silver over the last six weeks or so, as it sure as heck isn’t John Q. Public.
The folks over at Switzerland Zürcher Kantonalbank updated their website with the goings-on inside their gold and silver ETFs as of the close of business on Friday, July 19 — and this is what they had to report. They added only 1,221 troy ounces of gold, but brought in a hefty 402,978 troy ounces on silver.
I posted the table of numbers below from Nick Laird’s website in my column on Saturday — and it’s time for a revisit only one business day later. It’s a list of all the known silver depositories, ETFs and mutual funds, showing the daily changes — and the 4-week changes, updated with Monday’s data. There was 9,552,016 troy ounces of silver added to them on a net basis yesterday — and 53.4 million over the last four weeks. Click to enlarge.
There was no sales report from the U.S. Mint.
The only activity in gold over at the COMEX-approved depositories on the U.S. east coast on Friday was one lone kilobar…32.15 troy ounces…U.K./U.S. kilobar weight that departed Manfra, Tordella & Brookes. I won’t bother linking this.
And, in what is a very rare occurrence, there was no in/out movement in silver.
The most activity on Friday came from the COMEX-approved gold kilobar depositories in Hong Kong on their Friday. They didn’t report receiving any, but shipped out 1,100 of them. That activity was at Brink’s, Inc. of course — and the link to that is here.
The Snettisham Jeweller’s Hoard is a collection of Romano-British jewellery and raw materials, found during the construction of a house in the Norfolk village of Snettisham in 1985. The hoard is thought to be the working stock of a jeweller, buried in a single clay pot around 155 A.D. The finds include the working tip of a quartz burnishing tool (its handle has not survived), partially or fully completed items of jewellery, and raw materials: mainly silver coins, scrap silver items and silver ingots, but also six pieces of scrap gold, and many engraved gemstones to be set in rings. The presence of scrap gold and silver and absence of base metals indicates that the jeweller dealt mainly with high-status customers.
The 17.5 centimetres (6.9 in) high pot in which the hoard was found is local grey-ware, spherical with relatively narrow opening and base, with a capacity of around 1.6 litres (0.35 imp gal; 0.42 US gal). Some items – such as bracelets – had to be bent to fit through the opening. Within the pot were found:
- 110 coins: 83 silver denarii and 27 bronze coins; 74 of the silver coins are from the third issue by Domitian (81–96 AD), one with a relatively high silver content. There are also some posthumous coins of the deified Empress Faustina I (dated to 154–155 AD) which give a terminus post quem for the burial of the hoard. The silver coins are probably raw materials; the bronze coins may be the jeweller’s own petty cash.
- 117 engraved carnelian gemstones, of which only 7 stones are mounted in finger rings. Most have simple wheel-cut intaglio engravings with symbols of good luck, including deities such as Fortuna, Bonus Eventus, and Ceres. Stylistic differences indicate that the gemstones were produced by at least three different engravers.
- A variety of completed rings, illustrating the range of variation available to a provincial jeweller, some set with gems, but many snake-rings, with a snake’s head stamped in low relief at either end of a silver ribbon which would then be bent into shape.
- Snake-bracelets, like the snake-rings, produced by stamping with a hammer and dies.
The finds are held by the British Museum. Click to enlarge.
I have an average number of stories/articles for you today.
We’ve made three major predictions in this space.
Today, we add a fourth one.
- The Fed will never “normalize” interest rates (at least, not willingly). We were right.
- The Trump team will never go “Full Retard” in its trade war with China. So far, the trade war is still at half retard. We will see what happens.
- MMT, or Modern Monetary Theory, as crazy as it is, will become the new humbug creed of both Democrats and Republicans. MMT is gaining ground daily. Both parties are canoodling with it, even if they don’t admit it.
And today, we add: There will be no serious federal budget cuts… and no attempt to bring runaway government spending under control.
This interesting commentary showed up on the bonnerandpartners.com Internet site very early on Monday morning EDT — and another link to it is here. A related story was posted on the Zero Hedge website at 5:52 p.m. EDT on Monday afternoon — and it’s headlined “Trump Announces Two-Year Budget Deal That Will Handle Debt Ceiling “With No Poison Pills””
Here we have an image from 2008. It records a Zimbabwean, making a visual comment on the fact that, in a matter of months, his country experienced government-driven hyperinflation that left him broke.
In July of that year, inflation stood at 3500% per month. In order to cope with hyperinflation, the Zimbabwe government simply printed currency notes in ever-increasing denominations, the highest being one hundred trillion dollars.
Yes, that’s $100,000,000,000,000.
Sounds like a lot of money. So why is the gentleman above referring to himself as starving? Well, in July 2008, the cost of a loaf of bread had risen to ten billion dollars. In actual fact, the bank notes displayed on the cardboard above fell well short of that amount.
Not surprisingly, the monetary system soon collapsed and by the following February, it needed to be re-started completely.
Tough break for Zimbabweans, but other than for compassion, why should we be concerned?
This worthwhile commentary from Jeff put in an appearance on the internationalman.com Internet site on Monday morning EDT — and another link to it is here.
“I’ve Had Many Strange Experiences In My Life” – Inside Epstein’s ‘Honey Trap’ on E 71st Street — Eric Margolis
[Note: I normally stay miles away from the internal goings-on within the U.S. political system..Spygate, etc…but this inside first-hand account on the Epstein issue from someone who has been around the block a few times…Eric Margolis…I thought worth posting. – Ed]
I’ve had many strange experiences in my decades of covering intelligence affairs. These run from being invited to KGB HQ in Moscow, Chinese intelligence in Beijing, U.S. intelligence in Virginia, Libyan intelligence in Tripoli, South African intelligence, and even Albanian intelligence in Tirana.
But none was odder than the day I was invited to lunch in New York City with the by now notorious figure Jeffrey Epstein. The golden boy of Manhattan and Palm Beach society now sits in a grim jail cell accused of having sex with underage girls. He’s been doing this in plain view since the early 1990’s but, until recently, he seemed bullet-proof.
Soon after I walked into the entrance of Epstein’s mansion on E 71st Street, said to be the city’s largest private home, a butler asked me, “would you like an intimate massage, sir, by a pretty young girl?” This offer seemed so out of place and weird to me that I swiftly declined.
More important than indelicacy, as an old observer of intelligence affairs, to me this offer reeked of ye old honey trap, a tactic to ensnare and blackmail people that was old when Babylon was young. A discreet room with massage table, lubricants and, no doubt, cameras stood ready off the main lobby.
I had arrived with Canada’s leading lady journalist who was then close to Epstein’s sometime girlfriend, Ghislaine Maxwell and, it was said, procuress – something Maxwell denies. Bizarrely, Maxwell believed that I could get KGB Moscow Center to release satellite photos that showed the murder on his yacht of her father, the press baron Robert Maxwell, who was a well-known double agent for Israel and KGB, and a major criminal.
You couldn’t make this stuff up — and that it in itself is more than disturbing. Coming from him, I have little doubt of its veracity. It appeared on the Zero Hedge website at 4:05 a.m. EDT on Monday morning — and comes to us courtesy of Brad Robertson. The link to this article on the EricMargolis.com Internet site is here.
Dave and I had a 25-minute chat on all-talk radio WAAM-1600 out of Ann Arbor, Michigan on Sunday afternoon. We spent all our time talking about things like Deutsche Bank, international finance and, of course the precious metals.
Swiss National Bank President Thomas Jordan is facing a new wall of pressure that could force him to push the world’s lowest central bank interest rate even lower.
The franc is already at the strongest in two years, and likely to move higher as the European Central Bank outlines plans for loosening. A dramatic shift toward parity could even prompt surprise action by Jordan before the next scheduled meeting in September. That’s something he’s not been afraid to do before, notably in 2015 with the shock decision to scrap the cap on the franc. Click to enlarge.
“There’s pressure on the SNB to act,” said Credit Suisse Group AG economist Maxime Botteron. “Especially if the ECB cuts by more than 10 basis points.”
The capital inflows boosting the currency reflect a slowing global economy that has investors searching for havens. Yet the SNB already has record-low interest rates and a swollen balance sheet, limiting its room.
This story appeared on the Bloomberg website at 9:00 p.m. Pacific Daylight Time on Sunday evening — and I thank Swedish reader Patrik Ekdahl for pointing it out. Another link to it is here.
As the silver price continues to break out of its lows, two of the top primary mining companies are experiencing major production declines in the first half of the year. Mexico’s Fresnillo PLC and Peru’s Buenaventura’s top primary silver mines saw a significant decrease in production due to either falling ore grades, decreased volumes of processed ore, poor weather, or labor strikes.
The largest silver miner in the world, Fresnillo PLC, just released their 1H 2019 production results, showing declines in all three of their major silver operations. The Fresnillo, Saucito, and San Julian Mines reported a combined 13% decline in silver production during the first half of the year while Buenaventura’s Uchucchacu Mine suffered a 40% decline.
Total silver production from Fresnillo PLC and Buenaventura fell 6.6 million oz (Moz) or 16% 1H (Jan-Jun) 2019 versus H1/2018…
If the current trend continues, the top two primary silver miners in the world could experience an 8-10% reduction in total mine supply in 2019. That is a considerable weakening of production right at the very same time the silver price is experiencing some strength in the market.
This interesting commentary showed up on the srsroccoreport.com Internet site on Monday sometime — and I thank Brad Robertson for sending it along. Another link to it is here.
Russian officials are planning to rezone the largest national park in Europe to allow gold mining in a move activists say could put all nature reserves here under threat.
At more than 1.9 million hectares, Yugyd Va national park in northwestern Russia is even bigger than the reserve around Iceland’s Vatnajkull glacier and forms part of the country’s oldest UNESCO natural heritage site, the “virgin Komi forests.”
It encompasses some of the most extensive untouched boreal forests in the world, the highest peak in the Ural Mountains. and tributaries of the Pechora River, the lifeblood of the indigenous Komi people.
But according to documents seen by The Daily Telegraph, the Komi region is now working with the federal government to remove protections from areas containing the Chudnoye (“Wonderful”) deposit, which holds an estimated 80 tonnes of gold long coveted by mining companies.
In a letter to the natural resources minister in October, the head of Komi claimed that rezoning part of the park for mining would create jobs for those left unemployed as the region’s coal industry dies out.
The rest of this gold-related story is buried behind a pay wall over at the telegraph.co.uk Internet site. Filed from Moscow, it was posted on their Internet site at 4:56 p.m. BST on Sunday afternoon in London — and I found it embedded in a GATA dispatch. Another link to it is here.
After a few months of seemingly diminishing central bank gold accumulations, Russia added a larger amount to its gold reserves in June than it had in the prior two months thereby perhaps quashing speculation that it may have been intentionally running down its reserve increases. Thus, for the month of June, the Russian Central Bank reported it added a further 600,000 troy ounces (18.66 tonnes) of gold to its reserves bringing the 6-month total to around 96.5 tonnes which looks like it’s getting back on track to add around another 200 tonnes this year. It is thus continuing to buy at a faster rate than China’s reported purchases which amounted to around 74 tonnes for the half year, although whether one can believe China’s reported gold reserve addition levels remains subject to debate.
Russia is the world’s fifth largest national holder of gold, as reported to the IMF, and is currently the world’s third largest producer, after China and Australia. (Its mines produced close to 300 tonnes of gold last year.) It is rapidly closing the reserve gap on the world’s No. 3 and No. 4 holders – Italy and France – and at the current rate of addition to its holdings could surpass both of these in terms of gold held in official reserves by the middle of next year – if not sooner.
While the Russian central bank remains the biggest accumulator of gold into its reserves as reported to the IMF, there remains a trend for Central Banks in general to increase their reserves with the latest to join the gold reserve building brigade, Poland which, as we reported here a few weeks ago, announced it had added 100 tonnes to its gold reserves in the first half of 2019, almost doubling them to 228.6 tonnes. This follows on from purchases of around 25.7 tonnes in the second half of 2018.
This worthwhile commentary from Lawrie put in an appearance on the Sharps Pixley website on Saturday sometime — and I found it on the Sharps Pixley website. Another link to it is here.
The PHOTOS and the FUNNIES
On Sunday morning, May 20…we drove B.C. Highway 97C/’The Connector’ from Merritt to Peachland for breakfast — and decided to spend the rest of the day exploring the place. Here are two shots along the waterfront — and it was already late/spring, early summer over there. That’s because they’re much lower in elevation than Merritt — and they have Okanagan Lake that modifies their air temperature as well during the winter. The third shot is of bachelor buttons just starting to flower — and growing wild along one of the residential streets. Click to enlarge.
It was a pretty much a nothing day on Monday — and not much should be read into the price actions of any of the precious metals, except the fact that ‘da boyz’ were always there, if you knew where to look. The first place they showed up was to close gold down on the day — and secondly, silver’s volume was enormous, as they are still not allowing this silver rally…such as it is…to get far.
Here are the 6-month charts for the Big 6 commodities — and silver’s overbought condition should be noted. Click to enlarge.
And as I type this paragraph, the London open is less than a minute away — and I see that ‘da boyz’ have been busy in the thinly-traded overnight market — and gold’s currently low was set around 1:40 p.m. China Standard Time on their Tuesday morning. It’s off that low by a bit — and down $7.10 an ounce currently. Silver was guided on a similar path — and its rally off its 1:40 p.m. CST low has been more robust — and it’s down 2 cents. Platinum and palladium prices have been handled in a similar manner, with the latter now back at unchanged — and the former down 6 dollars as Zurich opens.
Net HFT gold volume is pretty heavy already at about 70,000 contracts — and roll-over/switch volume out of August and into future months is not light either at around 11,800 contracts. Net HFT silver volume is not exactly light…coming up on 21,500 contracts — and there’s 1,200 contracts worth of roll-over/switch volume on top of that.
The dollar index opened up 6 basis points as soon as trading commenced at 7:45 a.m. on Monday evening in New York, which was 7:45 a.m. CST on their Tuesday morning. It rallied until around 1:25 p.m. China Standard Time — and hasn’t done much since — and is up 23 basis points at the moment.
Today, at the close of COMEX trading, is the cut-off for this Friday’s Commitment of Traders Report — and I’ll give you my opinion as to what might be in it in tomorrow’s column, once I see what the COMEX close looks like later today.
The July delivery month in silver is now winding down — and there are only seven more business days left, including today, in which all remaining deliveries have to be made. The August delivery month in gold is also ahead next week — and volumes will be increasingly heavy as this week progresses, as all the large traders that aren’t standing for delivery, have to roll or sell their positions by the close of COMEX trading on Monday.
And as I post today’s efforts on the website, I note that the gold price has been trading ruler flat ever since the 2:15 p.m. afternoon gold fix in Shanghai, but then jumped a bit higher in the last twenty minutes or so — and is down down only $5.50 the ounce at the moment. Silver is now up a penny currently. Platinum is still at unchanged — and palladium is down 8 bucks.
Gross gold volume is around 103,500 contracts — and minus roll-over/switch volume out of August and into future months, net HFT silver volume is 78,000 contracts. Net HFT silver volume is just under 24,000 contracts — and there’s 1,681 contracts worth of roll-over/switch volume in this precious metal.
The dollar index continues to inch very quietly and unevenly higher, but is off its current high — and is up 18 basis points as of 8:45 a.m. BST in London/9:45 a.m. CEST in Zurich.
That’s all I have for today — and I’ll see you here tomorrow.