Author Archives: Ed Steer

Jim Cook: A Q&A Session With Ted Butler

24 May 2019 — Friday

YESTERDAY in GOLD, SILVER, PLATINUM and PALLADIUM


The gold price crawled a dollar or so lower by noon in Shanghai on their Thursday — and was up a bit more than that amount by the London open.  It began to head quietly higher about an hour later, until the 8:20 a.m. EDT COMEX open — and then it took flight.  Ten minutes later it ran into ‘da boyz’ — and was sold lower until the equity markets open in New York.  It rallied a bit more from there until 10:45 EDT — and was then sold quietly lower into the 5:00 p.m. close.

The low and high ticks in gold were reported by the CME Group as $1,272.10 and $1,287.10 in the June contract.

Gold was closed in New York on Thursday at $1,282.80 spot, up an even 10 bucks on the day.  Net volume was getting up there at a bit over 246,000 contracts.  But roll-over/switch volume out of June and into future months was enormous once again at 85,500 contracts.

The price path that silver was allowed to travel was nearly identical to that of gold, with the only real difference being the timing of its high of the day…$14.61 spot…which came around 11:10 a.m. in New York.  It wasn’t allowed above that price after that.  Once the COMEX closed at 1:30 p.m. EDT, silver’s price was edged quietly lower until the market closed at 5:00 p.m.

The low and high ticks in this precious metal were recorded as $14.40 and $14.635 in the July contract.

Silver was closed at $14.555 spot, up 14.5 cents on the day…but, like gold, would have closed considerably higher than that, if allowed…which it obviously wasn’t.  Net volume was very decent at a hair under 65,000 contracts — and there was 3,900 contracts worth of roll-over/switch volume in this precious metal.

The platinum price was sold unevenly lower until the low tick was set around 12:30 p.m. in Zurich.  It jumped around — and higher by a bit in COMEX trading in New York.  But by shortly after 12 o’clock noon EDT, ‘da boyz’ had it settled down — and it was closed at $798 spot, down 5 dollars on the day — and at a new low close for this engineered price decline.

The palladium price was down ten dollars by shortly before 11 a.m. China Standard Time on their Thursday morning — and it chopped very unevenly, but quietly sideways for the remainder of the day.  I’m ignoring the vicious down/up spike shortly before 10 a.m. in New York, as this is a frequent occurrence in this precious metal, as its always a very tiny and illiquid market at the best of times.  Palladium finished the Thursday session at $1,292 spot, down 7 bucks from its close on Wednesday.

The dollar index closed very late on Wednesday afternoon in New York at 98.04 — and opened up about 2 basis points once trading commenced at 7:45 p.m. on Wednesday evening, which was 7:45 a.m. CST on their Thursday morning.  It crept a bit higher until around 8:10 a.m. BST in London — and then crept lower, giving back almost all that gain [such as it was] by 8:35 a.m. in New York.  It jumped a bit higher starting at that juncture — and the 98.37 high tick was set a few very minutes after the equity markets opened in New York yesterday morning.  The index began to slide from there — and the 97.81 low came around 1:15 p.m. EDT.  It chopped quietly sideways from that juncture until the market closed at 5:30 p.m.

Of course the sell-offs in both silver and gold that occurred in early morning trading in New York will be attributed to the ‘rally’ that occurred in the dollar index at that point.  But it was just as obvious that neither precious metal was allowed to benefit much from the rather precipitous decline in the DXY that followed thereafter.

The dollar index finished the Thursday session at 97.86…down 18 basis points from Wednesday’s close.

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

And here’s the 6-month U.S. dollar index chart, courtesy of stockcharts.com — and the delta between its close…97.72…and the close on the DXY chart above, was 14 basis points on Thursday.  Click to enlarge as well.

The gold stocks jumped up at the open, with most of the gains coming by minutes before 10:30 a.m. in New York trading.  They crept unevenly higher from that point until a few minutes before the 1:30 p.m. COMEX close — and then were sold rather sharply lower until trading ended at 4:00 p.m. EDT.  The HUI closed up only 0.44 percent, giving up about two percentage points of its gains on the day in the process.

The rally in the silver equities was far less impressive — and the sell-off in their shares began at the exact same moment as they did for the gold stocks…a very few minutes before the COMEX close.  They actually closed down on the day, as Nick Laird’s Intraday Silver Sentiment/Silver 7 Index finished lower by 0.67 percent.  The choppy chart pattern that existed until minutes before noon EDT was caused by a data feed error on Nick’s website.  Click to enlarge if necessary.

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

Excuse me for thinking this, but the sell-offs in the precious metal equities that began a minute or so before the COMEX close yesterday, looked deliberate to me…as no profit-maximizing seller would unload a position in such a manner.  This was not John Q. Public selling, as they were buyers yesterday.


The CME Daily Delivery Report showed that zero gold and 3 silver contracts were posted for delivery within the COMEX-approved depositories on Monday.  In silver, Advantage issued all three — and ADM and JPMorgan picked up 2 and 1 contracts.  All contracts, both issued and stopped, involved their respective client accounts.  The link to yesterday’s Issuers and Stoppers Report is here.

The CME Preliminary Report for the Thursday trading session showed that gold open interest in May remained unchanged at 58 contracts for the second day in a row — and no gold contracts are out for delivery today.  Silver o.i. in May dropped by 48 contracts, leaving 209 still open, minus the 3 silver contracts mentioned in the previous paragraph.  Wednesday’s Daily Delivery Report showed that 48 silver contracts were actually posted for delivery today, so the change in open interest and deliveries match in this precious metal as well.


There were no reported changes in either GLD or SLV on Thursday.

And there was no sales report from the U.S. Mint, either.

There was a bit of activity in gold over at the COMEX-approved depositories on the U.S. east coast on Wednesday.  Nothing was reported received — and only 2,712 troy ounces was shipped out — and that occurred at HSBC USA.  I won’t bother linking this.

It was a lot busier in silver, as 599,578 troy ounces…one truckload…was received — and all that ended up at Canada’s Scotiabank.  There was 753,816 troy ounces shipped out.  One truckload…600,637 troy ounces…departed Scotiabank — and the remaining 153,178 troy ounces left the Brink’s, Inc. depository.  There was also a tiny paper transfer, as 9,973 troy ounces was moved from the Eligible category — and into Registered…destined for delivery in the May, no doubt.  That occurred at CNT.  The link to this activity is here.

It was fairly busy over at the COMEX-approved gold kilobar depositories in Hong Kong on their Wednesday.  There were 1,800 reported received — and 1,167 shipped out.  This activity was at Brink’s, Inc. — and the link to that, in troy ounces, is here.


The Middleham Hoard is a coin hoard found near Middleham, North Yorkshire in England. It dates from the period of the English Civil War, and consists of 5,099 coins, all silver. It is the largest hoard of coins buried during the Civil War to have been discovered. The hoard was discovered in June 1993 by William Caygill while using a metal detector. Though referred to as one hoard, the coins were buried in three pots in two pits. These had slightly different deposition dates; likely in the later 1640s, though the person making the deposits was probably the same. The coins are dispersed between museums and private collections, 54 of them now in the Yorkshire Museum’s numismatic collection.

Two of the pots (A and B) were discovered together, and the third pot (C) was discovered about twenty paces to the west. All three pots were covered with a capstone made from local Coverdale sandstone. The latest coins in Pots A and B date to 1645–1646, suggesting a date of deposition of about 1646. Pot C includes ten shilling coins with a late portrait of Charles I that are not represented in either Pot A or Pot B; Pot C also includes a single shilling with a “sceptre” privy-mark that was in use from 1646 to 1649. These features suggest that Pot C was deposited at a slightly later date than Pots A and B, possibly in 1648.

One of the main features of the hoard is the relatively large proportion of Spanish coins. There are 247 coins from the Spanish Netherlands and Spanish America, comprising nearly 5% of the hoard by numbers, but these coins are of high value — and the face value of these Spanish coins is about £65, which is some 20% of the face value of the entire hoard.

The three pots in which the coins were buried in are all rather similar types of mid-seventeenth century kitchen ware. They are all handled jars that would have been used in the kitchen, and as they show no signs of being used for cooking it has been surmised that they would have been used for food storage.  Pot ‘A’ is featured in the first photo — and Pot ‘B’ in the third.  Click to enlarge.

For the second day in a row I don’t have all that much in the way of articles/stories for you.


CRITICAL READS

U.S. PMIs Crash as Business Confidence Collapses to 7-Year Lows

Following disappointments in Europe’s PMI this morning (with Germany slumping even further, and seeing IFO hit a 4.5 year low), preliminary May data for US PMIs were expected to rebound very modestly after its recent collapse.

But both Manufacturing and Services PMI slumped again in May:

  • Flash U.S. Composite Output Index at 50.9 (53.0 in April). 36-month low.
  • Flash U.S. Services Business Activity Index at 50.9 (53.0 in April). 39-month low.
  • Flash U.S. Manufacturing PMI at 50.6 (52.6 in April). 116-month low.
  • Flash U.S. Manufacturing Output Index at 50.8 (52.7 in April). 35-month low

It’s ugly!!  Click to enlarge.

This 2-chart Zero Hedge story was posted on their website at 9:52 a.m. EDT yesterday morning — and I thank Brad Robertson for sharing it with us.  Another link to it is here.


Hey Parker Brothers! Bankers Changed The Rules Of Your Monopoly Game —  Dennis Miller

In 1935, Parker Brothers introduced the game “Monopoly”. Wikipedia tells us:

Monopoly is a board game…. Players roll…dice to move around the game board, buying and trading properties, and developing them with houses and hotels. Players collect rent from their opponents, with the goal being to drive them into bankruptcy.

Money can also be gained or lost through Chance, Community Chest cards, and tax squares; players can end up in jail, which they cannot move from until they have met one of several conditions. …hundreds of different editions exist…. Monopoly has become a part of international popular culture….”

I remember Monopoly as a multi-generational game we played for hours. We all started with the same amount of money. The goal was to acquire property and drive your opponents bankrupt.

The bank was passive, collecting fines and paying out $200 every time you passed GO. Passive? Not anymore!

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


Trump Missed His Chance to Make America Great Again — Bill Bonner

In the last 20 years, there were probably only a couple of opportunities to stop this Debtball Express.

One of them came in June 2000, says our colleague David Stockman. Then, it was obvious – to Alan Greenspan, as well as others – that the monetary system inspired by Milton Friedman and put in service by Richard Nixon wouldn’t work. Friedman’s system – monetarism – called for controlling the growth of money, keeping it at around 3% per year.

But after 1971, when the final thread between gold and the dollar was severed, America’s real purchasing power came from a new source – credit.

And by the end of the 20th century, Greenspan noticed that the Fed no longer knew what “money” was… and could neither measure it nor control it.

Greenspan, the former gold bug, might have stood up straight before his fellow Fed governors and explained the situation:

Uh… guys… this isn’t working. We’ve got to go back to a gold-based system.”

Instead, he let the credit money system erupt, reducing the cost of money/credit from a federal funds rate of 6% to a rate of 1% – the lowest at that point in history.

This worthwhile commentary from Bill put in an appearance on the bonnerandpartners.com Internet site early on Thursday morning EDT — and another link to it is here.


U.K. Pound Headed For Record 14-Day Losing Streak as May Resignation Expected

Instead of hanging on for what would be a fourth vote on the withdrawal agreement she negotiated with the European Union – an agreement that is widely despised in Parliament because of the possibility that the hated ‘Irish Backstop’ could trap the U.K. in the E.U. Customs Union indefinitely – Theresa May might instead step down, or set a date for her resignation, according to a Financial Times report.

When the government published its itinerary for future business on Thursday, it left no time set aside for debating the “WAB” – that is, the withdrawal agreement bill – during the week of June 3. Though a senior Tory whip filling in for Andrea Leadsom (who resigned as Commons leader last night) insisted that the government still wanted to debate the bill, anonymous sources cited in the British press were skeptical.

Rumors that May had been preparing to resign on Wednesday night didn’t pan out, but many still expect May to either resign or decide on a firm departure date before the end of the week, as the backlash to the latest iteration of her withdrawal plan – which included a provision for a Parliamentary vote on a second referendum – intensifies. Graham Brady, the leader of the 1922 Committee of Tory backbenchers, reportedly told the prime minister that she would face another leadership challenge if she decides to move ahead with a vote on her withdrawal bill. Leadsom’s departure has also fostered rumors that more cabinet members could follow her lead and resign.

Should the Brexit Party garner a decisive plurality of the vote in the European Parliamentary elections on Thursday – as is widely expected – that would be yet another rebuke to the PM.

Amid all of the uncertainty, the pound weakened on Thursday for the 14th straight session as May’s refusal to go quietly creates more uncertainty surrounding the Brexit outlook.

This news item showed up on the Zero Hedge Internet site at 7:15 a.m. on Thursday morning EDT — and another link to it is here.  I thank Brad Robertson for sending it our way.  There was this somewhat related Zero Hedge story from 4:15 a.m. EDT on Thursday morning — and that one is headlined “How Farage’s Brexit Party is Destroying The U.K. Political Establishment” — and that’s from Brad as well.  It’s worth reading.


Deutsche Bank CEO Vows to Make “Tough Cutbacks” as Shares Slump to Record Low

Watching Deutsche Bank shares crash to new all-time lows (around €6.35/US$7.07) just as the troubled German lender’s annual shareholder meeting was getting underway in Frankfurt on Thursday, we could hardly imagine anything more appropriate. Actually, that’s not true – there is one thing: The revelation, just hours before the meeting’s start, that a ‘software glitch’ had blocked reporting of suspicious transactions for years.

With DB’s brand mired in controversy thanks to Congressional subpoenas that have drawn attention to its lending relationship with the Trump Organization, anything that would appear to support Maxine Waters’ claim that DB is “the biggest money laundering bank in the world” is perhaps the last thing shareholders need to see (other than maybe another capital raise).

Following the collapse of merger talks with Commerzbank, Deutsche’s frustrated shareholders let it be known that their patience with the bank’s perennial underperformance and its cratering share price (the bank’s market capitalization is now under €15 billion) has run out. Now is the time for CEO Christian Sewing, who was heralded as a reformer when he was elevated to replace John Cryan 14 months ago, to make good on his promise to turn DB around.

And though Sewing didn’t give as much ground as investors would probably have liked, he did deliver a grudging concession during his speech: It’s time to make “tough cutbacks” to DB’s investment bank. WSJ described Sewing’s statement to shareholders as “his strongest public admission yet that the business needs a dramatic overhaul.”

This article showed up on the Zero Hedge website at 11:31 a.m. EDT on Thursday morning — and I thank Brad Robertson for sending it along.  Another link to it is here.


China’s Insurmountable Global Weakness: Its Currency — Charles Hugh Smith

If China wants superpower status, it will have to issue its currency in size and let the global FX market discover its price.

Quick history quiz: in all of recorded history, how many superpowers pegged their currency to the currency of a rival superpower? Put another way: how many superpowers have made their own currency dependent on another superpower’s currency?

Only one: China. China pegs its currency, the yuan (RMB) to the U.S. dollar. It adjusts the peg a bit here and there, but the yuan’s value is set by the Chinese state, not by the market of buyers and sellers.

Second question: is pegging your currency to a rival power’s currency a sign of strength? The obvious answer is no. It’s a sign of weakness. A real financial power issues its own currency and let’s the global FX (foreign exchange) market discover the relative price / value of the currency. The financial power trusts the market to discover the value / price of its currency, and it responds by raising or lowering the yields on its government bonds and other pricing inputs.

If the issuing nation won’t allow users and owners of its currency price discovery, few will want the currency because they can’t trust the state’s arbitrary, non-market price. This reality is reflected in the chart below of global currencies’ relative share in global payments, loans and reserves. China’s currency, the yuan (RMB) is basically signal noise: its global role in payments, loans and reserves is near-zero.  [The ‘click to enlarge’ feature does not help with this chart.]

This commentary by Charles appeared on the Zero Hedge website at 10:40 a.m. on Thursday morning EDT — and it’s another contribution from Brad Robertson.  Another link to it is here.  A related story from the South China Morning Post is headlined “Could China Dump Its U.S. Treasuries to Fight the Trade War? A Contrarian View is Emerging in Beijing” — and I found that one in a GATA dispatch.


Jim Cook Interviews Ted Butler: JPM, Silver Investors & More

Cook: A lot of silver investors are frustrated these days. Can you give them any hope?
Butler: I’d be lying if I said I wasn’t frustrated as well. But I have no doubt that silver will eventually prove its great worth.

Cook: Does everything still depend on what JPMorgan does?
Butler: If you don’t know by now that silver is manipulated by COMEX paper trading, largely at the hands of JPMorgan, you’re missing the whole story.

Cook: OK, we get all that. We want to know when will it change?
Butler: When JPMorgan decides it will change. Look, you know I can’t tell you the precise time in advance.

Cook: Is that the best you can do? People are getting tired of hearing that.
Butler: Tired of what – the only explanation that makes any sense?

This rather brief, but must read Q&A between Jim and Ted was posted on the silverseek.com Internet site at 11:15 a.m. EDT on Wednesday morning — and I lifted it from Ted’s mid-week column to his paying subscribers on Wednesday afternoon.  Another link to it is here.


The PHOTOS and the FUNNIES

A week after our day trip to Hope, we headed east from Kamloops towards Chase, B.C...partly on the Trans-Canada Highway on the south shore of the South Thompson River.  We crossed over to the north shore at a rather hole-in-the-wall place called Pritchard on this 1-lane wooden bridge that you can see in the first photo.  It was a glorious sunny and warm day…not a cloud in the sky.  The last two shots were from the gravel road that leads to Chase — and the river and the Trans-Canada Highway are clearly visible in both shots…the first looking southwest — and the second looking due east.  Click to enlarge.


The WRAP

Everything was not fine that spring with the American economy. It was showing ominous signs of trouble. Steel production was declining. The construction industry was sluggish. Car sales dropped. Customers were getting harder to find. And because of easy credit, many people were deeply in debt. Large sections of the population were poor and getting poorer…

It was this nature of mass illusion. Prices were going up, people bought. That forced prices up further, that brought in more people. And eventually, the process becomes self-perpetuating. Every increase brings in more people convinced of their God-given right to get rich.

At the end of 1929, as they celebrated New Year’s Eve, all that lay in the future. Nobody knew that the Great Depression was coming — unemployment, bread lines, bank failures — this was unimaginable. But the bubble had burst. Gone was that innocent optimism, the confidence, the illusion of wealth without work. One era had ended. They toasted the coming of the 30s, but somewhere, deep down, they knew the party was over.” — PBS American Experience: The Great Crash of 1929


Although gold and silver were allowed to rally by a bit before being capped and turned lower, neither price increase came anywhere near breaking above gold’s 50-day moving average, or silver’s 200-day moving average.  There was most likely some increase in the commercial net short positions in both these precious metals, but it wouldn’t have been by material amounts.

Platinum was closed at another new low for this move down — and copper hit a new intraday low for this move down, but finished the Thursday trading session a hair above its Wednesday’s close.  Oil got hammered back below its 200-day moving average on the inventory build-up report yesterday.  But the price drop occurred because the Managed Money traders were puking up longs — and going shorts…the same reason that prices decline in the precious metals.  It’s all paper.

Here are the 6-month charts for all four precious metals, plus copper and WTIC — and the above changes should be noted.  Click to enlarge for all.

And as I type this paragraph, the London/Zurich opens are minutes away — and I note that the gold price didn’t do much of anything in Far East trading — and is down 20 cents currently. Silver hasn’t done a thing in Far East trading, either — and it’s down 2 cents. Platinum has been stair-stepping its way quietly higher in price — and is up 6 bucks at the moment. Ditto for palladium, except it’s now up 14 dollars.

Net HFT gold volume is pretty light at just under 30,000 contracts — and there’s 5,800 contracts worth of roll-over/switch out of June and into future months. Net HFT silver volume is pretty decent already at around 10,400 contracts — and there’s 400 contracts worth of roll-over/switch volume in this precious metal.

The dollar index has been trading very quietly sideways ever since trading began at 7:45 p.m. in New York on Thursday evening, which was 7:45 a.m. China Standard Time on their Friday morning. That lasted until 2 p.m. CST on their Friday afternoon. It has been heading lower ever since — and as of 7:45 a.m. BST in London/8:45 a.m. CEST in Zurich, the index is down 12 basis points…and off its current low tick by a hair.


Today, around 3:30 p.m. EDT, we get the latest and greatest Commitment of Traders Report for positions held at the close of COMEX trading on Tuesday — and I’m expecting big declines in the commercial net short positions in both silver and gold…plus platinum as well.

Silver analyst Ted Butler had this to say about what he expects in today’s report…”As far as what to expect in this Friday’s COT report, the reporting week ended yesterday was a mirror-image of the previous reporting week, so the hope is that much if not all of the prior week’s deterioration in gold was reversed…It may be too optimistic to expect a complete reversal of the prior week’s 40,000 net contracts of managed money buying, but I do hope we come reasonably close…The main focus of my attention in Friday’s report will be what the crooks at JPMorgan did.”

As the May delivery month in silver draws to a close, all eyes should now be on the upcoming delivery month for gold in June.  As you are most likely already aware, roll-over/switch volume out of June and into future months has really picked up this week — and will continue to be heavy right until next Thursday…the day before First Day Notice.  The heaviest volume day will most likely occur on Wednesday, as all the large trader that aren’t standing for delivery in that month, will have to sell their June positions, or roll them over into future months.


And as I post today’s efforts on the website at 4:02 a.m. EDT, I see that the gold price has done very little during the first hour of London trading — and is still down 30 cents the ounce. Silver is still down 2 cents. Platinum and palladium are up 5 and 20 dollars respectively.

Gross gold volume is a bit over 53,500 contracts — and minus roll-over/switch volume out of June and into future months, net HFT gold volume is 39,000 contracts. Net HFT silver volume is a bit over 12,500 contracts — and there’s still only 400 contracts worth of roll-over/switch volume on top of that.

The dollar index hit it current low about twenty minutes before the London/Zurich opens — and has crawled a bit higher since — and as of 8:45 a.m. in London/9:45 a.m. in Zurich, the index is down 7 basis points.

That’s all I have for today.  I hope you have a great weekend — and I’ll see you here tomorrow.

Ed

New Low Closes in Platinum & Copper Yesterday

23 May 2019 — Thursday

YESTERDAY in GOLD, SILVER, PLATINUM and PALLADIUM


It was another incredibly low-volume day in gold.  It didn’t do much in Far East trading — and was down about $1.70 or so at the London open.  It rallied a handful of dollars in fits and starts from there, before getting capped and turned lower at 9:45 a.m. in New York — and it was mostly downhill from there until trading ended at 5:00 p.m. EDT.

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

Gold finished the Wednesday session at $1,272.80 spot, down $1.40 from Tuesday’s close.  Net volume was exceedingly light at around 126,500 contracts — and roll-over/switch volume was pretty heavy at a bit over 66,000 out of June and into future months.

Silver was forced to follow the same general price path as gold — and the high and low ticks aren’t worth looking up, either.

Silver closed yesterday at $14.41 spot, down 1.5 cents on the day.  Net volume was also unbelievably quiet at a hair under 33,500 contracts — and there was 3,560 contracts worth of roll-over/switch volume on top of that.

Platinum began its downward price decent shortly before 9 a.m. China Standard time on their Wednesday morning — and it crept unsteadily lower until around 12:45 p.m. in New York — and didn’t do a thing after that.  Platinum was closed at $803 spot, down another 12 bucks — and another new low close for this engineered price decline.

The palladium price didn’t do much of anything until around 2 p.m. CST on their Wednesday afternoon — and it began to edge quietly lower from there, with the low tick of the day coming about 10:40 a.m. in New York.  It jumped back to the $1,300 spot mark minutes after the Zurich close — and crept unevenly sideways for the rest of the day.  Platinum finished the Wednesday trading session at $1,299 spot, down 4 bucks from Tuesday’s close.

The dollar index closed very late on Tuesday afternoon in New York at 98.06 — and opened down 5 basis points once trading commenced at 7:45 p.m. EDT on Tuesday evening, which was 7:45 a.m. China Standard Time on their Wednesday morning.  It drifted a couple of basis points lower from that juncture, but began to head unevenly higher starting at 9:35 a.m. CST — and that rally lasted until around 8:55 a.m. in London, when the 98.12 high tick of the day was set.  A more serious decline began at that juncture — and the 97.89 low was set at 8:45 a.m. in New York.  A ‘rally’ began at that point — and it headed very unevenly higher until around 4:55 p.m. EDT.  It shed a few basis points going into the 5:30 p.m. close.  The dollar index finished the Wednesday session at 98.04…down 2 basis points from Tuesday’s close.

Here’s the DXY chart courtesy of BloombergClick to enlarge.

And here’s the 6-month U.S. dollar index chart, courtesy of the folks over at the stockcharts.com Internet site — and the delta between its close…97.88…and the close on the DXY chart above, was 16 basis points on Wednesday.  Click to enlarge as well.

The gold shares opened unchanged — and were up a hair by a minute or so before 10 a.m. in New York trading.  It was quietly downhill from there — and the low tick was set very close to 3 p.m. EDT.  Some bargain hunters showed up at that juncture — and they edged a bit higher into the close.  The HUI finished down 1.41 percent.

The price path for the silver equities was very similar to the gold stocks, except their sell-off was more intense — and they barely closed off their low ticks of the day.  Nick Laird’s Intraday Silver Sentiment/Silver 7 Index finished lower by 2.81 percent.  Click to enlarge if necessary.

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

The CME Daily Delivery Report showed that zero gold and 48 silver contracts were posted for delivery within the COMEX-approved depositories on Friday.

In silver, of the three short/issuers in total, the only one that mattered was JPMorgan, with 41 out of its client account.  Of the four long/stoppers in total, the two biggest were ADM with 32 contracts for its client account — and JPMorgan, with 11 in total…8 for its client account — and 3 contracts for its in-house/proprietary trading account.

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

The CME Preliminary Report for the Wednesday trading session showed that gold open interest in May remained unchanged at 58 contracts — and no contracts were posted for delivery today…so those number match.  Silver o.i. in May actually rose by 32 contracts, leaving 257 still open, minus the 48 contracts mentioned a few short paragraphs ago.  Tuesday’s Daily Delivery Report showed that 29 silver contracts were actually posted for delivery today, so that means that 32+29=61 more silver contracts were just added to the May delivery month.


There was a rather smallish withdrawal from GLD on Wednesday, as an authorized participant took out 28,316 troy ounces.  There were no reported changes in SLV.

There was a tiny sales report from the U.S. Mint on Wednesday.  They sold 20,000 silver eagles — and another 4,000 of those ‘American the Beautiful’ 5-ounce rounds.

Hard on the heels of their 2019 annual report two weeks ago, the Royal Canadian Mint has posted its Q1/2019 report on its website — and I’ve snipped part of Page 7 that deals with gold and silver bullion sales for that time period.  I was surprised to see that their sales were up.  I wouldn’t have know about this until I read a story about it on Sharps Pixley in the wee hours of Wednesday morning.  Click to enlarge.

There was a tiny amount of activity in gold over at the COMEX-approved depositories on Tuesday.  There was 32.150 troy ounces/1 kilobar [U.K./U.S. kilobar weight] shipped out of Canada’s Scotiabank.  There was some paper movement, as 7,924 troy ounces was transferred from the Registered category — and back into Eligible.  I won’t bother linking this.

It was much, much busier in silver, as 1,057,684 troy ounces were received — and 1,675,872 troy ounces was shipped out.  All of the ‘in’ activity was at Loomis International.  The ‘out’ activity was split up more or less equally between CNT and Brink’s, Inc…as the former shipped out 847,415 troy ounces — and the latter parted with 828,457 troy ounces.  There was also a paper transfer of 34,391 troy ounces from the Eligible category — and into Registered.  That occurred at CNT — and is mostly likely out for delivery in May sometime.  The link to all this is here.

There was some activity over at the COMEX-approved gold kilobar depositories in Hong Kong on their Tuesday.  They didn’t receive any, but reported shipping out 1,036 of them.  All of this occurred at Brink’s, Inc. — and the link to that, in troy ounces, is here.


The Leekfrith torcs are four Iron Age gold torcs found by two hobby metal detectorists in December 2016 in a field in Leekfrith, north Staffordshire, England. The find consists of three neck torcs and a smaller bracelet, which were located in proximity to each other. They are believed to be the oldest Iron Age gold jewellery found in Britain. Subsequent archaeological examination of the area did not uncover further objects.

One of the torcs is a smaller bracelet decorated with ornament in the style of Celtic art, and the other three are neck rings. The bracelet and one of the neck rings are made with twisted gold wire, and the other neck rings have finials shaped like trumpets. One of the latter has been broken into two pieces.

The gold content of the four torcs has been measured using x-ray fluorescence to be between 74-78% (roughly equivalent to 17-18 carat), with 18-22% silver, some copper, and traces of iron, mercury and tin – a mix consistent with other Iron Age gold finds in Europe. The weight of the pieces varies from 31 grams (1 oz) to 230 grams (8 oz), and over 350 grams (10 oz) in total.  Click to enlarge.

I only have a tiny handful of stories for you today.


CRITICAL READS

Fed minutes: No rate moves are coming “for some time” even if the economy improves

Federal Reserve officials remained firmly committed to a “patient” policy stance at their meeting earlier this month, saying rates likely will remain unchanged well into the future.

Minutes from the May 1-2 Federal Open Market Committee meeting also showed that members raised their expectations for full-year economic growth and said that earlier concerns they had about a slowdown had abated. Despite their general optimism, the committee held the line on interest rates, primarily citing a lack of inflation pressures that allow the central bank to watch how events unfold before making any further moves.

Members observed that a patient approach to determining future adjustments to the target range for the federal funds rate would likely remain appropriate for some time, especially in an environment of moderate economic growth and muted inflation pressures, even if global economic and financial conditions continued to improve,” the meeting summary stated.

For the past several meetings, members had expressed concerns about slowing global growth, the messy Brexit negotiations and the U.S.-China trade impasse.

However, the minutes from the most recent meeting showed a more upbeat tone. “A number of participants observed that some of the risks and uncertainties that had surrounded their outlooks earlier in the year had moderated, including those related to the global economic outlook, Brexit, and trade negotiations,” the minutes said.

This news item showed up on the cnbc.com Internet site on Wednesday morning sometime — and it comes courtesy of Swedish reader Patrik Ekdahl.  Another link to it is here.  The Zero Hedge spin on this is headlined “FOMC Minutes Show Fed “Patient For Some Time“, Fears Financial Stability Risks“.


Gundlach: GDP Would Be Negative If Not for Government Borrowing

Jeff Gundlach, founder of DoubleLine Capital, and Danielle DiMartino Booth, CEO of Quill Intelligence, recently spoke to an audience of investors. The wide ranging discussion covers the reasons behind the dovish pivot by the Federal Reserve, the swelling national debt, and rising corporate debt.

This very long video was posted on thesoundingline.com Internet site on Wednesday sometime — and I’m only including it because I have so little for you today.  It runs for 1 hour and 30 minutes — and I thank Brad Robertson for sending it our way.


China’s other nuclear option in trade war with the U.S. – Rare earth materials

Beijing has yet another economic weapon to use against Washington in the escalating trade row – a possible embargo on vital rare earth metals needed to make everything from high-tech devices to fighter jets.

A routine visit by President Xi Jinping to a Chinese rare earths facility earlier this week came amid rising tensions between the two countries and shortly after the U.S. turned up the heat on Chinese tech giant Huawei. Despite the lack of any official announcement from Beijing, the visit has triggered fears that China is ready to use the materials, specifically a ban on their export, as an advantage against the U.S.

Rare earth materials are indeed one more way China can retaliate, independent political analyst, Alessandro Bruno, told RT.

It could put heavy restrictions on the rare earth metals that are necessary to make all kinds of electronic equipment, especially phones. This is a significant threat because the West does not have its own supply,” he explained.

The minerals are, unsurprisingly, not included on the U.S. list of $200 billion worth of Chinese goods facing higher import tariffs. Shortly after Chinese and other media reported that Beijing is considering an embargo, shares of rare earth miners skyrocketed.

I posted a Zero Hedge article on this the other day, but this Russia Today story…posted on their Internet site at 1:31 p.m. Moscow time on their Wednesday afternoon…is far more in-depth.  I thank Larry Galearis for sending it along — and another link to it is here.


Kansas exempts gold and silver coins and bullion from sales tax

On Thursday, May 16, 2019, Kansas governor Laura Kelly signed into law House Bill 2140, which provides a sales-tax exemption on sales of gold and silver coins and on all gold, silver, platinum, and palladium bullion.

The outcome is not everything we started with in the original bill, but certainly better than where we were,” said Dean Schmidt (Dean Schmidt Rare Coins). The late Diane Piret, ICTA’s director of legislative affairs, would agree. She always said, “It’s better to get a partial loaf than none. We can always come back for more.”

Kansas now joins the 38 other states with a sales-tax exemption,” said chief operating officer David Crenshaw. “We thank Dean Schmidt for his continued perseverance and the tremendous support of everyone who helped make this exemption a reality.”

The bill was enrolled on Friday, May 10, and presented to Governor Kelly for her signature. The new law’s effective date is July 1, 2019.

I found this precious metal-related story in a GATA dispatch yesterday — and another link to it is here.


How to Un-rig the Gold Market, According to GATA’s Chris Powell — Frank Holmes

In an earlier post, I gave you a sneak preview of my interview with Chris Powell, secretary/treasurer at Gold Anti-Trust Action Committee (GATA). For 20 years now, Chris and others at GATA have made it their mission to expose collusion by international financial institutions to control the price and supply of gold.

Below are highlights from the interview. I have to say that during much of our conversation, my jaw was on the floor. I don’t want to say much more than that! Read on, and remember to share widely.

I don’t know why Frank is so surprised, as we here at GATA have spoken to Frank on this issue many times over the last ten years or more when we’ve seen him at various conferences — and Chris has mailed him the complete GATA package of information at least once during those years.  However, I certainly am grateful that a fund manager has finally given the price management scheme in gold and silver the public attention it so richly deserves.  Let’s hope that other fund managers, along with the main stream press, finally develop some gonads.  I thank Frank for being the first one out of the gate with this issue.  The interview was posted on his website…usfunds.com…on Monday sometime — and another link to it is here.


Serbia adds 7 tonnes of gold reserves since 2012 —  central bank governor

Serbia’s gold reserves currently amount to 20.8 tonnes, having increased by about seven tonnes since 2012, central bank governor Jorgovanka Tabakovic has said.

We will enhance the financial stability of Serbia by modifying the structure of the currency reserves which are at a historically high level of about €11.5 billion,” Tabakovic said in a video file posted on the website of news agency Tanjug on Tuesday.

According to media reports, Serbia’s president Aleksandar Vucic has recommended to Tabakovic and finance minister Sinisa Mali to increase the country’s gold reserves to 30 tonnes in 2019 and 40 tonnes in 2020. Vucic has discussed the potential acquisition of gold with representatives of the International Monetary Fund (IMF) who supported the idea, Vecernje Novosti daily reported on Tuesday.

The central bank is the fiscal agent of the Republic of Serbia and it is normal that in such crisis times it steps up the acquisition of gold and such advice from the Serbian president is welcome,” Tabakovic said in the video file.

Last month, the World Gold Council said Serbia was the only country in Southeast Europe that has expanded its gold reserves in the first nine months of last year, to 20.4 tonnes in September 2018 from 19.5 tonnes in January 2018.

The above five paragraphs are all there is to this gold-related news item.  It was filed from Belgrade — and appeared on the seenews.com Internet site on Wednesday sometime.  I found it on the Sharps Pixley website.  Another link to the hard copy is here.


The PHOTOS and the FUNNIES

The first shot was one of the last I took in Thacker Regional Park in Hope before we headed back to Merritt.  We decided to take the Trans-Canada Highway north through the unbelievably scenic Fraser Canyon…rather than the somewhat less spectacular Coquihalla Highway, even though its quite a bit longer time-wise.  We stopped in Boston Bar at our favourite restaurant…which is only one of two restaurants in the whole place.  The town is very much of the 1-horse variety, which they share with the even tinier community of North Bend on the west side of the river.  The last two photos were taken looking east at Boston Bar from the ‘outskirts’ of North Bend — and you can see the bridge across the river in the far left of the frame in the second shot.   The CN Rail tracks are across the river in Boston Bar — and the CP Rail tracks in the lower foreground.  Click to enlarge for all.


The WRAP

There are two distinct classes of men.  Those who pay taxes — and those who receive and live upon taxes.” — Thomas Paine


With volumes in the ‘fumes and vapours’ category in both gold and silver on Wednesday, not much should be read into their respective price activity.  But ‘da boyz’ were still lurking about.  A new low close in platinum for this move down was handed out yesterday — and it was the same in copper as well.  WTIC was closed below its 50-day moving average on Wednesday as well.

Here are the 6-month charts for the Big 6 commodities and, if you have the interest, the above mentioned highlights should be noted.  Click to enlarge for all.

And as I type this paragraph, the London open is a minute or so away — and I see that the gold price has done next to nothing in Far East trading, but has ticked higher by a bit in the last two hours — and is currently up $1.00 an ounce. Ditto for silver — and it’s up 4 cents currently. Platinum was at a new low for this move down earlier, but is lower by only 3 bucks at the moment. Platinum is down 5 dollars.

Net HFT gold volume is almost non-existent at a bit over 16,000 contracts — and there’s only 1,288 contracts worth of roll-over/switch volume out of June and into future months.  Net HFT silver volume is a vanishingly small 3,100 contracts — and there’s only 221 contracts worth of roll-over/switch volume in that precious metal. [These numbers are now suspect…see further down. – Ed]

The dollar index opened up about 3 basis points once trading commenced at 7:45 p.m. EDT in New York on Wednesday evening, which was 7:45 a.m. China Standard Time on their Thursday morning.  It crept very quietly higher until around 1:10 p.m. CST…dipped a bit — and then took off higher starting minutes after the 2:15 p.m. CST afternoon gold fix in Shanghai.  It’s up 13 basis points as of 7:45 a.m. BST in London/8:45 a.m. CEST in Zurich.


It certainly has been quiet in the precious metals so far this week…topped of with the minuscule volumes that we had on Wednesday — and the almost non-existent volume so far today…which are now suspect!  But despite this seemingly quiet period, ‘da boyz’ went about their duties.  Only WTIC, palladium and gold still have intact 200-day moving averages.  I suspect that it’s only a matter of time before WTIC and gold are trading below that number…but palladium may be a bridge too far, even for JPMorgan…although it’s such a tiny market, it’s almost irrelevant.


And as I post today’s column on the website at 4:02 a.m. EDT, I note that gold and silver aren’t doing much of anything as the first hour of London/Zurich trading ends.  Gold is currently up $1.10 — and silver is up 2 cents.  Platinum and palladium are down 2 dollars and 3 dollars respectively.

It appears that they’re having issued on the CME’s website, as the volume numbers for both gold and silver are unchanged from the London open an hour ago.  So it’s obvious that their website has not been updating their data for quite a while now — and that’s why the pre-London open numbers in both precious metals were as low as they are.  It appears that those numbers are not accurate, either.

The dollar index’s current high tick was printed at 8:08 a.m. BST, but has backed off that number by a bit.  As of 8:45 a.m. in London/9:45 a.m. in Zurich, the index is up 15 basis points — and 11 basis points off its high of the day so far.

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

Ed

New Intraday Lows in Gold & Platinum Yesterday

22 May 2019 — Wednesday

YESTERDAY in GOLD, SILVER, PLATINUM and PALLADIUM


The gold price began to edge a few dollars lower about two hours after trading began in New York on Sunday evening — and that ended around noon in Shanghai on their Tuesday morning.  From that point it chopped quietly sideways until shortly after 11 a.m. in London — and its downward journey to its low tick of the day began at that juncture.  That was set around 9:40 a.m. in New York — and was a new intraday low price for gold for this move down.  It rallied a bit from there until the 11 a.m. EDT London close — and it chopped unevenly sideways until trading ended at 5:00 p.m. EDT.

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

Gold was closed on Tuesday in New York at $1,274.20 spot, down $3.10 on the day.  Net volume was very quiet for the second day in a row at just about 166,500 contracts — and there was around 47,500 contracts worth of roll-over/switch volume out of June and into future months.

Except for an odd variation here and there, the silver price was forced to follow a similar price as gold yesterday, so I shan’t bother with any further commentary on it.

The high and low ticks aren’t worth looking up in this precious metal, either.

Silver was closed at $14.425 spot, down a penny from Monday.  Net volume, like in gold, was very much on the lighter side at a bit under 45,500 contracts — and there was 2,537 contracts worth of roll-over/switch volume on top of that.

The platinum price didn’t do much of anything in morning trading in the Far East on their Tuesday.  It jumped up a bit staring shortly after 12 o’clock noon CST, but it was all unevenly down hill from there until, like silver and gold, its low tick of the day was set around 9:40 a.m. in New York.  It chopped erratically higher from there until shortly after 2 p.m. in the thinly-traded after-hours market, before trading flat into the 5:00 p.m. EDT close from there.  Platinum finished the day at $815 spot, up 2 bucks from Monday’s close, but set a new intraday low price for this engineered price decline.

The palladium price was up 6 bucks by the Zurich open on their Tuesday morning.  But shortly after that it began to chop unevenly lower — and that lasted until about fifteen minutes after the Zurich close — and it didn’t do a lot after that.  Palladium was closed at $1,303 spot, down 11 dollars on the day.

The dollar index closed very late on Monday afternoon in New York at 97.93 — and opened down about 1 basis point once trading commenced at 7:44 p.m. EDT on Monday evening, which was 7:44 a.m. China Standard Time on their Tuesday morning.  It began to creep quietly higher from that point until about twenty minutes before the London open — and from that juncture it chopped unevenly sideways until a waterfall decline event began at 10:52 a.m. in New York.  The index was saved by the usual ‘gentle hands’ at precisely 11:00 a.m. EDT, which was the London close. It ‘gained’ all of that loss back, plus a bit more, by 2:12 p.m. in New York — and then proceeded to tick quietly lower until trading ended at 5:15 p.m. EDT.

The dollar index finished the Tuesday session at 98.06…up 13 basis points from Monday’s close — and you should note that the waterfall decline in the dollar index has zero effect on precious metal prices.

Here’s the DXY chart courtesy of BloombergClick to enlarge.

Here’s the 6-month U.S. dollar index chart, courtesy of the folks over at the stockcharts.com Internet site — and the delta between its close…97.90…and the close on the DXY chart above, was 16  basis points on Tuesday.  Click to enlarge as well.

The gold stocks opened down a bit once trading began at 9:30 a.m. in New York on Tuesday morning — and their respective low ticks were printed a few minutes before 10 a.m. EDT.  They were back at the unchanged mark about thirty-five minutes later — and then traded quietly and unevenly sideways for the remainder of the day.  The HUI managed to close up 0.24 percent.

The silver equities hit their lows at the same time as the gold shares — and from there they rallied rather smartly until around 11:20 a.m. EDT — and then didn’t do much of anything after that.  Nick Laird’s Intraday Silver Sentiment/Silver 7 Index closed higher by 1.18 percent.  Click to enlarge if necessary.

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

The CME Daily Delivery Report showed that zero gold and 29 silver contracts were posted for delivery within the COMEX-approved depositories on Thursday.

In silver, the three short/issuers were JPMorgan, ADM and Advantage…with 14, 8 and 7 contracts…all out of their respective client accounts.  There were four long/stoppers in total — and JPMorgan topped the list as usual, with 15 in total…11 for clients, plus 4 for its own account.  ADM came in second with 10 contracts for its client account.  Advantage and Standard Charter were tied for third spot, with 2 each…the former for its client account — and the latter for its in-house/proprietary trading account.

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

The CME Preliminary Report for the Tuesday trading session showed that gold open interest in May declined by 15 contracts, leaving 58 still open.  Monday’s Daily Delivery Report showed that 15 gold contracts were actually posted for delivery today, so the change in open interest and the deliveries match.  Silver o.i. in May fell by 2 contracts, leaving 225 around, minus the 29 contracts mentioned a few paragraphs ago.  Monday’s Daily Delivery Report showed that 13 silver contracts were actually posted for delivery today, so that means that 13-2=11 more silver contracts were just added to the May delivery month.


There was a deposit into GLD on Tuesday, as an authorized participant added 113,265 troy ounces.  There was a withdrawal from SLV, as an a.p. removed 749,430 troy ounces.

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

There was a bit of movement in gold over at the COMEX-approved depositories on the U.S. east coast on Monday.  Nothing was reported received — and 11,831 troy ounces was shipped out.  The vast majority of that…10,995.300 troy ounces/342 kilobars [U.K./U.S. kilobar weight] departed JPMorgan.  There was 803.750 troy ounce/25 kilobars [U.K./U.S. kilobar weight] shipped out of Scotiabank — and 1 kilobar [SGE kilobar weight]…32.151 troy ounces…that left Brink’s, Inc.  There was also 4,883 troy ounces transferred from the Registered category — and back into Eligible.  Of that amount, there was 2,712 troy ounces transferred at HSBC USA — and the remaining 2,170 transfer occurred at Brink’s, Inc.  The link to all that is here.

In silver, the only physical activity was two truckloads…1,209,235 troy ounces…that ended up at Loomis International.  The only other activity was a transfer from Eligible and into Registered over at CNT…59,155 troy ounces…and I would suspect that this amount is out for delivery in May.  The link to that is here.

There was some activity over at the COMEX-approved gold kilobar depositories in Hong Kong on their Monday.  They received 2,150 of them — and shipped out 34.  And except for the 9 kilobars shipped out of Loomis International, all of the remaining in/out movement occurred at Brink’s, Inc.  The link to that, in troy ounces, is here.


There are two notable Ipswich Hoards. The first was a hoard of Anglo-Saxon coins discovered in 1863. The second was a hoard of six Iron Age gold torcs that was discovered in 1968 and 1969. The latter hoard has been described as second only to the Snettisham Hoard in importance as a hoard from the Iron Age, and is held at the British Museum.

The first hoard was found in an earthenware pot buried about 10 feet (3.0 m) beneath the doorstep of the house at the corner of Old Buttermarket and St. Lawrence Lane in Ipswich, which had previously belonged to numismatist James Conder (1763–1823), when it was demolished during road widening in 1863. It was reported as consisting of 150 coins, although only 75 are known now. The coins were all silver pennies of the reign of Æthelred the Unready, minted in London and Ipswich. It is tempting to associate this find with the ravaging of Ipswich which took place in 991. However clues in the coins indicate that the hoard may have been deposited between 979 and 985.

Five neck ornaments called torcs were discovered in 1968 by the operator of a mechanical digger preparing ground for the construction of new housing in Belstead, near Ipswich, for which the driver received £45,000; a sixth torc of a slightly different design was discovered a year later by the owner of one of the newly completed houses when sorting though a pile of earth left by the building in his garden, for which he received £9,000.

The torcs were manufactured by twisting two strands of large diameter wire around each other and fashioning them into a near circle. The ends of the twisted wire are finished with terminal decorations. They are made from green gold as they have a lower proportion of silver in them than later finds, leading British Museum experts to date their manufacture to about 75 B.C. However the torcs may have been used by many generations before they were hoarded away.  Click to enlarge.

I have an average number of stories for you again today.


CRITICAL READS

Existing Home Sales Tumble YoY For 14th Month — Worst Run Since Housing Crisis

Existing home sales were the odd one out in March (falling as new- and pending-home-sales spiked) but expectations were for a catch-up rebound in April, but did not, dramatically missing the expectation of a 2.7% rise by dropping (again) by 0.4% MoM…

This 0.4% decline comes after existing home sales fell 4.9% MoM in March with a tumbling mortgage rate seemingly not affecting the secondary market…

Single-family units fell 1.1% MoM but Condos/Co-ops jumped 5.6% in April (erasing March’s 5.3% drop).

Supply increased from 3.8 to 4.2 months (the highest since Oct 2018) as median prices jumped to their highest since July 2018.

Only The West saw an increase in sales (up 1.8% MoM) in April, with the Northeast worst, down 4.5% MoM.

Worse still, existing home sales are still down 4.4% year-over-year…Click to enlarge.

This is the 14th month in a row of annual declines – the longest stretch since the housing crisis over a decade ago…but that’s probably nothing!!

This story, courtesy of Brad Robertson, was posted on the Zero Hedge website at 10:08 a.m. EDT on Tuesday morning — and another link to it is here.


QE May Be Over, But the Fed’s U.S. Debt Hoard Is About to Soar

If you thought the Federal Reserve was done with quantitative easing, you might only be half right.

As soon as next year, analysts say the Fed will resume large-scale buying of debt securities — this time just U.S. Treasuries — in amounts that may ultimately exceed its crisis-era purchases. According to an estimate by Wells Fargo & Co., the central bank’s balance sheet will rise past its historic peak as it adds over $2 trillion to its Treasury debt holdings in the next decade.

Of course, it won’t be called QE, which President Donald Trump has urged the Fed to restart. Rather than trying to drive down long-term interest rates to boost growth, the purchases are intended to replace the Fed’s mortgage-bond holdings gradually as they mature and to keep ample reserves in the banking system. But the effect, some say, will nevertheless be largely the same.

For anybody that has been in the market for the last 10 years, it will feel like QE,” said Priya Misra, global head of rates strategy at TD Securities. “Once again the Fed will be the single largest buyer of Treasuries and (this time) in a non-QE world. This will be a very bullish Treasury-market dynamic.”

This Bloomberg news story showed up on their Internet site at 2:00 a.m. PDT on Monday morning — and was updated twelve hours later.  I found it in a GATA dispatch yesterday — and another link to it is here.


Regime Change For the Fed: Honest Rates — Jim Grant

James Grant was one of three recipients of the 2019 Bradley Prize. Roger Kimball and Judge Janice Rogers Brown were likewise honored. At the May 7 award ceremonies at Washington, the famed editor of Grant’s Interest Rate Observer had this to say:

* * *

Ladies and gentlemen, it’s a blemish on the age that so many of us know the name of the Federal Reserve chairman. In a better world, that government functionary would be as obscure as what’s-his-name, the home plate umpire who got no arguments calling balls and strikes at Yankee Stadium the other night.

Who elected the Greenspans, Bernankes, and Powells to be the arbiters of interest rates, asset prices, the rate of inflation and who knows what else? It wasn’t Alexander Hamilton. Nor was it the Fed’s own founders. If the authors of the 1913 Federal Reserve Act could return to earth to inspect their handiwork, the shock might kill them all over again.

Congress envisioned an institution to function in the context of the international gold standard. This meant a dollar defined as a fixed weight of gold. You should have heard old Carter Glass, the congressional father of the Fed, berate the critics who dared to suggest that he was scheming to replace the gold dollar with a scrap of green paper.

Well, Glass himself is to blame for much of the evil that followed. The legislative preamble to the act that Woodrow Wilson signed describes a bill “to furnish an elastic currency, to afford means of discounting commercial paper, to establish a more effective supervision of banking in the United States—and for other purposes.”

These other purposes quickly became the principal ones. No sooner did America enter the Great War than the Fed lent a hand to facilitate the government’s borrowing. By the time the system celebrated its 30th birthday, in 1943, the central bank was pegging interest rates to suppress the costs of financing an even greater war.

This interesting commentary from Jim appeared on The New York Sun‘s website on Sunday sometime — and I found it in a Zero Hedge article that Brad Robertson sent our way.  Another link to it is here.


Dr. Dave Janda interviews your humble scribe…

The good doctor and I spent about twenty-five minutes discussing the state of the world — and the precious metals.  I was going to include this in my Tuesday column, but there was enough content in that already, so here it is today.

This audio interview was on all-talk radio WAAM 1600 out of Ann Arbor, Michigan — and another link to that is here.


Thousands of jobs at risk with British Steel on brink of collapse

Britain’s second-largest steel producer is on the brink of collapse amid growing signs that an emergency government loan would fail to materialise, putting a total of close to 25,000 jobs at risk.

Sky News has learnt that British Steel, its lenders and Whitehall are preparing for an insolvency to take place within 48 hours, with E&Y expected to be formally appointed as administrators on Wednesday unless a deal is struck by Tuesday afternoon.

If last-minute talks fail to secure a solvent deal, British Steel’s collapse could result in more than 4,000 redundancies at its giant Scunthorpe steelworks, job cuts at its other sites, and as many as 20,000 more jobs in its supply chain also jeopardised by the crisis.

Insiders said that a request to the government for emergency financial support had been reduced from £75m to around £30m, with British Steel’s shareholder – Greybull Capital – and lenders agreeing to inject new money into the company.

Lenders are also understood to have released their security in order for a new government loan to be made on secured terms.

This story showed up on the sky.com Internet site on Monday sometime, but has been updated since — and I thank Swedish reader Patrik Ekdahl for pointing it out.  Another link to it is here.


Deutsche Bank Death Spiral Hits Historic Low. European Banks Get Re-Hammered — Wolf Richter

Just bumping along the bottom, from hopeless to hope and back to hopeless…

The amazing thing with Deutsche Bank shares is this: Since 2007, so for 12 years, bottom fishers have been routinely taken out the back and shot, every time, with relentless regularity – as have big institutional investors, from Chinese conglomerates to state-owned wealth funds, that thought they were picking the bottom. A similar concept applies to European banks in general. May 2007 was the high point. And it has been brutal ever since – 12 years of misery.

Deutsche Bank shares dropped another 2.9% on Monday in Frankfurt, and closed at a new historic low of €6.64 after hitting €6.61 intraday. This time, the blame was put on UBS analysts that finally stamped “sell” on the stock, replacing their “neutral” rating. Deutsche Bank’s market cap is now down to just €13.8 billion. Shares have plunged 39% over the past 12 months and 60% since January 2018…

The bank has been subject to years of revelations of shenanigans that span the palette. Once a conservative bank that primarily served its German business clientele in Germany and overseas, it decided to turn itself into a Wall Street high-flyer that caused its shares to skyrocket until May 2007, when it got tangled up in the Financial Crisis that then led to a slew of apparently never-ending hair-raising revelations, settlements with regulators, and huge fines.

Since their death-spiral began in May 2007, Deutsche Bank shares have lost over 94% of their value. The UBS downgrade to sell came just in the nick of time.

This very interesting 5-chart commentary from Wolf put in an appearance on the wolfstreet.com Internet site on Monday sometime — and I thank Richard Saler for sharing it with us.  Another link to it is here.


Amid Soaring Inflation, Turkey Bizarrely Cuts Rates; Lira Tumbles

What do you do if you have borderline hyperinflation coupled with accelerating capital flight and a collapse of international confidence in your country’s institutions? In Turkey, the answer is apparently to cut rates.

That’s what the Turkish central bank did early on Tuesday when it effectively rolled back a limited tightening of monetary policy which it delivered just days prior in the latest policy flip-flop by an increasingly chaotic monetary authority, hammering the lira – which is desperate for higher rates – just weeks before President Erdogan’s party seeks to regain control of Istanbul in a bizarre and controversial rerun of local elections.

Two weeks after the Turkish central bank tightened monetary policy, a move which did nothing to boost confidence in the lira, the regulator went for broke and on Tuesday said that it will offer funds at its cheapest rate of 24% through the repo auction, 150 basis points lower than the overnight rate of 25.5% it used for almost two weeks. Today’s announcement came less than a week after Turkey re-introduced a 0.1% tax on most large foreign-currency transactions, a sign the authorities are trying to stem the dollarization of the economy before municipal elections in Istanbul in June.

The panicked decision follows a slew of failed measures meant to prop up the currency before next month’s elections. As Bloomberg noted, “some of these steps have raised concern that the government is taking on a larger role in managing the market“, which is a polite way of saying Turkey is preparing to implement capital controls next. Officials have repeatedly said Turkey would adhere to free-market policies.

This Zero Hedge news item put in an appearance on their Internet site at 7:00 a.m. on Tuesday morning EDT — and it’s another contribution from Brad Robertson.  Another link to it is here.


Pentagon Declares Victory in Non-War: Iran Forced to Put Attacks “On Hold

And just like that it’s over — war averted, apparently, as the Pentagon announced Tuesday U.S. defense posturing and military build-up in the Persian Gulf has thwarted potential attacks an Americans.

Defense Secretary Patrick Shanahan said Iran was forced to “put on hold” plans to harm American troops and their allies in the region:

I think our steps were very prudent and we’ve put on hold the potential for attacks on Americans and that is what is extremely important,” Shanahan told reporters at the Pentagon, though without giving specifics.

He added that Iran was ultimately forced to “recalculate” its aggression.

Since John Bolton’s May 5th statements citing “credible intelligence” of a heightened Iran threat which supposedly put U.S. troops in the cross hairs there’s been next to nothing in terms of actual details.

Instead the past two weeks has witnessed incessant blustering out of Washington, with daily threats that military action was looming against Iran.

And now with zero evidence that Iran was readying an attack, the Pentagon is essentially declaring victory following statements by Trump that he is not willing to escalate, but instead telling Iran’s leaders to “call me“.

This news item put in an appearance on the Zero Hedge website at 10:25 p.m. EDT on Tuesday night — and another link to it is here.


OPEC is poised to defy Trump once again by keeping a lid on oil output

Major oil-producing nations are leaning toward keeping a lid on production throughout 2019, defying President Donald Trump’s calls to open the taps and cut the cost of crude.
OPEC and a group of allies led by Russia are trying to keep supply and demand in balance and stabilize prices by pumping less oil. Over the weekend, a committee representing the so-called OPEC+ alliance strongly signaled the group will extend the policy, which has helped to boost oil prices by about $20 a barrel this year.

If OPEC+ follows that course when producers meet in June, it would be the second time in six months the group ignored Trump, who lobbied against the current production cuts last fall. So long as the production caps remain in place, oil prices are likely to remain anchored near six-month highs around $63 a barrel.

That would keep a thorn in Trump’s side. The economy-focused president wants to lower prices at the pump, but his foreign policy is putting upward pressure on oil futures, which in turn increases gasoline costs.

Washington has restricted global oil supplies by slapping sanctions on OPEC members Iran and Venezuela. Trump wants his allies in Saudi Arabia and the United Arab Emirates, two of OPEC’s biggest producers, to offset those losses by pumping more oil.

This article was posted on the cnbc.com Internet site at 12:21 p.m. EDT on Monday — and was updated about three and a half hours later.   I thank Swedish reader Patrick Ekdahl for finding it for us — and another link to it is here.


Top Primary Miners Now Paying the Market $2 to Take Their Silver??

According to the poor financial results in the first quarter of the year, the top primary silver miners are now likely paying the market $2 an ounce to take their silver.  And, the financial situation for these silver producing companies may even worsen in the second-quarter if the oil price continues to increase while the silver price remains weak.

I have to say; it is a real shame that the few companies in the world that are producing REAL WEALTH are not being paid a decent price for their product.  While the Amazons, Netflixes, Apples, and Facebooks of the world are providing a great deal of technology and service to the market, these companies and their products are not “Stores of Value.”

Why?  Well, as soon as a new Apple I-phone is sold, it begins to deteriorate and likely becomes obsolete (or broken) within five years, which is precisely why the company makes a fortune upgrading and providing new I-phones.  Don’t get me wrong, I have to applaud Apple for developing a high-tech consumption racket for the masses, but again, they are not stores of wealth.  Furthermore, it takes a tremendous amount of energy in the massive supply-chain system to provide these increasingly complex and advanced I-phones.

Moreover, highly advanced technologies don’t last as long as they are inherently fragile. I can assure you that if you take an I-phone and a silver coin and place them in a chest underwater for 100 years, the silver coin will still be usable, but the I-phone will be toast.  Thus, the reason gold and silver win the title of being the top “Stores of Wealth.”

I’m in no position to comment on the veracity of the facts and figures in this article, so I’ll leave this to your good judgement, dear reader.  But when I sent the article to Ted for his opinion…this is what he had to say…”No basic argument, except he leaves out the most important point, namely, why is the price so low?”  Yes, dear reader, the author fails to mention the glaringly obvious reason for the silver miner’s woes — and because of that fact, I’m wondering what else has been left out.  This item was posted on the srsroccoreport.com Internet site on Tuesday sometime — and I thank Marvin Wieler for sending it our way.  Another link to it is here.


Russia adds another 15.6 tonnes to gold reserves in April — Lawrie Williams

The Russian central bank has announced that it added a further 500,000 ounces (!5.6 tonnes) to its gold reserves in April, keeping it ahead of China in its announced monthly gold accumulations, but a little below its March figure of 600,000 ounces.  Even so, it is comfortably on track after four months of the year have passed to again accumulate over 200 tonnes of gold in the full year.

It will not have gone without notice that the Bank of Russia almost always announces its gold reserve increases in round numbers – usually to the nearest 100,000 ounces – but the likelihood is perhaps that this is just an announced figure — and the true accumulation which, in due course will be passed on to the IMF for its world gold reserve statistics, will be marginally higher or lower.

Overall, if we incorporate the latest increase as announced into the IMF figure for Russian central bank gold holdings we come up with a figure of around 2,184 tonnes of gold as the world’s fifth largest national holder of gold, which puts it within spitting distance of the World’s No.s 3 and 4, Italy and France which respectively report their gold holdings at 2,451.8 tonnes and 2,436.0 tonnes.  At its current gold accumulation rate, Russia could move ahead of both of these by early next year.

Russia has been the largest annual accumulator of gold for some years now, at least as far as figures reported to the IMF go.  (We have always held the opinion that China has been increasing its gold reserves at a faster pace than it has been reporting to the IMF, but hiding this excess gold in accounts it says does not meet the criteria for reporting as part of its official forex reserves).

Russia, however, seems to have been following a conscious policy of replacing most of its U.S. dollar-related holdings in its forex mix given the imposition of mostly Crimea-related U.S. economic sanctions.  With U.S. under the Trump Administration seeming increasingly willing to impose economic weapons against countries which it deems to be unfriendly, it would not be too surprising if some other countries were to follow the Russian lead.

This worthwhile commentary from Lawrie showed up on the Sharps Pixley website on Tuesday morning BST in London — and another link to it is here.


Gold Bar Imports Slipped by 4% in India, but…

The latest trade data published by the Gem & Jewellery Export Promotion Council (GJEPC) indicates that gold bar imports by the country witnessed marginal decline during the month of April this year.

The gold bar imports by the country totaled $612.98 million in April this year. This is slightly lower by 4.17% when compared with the imports of $639.67 million in April 2018. In rupee terms, the imports totaled INR 4,255.95 crores, slightly higher by 1.36% over the previous year. The imports had totaled INR 4,198.81 crores in April 2018.

Meantime, the country witnessed huge surge in silver bar imports. The imports of silver bar totaled $2.13 million, significantly higher by nearly 46% year-on-year when compared with the imports of $1.46 million in April last year. In rupee terms, the imports surged higher by 55% from INR9.57 crores to INR 14.79 crores over the year.

The strong trend in imports of gold and silver jewellery continued in April as well. The gold jewellery imports at $28.51 million were significantly higher by 14.41% from $24.92 million in April 2018. The silver jewellery imports were up marginally by nearly 2% from $5.24 million to $5.32 million year-on-year.

This precious metal-related article, filed from Seattle, was posted on the scrapmonster.com Internet site on Tuesday — and it’s another story that I found on the Sharps Pixley website.  Another link to it is here.


The PHOTOS and the FUNNIES

Continuing on our tour around Hope, B.C. on April 13, where spring was well advanced on Canada’s west coast…here are three more shots.  All were taken in Thacker Regional Park in the town.  The flower is a member of the Trillium family, I believe.  Click to enlarge.


The WRAP

Don’t be afraid to take a big step if one is indicated; you can’t cross a chasm in two small jumps.” — David Lloyd George


Although all was quiet from a volume perspective in the precious metals, ‘da boyz’ did not pass on the opportunity presented, setting new intraday lows in gold, platinum and copper on Tuesday.  They obviously could have done more price damage than they did, but passed on it for some reason.  Maybe they didn’t want to become even more conspicuous about all this than they already are.

And with the gold price currently situated where it is, I would suspect that its 200-day moving average is now firmly within their sights.  As to how long this will take them, nobody knows.  All we can do is wait it out.

Here are the 6-month charts for the Big 6 commodities once again — and the above changes should be noted.  Click to enlarge.

And as I type this paragraph, the London open is dead ahead — and I note that the prices of all four precious metals have been edging very quietly and unsteadily lower in Far East trading on their Wednesday. Gold is down 90 cents the ounce at the moment — and silver by 3 cents. Platinum is down 6 bucks — and palladium by 5.

Net HFT gold volume is pretty light at a bit under 27,000 contracts — and there’s only 879 contracts worth of roll-over/switch volume on top of that. Net HFT silver volume is exceedingly light at a bit over 5,100 contracts — and there’s only 896 contracts worth of roll-over/switch volume in this precious metal.

The dollar index opened down 5 basis points once trading began at 7:44 p.m. EDT in New York on Tuesday evening, which was 7:44 a.m. China Standard Time on their Wednesday morning. It didn’t do much from there until around 9:35 a.m. CST — and has been creeping very quietly and unevenly higher since. As of 7:45 a.m. BST in London/8:45 a.m. CEST in Zurich, the dollar index is up 2 basis points.


Yesterday, at the close of COMEX trading, was the cut-off for this Friday’s Commitment of Traders Report — and it’s going to be an easy call. All four precious metals were closed lower almost every trading day during the reporting week…particularly gold, silver and platinum…so it’s a given that there will be further long selling and shorting by the Managed Money traders during the reporting week. It was precisely those actions that caused these price declines in the first place. All of last week’s deterioration…and then some… will have vanished.

Ted will have his mid-week commentary for his paying subscribers this afternoon — and I’m sure he’ll have something to say about this.  I’ll ‘borrow’ a couple of sentences for my Friday column so you can see what his thoughts are.


And as I post today’s efforts on the website at 4:02 a.m. EDT, I see that gold and silver prices have edged a bit lower during the first hour of London trading. Gold is now down $1.70 the ounce — and silver is down 5 cents. Platinum is down 5 bucks, but palladium, which had been down 11 dollars at one point, is now down only 4 dollars — and I’m disregarding that vicious down/up spike moments before 10 a.m. CEST, as it’s probably in the front month only.

Gross gold volume is 37,000 contracts — and minus roll-over/switch volume out of June and into future months, net HFT gold volume is still very light at around 30,500 contracts. Net HFT silver volume is still extremely light at about 6,600 contracts — and there’s 934 contracts worth of roll-over/switch volume on top of that.

The dollar index continues to creep almost Imperceptibly higher — and is now up 5 basis points as of 8:45 a.m. in London/9:45 a.m. in Zurich.

That’s all I have for today, which is more than enough — and I’ll see you here tomorrow.

Ed

Russia Adds 500,000 Ounces of Gold to Their Reserves in April

21 May 2019 — Tuesday

YESTERDAY in GOLD, SILVER, PLATINUM and PALLADIUM


The gold price certainly didn’t do much on Monday.  The low tick, such as it was came at, or shortly after the morning gold fix in London — and the high, such as it was, came shortly after the 11 a.m. EDT London close.  The price didn’t do much after that — and the low and high ticks certainly aren’t worth looking up.

Gold finished the Monday session at $1,277.30 spot, up 20 cents on the day.  Net volume was exceedingly light at a bit under 163,000 contracts — and there was a hair under 50,000 contracts worth of roll-over/switch volume on top of that.

Silver was up a penny or three in morning trading in the Far East on their Monday — and the down/up price spikes minutes before 2 p.m. China Standard Time, was only in the spot month.  From there it edged sideways until 1 p.m. BST/8 a.m. EDT — and chopped quietly higher by a nickel or so by 3 p.m. in the thinly-traded after-hours market.  It didn’t do a whole lot after that.

The low and high ticks in this precious metal aren’t worth looking up, either.

Silver finished the day at $14.435 spot, up 5.5 cents from Friday’s close.  Net volume in this precious metal was very light as well at just over 41,500 contracts.  Roll-over/switch volume was a bit over 3,100 contracts.

The platinum price was up 6 bucks by shortly after 9 a.m. China Standard Time on their Monday morning — and then didn’t do much of anything until 10 a.m. Central European Summer Time.  It was sold down to its low of the day — and a new low for this move down, which came a few minutes after 9 a.m. in New York.  It then rallied back about five bucks or by minutes after the Zurich close.  It was sold a bit lower over the next hour or so — and then didn’t do much for the rest of the day.  Platinum was closed at $813 spot, down 3 bucks from Friday.

The palladium price traded aimlessly sideways in all of Far East — and most of Zurich trading on their respective Mondays.  After a particularly vicious down/up spike minutes after 9 a.m. in New York, it headed higher until around 11:30 a.m. EDT.  It crawled a bit lower until trading ended at 5:00 p.m.  Palladium finished the Monday session at $1,314 spot, up 17 dollars on the day.

The dollar index closed very late on Friday afternoon in New York at 97.995 — and dipped about 5 basis points once trading began at 5 p.m. EDT on Sunday.  The 98.03 high tick came around 1:20 p.m. China Standard Time on their Monday afternoon — and its 97.88 low tick was set about 11:35 a.m. in New York.  From that juncture it chopped quietly higher into the close from there.  The dollar index finished the Monday session at 97.93…down about 7 basis points from its close on Friday.

Here’s the daily DXY chart from the folks over at the ino.com Internet site, as I got home too late in the day on Monday to pick up the Bloomberg chart, as it had already changed over to the Tuesday trading session, which began at 7:44 p.m. EDT yesterday evening/7:44 a.m. CST in Shanghai on their Tuesday morning.  The ‘click to enlarge’ feature does not help with this graph.

Here’s the 6-month U.S. dollar index chart from the folks over at the stockcharts.com Internet site — and the delta between its close…97.76…and the close on the DXY chart above, was 17 basis points on Monday.  Click to enlarge.

The gold shares opened a bit below unchanged on Monday morning in New York trading — and then wandered around either side of unchanged for the rest of the day…in the green in the morning — and in the red in afternoon trading.  The HUI closed lower by 0.48 percent.

The silver equities looked like they were trading on another Planet.  They also opened down a bit, but kept right on going, closing on their lows of the day, as Nick Laird’s Intraday Silver Sentiment/Silver 7 Index closed down a hefty 2.54 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.

Pan American Silver was down a bunch yesterday, as was Coeur Mining.  Hecla got smoked for 7.89 percent.  I didn’t have time to see if there was any specific news on any of them.  Maybe the short sellers are back once again.


The CME Daily Delivery Report showed that 15 gold and 13 silver contracts were posted for delivery within the COMEX-approved depositories on Wednesday.

In gold, ADM and Advantage issued 8 and 7 contracts — and the only two long/stoppers that mattered were JPMorgan and Advantage, with 8 and 6 contracts.  All contracts, both issued and stopped, involved their respective client accounts.

In silver, ADM issued 12 — and Advantage issued 1 contract…all from their respective client accounts.  Of the three long/stoppers in total, JPMorgan picked up 10 contracts…8 for clients — and 2 for its own account. Advantage stopped 2 for its client account.

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 May rose by 6 contracts, leaving 73 still around, minus the 15 contracts mentioned a few paragraphs ago.  Friday’s Daily Delivery Report showed that only 1 gold contract was posted for delivery today, so that means that 6+1=7 more gold contracts were just added to the May delivery month.  Silver o.i. in May declined by 60 contracts, leaving 227 still open, minus the 13 contracts mentioned a few paragraph ago.  Friday’s Daily Delivery Report showed that 49 silver contracts were actually posted for delivery today, so that means that 60-49=11 silver contracts vanished from the May delivery month.


There were no reported changes in either GLD or SLV on Monday.

Over at Switzerland’s Zürcher Kantonalbank, they updated their gold and silver ETFs as of the close of business on Friday, May 17 — and this is what they had to report.  Both ETFs declined by smallish amount, as their gold ETF dropped by only 1,703 troy ounces — and their silver ETF by 13,985 troy ounces.

There was a sales report from the U.S. Mint on Monday.  They sold 2,000 troy ounces of gold eagles — 2,000 one-ounce 24K gold buffaloes — and 546,000 silver eagles.  They also reported their first sales of the ‘America the Beautiful’ 5 oz. silver rounds…74,000 of them, or 370,000 troy ounces.

There was no in/out movement in gold over at the COMEX-approved gold depositories on the U.S. east coast on Friday.

There was decent activity in silver, as 597,082 troy ounces, one truckload, was received — and all of that ended up at Loomis International.  There was 783,090 troy ounces shipped out.  The largest amount, one truckload…617,669 troy ounces…departed CNT.  The remainder…105,092 troy ounces…and 60,328 troy ounces…departed Brink’s, Inc. and Canada’s Scotiabank respectively.  There was was also a paper transfer of 118,009 troy ounces from the Eligible category and into Registered over at CNT — and I would suspect that this amount will be delivered in May.  The link to all this, is here.

There was a bit of activity over at the COMEX-approved gold kilobar depositories in Hong Kong on their Friday.  There were 280 reported received — and 200 kilobars shipped out.  Except for the 180 kilobars deposited at Loomis International, all the other in/out activity was at Brink’s, Inc.  The link to that, in troy ounces, is here.


Since yesterday was the 20th of the month — and it fell on a weekday, the good folks over at The Central Bank of the Russian Federation updated their website with April’s data.  It showed that they added 500,000 troy ounces/15.55 metric tonnes of gold to their reserves that month.

That brings their total gold holdings up to the 70.2 million troy ounce/2,183.4 metric tonne mark.  Here’s Nick’s most excellent chart showing that change.  Click to enlarge.

I have an average number of stories for you today.


CRITICAL READS

Ford Slashing 7,000 Jobs as Disruption Sweeps Automakers

Ford Motor Co. plans to eliminate about 7,000 salaried jobs — about 10% of its global white-collar workforce — as pressures mount on automakers to keep pace with massive technological shifts amid signs global car demand has peaked.

Eliminating the positions will save Ford about $600 million a year, Chief Executive Officer Jim Hackett wrote in a memo to employees Monday, seven months after the company informed employees of a salaried workforce “redesign.” The majority of the cuts will be completed by May 24 in North America, and by the end of August in markets including Europe, China and South America.

To succeed in our competitive industry, and position Ford to win in a fast-changing future, we must reduce bureaucracy, empower managers, speed decision making, focus on the most valuable work, and cut costs,” Hackett wrote. “Ford is a family company and saying goodbye to colleagues is difficult and emotional.”

The dismissals are designed to shrink Ford’s management structure by 20% and streamline the number of organizational layers to nine or less, from 14, Hackett said. The number of jobs cut is far less drastic than the 25,000 that a Morgan Stanley analyst predicted last year.

This Bloomberg article from early on Monday morning EDT is something I found in Tuesday’s edition of the King Report.  Another link to it is here.


Overwhelming Military Response Needed“: Graham Urges Trump “Stand Firm” on Iran

Here we go again — just as tensions seemed to be calming going into the weekend, with Trump distancing himself from some of the more out-front escalatory rhetoric from hawks like Bolton within his own administration last Friday, leave it to who else but Senator Lindsey Graham to ramp things up again. “We must deliver an overwhelming military response,” he tweeted in reference to Iran.

Following Saudi claims last week that Iran was behind a Houthi drone attack out of Yemen which targeted an ARAMCO pumping station and pipeline, and after the alleged “sabotage” attack on Saudi and other tankers near the Strait of Hormuz, Graham said early Monday it was “clear” that Iran has “attacked pipelines and ships of other nations” over the past weeks.

Interestingly, again we find Bolton pushing this narrative, per Graham’s tweet: “Just received a briefing from National Security Advisor Bolton about escalating tensions with Iran. It is clear that over the last several weeks Iran has attacked pipelines and ships of other nations and created threat streams against American interests in Iraq.”

And further appearing to acknowledge President Trump’s reluctance to let the hawks drag him into yet another useless and futile regime change war in the Middle East, Graham urged, “Stand firm Mr. President“.

So now it appears the hawks are waging a full frontal assault to goad the president into war, as even a statement from Iran’s foreign minister acknowledged earlier in the day.

This story put in an appearance on the Zero Hedge website at 12:32 p.m. on Monday afternoon EDT — and I thank Brad Robertson for pointing it out.  Another link to it is here.


Fire the Nutcases Leading Us to War — Eric Margolis

President Donald Trump claimed this week that he does not want war with Iran. If he really believes this, the president ought to look into what his subordinates are doing.

Among their bellicose actions are deployment of the ‘Abraham Lincoln CVN-72’ carrier task force to the coast of Iran, massing a strike package of B-52 heavy bombers in Qatar, just across the Gulf from Iran, positioning more U.S. warplanes around Iran, readying a massive cyber attack against Iran, and trying to stop the export of Iranian oil, upon which its economy depends.

Plus repeated attempts to overthrow the government in Tehran – something the U.S. already did very skillfully in 1953.

If all this is not war, according to Trump, then what is? It’s war by another name. Just what the U.S. did to Cuba, Iraq, Sudan, North Korea, Nicaragua, Syria, and, since 1979, Iran. Like a shark, the U.S. warfare state has to keep moving. So it finds threats popping up all over.

The latest alleged grave ‘threat’ to America’s security was an ancient wooden dhow. Spotted by U.S. satellites, this decrepit old sail-powered tub was claimed by Washington war promoters, led by the enragé John Bolton, to be carrying Iranian missiles. What unbelievable rubbish.

This rather brief, but very worthwhile commentary from Eric was posted on the unz.com Internet site on Saturday sometime — and it comes to us courtesy of Larry Galearis.  Another link to it is here.


Deutsche Bank Shares Hit All-Time Low After UBS Cuts Rating to Sell

With its hoped-for merger with Commerzbank in ruins, and the future of its investment bank uncertain, Deutsche Bank shares tumbled to a new all-time low on Monday after an analyst at UBS downgraded DB shares to a sell with a price target of €5.70 ($6.40) – that’s the second-lowest price target on Wall Street.

After Monday’s selloff, shares aren’t far from that level.  Click to enlarge.

UBS analysts led by Daniele Brupbacher wrote that operating conditions for Germany’s biggest lender are expected to remain “difficult” and its strategic options are “limited.” The bank remains vulnerable to “external events.”

They also cut EPS estimates for 2020 to 2022 by 25%, 18% and 12% respectively, based on lower revenue assumptions.

The above four paragraphs and chart are all there is to this tiny Zero Hedge story that Brad Robertson sent our way yesterday.  It showed up there at 7:06 a.m. EDT on Monday morning — and another link to it is here.


Russia Grinds Out Wins In Europe — Tom Luongo

Europe is finally coming to its senses five years after the coup in Kiev started what is now the new Cold War between Russia and the West.

The first part of Russia’s win comes from Italian leader Matteo Salvini. Speaking for the under-represented in European politics, Salvini declared this week, “I continue to believe that we don’t need sanctions. The issue of their removal unites all decent people.“

Salvini is tackling, head-on, the European political establishment in this week’s European parliamentary elections. And his raising the issue of lifting sanctions on Russia imposed over the reunification with Crimea is a massive attack on them.

It means that Salvini is looking at using the extension of sanctions as a bargaining chip this summer. He is threatening to veto any extension with words this strong on the eve of an election.

The second victory for Russia, however, is far more significant. The Council of Europe has finally agreed to restore Russia’s voting rights after suspending them over the unification with Crimea.

This was a major bone of contention between Europe and Russia, who suspended their budget payments to the CoE in 2017. The deadline for dealing with their non-payment was coming up next month.

This very worthwhile commentary from Tom was something I found embedded in a Zero Hedge article very early on Monday morning — and it comes courtesy of Brad Robertson as well.  Another link to it is here.


Ukraine’s leader takes office and calls snap election

Ukraine’s president, Volodymyr Zelenskiy, took the oath of office on Monday and immediately announced plans to dissolve parliament, setting up a clash between the country’s entrenched political class and its new leader.

Zelenskiy, a comedian with no prior political experience, won a landslide victory in elections last month, amid anger over corruption and a grinding war with Russian-backed separatists in the country’s south-east.

In a fiery inauguration speech on Monday, he called on government ministers to resign and urged officials not to idolise the president.

I don’t want my portraits to hang in your offices,” Zelenskiy said. “Because the president is not an icon or an idol. Hang pictures of your children there and look them in the eyes before every decision.”

By calling snap elections, Zelenskiy hopes to quickly extend his political momentum to the legislature and sweep out loyalists to the former president Petro Poroshenko. Zelenskiy’s new party, Servant of the People, would win about 40% of the votes in a parliamentary election, according to recent polls.

This is very encouraging.  Let’s hope that he doesn’t die of ‘lead poisoning’ in the process.  I thank Dave Stirling for sending us this news story from theguardian.com Internet site yesterday.  It was posted on their website at 9:40 a.m. BST on their Monday morning, which was 4:40 a.m. EDT in Washington — EDT plus 5 hours.  Another link to it is here.  Then there was with parallel story from Zero Hedge at 2:45 a.m. EDT this morning headlined “Ukraine’s Comedian-Turned-President Vows “First Task” is to “End War In Donbass


How Close Should Your Wealth Be? — Jeff Thomas

Recently, an eminent gold advisor, whom I know and have a high regard for, stated that holders of precious metals would be well served by keeping their metals in a remote location, saying, “Distance equals security.” (He lives in the U.S. and recommends storage in New Zealand, as it’s as far away from him as possible.)

Another prominent metals advisor, whom I also know well and respect, contacted me after the release of this statement to say that he doesn’t necessarily agree with the idea, even though he himself stores gold in a country outside his own.

So, what’s the real answer? Is the investor better off keeping his metals as close to home as possible or as far away as possible?

Well, the answer should not be defined by distance at all. It should be defined by accessibility and safety.

This worthwhile commentary be Jeff appeared on the internationalman.com Internet site on Monday morning EDT sometime — and another link to it is here.


U.S. Global’s Frank Holmes previews interview with GATA secretary on gold manipulation

In his “Frank Talk” column today, U.S. Global Investors CEO Frank Holmes previews his recent interview with GATA secretary/treasurer Chris Powell about manipulation of the gold market, which is scheduled to be published in his column next week.

It was posted on the usfunds.com Internet site last Friday — and another link to it is here.


Russian January-March gold output at 58.12 tonnes, silver output down — Finance Minister

Russia’s finance ministry said on Monday gold production in Russia between January and March this year rose to 58.12 tonnes, up from 51.61 tonnes during the same period the previous year.

Production for the period included 45.95 tonnes of mined gold compared with 39.78 tonnes a year ago, the ministry said.

Silver production during the first three months of this year was down compared to the same period in 2018, slipping to 223.28 tonnes from 250.76 tonnes, the finance ministry said in its statement.

The above three paragraphs are all there is to this tiny Reuters article, filed from Moscow, that put in an appearance on the kitco.com Internet site on Monday.  Another link to it is here.


Xi Sends Trump a Message: Rare-Earth Export Ban is Coming

Back in April of 2018, when the trade war with China was still in its early stages, we explained that among the five “nuclear” options Beijing has to retaliate against the U.S., one was the block of rare-earth exports to the US, potentially crippling countless U.S. supply chains that rely on these rare commodities, and forcing painful and costly delays in U.S. production as alternative supply pathways had to be implemented.

As a result, for many months China watchers expected Beijing to respond to Trump’s tariff hikes by blocking the exports of one or more rare-earths, although fast forwarding one year later this still hasn’t happened. But that doesn’t mean it won’t happen, and overnight President Xi Jinping’s visit to a rare earths facility fueled speculation that the strategic materials will soon be weaponized in China’s tit-for-tat war the U.S.

As Bloomberg reported overnight, shares in JL MAG Rare-Earth surged by the daily limit on Monday after Xinhua said the Chinese president had stopped by the company in Jiangxi, a scripted move designed to telegraph what China could do next.

The reason for the dramatic market response is that the presidential visit flags policy priorities, and “rare earths have featured in the escalating trade spat between the U.S. and China.” Specifically, as Bloomberg notes, China raised tariffs to 25% from 10% on American imports, while the U.S. excluded rare earths from its own list of prospective tariffs on roughly $300 billion worth of Chinese goods to be targeted in the next wave of measures. And just in case the White House missed the message, Xi was accompanied on the trip to JL MAG by Liu He, the vice premier who has led the Chinese side in the trade negotiations.

This news story showed up on the Zero Hedge website at 11:10 a.m. EDT Monday — and I thank Brad Robertson for bringing it to our attention.  Another link to it is here.


Opponents Squash Platinum Plans of Shanghai Gold Exchange

The Shanghai Gold Exchange has delayed plans for a platinum contract after failing to gain political clearance, threatening a push to open up a market for the precious metal dominated by the arm of a big state-owned company.

The SGE had been due to launch a two-way cash-settled contract — enabling users to sell and buy platinum — in the first quarter but it failed to win approval, according to two people familiar with the exchange.

The failure highlights the difficulties of reforming China’s domestic commodity markets, where state-owned companies hold sway.

A platinum contract in China would have given carmakers in the world’s largest auto market the ability to hedge the platinum they use in their catalytic converters or fuel cell vehicles. Investors would also have been able to speculate on prices of the metal.

It is quite a setback for the market,” said one industry source in China.

China is the world’s largest consumer of platinum, using 73.8 tonnes last year, a third of global demand, according to Johnson Matthey, a maker of platinum-based catalysts.

This precious metals-related news item was posted on the Financial Times website — and the above paragraphs are all of it that is posted in the clear on the gata.org Internet site.  Another link to it is here.


Australian finds AUS$100,000 gold nugget using metal detector

An Australian man has unearthed a 1.4kg (49oz) gold nugget with a metal detector while wandering Western Australia’s gold fields, say locals.

A shop in Kalgoorlie shared pictures of the rock online, estimated to be worth A$100,000 (£54,000; US$69,000).

The unidentified man was an experienced local hobbyist, shop owner Matt Cook, told the BBC.

Finds of this scale by prospectors are known to happen a few times a year, experts say.

About three-quarters of the gold mined in Australia is produced in and around the Kalgoorlie region.

This very interesting article put in an appearance on the bbc.com Internet site on Monday sometime — and I thank Kiwi reader Kae Lewis for sharing it with us.  Another link to it is here.


The PHOTOS and the FUNNIES

Continuing on with our excursion around Hope, B.C. on April 13…spring was well underway here on the west  side of the mountains, but still a month away in Merritt, an hour’s drive east — and over the Northern CascadesClick to enlarge.


The WRAP

With no volume worthy of the name in the precious metals on Monday, nothing much should be read into their respective price actions…down or up…although it should be noted that ‘da boyz’ set a new low for platinum for this move down.  Both silver and copper are still below their respective 200-day moving averages.

Here are the 6-month charts for the Big 6 commodities — and there isn’t much to see except for what I just noted above.  Click to enlarge.

And as I type this paragraph, the London open is less than ten minutes away — and I see that that the gold price has been edging quietly and unevenly lower almost since trading began in New York at 6:00 p.m. EDT on Monday evening — and it’s down $3.10 currently. Silver was down 4 cents by around 10:30 a.m. China Standard Time on their Tuesday morning — and has been creeping quietly sideways since — and is still down 4 cents at the moment. Platinum and palladium are both off their earlier highs in Far East trading. Platinum is back at unchanged, but palladium is still up 3 bucks as Zurich opens.

Net HFT gold volume is pretty light…coming up on 27,500 contracts — and there’s around 4,500 contracts worth of roll-over/switch volume on top of that. Net HFT silver volume is pretty light as well…just over 6,800 contracts — and there’s only 376 contracts worth of roll-over/switch volume in this precious metal.

The dollar index opened down 1 basis points or so once trading commenced at 7:44 p.m. EDT on Monday evening, which was 7:44 a.m. CST on their Tuesday morning. It has been crawling quietly higher since — and as of 7:45 a.m. BST in London/8:45 a.m. CEST in Zurich, it’s up 17 basis points.


Today, at the close of COMEX trading, is the cut-off for this Friday’s Commitment of Traders Report — and I’ll certainly have an opinion on what it might show in Wednesday’s missive.


And as I post today’s column on the website at 4:02 a.m. EDT, I see that gold is off its current low by a bit — and down only $1.90 — and silver is still down 4 cents. Platinum is now down a dollar — and palladium is up by 3.

Gross gold volume is 46,000 contracts — and minus roll-over/switch volume out of June and into future months, net HFT gold volume is a bit over 35,000 contracts. Net HFT silver volume is just under 8,600 contracts — and there’s 546 contracts worth of roll-over/switch volume on top of that.

The dollar index paused in it currently rally about twenty minutes before the London/Zurich opens — and hasn’t done much during the last hour of trading — and is up 11 basis points as of 8:45 a.m. in London/9:45 a.m. in Zurich.

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

Ed

The Precious Metal Equities Close in the Green

18 May 2019 — Saturday

YESTERDAY in GOLD, SILVER, PLATINUM and PALLADIUM


Well, ‘da boyz’ had the ‘long knives’ out for the precious metals yesterday.

The gold price didn’t do much in morning trading in the Far East on their Friday, but staring shortly after 12 o’clock noon in Shanghai, it began to edge higher.  That lasted until the London open — and it was sold quietly and unevenly lower until shortly after 11:30 a.m. BST.  Then the real price pressure began.  The low tick of the day was set at the 11:00 a.m. EDT London  close — and it managed to tick a few dollars higher in the thinly-traded after-hours market.

The high and low ticks in gold were recorded by the CME Group as $1,289.00 and $1,274.60 in the June contract.

Gold was closed in New York on Friday afternoon at $1,277.10 spot, down another $9.30 on the day — and well below its 50-day moving average.  Net volume was decent, but not that overly heavy, at a bit over 237,000 contracts — and there was a bit under 28,000 contracts worth of roll-over/switch volume on top of that.

Silver was down a couple of pennies by the London open — and around 8:30 a.m. BST, the price was engineered quietly lower until the London close — and it didn’t do much of anything after that.  The down/up price spike in after-hours trading, only involved the spot month, not future months.

The high and low ticks were reported as $14.555 and $14.38 in the July contract.

Silver was closed yesterday at $14.38 spot, down 14.5 cents from Thursday.  Net volume was elevated a bit at just under 59,500 contracts — and there was around 4,450 contracts worth of roll-over/switch volume in this precious metal.

The platinum price traded sideways for two hours once trading began at 6:00 p.m. EDT in New York on Thursday evening.  It was sold down a few dollars at that juncture — and opened down 3 bucks when trading began in Zurich on their Friday morning.  The price began to ‘slide’ ever-so-slowly from there — and most of the decline that mattered was in by a few minutes after 12 o’clock noon in New York.  Platinum was closed at $816 spot, down 17 dollars on the day — and firmly back below its 200-day moving average.

The palladium price began edge very unevenly lower starting shortly after 8 a.m. China Standard Time on their Friday morning.  That lasted until a few minutes before the COMEX close in New York — and it didn’t do much of anything after that.  Palladium finished the Friday session at $1,297 spot, down 19 bucks from Thursday’s close.

The dollar index closed very late on Thursday afternoon in New York at 97.86 — and then opened down 3 basis points once trading commenced at 7:44 p.m. on Thursday evening, which was 7:44 a.m. CST on their Friday morning.  It edged mostly lower from there, with the 97.77 low tick of the day coming a minute or so after the 8:00 a.m. BST London open.  A ‘rally’ commenced at that time — and the index headed very unevenly higher until the 98.03 high tick was set at 4:28 p.m. EDT in New York.  It backed off a few basis point going into the close — and it finished the Friday session at 97.995…up 14 basis points from Thursday’s close.

A ‘rally’ of that size, which I feel was engineered in a similar manner as the declines in precious metal prices on Friday, was a pretty thin reed for ‘da boyz’ to hang their hats on.  However the media will lap up the gold price decline on a dollar index ‘rally’ once again, as that’s as far as their critical thinking level goes.

Here’s the DXY chart, courtesy of BloombergClick to enlarge.

And here’s the 5-year U.S. dollar index chart, courtesy of stockcharts.com — and the delta between its close…97.82…and the close on the DXY chart above, was 18 basis points on Friday.  Click to enlarge as well.

The gold shares sold off a bit as soon as trading commenced at 9:30 a.m. in New York yesterday morning — and their respective lows came around 10:25 a.m. EDT.  From there, it was very unsteadily higher — and the stocks managed to pop into positive territory in the last fifty minutes of trading.  The HUI closed up 0.57 percent.

The trading pattern in the silver equities was almost identical to what happened with the silver equities, except their respective lows came a few minutes before 11 a.m. EDT.  Nick Laird’s Intraday Silver Sentiment/Silver 7 Index closed higher by 0.55 percent.  Click to enlarge if necessary.

And here’s Nick Laird’s 5-year Silver Sentiment/Silver 7 Index chart.  I didn’t think it possible that the silver equities would fall below their lows of very early December 2018…but they have.  Click to enlarge as well.

No short selling yesterday, dear reader.  And one should take very great comfort from the fact that ‘deep pockets’ were scooping up all precious metal stocks that were offered on Friday, plus a bunch more.


Here are the usual charts from Nick that show what’s been happening for the week, month-to-date — 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, to no one’s surprise, all four precious metals are down on the week — and only the gold stocks finished in the green, with the silver equities not all that far behind.  Of course it was Monday’s big ‘up’ day that makes this chart look as ‘good’ as it does, as it was pretty much all down hill for everything after that. Click to enlarge.

The month-to-date chart is a sea of red., although gold is only down a hair — and silver by not all that much…relatively speaking that is. But the performance of their related equities is pretty bad — and the decline in the silver equities is particularly brutal.  Click to enlarge.

The year-to-date chart — and gold is still hanging in there, even though it’s slightly in the red.  It’s obvious that JPMorgan et al have their sights set on silver.  And what can I say about their associated equities that I haven’t already said.  Although rather perverse and incongruous at this juncture, the silver equities are down less as a percentage than the gold stocks, compared to the declines in the underlying precious metals.  But I certainly get no comfort from that.  Click to enlarge.

The only positive news to be gleaned from this is that at least the brutal shorting of the precious metal equities came to an end sometime this week, which will be rocket fuel during the next rally as they rush to cover.  And the positive closes in the precious metal equities on Friday certainly means that the ‘strong hands’ were out and about in force.  As I and many others have said before, “it’s always darkest just before dawn.”


The CME Daily Delivery Report showed that 1 gold and 49 silver contracts were posted for delivery within the COMEX-approved depositories on Tuesday.

In gold, Advantage issued the lone contract — and JPMorgan stopped it.  Both contracts involved their respective client accounts.

In silver, The three short/issuers were ADM, JPMorgan and Advantage, with 35, 11 and 3 contracts out of their respective client accounts.  JPMorgan was the largest long/stopper as always, picking up 28 for its client account, plus another 7 for its own account.  Advantage and Standard General came in second and third…6 for Advantage’s client account — and 5 contracts for S.G.’s in-house/proprietary trading account.

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

So far this month, there have been 291 gold contracts issued/reissued and stopped — and that number in silver is 3,441 contracts.

The CME Preliminary Report for the Friday trading session showed that gold open interest in May declined by 2 contracts, leaving 67 left, minus the 1 contract mentioned a few paragraphs ago.  Thursday’s Daily Delivery Report showed that 2 gold contracts were actually posted for delivery today, so the change in open interest and deliveries match for a change.  Silver o.i. in May fell by 66 contracts, leaving 287 still around, minus the 49 contracts mentioned a few paragraphs ago.  Thursday’s Daily Delivery Report showed that only 15 silver contracts were posted for delivery today, so that means that 66-15=51 silver contracts vanished from the May delivery month.


There was some gold added to GLD by an authorized participant on Friday…94,392 troy ounces worth.  But over at SLV, there was a monstrous withdrawal, as an a.p. took out 3,185,270 troy ounces.  Whether or not that was honest liquidation because of the current price action, or a conversion of shares for physical metal by JPMorgan, is something I leave Ted to pass judgement on his weekly review later today.

There was no sales report from the U.S. Mint once again.

So far this month the mint has sold 1,000 troy ounces of gold eagles — 1,000 one-ounce 24K gold buffaloes — and 160,000 silver eagles.  How pathetic is that?

There was no in/out movement in gold over at the COMEX-approved depositories on the U.S. east coast on Thursday.

There was some movement in silver.  Only 11,134 troy ounces was received — and 600,006 troy ounces shipped out.  All of the ‘in’ activity was at Brink’s, Inc.  In the ‘out’ category, there was one truckload…597,082 troy ounces…shipped out of CNT — and the remaining 2,923 troy ounces departed Delaware.  There was also a paper transfer of 24,783 troy ounces from the Eligible category and into Registered.  That occurred at Brink’s, Inc. — and is probably out for delivery in May.  The link to all this, is here.

There was a bit of activity over at the COMEX-approved gold kilobar depositories in Hong Kong on their Thursday.  They reported receiving 2 of them — and shipped out 457.  The ‘in’ activity was at Loomis International — and all the ‘out’ activity was at Brink’s, Inc.  The link to this, in troy ounces, is here.


The Huxley Hoard is a hoard of Viking jewellery from around 900-910 found buried near Huxley, Cheshire, England. It consists of 21 silver bracelets, one silver ingot, and 39 lead fragments, weighing around 1.5 kilograms (3.3 lb) in total. The bracelets might have been produced by Norse settlers in Dublin and possibly buried for safekeeping by Viking refugees settling in Cheshire and the Wirral in the early 900’s. It was discovered by Steve Reynoldson in November 2004 after he found fragments of lead 30 centimetres (12 in) underground using a metal detector.

The bracelets were folded flat, sixteen decorated by punched patterns, six with crosses stamped in their centre, and another six with centre cross and one at each end. Two have lattice patterns, one an hourglass stamp around the edge, one chevrons with central and end crosses, and one (found as a twisted bar) a zig-zag pattern; the remaining four are plain. The lead fragments suggest the hoard could have been buried either in a lead sheet or a lead-lined wood box.

The second photo is of the lead fragments found.  Click to enlarge for both.


The Commitment of Traders Report for positions held at the close of COMEX trading on Tuesday came in as Ted expected in gold — and as we both hoped/prayed for in silver…a huge increase in the commercial net short position in the former — and a nice decrease in the latter.

In silver, the Commercial net short position declined by a further 3,881 contracts or 19.4 million troy ounces of paper silver.

The Commercial traders arrived at that number by adding 1,440 long contracts — and they also decreased their short position by 2,441 contracts.  It’s the sum of those two numbers that represents their change for the reporting week.

Under the hood in the Disaggregated COT Report the Managed Money traders didn’t do much — and it’s still very much bifurcated.  The non-technical/value investing Managed Money traders added 924 long contracts to their already impressive long position…while the brain-dead/moving average-following Managed Money traders added a further 982 short contracts to their very impressive short position.  It’s the difference between those two numbers…a tiny 982 minus 924 equals 58 contracts…that represents their change for the reporting week.

The difference between that number and the Commercial net short position…3,881 minus 58 equals 3,823 contracts…was made up, as it always is, by the traders in the other two categories.  The ‘Other Reportables’ decreased their net long position by 1,194 contracts — and the ‘Nonreportable’/small traders decreased their net long position by 2,629 contracts.  Those two numbers add up to the 3,823 contracts, which they must do.

The Commercial net short position in silver is down to 63.9 million troy ounces, a very low number.

Ted figures that JPMorgan sold about 2,000 of their long contracts in order to cap Monday’s rally — and their net long position is now only 3,000 contracts as of the Tuesday cut-off.

Here is the 3-year COT Report chart from Nick — and the change should be noted.  Click to enlarge.

Of course, Friday’s COT Report is already ‘yesterday’s news’ in just about every respect.  Not only is the Commercial net short position far lower as of the COMEX close on Friday, but as Ted correctly pointed out on the phone yesterday, it’s a given that JPMorgan has bought back whatever COMEX contracts it had to sell on Monday, plus probably a bit more.


In gold, the commercial net short position rose by a knee-wobbling 40,824 contracts, which is pretty much what Ted said it would be.  This number shouldn’t be surprising, as gold broke above and then closed above its 50-day moving average on Monday, plus closed above it again on Tuesday.

The commercial traders arrived at that number by adding 17,366 long contracts, but they also added an eye-watering 58,190 contracts to their short position — 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 bit more…as they added 35,492 long contracts — and they also reduced their short position by 7,507 contracts — and it’s the sum of those two numbers…42,999 COMEX contracts…that represents their change for the reporting week.

The difference between that number — and the commercial net short position…42,999 minus 40,824 equals 2,175 contracts…was made up by the traders in the other two categories.

And as is normally the case, both categories went about it in wildly different manners.  The ‘Other Reportables’ actually increased their net long position by 6,126 contracts, while the ‘Nonreportable’/small traders decreased their net long position by 8,301 contracts.  The difference between those two numbers is those same 2,175 contracts, which it must be.

Here’s the snip from the Disaggregated COT Report, so you can see these numbers for yourself.  Click to enlarge.

The commercial net short position in gold jumped up to 13.72 million troy ounces as of Tuesday’s cut-off.

Ted says that JPMorgan sold its entire 5,000 contract long position on Monday’s big rally — and most likely 5-10,000 contracts more than that to cap that rally.  They appeared to be the short sellers of both first and last resort in gold and silver this week.

Here is the 3-year COT chart for gold — and this week’s change should be noted as well.  Click to enlarge.

But, as in silver, this COT Report in gold is very much ‘yesterday’s news’ as well — and one should expect that all of last week’s deterioration has been reversed — and then some, since Tuesday’s cut-off.

Ted’s of the opinion that the price action in the precious metals this week was a premeditated act — and its sole purpose was get the short position in silver as low as possible.  Yes, the commercial traders ripped the Managed Money trader’s faces off in the process, both on the way up through gold’s 50-day moving average — and again on the way down, but that was secondary to the real purpose.

Were they successful?  You betcha.

Is the bottom in yet?  Who knows.  As Ted always says, you’ll won’t know the bottom is in until you see it in the rear-view mirror.

In the other metals, the Manged Money traders in palladium decreased their net long position in this precious metal for a second week in a row, this time by 1,163 contracts.  The Managed Money traders are net long the palladium market by 8,119 contracts.  Total open interest in palladium is 20,834 COMEX contracts, down about 650 contracts from the previous week.  It’s a very tiny market.  In platinum, the Managed Money traders decreased their net long position by a further 4,750 contracts.  The Managed Money traders are still net long the platinum market by a fairly hefty 13,012 contracts, but it’s now much lower than that since the Tuesday cut-off.  Total open interest is 75,331 contracts.  With copper engineered lower for another week, the Managed Money traders increased their net short position in that metal by a further 8,550 contracts during the reporting week — and are now net short the COMEX futures market by a whopping 37,706 contracts.


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 99 days of world silver production, which is down 2 days from last week’s report — and the ‘5 through 8’ large traders are short an additional 62 days of world silver production, up 1 day from last week’s report — for a total of 161 days that the Big 8 are short, which is a bit over 5 months of world silver production, or about 375.8 million troy ounces of paper silver held short by the Big 8.  [In the prior week’s COT Report, the Big 8 were short 162 days of world silver production.]

In the COT Report above, the Commercial net short position in silver was reported as 63.9 million troy ounces.  As mentioned in the previous paragraph, the short position of the Big 8 traders is 375.8 million troy ounces.  The short position of the Big 8 traders is larger than the total Commercial net short position by a chunky 375.8 minus 63.9 equals 311.9 million troy ounces.

The reason for the difference in those numbers…as it always is…Ted’s raptors, the 34-odd small commercial traders other than the Big 8, are net long that amount.  Unbelievable.

As I mentioned in my COT commentary in silver above, Ted said that JPMorgan was long the COMEX futures market in silver by around 3,000 contracts, down about 2,000 contracts from the previous reporting week after their silver price capping exercise on Monday.

The Big 4 traders now in that category are short, on average, about…99 divided by 4 equals…24.75 days of world silver production each.

The four traders in the ‘5 through 8’ category are short 62 days of world silver production in total, which is 15.50 days of world silver production each.

Ted’s of the opinion that there are most likely three Managed Money traders with short positions large enough in the COMEX futures market to inhabit the Big 8 category now.

The Big 8 commercial traders are short 36.8 percent of the entire open interest in silver in the COMEX futures market, which is down a bit from the 37.9 percent they were short in last week’s report.  And once whatever market-neutral spread trades are subtracted out, that percentage would be a bit over the 40 percent mark.  In gold, it’s now 35.5 percent of the total COMEX open interest that the Big 8 are short, down a bit from the 36.5 percent they were short in last week’s report — and a bit over 40 percent once the market-neutral spread trades are subtracted out.

In gold, the Big 4 are short 37 days of world gold production, up 4 days from what they were short in last week’s COT Report.  The ‘5 through 8’ are short another 27 days of world production, up 3 days from what they were short last week…for a total of 64 days of world gold production held short by the Big 8…up 7 days from last week’s report.  Based on these numbers, the Big 4 in gold hold 58 percent of the total short position held by the Big 8…up a percent 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 61, 74 and 86 percent respectively of the short positions held by the Big 8.  Silver is down 1 percentage point from a week ago, platinum is also down 1 percentage point from last week — and palladium is up another 3 percentage points — and at another new record high!

If you look at the above ‘Days to Cover’ chart, 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 in palladium should be noted.

I don’t have much in the way of stories for you today, but most of the ones I do have are definitely worth reading.


CRITICAL READS

America’s “Light Unto the World” Is Now a Bonfire — Bill Bonner

The week moved along quickly… like a piece of trash in a fast-moving stream.

At the beginning of the week, investors were worrying about an intensifying trade war. By its end, they thought they heard the “all clear,” and convinced themselves that stifling trade either won’t happen or won’t matter.

Of course, we agreed with them, predicting that The Donald would never go “Full Retard” in the trade war.

Unless he can pin the next bear market/recession on the Fed, he will suffer more than anyone. His career, his reputation, and his private fortune – all could go downstream in a downturn.

But now that investors have gotten on board with our point of view, we disembark. Because we’re beginning to wonder: What if the trade war is real, and not merely part of the president’s performance art?

What if he really is foolish enough to risk a major market sell-off? And what if his rise to power was not just a fluke, after all, but a signal of a deep, megapolitical shift?

This interesting commentary from Bill put in an appearance on the bonnerandpartners.com Internet site on Friday sometime — and another link to it is here.


Doug Noland: True Start to U.S. vs. China Trade War

Increasingly, it appears as if the respite from Q4 global market instability has about run its course. As an economy – from governments to corporations to households – I can’t imagine a more poorly prepared system for the gathering storm. I know: fundamentals are “sound” and the banking system is “well capitalized.” Besides, there’s the Quadruple Puts – a deeply entrenched market misperception that really concerns me. Complacency is pervasive – especially so. Ignore fundamental developments, while placing faith in the power of politicians and central bankers (and corporations forever enjoying access to cheap finance to fund buybacks). Such a backdrop creates extraordinary risk for an abrupt change in perceptions and resulting crisis of confidence – in policymakers and the markets.

We started with the markets and will end with the markets. At this point, I don’t see great contradictions between the markets: Safe haven bonds and the risk markets are not actually telling wildly different stories. Seeing low market yields, loose financial conditions, seemingly great underlying U.S. economic fundamentals and Quadruple Puts, highly speculative (trend-following and performance-chasing) markets have been behaving about as one would expect near the end of a historic cycle: an intense, overarching short-term focus on speculative market gains. The safe havens, much less concerned with timing, see speculative Bubbles primed for bursting. Treasuries, bunds, JGBs, Swiss bonds, etc. see an acutely fragile global market structure.

And for the crowd that these days harbors delusions of U.S. markets and economic activity largely immune to global issues, I pose the question: How do U.S. markets perform in the event of illiquidity and a “seizing up” of global markets? As I’ve posited before, the U.S. economy is extremely vulnerable to a dramatic market-induced tightening of financial conditions. What would markets look like if the marketplace turns against negative cash-flow enterprises? How would the U.S. economy function in the event of if debt market illiquidity?

The Powell U-turn granted markets four months of fun and games – and only greater systemic vulnerability. Now comes the downside, with a Fed that just might prove somewhat slower to come to the markets’ rescue than everyone presumes. This week marked the True Start to the U.S. vs. China Trade War. The degree of cluelessness is shocking.

This commentary by Doug, which is always a must read for me, appeared on his Internet site in the wee hours of Saturday morning — and another link to it is here.


Who Wants This War With Iran? — Patrick Buchanan

Speaking on state TV of the prospect of a war in the Gulf, Iran’s supreme leader Ayatollah Khamenei seemed to dismiss the idea.

There won’t be any war. … We don’t seek a war, and (the Americans) don’t either. They know it’s not in their interests.”

The ayatollah’s analysis — a war is in neither nation’s interest — is correct. Consider the consequences of a war with the United States for his own country.

Iran’s hundreds of swift boats and handful of submarines would be sunk. Its ports would be mined or blockaded. Oil exports and oil revenue would halt. Air fields and missile bases would be bombed. The Iranian economy would crash. Iran would need years to recover.

And though Iran’s nuclear sites are under constant observation and regular inspection, they would be destroyed.

Tehran knows this, which is why, despite 40 years of hostility, Iran has never sought war with the “Great Satan” and does not want this war to which we seem to be edging closer every day.

This very worthwhile commentary by Pat appeared on his Internet site on Friday sometime — and it was picked up by the folks over at Zero Hedge — and that’s where I found it.  I thank Brad Robertson for pointing it out — and another link to it is here.


Beijing Backs Iran, “Firmly Opposes” Unilateral U.S. Sanctions

In the latest sign of Beijing’s frustration with the U.S., the Chinese leadership have reiterated their opposition to American sanctions against Iran. After a meeting with Iranian Foreign Minister Javad Zarif, Chinese Foregin Minister Wang Yi reiterated Beijing’s ‘firm opposition‘ to unilateral U.S. sanctions against Iran.

  • CHINA’S FOREIGN MINISTER WANG YI MEETS IRAN’S ZARIF
  • CHINA FIRMLY OPPOSES U.S.’S UNILATERAL SANCTIONS AGAINST IRAN

With the U.S. moving more firepower into the Persian Gulf, an attempt to send Tehran an unmistakable message, Zarif asked Beijing to try and save the 2015 nuclear deal, the WSJ reports.

Zarif’s meeting with his Chinese counterpart is the first step on a tour of Asia, as Iran canvasses its key economic partners now that U.S. sanctions have been reimposed.

China imports crude from Iran and has expressed reservations about U.S. sanctions in the past. However, given the state of the relationship between Washington and Beijing, the Chinese appear to be signaling that a proxy war over Iran could be just around the corner if Washington doesn’t seriously reevaluate its approach.

This news item showed up on the Zero Hedge website at 10:20 a.m. on Friday morning EDT — and I thank Brad Robertson for this article as well.  Another link to it is here.


Houthi drone attacks in Saudi “show new level of sophistication

Drone attacks on a Saudi oil pipeline west of Riyadh on Tuesday have revealed an apparent significant leap in the capabilities of the Ansar Allah fighting group, otherwise known as the Houthis.

The Aramco East-West pipeline, stretching across the country to the port and oil terminal at Yenbu, was damaged in two places as pumping stations were hit.

The attacks caused minor damage but alarmed an international community already rattled by the sharp downturn in relations between Iran and the United States.

Information on the attacks is scarce, posing more questions than providing answers.

Drones have been increasingly used by the Houthis in operations against the Saudi-UAE-led coalition. In July 2018 a drone exploded at Abu Dhabi airport causing only minor damage but sending a message to the UAE that its economic interests were not invulnerable.

In January 2019, a senior intelligence chief, along with several officers, were killed at the al-Anad air force base just outside Aden by a weaponised drone that exploded above the delegation.

This latest attack signifies a big jump in abilities as the drone flew more than 800km into Saudi Arabia to successfully attack its target.

This interesting article showed up on the aljazeera.com Internet site on Wednesday — and for obvious content reasons, I though it should wait for today’s column.  I thank George Whyte for bringing it to our attention — and another link to it is here.


Not Just a Trade War, But a Shooting War With China — Doug Casey

The Chinese came from nothing; only 40 years ago, they had nothing but a billion impoverished peasants. No money. No technology. No power. Today, they’re on par with the United States. But, if this trend continues – which it will – their economy will be triple the size of the US economy in 20 years.

Not just a trade war, but a shooting war with the Chinese seems inevitable. Because when tensions build up between states they eventually fight with each other. China is the major rising power. It’s got four times the U.S. population, it’s soon going to be more economically powerful, and it’s going to reach military parity. It’s of a different culture than the U.S. The U.S. government may figure it’s best to take them out while the balance still favors them. It’s a bit like the situation was with the USSR in the ’80s. They could see they were going into decline, and some Soviet generals figured it was “now or never” for a successful war. Fortunately they collapsed first.

The Chinese don’t like seeing U.S. aircraft carriers off their coast any more than we would like to see Chinese aircraft carriers in the Gulf of Mexico or off Santa Catalina Island.

The last thing that we need is a war with the Chinese. But if something that’s been called the Thucydides Trap is valid – and I think it is – then it’s highly likely. It refers to the Peloponnesian War between Athens and Sparta, at the end of 5th century B.C. The Trap is sprung when a reigning power strikes out at the advancing power while they still have a chance of winning.

The American military thinks that a shooting war is inevitable. And it probably is. Why? Well, 5,000 years of history teaches us that it’s better to start a war when you’re more powerful than your enemy rather than wait until they’re more powerful than you. It’s always been this way. The Golden Rule of statecraft is: ‘Do unto others – but do it first.’  It’s a very dangerous situation.

This very worthwhile commentary by Doug was posted on the internationalman.com Internet site on Friday sometime — and another link to it is here.


The Gold Manipulation Question — Grant Williams

Is the price of gold manipulated? If so, who is manipulating it, and why? Real Vision co-founder Grant Williams asks a host of experts that question to decipher the truth. This video is excerpted from a piece published on Real Vision on February 23, 2018 entitled “Gold: The Story of Man’s 6000 Year Obsession.”

This 14:47 minute video clip was posted on the youtube.com Internet site on Thursday — and I found in a GATA dispatch yesterday.


Venezuela Sells $570 Million From Gold Reserve Despite Sanctions

Venezuela sold about $570 million in gold from central bank reserves over the past two weeks, skirting U.S. Treasury sanctions designed to freeze assets of the Nicolas Maduro’s administration, according to people with knowledge of the matter.

The central bank sold about 9.7 tons of gold on May 10 and an additional 4 tons three days after, the people said, driving its reserves down to a 29-year low of $7.9 billion. The proceeds will be partly used to fund imports through the country’s foreign trade office, according to one of the people.

A central bank press official didn’t immediately respond to requests for comment on the sales.

Venezuela has sold 23 tons of gold since the beginning of April, defying an economic blockade meant to stop the lucrative trading Maduro has been using to keep the military loyal to his regime. Last month, the U.S. Treasury’s Office of Foreign Assets Control included the Venezuelan central bank its list of sanctioned entities.

Maduro has been selling gold to firms in the United Arab Emirates and Turkey, as sanctions increasingly cut off his authoritarian regime from the global financial system. While he maintains a stranglehold on power on the ground — including the military and government bureaucracy — opposition leader Juan Guaido is using support from dozens of countries to slowly seize Venezuela’s financial assets abroad.

This gold-related news item appeared on the Bloomberg website at 10:44 a.m. PDT on Friday morning — and I found this story on the gata.org Internet site.  Another link to it is here.


The PHOTOS and the FUNNIES

The day after taking the photos on the barren Thompson Plateau on super-scenic B.C. Highway 5A between Kamloops and Merritt, we drove to Hope, B.C.…less than an hour’s drive southwest of Merritt on the Coquihalla Highway.  On the west side of the Northern Cascade mountains, the grass was green, flowers were blooming — and spring was in full cry.  Here are first three shots of our trip there.  The second shot is of a magnolia tree in full bud — and the second is most likely a cherry tree…although I’m not up on my flowering trees in this area.  I could be an ornamental crab-apple tree as well.  Click to enlarge.


The WRAP

The first panacea for a mismanaged nation is inflation of the currency; the second is war. Both bring a temporary prosperity; both bring a permanent ruin. But both are the refuge of political and economic opportunists.” — Ernest Hemingway


Today’s pop ‘blast from the past’ is in remembrance of one who left us on Monday…Doris Mary Kappelhoff, but everyone knew her as Doris Day.  I remember singing this song in the kitchen with my Mom back in 1956 when it was a big hit.  I was eight years old — and the link is here.  And I’m also old enough to remember this one from 1939 as well, even though it was an “oldie, but goodie” by then.  R.I.P Mary — and “thanks for the memories.”

Today’s classical ‘blast from the past’ is a short piece from Piotr Ilyich Tchaikovsky’s “The Nutcracker“, Op. 71.  Of all the great waltzes that he wrote, this is my favourite — and needs no introduction.  Here’s Daniel Barenboim conducting the Berlin Philharmonic.  The video quality is dated, but the soundtrack certainly isn’t.  The link is here.


As I stated at the top of today’s column…”the ‘long knives’ were out for the precious metals yesterday.”  None of Friday’s price action had anything to do with China, the U.S. dollar index, or anything else.  This was all engineered by ‘da boyz’ in the COMEX futures market…forcing the brain-dead/moving average-following Managed Money traders to puke up long positions for big losses  — and slamming them onto the short side for more losses later when precious metal prices are allowed to rise.

Gold is now well below its 50-day moving average — and silver below its 200-day.  Platinum was closed well below its 200-day moving average as well on Friday — and another new low for this engineered price decline.  Palladium’s 200-day moving average is proving to be a tougher nut to crack.

Copper has been closed below its 200-day moving for the eighth consecutive day — and the Managed Money traders in that metal are mega short…as I pointed out in my COT discussion further up.  WTIC has been quietly pulling away from its 50 and 200-day moving averages for the last four trading days.

I don’t know if we’re done to the downside or not.  I was surprised that JPMorgan et al were able to get more blood out of the silver stone yesterday — and I would have paid a decent sum to have a peek at silver COT Report as of the close of COMEX trading on Friday.

Gold’s 200-day moving average is the only moving average of importance left — and it remains to be seen if they go for it or not.  This has been the Sword of Damocles hanging over the gold market for the last couple of month now — and I feel badly that I have to keep mentioning it.  But I’d be remiss if I didn’t.

However, to end this discussion on a positive note, there was some very serious bottom fishing going on in the precious metal equities yesterday — and it wasn’t John Q. Public or the mutual fund crowd doing the buying.  These was the smart ‘deep pockets’ money that knows that far better days are ahead.  And despite the big down day in the metals on Friday, their buying was actually aggressive enough to close the p.m. stocks in the green.  So all is not lost.

Here are the 6-month charts for the four precious metals, plus copper and WTIC — and the above changes should be noted.  Click to enlarge.

Bill King had this to say in his King Report on Wednesday…”Have we mentioned that the U.S. stock market is so perverted and manipulated that it is nothing more than a parlor game dominated by shills and riggers?

That’s the way it has to be now, as John Q. Public is no longer actively involved…leaving only the index and hedge funds with their algorithms and high-frequency trading running the show.

Here’s a 50-year chart of the Dow Jones Industrial Average.  The active management of the stock market began after the “crash of 1987″…which I remember all to well.  It was at that point where President Ronald Reagan’s  “Working Group on Financial Markets” was formed — and they’ve been hard at it ever since.

The real economy separated from stock market valuations long ago — and none of the companies currently in the Dow were there fifty years ago — and some of them didn’t even exist back then.  So what kind of average if this really?  I could show the S&P500, but its price pattern is the same.

And as Doug Noland so correctly pointed out in his commentary from a week ago…”[T]this week had me pondering the next crisis. It will, after all, be the first international market crisis in an era of competing global powers. Do the rivals come together or seek advantage at the other’s expense? I grimaced some months back when President Trump began using his Twitter account to troll the struggling Chinese markets and economy. And in this age of the strongman head of state, where will this leave central bankers when things turn dicey? Has the era of putting a select group of like-minded global central bankers in a room and empowering them to orchestrate a strategy to reliquefy the world run its course?

And it is coming, dear reader, just as surely as the sun rises in the east — and sets in the west.

Larry Galearis pointed out in an e-mail late this week that maybe a war with Iran was, in actuality, was a Trojan Horse of some kind.  Along with multiple U.S. casualties in both personal and hardware — and a crashing stock market, a war would put an end to Trump’s re-election chances in 2020.

It was a subject that I was planning on bringing up in today’s column anyway, but I see that Patrick Buchanan already beat me to it.  So rather than wordsmithing my own narrative, I’m more than happy to bow to his thoughts.  Here’s what he had to say in his commentary in the Critical Reads section of today’s column…

Who wants us to plunge back into the Middle East, to fight a new and wider war than the ones we fought already this century in Afghanistan, Iraq, Syria, Libya and Yemen?

Answer: Pompeo and Bolton, Bibi Netanyahu, Crown Prince Mohammed bin Salman and the Sunni kings, princes, emirs, sultans and the other assorted Jeffersonian democrats on the south shore of the Persian Gulf.

And lest we forget, the never-Trumpers and neocons in exile nursing their bruised egos, whose idea of sweet revenge is a U.S. return to the Mideast in a war with Iran, which then brings an end to the Trump presidency.”

And as I’ve been saying forever and a day now, the price management scheme in the precious metals will not end in a news vacuum.  It will be coordinated with some other ugly event of great financial, economic, or military significance.

This war, which will certainly be ignited by some sort of ingenious ‘false flag’ event…as Iran wants no part of it…is tailor made for this sort of thing.  And with the war drums sounding — and the belligerence level in the West, particularly in Washington and the Pentagon, now rising to an almost fever pitch…it certainly appears that some sort of military action is close at hand.

Of course the U.S. deep state is behind all this — and with ‘da boyz’ covering shorts and going long across the board in the precious metals and copper, you have to wonder what they know that we don’t…yet.

I’m done for the day — and the week.

Monday is a national holiday here in Canada…a long weekend — and I expect to be on the road most of that day.  So my Tuesday column will unbelievably brief…just the facts.

Enjoy what’s left of your weekend — and I’ll see you on that day.

Ed

Silver At a New Low For This Engineered Move Down

17 May 2019 — Friday

YESTERDAY in GOLD, SILVER, PLATINUM and PALLADIUM


The gold price traded flat until the 2:15 p.m. afternoon gold fix in Shanghai on their Thursday afternoon — and then crept higher by a couple of dollars until precisely 9:00 a.m. BST in London, because I was watching.  ‘Da Boyz’ showed up at that point, with the real down-side price pressure coming at 8:30 a.m. in New York.  The low tick of the day was set around 10:35 a.m. EDT — and it crawled higher into the COMEX close.  From there, it traded sideways  until trading ended at 5:00 p.m. EDT.

The high and low ticks in this precious metal were reported by the CME Group as $1,299.30 and $1,284.20 in the June contract.

Gold was closed in New York on Thursday at $1,286.40 spot, down $9.70 from Wednesday — and back below its 50-day moving average.  Net volume was very decent at around 246,500 contracts.  There was a hair under 37,000 contracts worth of roll-over/switch volume on top of that.

The silver price traded very quietly and unevenly sideways in all of Far East and most of London trading on their respective Thursday’s and, like in gold, JPMorgan et al showed up in force at 8:30 a.m. in New York.  Most of the price damage was done by noon EDT, but they picked away at it from there by a bit — and the low tick was set in the thinly-traded after-hours market.  It rallied a bit for an hour between 3 and 4 p.m. EDT — and then traded flat into the close from there.

The high and low ticks in this precious metal were recorded by the CME Group as $14.825 and $14.515 in the July contract.

Silver was close in New York on Thursday at $14.525 spot, down 24 cents on the day — and at a new low for this engineered price decline going all the way back to early December of 2018.  Net HFT silver volume was pretty heavy at just over 65,000 contracts — and there was a bit over 4,600 contracts worth of roll-over/switch volume on top of that.

Platinum didn’t do much in Far East trading on their Thursday — and opened about unchanged in Zurich.  It rallied a few dollars during the next hour, but less than an hour after that, the price decline began in that precious metal as well, with the low tick coming at 1:00 p.m. in New York.  It traded quietly sideways in the very thinly-traded after-hours market, before popping higher by a few dollars around 4:00 p.m. EDT.  It traded flat into the 5:00 p.m. close from there.  Platinum was closed on Thursday in New York at $833 spot, down another 11 dollars — and also at a new low for this engineered price decline.

The palladium price traded very unevenly sideways in both Shanghai and Zurich yesterday.  But once Zurich closed at 11 a.m. EDT, it was sold lower until 1 p.m. in New York.  It ticked a few dollars higher into the 5:00 p.m. close from there.  Platinum finished the Thursday session at $1,316 spot, down 7 dollars from Wednesday’s close.

The dollar index closed very late on Wednesday afternoon in New York at 97.57 — and opened down 3 basis points once trading commenced at 7:44 p.m. EDT on Wednesday evening, which was 7:44 a.m. CST on their Thursday morning.  It then proceeded to trade pretty much ruler flat until around 9:15 a.m. in London.  It edged lower from that juncture — and the 97.44 low tick of the day was set at a minute or so after 10 a.m. BST.  A ‘rally’ began at that point — and the 97.88 high tick was set a minute or so before 3:00 p.m. EDT in New York — and it edged a few basis points lower into the close from there.  The dollar index finished the Thursday session at  97.86…up 29 basis points from Wednesday’s close.

If you can find any direct correlation between what was happening in the currencies — and what was going on in each of the precious metals yesterday, I’d love to hear from you.  This was another COMEX paper affair, nothing else — and I have more to say about this in The Wrap.

Here’s the DXY chart, courtesy of BloombergClick to enlarge.

And here’s the 1-year U.S. dollar index chart, courtesy of the folks over at the stockcharts.com Internet site.  The delta between its close…97.68…and the close on the DXY chart above, was 18 basis points on Thursday.  Click to enlarge as well.

The gold stocks began to head lower the moment that trading began at 9:30 a.m. in New York on Monday morning, with their respective lows coming around 11:20 a.m. EDT.  They rallied very erratically from there by a bit until the markets closed at 4:00 p.m. — and the HUI closed lower by 1.37 percent.

In most respects that mattered, the trading pattern in the silver equities was the same as it was for the gold shares…except their lows of the day came around 2:40 p.m. in New York.  They rallied a bit into the close from there.  Nick Laird’s Intraday Silver Sentiment/Silver 7 Index closed down 1.80 percent.  It could have been far worse.  Click to enlarge if necessary.

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

The CME Daily Delivery Report showed that 2 gold and 15 silver contracts were posted for delivery within the COMEX-approved depositories on Monday.

In gold, the lone short/issuer was Advantage — and the lone long/stopper was JPMorgan.  Both transactions involved their respective client accounts.

In silver, the two short/issuers were International F.C. Stone and Advantage, with 10 and 5 contracts out of their respective client accounts.  Of the four long/stoppers in total, the two largest were JPMorgan, as they picked up 10 contracts in total…9 for clients — and one for its own account.  Advantage stopped 3 contracts.

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

The CME Preliminary Report for the Thursday trading session showed that gold open interest in May dropped by 54 contracts, leaving 69 left, minus the 2 contracts mentioned a few short paragraphs ago.  Wednesday’s Daily Delivery Report showed that 55 gold contracts were actually posted for delivery today, so that means that 55-54=1 more gold contract was added to May.  Silver o.i. in May actually rose by 55 contracts, leaving 353 still open, minus the 15 contracts mentioned a few paragraphs ago.  Wednesday’s Daily Delivery Report showed that only 4 silver contracts were actually posted for delivery today, so that means that 55+4=59 more silver contracts were added to the May delivery month.


There were no reported changes in either GLD or SLV on Thursday.

And there was no sales report from the U.S. Mint, either.

The only in/out movement in gold over at the COMEX-approved depositories on Wednesday was 514.400 troy ounces/16 kilobars [U.K./U.S. kilobar weight] that was shipped out out of Canada’s Scotiabank.  I won’t bother linking this amount.

It was busier in silver.  Nothing was reported received, but 1,073,733 troy ounces was shipped out.  There was one truckload…599,864 troy ounces…that departed Brink’s, Inc. — and 404,550 troy ounces was shipped out of Canada’s Scotiabank.  The remaining 69,318 troy ounces left the CNT depository.  The link to this activity is here.

There was some activity over at the COMEX-approved gold kilobar depositories in Hong Kong on their Wednesday, as 2,000 were reported received — and 10 were shipped out.  All this activity was at Brink’s, Inc. — and the link to that, in troy ounces, is here.


The Hoxne Hoard is the largest hoard of late Roman silver and gold discovered in Britain,[3] and the largest collection of gold and silver coins of the fourth and fifth centuries found anywhere within the Roman Empire. It was found by Eric Lawes, a metal detectorist in the village of Hoxne in Suffolk, England in 1992. The hoard consists of 14,865 Roman gold, silver, and bronze coins and approximately 200 items of silver tableware and gold jewellery. The objects are now in the British Museum in London, where the most important pieces and a selection of the rest are on permanent display. In 1993, the Treasure Valuation Committee valued the hoard at £1.75 million (roughly equivalent to £3.5 million in 2018).

The hoard was buried in an oak box or small chest filled with items in precious metal, sorted mostly by type, with some in smaller wooden boxes and others in bags or wrapped in fabric. Remnants of the chest and fittings, such as hinges and locks, were recovered in the excavation. The coins of the hoard date it after A.D. 407, which coincides with the end of Britain as a Roman province. The owners and reasons for burial of the hoard are unknown, but it was carefully packed and the contents appear consistent with what a single very wealthy family might have owned. It is likely that the hoard represents only a part of the wealth of its owner, given the lack of large silver serving vessels and of some of the most common types of jewellery.

The Hoxne Hoard contains several rare and important objects, such as a gold body-chain and silver-gilt pepper-pots (piperatoria), including the Empress pepper pot. The hoard is also of particular archaeological significance because it was excavated by professional archaeologists with the items largely undisturbed and intact. The find helped to improve the relationship between metal detectorists and archaeologists, and influenced a change in English law regarding finds of treasure.

I have an average number of stories for you today.


CRITICAL READS

Subprime Bites: Auto-Loan Delinquencies Spike to Q3 2009 Level, Despite Strongest Labor Market in Years — Wolf Richter

Serious auto-loan delinquencies – 90 days or more past due – jumped to 4.69% of outstanding auto loans and leases in the first quarter of 2019, according to New York Fed data. This put the auto-loan delinquency rate at the highest level since Q4 2010 and merely 58 basis points below the peak during the Great Recession in Q4 2010 (5.27%)…

These souring auto loans are going to impact banks and specialized lenders along with the real economy – the automakers and auto dealers and the industries that support them.
This is what the banks are looking at.

The dollars are big. In Q1, total outstanding balances of auto loans and leases rose by 4% from a year ago to $1.28 trillion (this amount by the New York Fed is slightly higher than the amount reported by the Federal Reserve Board of Governors as part of its consumer credit data). Over the past decades, since in Q1 2009, total auto loans and leases outstanding have risen by 65%.

But the number of auto-loan accounts has risen only 34% over the decade, to 113.9 million accounts in Q1 2019. In other words, what caused much of the increase in the auto-loan balances is the ballooning amount financed with each new loan and longer loan terms that causes those loans to stay on the books longer.

This article from Wolf put in an appearance on his Internet site on Wednesday sometime — and I thank Richard Saler for pointing it out.  Another link to it is here.


Here’s What Uber is Really Worth — Bill Bonner

Wall Street continued its recovery yesterday, the Dow rising 116 points.

Investors believe – as we do – that the trade war will blow over… or at least calm down into tweety skirmishes. The Donald himself is already backing off, calling it only a “squabble.”

The Trump administration also signaled that it would not step up its trade war with Europe (over autos)… and that it was ready to back away from steel and aluminum tariffs, too.

And faced with a collapsing stock market, there is little doubt – Trump will retreat… and turn his guns on the Fed.

But only the old-timers bother to worry about a stock collapse.

Three times, the Dow has tried to beat its October 2018 high of 26,800. And three times, it has failed. This “triple top” formation is a bad sign. It foretells a bear market, they say.

The latest news from Reuters shows Main Street weakening too — and the Atlanta Fed is now predicting a big drop in GDP growth.

But nobody pays any attention to old-timers… or to warning signs… anymore. That’s what financialization is all about – separating the real world from the financial world… and allowing fantasy and fake money to replace facts and real earnings.

This worthwhile commentary from Bill put in an appearance on the bonnerandpartners.com Internet site early on Thursday morning EDT — and another link to it is here.


Will The Stock Market Protect You Against Inflation? — Dennis Miller

How do baby boomers protect their life savings from the ravages of inflation? Our recent interview with Chuck Butler got the attention of many readers. We reviewed how gold and foreign currencies performed during the high inflation Carter years. During a five-year period beginning 1/1/77, we experienced almost 60% inflation. That destroyed a lot of wealth held by seniors and savers. We concluded:

Preservation of capital (not losing money) is no longer the entire goal. We must preserve the buying power of our life savings!

Our handy Inflation calculator confirms the market didn’t offer much inflation protection at all. Just to keep up with inflation, the S&P should have climbed to $165.29.Readers asked about the stock market. One might think that the stock market would also rise with inflation. On January 1, 1977, the S&P 500 was $103.80. Five years later it closed at $117.30.

The Department of Energy historical gas pump prices reports the 1977 average pump price of $.62/gal more than doubled, rising to $1.31 over the next five years. The oil industry had no problem staying ahead of inflation. Their profits were so high, Congress instituted a “Windfall Profits Tax”. Of course, the consumer never saw a dime, the money went into the treasury to support government spending.

Our interview with Chuck discussed how metals and various currencies help offset inflation. Readers asked for more, what stocks and industries historically perform well in a high inflationary environment?

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


Global air freight is falling in a sign of economic strain

Global air freight volumes are falling at some of the fastest rates since the end of the great recession in a warning sign that recessionary forces are building in the world economy.

Freight indicators are available with a much shorter lag than most macroeconomic statistics, which makes them a good barometer of the economy’s health. It carries some of the highest-value cargo and reacts quickly to changes in demand, making it a good leading indicator for freight movements and the economy in general.

Freight volumes are now declining at major airports around the world in a signal the global manufacturing and distribution system is under growing stress.

Hong Kong International Airport, the busiest cargo hub in the world, reported volume down 7% for the three months between February and April compared with the same period a year earlier.

London’s Heathrow Airport reported volume down by more than 3% over the same period, and growth rates have been sliding for almost two years.

In North America at Memphis International Airport, the busiest hub in the United States, volume was up by 1 percent in January-March, but that was a marked slowdown from 5% growth in May-July 2018.

This Reuters story, filed from London, showed up on their Internet site back on May 10 — and I plucked it from a Zero Hedge story from Thursday afternoon.  Another link to it is here.  There was a ZH story on this issue headlined ““Significant Slowdown” Spooks Maersk at Mediterranean’s Third Largest Port” — and the comes courtesy of Brad Robertson.


Trump administration to delay auto tariffs by up to six months

The Trump administration plans to delay auto tariffs by up to six months, stopping itself for now from widening global trade disputes, four sources told CNBC.

The White House faces a Saturday deadline to decide whether to slap duties on car and auto part imports over national security concerns. After Saturday, the administration would have another 180 days to come to a decision as long as it is negotiating with its counterparts.

President Donald Trump sees the tariffs as a way to gain leverage over trading partners such as the European Union and Japan during ongoing talks. But the president risks sparking fresh global trade clashes if he goes through with car duties. The European Union, for example, has already prepared a list of retaliatory duties to implement if Trump targets autos.

Stocks gained back their their losses Wednesday following news of the administration’s plans, which were confirmed by a source briefed on the talks, an administration official and two foreign officials. Shares of automakers such as Ford and General Motors jumped.

This news story appeared on the cnbc.com internet site at 10:18 a.m. EDT on Wednesday morning — and I found it in Wednesday’s edition of the King Report.  Another link to it is here.


SWAT Team Raids Venezuelan Embassy in D.C. to Cheers of Guaido Supporters

A federal SWAT team breached the Venezuelan embassy in D.C. on Thursday morning, in a move the Maduro government has condemned as a violation of the Vienna Convention, which protects a nation’s embassy as sovereign territory.

The four remaining “Embassy Collective” activists who were remaining from among dozens of anti-war protesters who had been holed up in the embassy for the prior few weeks were arrested, according to local accounts.

The group had been defending the embassy since April 10 from what they described as a hostile and illegal potential takeover from pro-Guaido opposition supporters camped outside. The Maduro-supporting collective had the blessing of Venezuelan diplomatic authorities.

Subsequently, Carlos Vecchio – the Guaidó-appointed ambassador – tweeted his congratulations that the embassy had been “liberated,” further thanking the “Venezuelan diaspora” for helping.

The vocal anti-war group Code Pink had formed a core of the group which D.C. police and the Secret Service had reportedly considered as illegal squatters.

The raid was likely on orders from the highest levels of the State Department, given the U.S. only recognizes Juan Guaido’s opposition movement as the sole legitimate authority in Venezuela, even though it has no power domestically, but is a kind of government-in-exile.

This Zero Hedge news item appeared on their website at 2:50 p.m. on Thursday afternoon EDT — and another link to it is here.  Then there was with Venezuela-related Zero Hedge article headlined “U.S. Suspends All Passenger and Cargo Flights To Venezuela” — and I thank Brad Robertson for that one.


E.U. Fines Five Major Banks 1 Billion for Cartel Collusion

The European Commission (E.C.) said in a statement Thursday that it had fined five banks €1.07 billion (US$1.2 billion) for taking part in cartels.

In two settlement decisions, the European Commission has fined five banks for taking part in two cartels in the Spot Foreign Exchange market for 11 currencies — Euro, British Pound, Japanese Yen, Swiss Franc, U.S., Canadian, New Zealand and Australian Dollars, and Danish, Swedish and Norwegian crowns“, the European Commission said.

The first decision (“Forex — Three Way Banana Split” cartel) imposes a total fine of some €811 million on Barclays, The Royal Bank of Scotland (RBS), Citigroup, and JPMorgan. The second decision (“Forex- Essex Express” cartel) imposes a total fine of nearly €258 million Barclays, RBS, and MUFG Bank (formerly Bank of Tokyo-Mitsubishi).

According to Brussels, the banks formed those cartels in order to influence 11 different currencies, including the euro, U.S. dollar, pound sterling, Japanese yen, Swiss franc, and others.

More licensing fees for these banks.  This news item showed up on the sputniknews.com Internet site at 1:13 p.m. Moscow time on Thursday afternoon, which was 6:13 a.m. in New York — EDT plus 7 hours.  It was updated about twenty minutes later.  The first reader through the door with this story yesterday morning was Steward Naylor — and another link to it is here.


Saudis Claim Iran Ordered Aramco Pipeline Drone Attack

Saudi Arabia on Thursday blamed Iran for ordering an attack early this week on two Aramco pipeline booster stations, a strike that was intended as part of a broader sabotage campaign to disrupt world oil supplies, according to Saudi Energy Minister Khalid al-Falih.

The drone attacks came one day after a string of attacks on two Saudi oil tankers and two other vessels in the Strait of Hormuz, and caused the temporary closure of a vital east-west pipeline traversing the kingdom, since reopened.

Prince Khalid Bin Salman, the vice minister for defense and brother of the crown prince MbS, described Yemen’s Houthis – which were believed to have launched the drone attack – of being used as an “Iranian” tool advancing Tehran’s aggression and hegemony in the region.

Since 2015 Saudi coalition jets have been waging a brutal bombing campaign over Yemen to roll back the country’s Shia Houthi rebels, the latter which have occasionally launched missile and drone attacks against sensitive sites in the kingdom, at times even reaching Riyadh’s international airport with ballistic missiles.

U.S. and Saudi investigators further blamed Iran for a “sabotage attack” on several Saudi and international tankers off a UAE port near the Strait of Hormuz on Sunday.

Of course this is all bulls hit.  This Zero Hedge story was posted on their website at 9:45 a.m. EDT on Thursday morning — and I thank Brad Robertson for sending it our way.  Another link to it is here.


Kitco lets Max Keiser mention gold market manipulation

Gold’s true-value potential is being held back by market “abuse,” which is why the metal is trading at relatively depressed prices, said Max Keiser, host of the Keiser Report.

Keiser cited the tremendous amount of paper gold in the market as the main problem, as this creates opportunities for short sellers to prevent prices from moving to the upside.

During the trading of gold futures, or paper gold, Keiser said that “there’s a huge gap between when they’re supposed to reconcile these trades and when they actually do, and in that gap there’s a lot of abuse, and that abuse comes with banging the price of gold down in ways that do not reflect the genuine price discovery between buyers and sellers.”

Keiser said that when tracked against historical U.S. debt accumulation, gold should be trading around $2,900 an ounce today if no market manipulation were to occur.

I don’t know how Max knows that gold should be trading at $2,800 per ounce, but I wouldn’t complain if it was.  This 11-minute long interview was posted on the kitco.com Internet site at 10:55 a.m. EDT on Thursday — and I found it in a GATA dispatch yesterday.  Another link to the interview is here.


India’s Gold imports spike 54% to $3.97 billion in April

India’s gold imports spiked by 54% to $3.97 billion in April from $2.58 billion in the same month last year, according to latest data release from the Ministry of Commerce.

The rise in imports by the world’s second-biggest consumer of the precious metal was driven by strong demand during wedding season along with fall in prices which prompted purchases.

After recording negative growth for three consecutive months – October, November and December 2018 – gold imports grew 38.16% to $2.31 billion in January 2019. It again contracted by 10.8% to $2.58 billion in February.

In March 2019, gold imports grew by 31.22 % to $3.27 billion.

This very brief gold-related news item, filed from Mumbai, appeared on the scrapregister.com Internet site on Thursday sometime — and I found it on the Sharps Pixley website.  Another link to it is here.


The PHOTOS and the FUNNIES

These two photos were taken a bit further down super-scenic B.C. Highway 5A on the way back to Merritt.  The very late afternoon sun was casting long shadows at that time of day.  I took both these photos from the side of the highway and at exactly the same spot — and close up against a barbed-wire fence.  The first photo is looking generally NNE — and the second mostly SE.  The water in the second shot is the south end of the ‘lake’ you can see in the first photo.  Click to enlarge for both.


The WRAP

With gold now back below its 50-day moving average, I’ll bring up the possibility once again that JPMorgan et al still have gold’s 200-day moving average in their sights.  That’s about 31 dollars away — and it can be assumed that if they go for it, the price low at the bottom of that engineered price decline will be somewhat below it.  But by how much, I don’t know.

Also in gold, in my conversation with Ted yesterday, we were talking about how the brain-dead/moving average-following Managed Money had their faces ripped off covering shorts and going long on Monday’s penetration of gold’s 50-day moving average — and how they got their faces ripped off again yesterday, puking up those recently-purchased longs and resetting short positions.  How much of their clients money they lost during the last four trading days is something that Ted might touch on his weekly review on Saturday.

Silver is back to a closing price not seen since the COMEX close on Monday, December 3, 2018.  Ted’s of the opinion…and who am I to argue…that ‘Da Boyz’ are using this current price smash in gold to further reduce their collective short positions in silver.  It’s also a distinct possibility that JPMorgan was adding more long positions during yesterday’s engineered price decline.  They were probably making up for the long positions they had to sell to cap silver’s price rally on Monday.

They may have done the same in gold as well, but none of this will be known with any degree of certainty until next Friday’s COT Report.

It should be noted that the price pressure in platinum continues — and was closed a few dollars above its 200-day moving average on Thursday.  It’s pretty much a given that JPMorgan et al will be gunning for that moving average as well.  As a matter of fact, as I type this paragraph, that event appears to have occurred shortly after trading began in New York on Thursday evening.  I expect the pounding in this precious metal to continue.

If you remember — and you’re forgiven if you don’t…in last Saturday’s ‘Days to Cover‘ Report, the Big 4 short holders in platinum were short 83 percent of the short position held by the Big 8 traders…of which includes the Big 4 traders.  That’s grotesque!  And in the ‘Bank Participation Report’ on Saturday, it showed that 5 U.S. banks had increased their short position in platinum by 60 percent during April — and that they also held 60 percent of the entire short position in platinum held by all 25 banks in the world that were net short platinum in the COMEX futures market.  So it’s a given the JPMorgan is the absolute king short in platinum.

Moving along, copper made it back to its 200-day moving average on an intraday basis yesterday, but was hauled back down to close below it by a few pennies.  WTIC is back above both its 50 and 200-day moving averages by a bit.

Here are the 6-month charts for the Big 6 commodities — and you can check out “all of the above” for yourself.  Click to enlarge.

And as I type this paragraph, the London open is less than ten minutes away — and I note that the gold price crept quietly sideways until shortly after 12 o’clock noon in Shanghai on their Friday morning — and then it began to creep quietly higher. Currently, it’s up $1.70 cents the ounce. Silver was sold a few pennies lower about an hour after trading began in New York at 6:00 p.m. EDT in New York on Thursday evening — and then was bounced of its Thursday low tick of the day [$14.49 spot] multiple times, but no Managed Money traders were prepared to go further short — and that was as low as they could get it — and it’s down 2 cents at the moment. Platinum was sold lower starting at 8 a.m. CST — and it has been chopping unevenly and quietly sideways since — and is down 5 dollars as the Zurich open looms. ‘Da boyz’ have palladium lower by 11 bucks as Zurich opens.

Net HFT gold volume is coming up on 36,000 contracts — and there’s only 1,508 contracts worth of roll-over/switch volume out of June and into future months on top of that. Net HFT silver volume is very close to 12,000 contracts — and there are 1,044 contracts worth of roll-over/switch volume in this precious metal.

The dollar index opened down 3 basis points once trading commenced around 7:44 p.m. EDT in New York on Thursday evening, which was 7:44 a.m. CST on their Friday morning. It poked its nose above unchanged around 8:30 a.m. CST — and has been creeping nervously lower since — and is down 6 basis points as of 7:45 a.m. BST in London/8:45 a.m. CEST in Zurich.


Today, around 3:30 p.m. EDT, we get the latest Commitment of Traders Report for positions held at the close of COMEX trading on Tuesday.  Ted is not looking forward to how big and bad the increase in the commercial net short position in gold will be — and I’m now fearful as well.  Silver is another matter, as Ted isn’t sure — and neither am I.  Were bracing for an increase, but hoping for a positive surprise.


And as I post today’s column on the website at 4:02 a.m. EDT, I see that the gold price was sold lower once trading began in London — and it’s down 80 cents at the moment.  Silver is down 4 cents — and has set a new low for this move down by a couple of pennies.  Platinum is down 7 bucks, but was down 9 earlier — and now back below its 200-day moving average.  JPMorgan et al continue to kick the snot out of palladium — and they have it down 17 dollars as the first hour of Zurich trading ends.

Gross gold volume is now up to 54,000 contracts — and minus roll-over/switch volume out of June and into future months, net HFT gold volume is a bit over 45,000 contracts.  Net HFT silver volume is a hair under 15,000 contracts — and there’s 1,156 contracts worth of roll-over/switch volume on top of that.

The dollar index hasn’t done much in the last hour — and it’s current low tick [such as it is] was set at the London open.   As of 8:45 a.m. in London/9:45 a.m. in Zurich, it’s down 4 basis points.

That’s all I have for today — and I’ll see you here tomorrow with the latest COT data…warts and all.

Have a good weekend.

Ed

“Care & Maintenance” Once Again on Wednesday

16 May 2019 — Thursday

YESTERDAY in GOLD, SILVER, PLATINUM and PALLADIUM


The gold price was guided a few dollars lower staring around 9 a.m. China Standard Time on their Wednesday morning — and the low tick of the day, such as it was, came at the London open.  It crawled quietly and unevenly higher from there — and both attempts to break above the $1,300 spot mark between 8 and 9 a.m. in New York, were easily turned aside. The gold price was turned a bit lower from that point — and then didn’t do much for the remainder of the Wednesday session.

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

Gold was closed on Wednesday at $1,296.10 spot, down 20 cents on the day and, in most respects, its price path on Wednesday was almost a carbon copy of the price path it was forced to follow on Tuesday.  Despite the quiet price action, net volume [like on Tuesday] was fairly decent at a bit over 223,000 contracts — and there was 25,000 contracts worth of roll-over/switch volume on top of that.

Like for gold, silver’s low, such as it was, came at the London open as well — and it then crept higher until at, or shortly before, the morning gold fix in London.  About thirty minutes after that, the price was headed lower — and that tiny sell-off lasted until around 11:25 a.m. in New York.  It edged a few pennies higher going into the 1:30 p.m. EDT COMEX close — and didn’t do much after that.

The low and high ticks aren’t worth looking up in this precious metal, either.

Silver was closed at $14.765 spot, up half a cent on the day.  If you look, you’ll see that ‘da boyz’ have closed silver within two cents of the same price for the last three trading sessions in a row.  This certainly isn’t by chance.  Net HFT gold volume was pretty light at a bit over 41,000 contracts — and there was 2,478 contracts worth of roll-over/switch volume in that precious metal.

The platinum price edged sideways in morning trading in the Far East on their Wednesday — and Ted’s “midnight move” in this precious metal began very shortly after 12 o’clock noon CST.  Its low tick was set either side of the Zurich close.  it crept a few dollars higher from there into the 1:30 p.m. COMEX close — and went back to trading flat until trading ended at 5:00 p.m. EDT in New York. Platinum was closed at $844 spot, down 9 dollars from Tuesday — and at a new low for this engineered price decline.

The palladium price was sold quietly and unevenly lower until the Zurich open — and then ‘da boyz’ got serious.  The low tick came around 9:15 a.m. in New York — and it began to tick higher from there.  Then the market appeared to go “no ask” once the afternoon gold fix in London was done for the day.  But a short seller of last resort appeared minutes later, not only capping the price, but driving it down twenty bucks or so in the process.  It gained half of that back by around 2:40 p.m. in the very thinly-traded after-hours market — and was sold down a few dollars going into the 5:00 p.m. EDT close.  Palladium was closed at $1,323 spot, up 4 bucks on the day, but off its high tick by about 10.  How high it would have closed if free markets had been allowed to prevail, would be anyone’s guess.

The dollar index closed very late on Tuesday afternoon in New York at 97.53 — and opened unchanged once trading began at 7:44 p.m. EDT on Tuesday evening, which was 7:44 a.m. China Standard Time on their Wednesday morning.  From that juncture, it really didn’t do much — and sank to its 97.44 low tick a few minutes before 10 a.m. BST in London.  It began to rally from there — and the 97.70 high tick came at the afternoon gold fix in London.  Then down it went.  That waterfall decline ended at a few minutes before 10:30 a.m. in New York — and it edged quietly and unevenly higher until around 3:25 p.m. EDT — and crept a few basis lower until trading ended at 5:30 p.m. EDT.  The dollar index finished the day at 97.57…up 4 basis points from Tuesday’s close.

Here’s the DXY chart, courtesy of BloombergClick to enlarge.

And here’s the 6-month U.S. dollar index chart — and that’s courtesy of the folks over at the stockcharts.com Internet site.  The delta between its close…97.32…and the close on the DXY chart above, was 25 basis points on Wednesday. Click to enlarge as well.

The gold stocks opened up less than one percent and then sank quietly and very unevenly lower for the entire New York trading session — and the HUI closed down 0.18 percent.

The price pattern for the silver equities was mostly the same, except their price path yesterday was even more erratic than their golden brethren.  Nick Laird’s Intraday Silver Sentiment/Silver 7 Index closed lower by 0.17 percent.  Click to enlarge if necessary.

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

At least there was nobody activity shorting the precious metal shares on Wednesday.


The CME Daily Delivery Report showed that 55 gold and 4 silver contracts were posted for delivery within the COMEX-approved depositories on Friday.

In gold, the three short/issuers were JPMorgan, Advantage and ADM, with 39, 11 and 5 contracts respectively.  Of the four long/stoppers in total, the three biggest were JPMorgan, Advantage and Morgan Stanley, with 33, 17 and 4 contracts respectively.  All contracts, both issued and stopped, involved their respective client accounts.

In silver, the two short/issuers were ADM and Advantage, with 3 and 1 contracts.  JPMorgan and Advantage stopped 2 contracts each.  And, like in gold, all contracts both issued and stopped, involved their respective client accounts.

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

The CME Preliminary Report for the Wednesday trading session showed that gold open interest in May rose by 2 contracts, leaving 123 still around, minus the 55 mentioned a few paragraphs ago.  Tuesday’s Daily Delivery Report showed that only 1 gold contract was actually posted for delivery today, so that means that 2+1=3 more gold contacts were added to May.  Silver o.i. in May rose by 3 contracts, leaving 298 still open, minus the 4 contracts mentioned a few paragraphs ago.  Tuesday’s Daily Delivery Report showed that zero silver contacts were posted for delivery today, so that means that 3 silver contracts just got added to the May delivery month.


There was a withdrawal of 103,833 troy ounces of gold from GLD on Wednesday.  This amount is within two troy ounces of the amount that was reported deposited in GLD on Monday.  What that was all about is something that I’m no position to even speculate on.  Over at SLV, an a.p. took out 1,030,557 troy ounces of silver.

There was a tiny sales report from the U.S. Mint on Wednesday.  They sold 500 troy ounces of gold eagles — and 500 one-ounce 24K gold buffaloes.

There was a tiny amount of in/out movement in gold over at the COMEX-approved depositories on Tuesday.  There was 8,234 troy ounces shipped out of Brink’s, Inc. — and there was 289.350 troy ounces/9 kilobars [U.K./U.S. kilobar weight] shipped out of Canada’s Scotiabank.  The link to that is here.

There wasn’t much going on in silver.  There was 168,373 troy ounces received — and all of that ended up at Loomis International.  There was a total of 169,441 troy ounces shipped out involving three different depositories.  The two largest were HSBC USA and Scotiabank, with 100,021 troy ounces shipped out of the former — and 68,352 troy ounces shipped out of the latter.  The link to this, plus a bit more, is here.

There was some activity over at the COMEX-approved gold kilobar depositories in Hong Kong on their Tuesday.  They reported receiving 1,150 of them — and shipped out only 54.  Except for 150 kilobars that were received at Loomis International, the remainder of the in/out activity was at Brink’s, Inc.  The link to that, in troy ounces, is here.


The Hallaton Treasure, the largest hoard of British Iron Age coins, was discovered in 2000 near Hallaton in southeast Leicestershire, England, by volunteers from the Hallaton Fieldwork Group. The initial find was made by Ken Wallace on 19 November 2000, when he found about 130 coins with a metal detector.

Along with local community archaeologists, the University of Leicester Archaeological Services (ULAS) excavated what turned out to be one of the most important Iron Age excavations and community archaeology projects in Britain.

The hoard includes over 5,000 silver and gold coins, a silver-gilt Roman parade helmet, jewellery, and other objects. Most of the items date to around the time of the Roman Conquest of Britain in the 1st century A.D. Of the coins from the site, 4,835 can be attributed to the local tribe, the Corieltauvi. This find more than doubled the total number of Corieltauvian coins previously recorded. A silver Roman coin from the hoard has been dated by local museums to 211 B.C., and is the oldest Roman coin found in Britain.

Some archaeologists have however speculated that it found its way into Britain before the Roman conquest in 43 A.D. and is evidence of exchange through trade or diplomacy. The site of the treasure proved to be an internationally important ritual site dating mostly to the generations before and after the Roman Conquest. Archaeologists believe that the site is a type of open air shrine that is the first of its kind to have been discovered in the U.K. It was located on a hilltop in the Welland valley and was probably enclosed by a ditch and palisade.  There is only one photo.  Click to enlarge.

I don’t have much in the way of stories/articles for you today.


CRITICAL READS

Prepare for Trench Warfare — Jim Rickards

What if China isn’t half so desperate for a deal as the president believes?

Are we in for an extended siege of economic trench warfare?

Today we explore possibilities… and their implications.

We first direct our gaze to Wall Street.

Investors came crouching from their shelters this morning… as if expecting an aftershock to the quake that drove them underground yesterday.

With Monday’s 617-point battering — piling atop last week’s losses — three months of stock market gains have vanished into the ether.

The S&P 500 endured its 15th-largest decline in history yesterday. It has shed $1.1 trillion since May 5 alone.

This commentary from Jim was written on Tuesday sometime — and it showed up on the dailyreckoning.com Internet site on Wednesday morning.  Another link to it is here.


The Nice Thing About Donald Trump — Bill Bonner

The nice thing about Donald Trump is that he is “honest.” Even when he is lying. He’s a performance artist for whom truth and lies are more or less the same thing. It’s the show that is true – the ratings… the base… the gross revenues.

In order for a show to have wide appeal, in politics as in professional wrasslin’, the theme has to be simple: good versus evil, black versus white, us versus them. Truth, nuance, and ambiguity have no place in it.

Dig down into the numbers, the theories, and the details, and the good versus evil narrative gets mucky, murky, and messed-up. But why bother?

Yesterday, we noted that even people who call themselves conservatives have stopped digging. They are now willing to let the feds tell them who they can and can’t do business with, and on what terms.

This was confirmed later in the day, when Dear Readers wrote to tell us what an idiot we were for doubting our president and his trade war with China. Many still believe that the U.S. president can – by edict – make us better off.

This commentary by Bill was posted on the bonnerandpartners.com Internet site on Monday morning EDT — and another link to it is here.


Global Trade Collapsing to Depression Levels

With the trade war between the U.S. and China re-escalating once more, investors are again casting frightened glances at declining global trade volumes, which as Bloomberg writes today, “threaten to upend the global economy’s much-anticipated rebound and could even throw its decade-long expansion into doubt if the conflict spirals out of control.”

Just as tentative signs appeared that a recovery is taking hold, trade tensions have re-emerged as a credible and significant threat to the business cycle,” said Morgan Stanley’s chief economist, Chetan Ahya, highlighting a “serious impact on corporate confidence” from the tariff feud.  Click to enlarge.

To be sure, even before the latest trade war round, global growth and trade were already suffering, confirmed most recently by last night’s dismal China economic data, which showed industrial output, retail sales and investment all sliding in April by more than economists forecast.

A similar deterioration was observed in the U.S., where retail sales unexpectedly declined in April while factory production fell for the third time in four months. Meanwhile, over in Europe even though Germany’s economy emerged from stagnation to grow by 0.4% in the first quarter, “the outlook remains fragile amid a manufacturing slump that will be challenged anew by the trade war.” As a result, investor confidence in Europe’s largest economy unexpectedly weakened this month for the first time since October.

The world economy has been in a significant slowdown for a period,’’ said James Bevan, chief investment officer at CCLA Investment Management. “People just have to wake up and look at the trade data.’’

This 2-chart Zero Hedge news item put in an appearance on their Internet site at 11:30 a.m. EDT on Wednesday morning — and I thank Brad Robertson for sending it along.  Another link to it is here.


War with Iran would be “like Christmas” for John Bolton – Tucker Carlson

Fox News host Tucker Carlson blasted National Security Advisor John Bolton for his apparent love of violent global conflict, saying that for him war with Iran would be like “Christmas, Thanksgiving and his birthday” in one.

Mercifully John Bolton doesn’t command the military,” Carlson said bitingly – however, the question of how strong his influence on President Donald Trump’s foreign policy remains.

Bolton has been consistent in his drive to push the U.S. into a violent conflict with the Islamic Republic, even penning a rather blunt op-ed in The New York Times entitled ‘To Stop Iran’s Bomb, Bomb Iran’ in 2015. Although President Trump was elected in part based on his turn-away from the traditional neo-con interventionist outlook, his national security advisor pick has been as hawkish as ever since assuming office last year.

How is a war with Iran in America’s interests in any way?” Carlson asked, a pertinent question given a NYT report recently claimed Bolton ordered a plan to send 120,000 troops to the Middle East in order to “check” Iran’s influence. While Trump has since refuted the report, calling it “fake news,” he added that if it came to such a plan, “we’d send a hell of a lot more troops than that.” He did say that, “hopefully,” this will not be needed.

Tucker on Tuesday was joined by retired army colonel Douglas Macgregor, who called the situation a “manufactured crisis,” noting that Iran actually serves as an ally in the main regional conflict against Islamic State (I.S., formerly ISIS).

This news item from rt.com Internet site, which contains the 4:36 minute Tucker/Macgregor interview, was posted on their website at 2:13 p.m. Moscow time on Wednesday — 7:13 a.m. EDT in Washington.  It was updated ten minutes later.  I thank Larry Galearis for sending it our way — and another link to it is here.


U.S. rebukes British general for doubting heightened threat from Iran

A U.K. military commander was rebuked by the U.S. Central Command for questioning Washington’s claims that Iran poses an increased threat. Gen. Ghika, a senior figure in the anti-ISIS coalition, said none was evident in Iraq or Syria.

The awkward exchange on Tuesday came as the U.S. is trying to rally its allies to confront Tehran over an unspecified threat to American interests in the Middle East.

Despite the beat of the war drum, even the U.S.’s closest allies remain skeptical about the narrative furthered by Iran hawks in Washington like U.S. National Security Advisor John Bolton and U.S. Secretary of State Mike Pompeo. One of the doubters is British Army Maj. Gen. Christopher Ghika, a deputy head of the U.S.-led coalition created to fight the terrorist group Islamic State.

There’s been no increased threat from Iranian-backed forces in Iraq and Syria,” Gen. Ghika said on Tuesday during a video briefing from Iraq. “We’re aware of that presence, clearly. And we monitor them along with a whole range of others because that’s the environment we’re in.”

There is a large number of Shia militias operating in Iraq and Syria, some with the backing of the Iranian government. They were involved in fighting against radical Sunni groups, including I.S., in the past few years, but the degree of control that Tehran has over the fighters is questionable.

Washington cited the existence of those groups as one of the reasons why Iran poses a danger to the U.S. and should be contained. The U.S. has some 5,000 troops deployed in Iraq with the consent of its government as part of the coalition effort, as well as some 2,000 troops stationed in Syria illegally.

This story showed up on the rt.com Internet site at 7:12 a.m. Moscow time on their Wednesday morning — which was 12:12 a.m. in Washington — EDT plus 7 hours.  It was updated about three and a half hours later.  I thank Larry Galearis for pointing it out — and another link to it is here.


Iran and the West: Can Europe restrain the U.S.? — Marwan Bishara

The schism between the United States and Europe over Iran bears the hallmarks of their friction over Iraq prior to the 2003 U.S.-led invasion. Their current dispute is mainly over means not ends, but could have major implications for transatlantic relations and the Middle East.

Both the U.S. and the E.U. would like to see the Ayatollahs’ Iran contained and constrained, preferably under new leadership – just as they wanted to see Saddam Hussein’s Iraq before 2003 – but as in the past, they disagree on how to go about it. To put it simply, it is a dispute over “carrots or sticks” – or whether to bring Iran to its senses or bring it to its knees.

The Europeans want to compel the Islamic Republic to change its behaviour using trade and investments in accordance with the Joint Comprehensive Plan of Action (JCPOA), while the U.S. wants to coerce it into a much more debilitating deal through tough sanctions and the threat of force.

But to paraphrase Mohamed ElBaradei, the former director of the International Atomic Energy Agency (IAEA), Iran is no “donkey” to be managed with carrots and sticks. It is a defiant regional power that demands a U.S. U-turn on sanctions, an apology, and respect.

As the crisis deepens, the disagreements between the U.S. and Europe are also worsening in tone and substance.

This worthwhile commentary appeared on the aljazeera.com Internet site on Wednesday morning sometime — and I thank George Whyte for sending it along.  Another link to it is here.


Iran’s Military “On the Cusp of War” as U.S. Allies Pull Troops From Iraq

In probably the most significant sign so far that we could be headed for yet another major war in the Middle East, multiple European allies of the United States are rapidly pulling their forces from Iraq and the Persian Gulf region on fears they could get unwillingly sucked into confrontation with Iran.

Tehran isn’t backing down the U.S. escalation ladder either, given moments ago Iran’s Revolutionary Guard commander, Major General Hossein Salami, said via the Reuters newswire:

We are on the cusp of a full scale confrontation with the enemy.”

Iran’s Minister of Defense Amir Hatami also vowed Wednesday, “We will defeat the American-Zionist front,” according to the Islamic Republic News Agency (IRNA). This follows on the heels of the U.S. State Department’s dramatic ordering of an evacuation of all non-essential diplomatic personnel and their families from the American embassy in Baghdad, citing an “imminent” threat.

The USS Abraham Lincoln carrier group makes its way through the lengthy Suez Canal en route to the Persian Gulf.

As of Wednesday morning the countries of Spain, Germany, and the Netherlands have suspended military support operations in Iraq, citing rising U.S.-Iran tensions. And further a top Iraqi diplomat told reporters at a press conference in Moscow that “Iraq is a sovereign nation. We will not let [the U.S.] use our territory for any military operations against Iran.”

Previously on Tuesday Spain was the first to announce that it ordered its military frigate, the Méndez Núñez, which has 215 sailors on board, out of a USS Abraham Lincoln carrier strike group currently en route to the Persian Gulf, citing “it will not enter into any other type of mission” in the Persian Gulf region, according to the Spanish Minister of Defense.

This news item was posted on the Zero Hedge website at 3:10 p.m. EDT on Wednesday afternoon — and George Whyte, Larry Galearis and Brad Robertson all contributed to this story.  It’s worth reading — and another link to it is here.


We Have The Power To End Gold Price Suppression — Mark O’Byrne interviews GATA’s Chris Powell [Part 2]

– “Over the long term, justice, fairness and decency will prevail … that is the history of mankind…as seen in the ascent of man … things tend to get better over the long term …

– CALL To ACTION: Precious metals suppression is only possible if gold buyers and investors give their money & energy to Wall Street and keep money in banks and in proxy gold such as ETF gold, digital gold and even gold mining shares. End this for once and for all by selling proxy gold and taking delivery of your bullion or owning coins and bars in fully allocated and fully segregated storage.

– The price suppression of gold and other natural resources has “real world consequences for the majority of the people on this planet …

This worthwhile 32:26 minute video interview [Part 2] between Goldcore’s Mark O’Byrne and GATA’s secretary/treasurer Chris Powell showed up on the goldcore.com Internet site on Wednesday morning BST — and another link to it is here.


The PHOTOS and the FUNNIES

About ten minutes or so after taking the last two shots from yesterday’s photo selection, we were back on super-scenic B.C. Highway 5A — and back on the road to Merritt.  My daughter spotted this small herd of female mule deer — and they were a good 300 meters/1,000 feet away.  They weren’t paying us any attention at all.  So after snapping the first photo, I shouted at them — and that woke them up.  Minutes later they were on their way to greener pastures — and that 4-strand barbed wire fence in their path of retreat was no obstacle.  I didn’t try to crop these shots any tighter, as lens resolution becomes an issue on objects this far away.  Click to enlarge.


The WRAP

[B]ut the complete control that speculative derivatives positioning has on price has become so glaring so as to become almost irrefutable. Yet shockingly, all seem to see it except those most responsible for doing something about it. Here’s something I would ask you to think about. You hear me going on and on about how the price discovery process is all screwed up because the COMEX futures market in gold and silver is dominated by speculators (in the form of managed money technical funds) on one side versus speculators (in the form of banks) on the other side. So large is this purely speculative paper trade that it sets the price for all gold and silver throughout the world. Because there is little to no actual participation by actual users or producers (miners) in COMEX futures trading, there is little to no legitimate hedging going on – which is the prime reason why congress authorized futures trading in the U.S.

Yet here is a speech just given by the chairman of the CFTC, extolling the virtues of the risk transfer mechanism of futures trading. But I don’t know what risk transfer mechanism he is referring to, since there is no legitimate hedging going on by actual gold and silver producers or users on the COMEX. Is he referring to the money consistently taken by the banks from the technical funds as the transfer of risk? Is that what he means by risk transfer? Is he looking at the same markets that I am looking at?

This is a really basic point that the CFTC refuses to even address, namely, how can markets completely dominated by speculators on both sides of the market come close to meeting the meaning of why regulated futures trading is allowed? With no real users or producers hedging in COMEX gold and silver, what legitimate risk transfer is occurring? Even though this is hardly a trick question, I doubt any answer will be forthcoming from the chairman or the agency. Silver analyst Ted Butler:  11 May 2019


It was a very quiet day for silver and gold on Wednesday, but it should be carefully noted that gold was prevented from breaking above the $1,300 spot mark twice yesterday morning in New York.  The other thing I noticed was that silver has now been closed below its 200-day moving average for twenty-five consecutive trading days…five weeks.  Platinum was closed at a new low for this engineered price decline yesterday as well.  I also see that WTIC closed back above its 50-day moving average by a bit for the second day in a row.

Here are the 6-month charts for the Big 6 commodities — and the the above changes should be noted. Click to enlarge for all.

And as I type this paragraph, the London open is less than ten minutes away — and I see that the gold price certainly hasn’t done much in Thursday trading in the Far East — and it’s up 10 cents currently. Ditto for silver — and it’s sitting at unchanged. It’s about the same for platinum — and it’s down a buck at the moment. Palladium as sold lower staring the moment that trading began at 6:00 p.m. EDT in New York on Wednesday evening — and it has been crawling quietly and unevenly sideways since 9 a.m. CST in Shanghai. It’s down 6 dollars as Zurich opens.

Net HFT gold volume is very light at just under 28,000 contracts — and there’s a tiny 857 contracts worth of roll-over/switch volume in this precious metal. Net HFT silver volume is extremely light as well, at a hair over 5,800 contracts — and there’s only 233 contracts worth of roll-over/switch volume on top of that.

The dollar index opened down 3 basis points once trading commenced at 7:44 a.m. in New York on Wednesday evening, which was 7:44 a.m. China Standard Time on their Thursday morning. It has been comatose since — and is down 4 basis points as of 7:45 a.m. BST in London/8:45 a.m. CEST in Zurich.


In this space yesterday I made two contradictory statements — and I didn’t catch this when I was editing, but Ted did when he read it yesterday morning, so I wish to set the record straight here.  At one point in The Wrap I stated that Friday’s COT Report…”will certainly show an increase in the commercial net short positions in both gold and silver.”  Then a handful of paragraphs later I stated that…”I shan’t bother with an estimate on silver as it’s just not possible to tell, but would tickled pink if it came in at unchanged.”  I’m hoping for the latter based on the five dojis during the trading week, but afraid it could turn out to be the former.


And as I post today’s missive on the website at 4:02 a.m. EDT, I note that all four precious metals began to trend higher just before the London/Zurich opens. At the moment, gold is up $1.80 the ounce — and silver is now up 2 cents. Platinum is up 3 dollars — and palladium is back at unchanged as the first hour of London/Zurich trading draws to a close.

Gross gold volume is coming up on 41,000 contracts now — and minus roll-over/switch volume, net HFT gold volume is 36,000 contracts. Net HFT silver volume is a bit over 7,100 contracts — and there’s 298 contracts worth or roll-over/switch volume in that precious metal.

The dollar index continues to do nothing…trading quietly sideways…and as of 8:45 a.m. in London/9:45 a.m. in Zurich, it’s down 4 basis points.

That’s all I have for today — and I’ll see you here again tomorrow.

Ed

152 Tonnes of Gold Withdrawn From the SGE in April

15 May 2019 — Wednesday

YESTERDAY in GOLD, SILVER, PLATINUM and PALLADIUM


The gold price crept a few dollars higher [and back above $1,300 spot] in very early morning trading in the Far East on their Tuesday — and its high of the day, such as it was, came shortly after 8 a.m. China Standard Time.  From that juncture it was sold very quietly and unevenly lower [and back below $1,300 spot] until around noon in New York — and then edged equally unevenly higher until 4 p.m. EDT.  It didn’t do anything in the last hour of trading.

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

Gold was closed at $1,296.30 spot, down $3.30 on the day, but still above its 50-day moving average.  Net volume was nothing special at 199,000 contracts — and there was a hair over 24,000 contracts worth of roll-over/switch volume on top of that.

The silver price was forced to behave in a similar fashion until 9 a.m. in Shanghai — and from there it chopped quietly sideways until 9 a.m. in London.  Its low tick in the spot month came a minute  or so before 10 a.m. BST — and once the noon silver fix was in, it began to show some signs of life.  That state of affairs was allowed to last until 9:40 a.m. in New York.  The price was capped and turned sharply lower until 10:20 a.m. EDT — and it chopped quietly sideways until trading ended at 5:00 p.m.

The high and low ticks you see on the Kitco chart below, occurred in the spot month only, so they aren’t worth reporting on.

Silver was closed at $14.76 spot, up 1.5 cents on the day.  Net volume was pretty quiet at a hair under 42,000 contracts — and there was about 6,100 contracts worth of roll-over/switch volume in this precious metal.

Platinum’s rally was also capped shortly after 8 a.m. in Shanghai on their Tuesday morning — and from there it chopped sideways until 2 p.m. CST.  It was sold lower until shortly before 11 a.m. in Zurich trading — and began to head higher from there.  Its rally was capped and turned lower about twenty minutes of so after that COMEX open — and the engineered price decline lasted until minutes after the afternoon gold fix was done for the day in London.  It ticked about five dollars higher until noon in New York — and then ticked a few dollars lower into the 5 p.m. EDT close from there.  Platinum was closed at $853 spot, unchanged from Monday.

Palladium traded flat until 8 a.m. CST — and then rallied a bit for the next two hours before chopping sideways to a bit lower until the 10 a.m. EST afternoon gold fix in London.  It was sold down to its low of the day shortly after that — and then rallied sharply until around 11:40 a.m. EDT.  It then chopped unevenly sideways…except for that vicious down/up price spike at 2:20 p.m…until trading ended in New York.  Palladium finished the Tuesday session at $1,319 spot, up 14 bucks on the day.

The dollar index closed very late on Monday afternoon in New York at 97.32 — and opened unchanged once trading commenced at 7:44 p.m. EDT on Monday evening.  It then proceeded to trade unevenly sideways until around 12:45 p.m. BST in London, which was 7:45 a.m. in New York.  It jumped up a bit over the next thirty minutes or so — and then edged very quietly and unevenly higher until trading ended at 5:28 p.m. EDT.  The dollar index finished the Tuesday session at 97.53…up 21 basis points on the day.

Bloomberg finally fixed their DXY chart, so I’m back to that one again.  Click to enlarge.

And here’s the 6-month U.S. dollar index chart courtesy of stockcharts.com — and the delta between its close…97.12…and the close on the DXY chart above, was 41 basis points on Tuesday.  Click to enlarge as well.

The gold shares began to head unevenly lower as soon as trading commenced in New York at 9:30 a.m. EDT on Tuesday morning — and their respective lows came at exactly 12:00 o’clock noon EDT.  I suspect a buying program of some kind kicked in at that point — and they rallied unevenly for the remainder of the day.  But the HUI still closed down 0.52 percent.

It was almost exactly the same trading pattern in the silver equities, except after the noon rally started in their stocks, it only lasted until minutes before 2 p.m. in New York trading — and they then traded quietly and unevenly sideways until the market closed at 4:00 p.m. EDT.  Nick Laird’s Intraday Silver Sentiment Index closed down 1.75 percent…taking back a very decent chunk of Monday’s gains in the process.  Click to enlarge if necessary.

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

The CME Daily Delivery Report showed that 1 gold and zero silver contracts were posted for delivery within the COMEX-approved depositories on Thursday.  Advantage issued the lone gold contract — and JPMorgan stopped it.  Both transactions involved their respective client accounts.  The link to yesterday’s Issuers and Stoppers Report is here.

The CME Preliminary Report for the Tuesday trading session showed that gold open interest in May fell by 38 contracts, leaving 121 still around, minus the 1 contract mentioned in the previous paragraph.  Monday’s Daily Delivery Report showed that 43 gold contracts were actually posted for delivery today, so that means that 43-38=5 more gold contracts were just added to the May delivery month.  Silver o.i. in May declined by 12 contracts, leaving 295 still open.  Monday’s Daily Delivery Report showed that 13 silver contracts were actually posted for delivery today, so that means that 13-12=1 more silver contract was added to May.


There were no reported changes in either GLD or SLV on Tuesday.

It was yet another day where there was no sales report from the U.S. Mint.

There was a tiny amount of activity in gold over at the COMEX-approved depositories on Monday.  Nothing was reported received — and the only ‘out’ activity was 8,219 troy ounces that departed Canada’s Scotiabank.  I won’t bother linking this.

There was some activity in silver, most of which occurred at CNT.  All of the ‘in’ activity was there, one truckload…599,952 troy ounces.  There was a total of 644,111 troy ounces shipped out — and one truckload…600,132 troy ounces…departed Canada’s Scotiabank.  There was also 39,984 troy ounces shipped out of CNT — and the remaining 3,994 troy ounces left the vault over at Brink’s, Inc.  There was also a paper transfer of 39,365 troy ounces that was moved from the Eligible category — and into Registered over at CNT.  The link to all this is here.

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


Here are three charts that Nick Laird sent around late on Monday evening, that I was just too lazy to stick in Tuesday’s column, as I already had the weekly transparent gold and silver holding charts in this spot…so here they are now.  It shows the amount of gold that was withdrawn from the Shanghai Gold Exchange in April — and in that month they took out 151.89 tonnes.  Here’s Nick’s chart updated with the April data point.  Click to enlarge.

This next chart shows total SGE withdrawals up to and including Month 4 [April] of 2019 — and although SGE withdrawals are not on par with with demand in Month 4 of 2018…they’re still way up there.  Click to enlarge.

This third SGE chart needs no further explanation, as that is included in the chart name.  Click to enlarge as well.

It should also be noted that since the exchange’s inception in 2008…there has been 17,801 tonnes withdrawn over that time period.

I don’t have all that much for you in the way of stories/articles today.


CRITICAL READS

Defining Liberty — Jeff Thomas

Here we have a most interesting collection of signage. Some low-level civil servant who’s in charge of deciding what the motorist may do at this particular junction has become quite thorough in creating restrictions.

The motorist may not proceed, may not turn left or right, and, most interestingly, in the second sign from the bottom, may not reverse out. In essence, “You’re stuck here and whatever you do to get out, you’re in violation of the rules we’ve placed upon you.”

Of course, if we were to encounter this particular intersection, we might say, “That’s absurd – they can’t possibly hold me to this.”

But, interestingly, under the traffic laws, a policeman can cite us for violating the signage. If we’re lucky, he might agree that it’s absurd and give us a break, but his job is to enforce it, regardless of its absurdity. And if he enjoys his position of authority, as many in his position do, he just may choose to demonstrate his power.

And, if we defy him, we’re in real trouble.

How many laws exist in the U.S. today? The answer is that no one knows. It’s too complex to define. There are roughly 20,000 laws regarding gun control alone – and that’s just the federal laws. State, county and city laws also exist in abundance.

This interesting commentary from Jeff appeared on the internationalman.com Internet site on Tuesday morning EDT — and another link to it is here.


How “Megapolitics” Destroy Wealth — Bill Bonner

[W]e have no time to stop and smell the flowers. We have dots to connect… and the breakdown of Western civilization to reckon with.

Yes, Dear Reader, gloom is what we see… doom is what we foretell. And if you are smart, you will vamoose out of the danger zone… if you can.

Alas, that will be hard to do, because civilization itself is at risk. And herewith, we begin to connect some big, squishy dots.

One of the most cherished lessons humans ever learned is that wars are dangerous, destructive, and rarely profitable. The war-makers are wealth (and happiness) destroyers; they need to be kept on a leash.

That was the central insight of conservatism for generations: The feds may be useful servants, but they are bad masters. They have the brute force to take away life, liberty, and property. And they’ll do it, if you let them.

But before we even begin to connect the dots, we will describe the broader tableau…

This commentary from Bill showed up on the bonnerandpartners.com Internet site early on Tuesday morning EDT — and another link to it is here.


Welcome to coup university: A Pentagon scholar’s guide to overthrowing governments

With the Venezuela crisis making regime change once again the talk of the town in Washington, the U.S. Special Operations Command has published a paper chronicling the highs and lows of seven decades of foreign interference.

The 250-page study, entitled “Support to Resistance: Strategic Purpose and Effectiveness,” was penned by Army Special Forces veteran Will Irwin, and published by the Joint Special Operations University, where Irwin is a resident senior fellow.

Few nations have universities dedicated to the art of the coup, but few nations have a history of foreign intervention quite like the U.S. Since the end of World War II, the United States has brought its military might to bear on dozens of countries and sponsored scores of insurgencies and regime change operations worldwide. Irwin was first faced with the task of whittling down the list to something manageable.

After discounting coups that involved no resistance movements – like those in Iran in 1953 and Guatemala in 1954 – as well as those that involved actions against non-state actors, the researcher was left with 47 cases. Recent U.S. proxy wars, like those in Syria, Ukraine and Libya, were also discounted.

Sponsoring foreign resistance movements transcends partisan divisions. “Even presidents who, prior to their election, looked upon such activity with disfavor, found themselves compelled to use it after taking office,” Irwin wrote glowingly.

That’s the power of the deep state, dear reader.  Kennedy fought it — and we all know what they did to him.  This article, along with a embedded link to the 250-page study, was posted on the rt.com Internet site on Tuesday afternoon Moscow time — and it comes to us courtesy of George Whyte.  I was going to save it for Saturday, but changed my mind.  Another link to it is here.


Farage Surge Heaps Pressure on May, Labour Ahead of Brexit Talks

Pressure is building on Theresa May ahead of talks with the opposition Labour Party aimed at reaching a deal on leaving the European Union, as opinion polls showed support for Nigel Farage’s Brexit Party soaring and members of her own side urged her to change strategy.

The government has been in talks with Jeremy Corbyn’s Labour for a month in search of a Brexit compromise, but with no deal in sight and Brexit delayed to October, May’s Tory party has been hemorrhaging voters. According to an Opinium survey for the Observer newspaper, the Brexit Party would take 34% of the vote in the May 23 European Parliament elections, compared with 21% for Labour and just 11% for the Conservatives.

The poll follows a disastrous showing in this month’s local elections, and the Tory clamor for May to jettison her plan for a soft Brexit deal with Labour has been growing. Former Defence Secretary Gavin Williamson, fired following an inquiry into a national security leak, was the latest to criticize May for talking to the opposition.

It is a grave mistake for any prime minister to fail to recognize when a plan will not work and it is fatal to press on regardless,” Williamson wrote in a newspaper op-ed.

But her ministers came out fighting on Sunday, saying the government was focused on securing a “stable majority” to get its Brexit bill through Parliament, and that meant dealing with the opposition.

This Bloomberg story from Sunday was picked up by the news.yahoo.com Internet site — and I thank I thank Jim Gullo for pointing it out.  Another link to it is here.


Europe, Enjoy ;-)) — Andrei Martyanov

In yet another sign of Washington getting its partners (vassals) in order (going completely off the rails)–some funny news from El Pais.

Más gasto en armamento, sí. Pero independencia estratégica, no. Estados Unidos ha advertido por escrito a la Unión Europea de que sus planes actuales de defensa están poniendo en peligro décadas de integración de la industria de defensa transatlántica y de cooperación militar a través de la OTAN. La misiva, fechada el pasado 1 de mayo y a la que ha tenido acceso EL PAÍS, llega cargada de amenazas, más o menos veladas, de posibles represalias políticas y comerciales si Bruselas mantiene su intención de desarrollar proyectos europeos de armamento sin apenas contar con países terceros, ni siquiera con EE UU. La diatriba del Departamento de Defensa contra los planes europeos agrava la tensión entre Europa y la Administración de Donald Trump cuando los ánimos ya estaban soliviantados por la negativa de Alemania y Reino Unido a impedir la participación de la empresa china Huawei en el desarrollo de la telefonía de quinta generación.”

Translation (Google): More spending on weapons, yes. But strategic independence, no. The United States has warned in writing to the European Union that its current defense plans are endangering decades of integration of the transatlantic defense industry and military cooperation through NATO.The letter, dated on May 1 and which has been accessed by EL PAÍS, comes loaded with threats, more or less veiled, of possible political and commercial reprisals if Brussels maintains its intention to develop European armaments projects with hardly any countries. third parties, not even with the United States. The diatribe of the Department of Defense against the European plans aggravates the tension between Europe and the Administration of Donald Trump when the spirits were already soured by the refusal of Germany and the United Kingdom to prevent the participation of the Chinese company Huawei in the development of the telephony of fifth generation.

Well, I feel the pain, of course (not really;)) but, dear Europe, allow me to quote to you none other than Lord Ismay about the nature of NATO, which, in his words, was needed: “to keep the Russians out, the Americans in, and the Germans down“. Does anyone see here anything about “Democracy”, defense or sovereignty? I don’t see anything. Of course, those dumb Soviets who lost 27 million defending themselves from this very Europe (actually, since middle ages) never really cared about attacking NATO and wanted to be left alone, but, of course, Europeans are not that good with serious military-political analysis, especially when this “analysis” is controlled from Washington, but never mind. So, now is the time to reap what one sowed–Europe wanted “defense” from mythical Russian threat, so let Europe be “defended”.

This rather brief, but very interesting commentary from Andrei was posted on the smoothiex2.blogspot.com Internet site on Tuesday sometime — and I thank Larry Galearis for sharing it with us.  Another link to it is here.


U.S. Accuses Iran of Attack on Saudi Tankers

Just as everyone with half a frontal lobe had expected, the WSJ reported late on Monday that according to an initial U.S. assessment, “Iran was likely behind the attack” on the two Saudi Arabian oil tankers and two other vessels damaged over the weekend near the Strait of Hormuz, a U.S. official said, a finding that, whether confirmed or not, will certainly inflame military tensions in the Gulf and likely result in a global proxy war that drags in the U.S., China and Russia. Oh, and that would be the Persian Gulf for those wondering, not the Gulf of Tonkin, which is where another famous False Flag naval incident occurred.

Furthermore, as we predicted would happen on Sunday, this “official assessment“, was the first suggestion by any nation that Iran was responsible for the attack and follows a series of U.S. warnings against “aggression” by Iran or its allies and proxies against military or commercial vessels in the region.  Some more details from the WSJ:

The U.S. official, who declined to be identified, didn’t offer details about what led to the assessment or its implications for a possible U.S. response. The U.S. has said in the past week that it was sending an aircraft carrier, an amphibious assault ship, a bomber task force and an antimissile system to the region after it alleged intelligence showed Iran posed a threat to its troops.

“If they do anything, they will suffer greatly. We’ll see what happens with Iran,” President Trump said while meeting with Hungary’s Prime Minister Viktor Orban at the White House earlier on Monday.

The assessment, predictable from a mile away, squares perfectly with CIA veteran Mike Pompeo’s warning from just two days before the alleged attack, in which he said that “The regime in Tehran should understand that any attacks by them or their proxies of any identity against U.S. interests or citizens will be answered with a swift and decisive U.S. response,” the U.S. Secretary of State wrote in a statement warning that Iran should not mistake U.S. “restraint” for a “lack of resolve,” and criticizing Iran for “an escalating series of threatening actions and statements in recent weeks.”

Two days later Iran – according to U.S. officials – staged the most brazen attack on oil tankers in the Straits of Hormuz in years.

No surprises here — and you can bet your entire net worth on the fact that Iran had nothing to do with these so-called ‘events’.  False flag setups like this are designed for only one purpose…a Casus belli for war.

This news item was posted on the Zero Hedge website at 3:45 a.m. EDT on Tuesday morning — and I lifted it from a story on the duran.com Internet site that Roy Stephens sent our way.  Another link to it is here.


Lavrov & Pompeo agree to work on nukes control but clash on Venezuela, election interference

U.S. Secretary of State Mike Pompeo and Russian Foreign Minister Sergey Lavrov concluded the Sochi talks by agreeing to cooperate on nuclear arms control. The two diplomats, however, could not reach agreement on Venezuela.

After emerging from a sit-down in the Russian Black Sea resort on Tuesday, Pompeo and Lavrov both talked of their governments’ desire to improve relations, currently at a low ebb. Lavrov described the meeting as “frank and useful,” while Pompeo said the U.S. “stands ready to find common ground” with Russia.

As predicted, nuclear arms control was top of the agenda, following the Trump administration’s recent withdrawal from the Intermediate-Range Nuclear Forces (INF) Treaty. Pompeo and Lavrov seemed open to cooperation on establishing new arms control pacts, with Pompeo restating President Donald Trump’s desire to bring China into any future deal.

With the New START nuclear arms reduction treaty set to expire in February 2021, Pompeo said that Washington is willing to work towards extending the deal by five years, while the Russian FM said he hopes any future agreements will be “positively received by both nations.”

Larry Galearis, who sent me this story, had his own headline for it…”Lavrov and Pompeo exchange empty statements“.  That’s far closer to the truth.  This story put in an appearance on the rt.com Internet site at 3:41 p.m. Moscow time on their Tuesday afternoon, which was 8:41 a.m. in Washington — EDT plus 7 hours.  Another link to it is here.


China SGE gold withdrawals sharply down in April — Lawrie Williams

The April figures for Shanghai Gold Exchange (SGE) gold withdrawals show a sharp fall year on year which could indicate a significant downturn in the Chinese economy, although it is probably still too early to confirm this given withdrawals last year fell sharply from May onwards.  However the cumulative total to date is very close to that of 2017.

The latest total gives withdrawal figures ample time to recover through the remainder of the year.  But even so the figures may show that the Trump imposed tariffs are beginning to bite as far as gold imports and consumption are concerned.

We have always looked upon the SGE withdrawal figures as being a strong indicator of Chinese gold consumption and imports and to an extent the latest figure confirms the slowdown in gold imports we have seen from key gold exporters like Switzerland so far this year.  But as far as global gold demand is concerned it appears that demand is picking up nicely in India and is strong in Europe (particularly in Germany and Austria) and this should counterbalance any Chinese shortfall this year.

But – and it is a big but – the world could be heading for a trade war-stimulated recession which could have a somewhat mixed impact on global gold demand.  On the one hand it could stimulate safe haven buying from those with deep pockets, but also adversely affect purchases from the huge numbers of small gold accumulators, particularly in countries like China, which tend to have a significant impact on global gold demand.  It could also stimulate sales of gold related investment holdings as people use their built-up gold accumulations to alleviate any recession-related income downturns and also revive what has been a flat to falling gold scrap supply sector.

This worthwhile commentary from Lawrie appeared on the Sharps Pixley website on Tuesday sometime — and another link to it is here.


The PHOTOS and the FUNNIES

These next three photos were taken further down the road from where I got that shot of the yellow-bellied marmot that appeared in Tuesday’s column.  This first shot of is a spring lamb…being carefully watched over by its mother.  The next two shots were also taken on this same valley road — and its the same herd of cattle in both shots, but the second photo was taken from about two or three hundred meters/yards further down the road — and looking east up the valley, instead of south down the valley, which is what you see in the first shot.  These photos were taken on April 13 — and spring was just getting started at this altitude.  Click to enlarge for all.


The WRAP

Not only were the precious metal rallies capped in New York on Monday, their tiny follow-through rallies in early morning trading in the Far East, weren’t allowed to get anywhere, either.

And whether Monday’s rally was another on of Ted’s “scams within a scam“…where his raptors, the small commercial traders other than the Big 8, forced the Managed Money traders to cover their latest short positions for their loss — and the commercials gain, remains to be seen.  We won’t know for sure until Ted has a look at this Friday’s COT numbers which, as he said on the phone yesterday, will certainly show an increase in the commercial net short position in gold, but probably not in silver.

Here are the charts for the four precious metals, plus copper and WTIC.  Gold has now closed above its 50-day moving average for the second day in a row — and silver is still well contained below its 200-day.  Platinum has now been closed below its 50-day moving average for five consecutive days — and the same can be said of copper and its 200-day moving average.  WTIC is still doing the dos-à-dos with its 50 and 200-day moving averages.  Click to enlarge for all.

And as I type this paragraph, the London open is less than ten minutes away — and I note that the gold price was up a dollar or so by around 9 a.m. China Standard Time on their Wednesday morning, but has drifted quietly lower since — and is currently down $3.40 an ounce. Silver didn’t do much of anything in Far East trading on their Wednesday, but was turned a bit lower starting around 2:40 p.m. CST — and is now down 3 cents at the moment. Platinum was up a few dollars by 10 a.m. CST, but has given all that back — and is now sitting at unchanged. Palladium chopped quietly sideways until shortly before 2 p.m. CST, but then was tapped a bit lower — and is down 3 dollars the ounce as Zurich opens.

Net HFT gold volume is nothing special at around 34,500 contracts — and there’s a tad under 4,000 contracts worth of roll-over/switch volume in this precious metal. Net HFT silver volume is a tiny bit over 6,800 contracts — and there’s only 87 contracts worth of roll-over/switch volume on top of that.

The dollar index opened unchanged once trading began at 7:45 p.m. EDT in New York on Tuesday evening, which was 7:45 a.m. CST on their Wednesday morning. It has been doing precisely nothing since then — and is still sitting at unchanged as of 7:45 a.m. BST in London/8:45 a.m. in Zurich.


Yesterday, at the close of COMEX trading, was the cut-off for this Friday’s Commitment of Traders Report. I expect a decent increase in the commercial net short position in gold because it rallied above — and then closed above its 50-day moving average on Monday. I shan’t bother with an estimate on silver as it’s just not possible to tell, but would tickled pink if it came in at unchanged. And, like Ted, I’m more than interested in seeing what JPMorgan did during the reporting week.


And as I post today’s efforts on the website at 4:02 a.m. EDT, I see that both silver and gold have rallied a bit off their London opening lows. Gold is down only 10 cents the ounce now — and silver is now up 2 cents. Platinum is down only a dollar. Palladium got smacked for 14 bucks, but is off that low by a bit — and down 11 dollars as the first hour of Zurich trading draws to a close.

Gross gold volume is a bit over 54,000 contracts — and minus roll-over/switch volume out of June and into future months, net HFT gold volume is a bit under 45,500 contracts. Net HFT silver volume is a bit over 9,400 contracts — and there’s still only 92 contracts worth of roll-over/switch volume in that precious metal.

The dollar index continued to chop very quietly sideways during the last hour — and as of 8:45 a.m. BST in London/9:45 a.m. CEST in Zurich, the index is down 3 basis points.

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

Ed

Gold Closes Above Its 50-Day Moving Average

14 May 2019 — Tuesday

YESTERDAY in GOLD, SILVER, PLATINUM and PALLADIUM


The gold price was up a couple of dollars by minutes before 9 a.m. China Standard Time on their Monday morning — and at that time, Ted’s “midnight move” began.  The price was sold quietly lower, with the low tick of the day coming at the London open.  It didn’t do much of anything from that juncture until around 1:05 p.m. BST in London, which was about fifteen minutes before the COMEX open…then away it went to the upside.  That rally stopped, or was capped at the 9:30 a.m. open of the equity markets in New York on their Monday morning.  It crawled quietly higher from there, breaking above $1,300 spot by the COMEX close, but was carefully closed below it in the thinly-traded after-hours market.

The low and high tick in gold were reported by the CME Group as $1,282.40 and $1,302.20 in the June contract.

Gold was closed in New York on Monday at $1,299.60 spot, up $13.80 from Friday — and back above its 50-day moving average by a decent amount.  Not surprisingly, net volume was absolutely enormous at 328,500 contracts — and there was a very heavy 58,700 contracts worth of roll-over/switch volume on top of that.

Ted’s “midnight move” in silver began at the same time as it did for gold — and it was sold lower until a few minutes after 1 p.m. BST in London.  With a brief blip at the COMEX open, it powered higher as well — and its price path was handled in a similar manner to gold’s after that.

The low and high ticks in this precious metal were recorded by the CME Group as $14.615 and $14.815 in the July contract.

Silver was closed at $14.745 spot, up 1 whole penny on the day.  Net volume was a bit higher than normal, but not by much at just over 59,000 contracts — and roll-over/switch volume was a bit over 5,300 contracts.

Platinum was hammered lower the moment that trading began at 6:00 p.m. EDT in New York on Sunday evening.  Its low came about fifteen minutes before the Zurich open — and it began to chop unevenly higher from there.  It made it back within three bucks of unchanged, but was then sold lower starting shortly after 9 a.m. in New York.  That sell-off lasted until the COMEX close — and the price didn’t do much of anything after that.  Platinum was closed at $853 spot, down 10 dollars on the day.

The engineered price decline began in palladium at the same time as it did for platinum — and from around 10:30 a.m. CST in Shanghai, the price really didn’t do much of anything until the afternoon gold fix in London.  It was sold a bit lower until around 11:30 a.m. in New York — and really didn’t do much after that going into the 5:00 p.m. EDT close of trading.  Palladium was closed at $1,305 spot, down 28 dollars from Friday.

The dollar index closed very late on Friday afternoon in New York at 97.32 — and opened down 2 basis points once trading commenced in New York on Sunday evening.  It began to chop quietly and unevenly sideways — and didn’t do much until something ‘happened’ a few minutes after 8 a.m. in New York on Monday.  Then down it went.  The index was saved by the usual ‘gentle hands’ either at 9:00 a.m. or 9:25 a.m. EDT…you choose.  The 97.03 low tick came at one of those times — and the subsequent rally had it back at around the unchanged mark by around 11:25 a.m. EDT.  It began to creep very quietly and unevenly higher starting shortly before the 1:30 p.m. COMEX close — and the 97.38 high tick came at precisely 5:00 p.m. EDT — and it sold off a few basis points into the close from there.  The dollar index finished the Monday session at 97.35…up 3 basis points from Friday’s close.

And despite the ‘rally’ back to unchanged in the dollar index in morning trading in New York, the precious metals were allowed to hang onto their gains they made during the precipitous decline in the dollar index that began earlier in the morning.

Here’s the intraday DXY chart from the folks over at the ino.com Internet site — and the ‘click to enlarge’ feature does not help with this chart.

And here’s the 6-month U.S. dollar index chart — and the delta between its close…97.12…and the close on the DXY chart above, was 23 basis points on Monday.  Click to enlarge.

The gold shares jumped up a bit at the 9:30 a.m. open of trading in New York yesterday morning, then dipped a bit until shortly after 10 a.m. EDT — and began to head steadily higher from there.  The gold stocks came very close to finishing on their respective highs of the day, as the HUI closed higher by 3.56 percent.

The rally in the silver equities was about the same as it was for their golden brethren, except they dipped a bit into negative territory before beginning to chop higher.  They really caught a bit starting around 2:20 p.m. EDT — and Nick Laird’s Intraday Silver Sentiment Index basically closed on its high tick of the day as well…up 2.24 percent.  Click to enlarge if necessary.

And here’s the 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 43 gold and 13 silver contracts were posted for delivery within the COMEX-approved depositories on Wednesday.

In gold, of the two short/issuers in total, the only one that mattered was JPMorgan, with 42 contracts.  The three long/stoppers were JPMorgan, Advantage and Morgan Stanley…with 28, 12 and 3 contracts.  All contracts, both issued and stopped, involved their respective client accounts.

In silver, ADM and Advantage issued 8 and 5 contracts out of their respective client accounts.  JPMorgan picked up 8 in total…6 for its client account, plus another 2 for its own account.  Advantage came in second with 4 contracts for its client account.

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 May rose by 40 contracts, leaving 159 still open, minus the 43 mentioned a few paragraphs ago.  Friday’s Daily Delivery Report showed that 2 gold contracts were actually posted for delivery today, so that means that 40+2=42 more gold contracts were just added to the May delivery month.  I suspect that the 42 contracts that JPMorgan issued  in the above Daily Delivery Report represents these same 42 contracts.  Silver o.i. in May dropped by 16 contracts, leaving 307 still around, minus the 13 mentioned a few paragraphs ago.  Friday’s Daily Delivery Report showed that 19 silver contracts were actually posted for delivery today, so that means that 19-16=3 more silver contracts were added to May.


After about six weeks of straight withdrawals, there was finally a deposit of some size into GLD on Friday, as an authorized participant added 103,835 troy ounces of gold.  There were no reported changes in SLV.

The folks over at Switzerland’s Zürcher Kantonalbank updated their website with the goings-on inside their gold and silver ETFs as of the close of business on Friday, April 10 — and this is what they had to report.  Their gold ETF rose by 19,772 troy ounces, but their silver ETF only added 3,630 troy ounces.

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

There was no in/out movement in gold over at the COMEX-approved depositories on the U.S. east coast on Friday.

There was some activity in silver, as 73,149 troy ounces were reported received — and 596,053 troy ounces were shipped out.  All of the ‘in’ activity was at CNT.  In the ‘out’ category, there was one truckload…594,030 troy ounces that departed CNT — and the remaining 2,022 troy ounces…two good delivery bars…was shipped out of Delaware.  The link to this is here.

Over at the COMEX-approved gold kilobar depositories in Hong Kong on their Friday, they reported receiving 1,354 of them — and shipped out another 3,053.  All of this activity was at Brink’s, Inc. — and the link to that, in troy ounces, is here.


Here are the usual two charts that Nick Laird passes around every weekend.  They show the amount of gold and silver in all know depositories, ETFs and mutual funds, as of the close of business on Friday, May 10.  For the week just past, these charts show that 331,000 troy ounces of gold was withdrawn on a net basis basis.  But in silver, there was 730,000 troy ounces added over the same period of time.  The dichotomy continues.  Click to enlarge for both.

I have a decent number of stories/articles for you today.


CRITICAL READS

Markets Tumble As China Strikes Back, May Dump “Some Treasuries”

After vowing over the weekend to “never surrender to external pressure“, Beijing has defied President Trump’s demands that it not resort to retaliatory tariffs and announced plans to slap new levies on $60 billion in U.S. goods.

  • CHINA SAYS TO RAISE TARIFFS ON SOME U.S. GOODS FROM JUNE 1
  • CHINA SAYS TO RAISE TARIFFS ON $60B OF U.S. GOODS
  • CHINA SAYS TO RAISE TARIFFS ON 2493 U.S. GOODS TO 25%
  • CHINA MAY STOP PURCHASING U.S. AGRICULTURAL PRODUCTS:GLOBAL TIMES
  • CHINA MAY REDUCE BOEING ORDERS: GLOBAL TIMES
  • CHINA ADDITIONAL TARIFFS DO NOT INCLUDE U.S. CRUDE OIL
  • CHINA RAISES TARIFF ON U.S. LNG TO 25% EFFECTIVE JUNE 1
  • CHINA TO RAISE TARIFFS ON IMPORTS OF U.S. RARE EARTHS TO 25%

China’s announcement comes after the White House raised tariffs on some $200 billion in Chinese goods to 25% from 10% on Friday (however, the new rates will only apply to goods leaving Chinese ports on or after the date where the new tariffs took effect).

This slightly longish chart-filled commentary appeared on the Zero Hedge website at 2:14 p.m. on Monday afternoon EDT — and another link to it is here.  There was this companion piece from the ZH website as well headlined “Trump: Beijing “Will Be Hurt Very Badly” If They Retaliate With More Tariffs” — and I thank Brad Robertson for that one.


White House Considers Economist Judy Shelton for Fed Board

The White House is considering conservative economist Judy Shelton to fill one of the two vacancies on the Federal Reserve Board of Governors that President Donald Trump has struggled to fill.

Shelton has been contacted by the White House regarding the position, according to two people familiar with the matter who described the outreach on condition of anonymity.

She declined a request for comment, but on Saturday responded “Thank you, sir” to a tweet from Representative Jim Banks, Republican of Indiana, saying she’d be a “great pick” for the central bank.

Shelton, who’s served as an informal adviser to Trump, holds a Ph.D. in business administration with an emphasis on finance and international economics from the University of Utah.

She’s currently U.S. executive director for the European Bank for Reconstruction and Development, and previously worked for the Sound Money Project, which was founded to promote awareness about monetary stability and financial privacy.

In April, Shelton wrote a commentary for The Wall Street Journal entitled “The Case for Monetary Regime Change.” She said it was “entirely prudent to question the infallibility of the Federal Reserve in calibrating the money supply to the needs of the economy.”

This Bloomberg article showed up on their Internet site at 3:24 p.m. PDT on Friday afternoon — and was updated about fifteen hours later.  I found it in a GATA dispatch on Monday — and another link to it is here.


Should Alabama Impose Tariffs on California? — Bill Bonner

We bet that Trump would never go full retard in his trade war with China. Were we wrong?  Maybe.

Last week, our no-real-trade-war bet was moving further and further out of the money. Team Trump didn’t yet go full retard, but – raising tariffs on $200 billion of Chinese imports – it was losing I.Q. points fast.

Our prediction was based on the guess that Trump cares more about stock prices than trade policy. A real trade war would cause the stock market to sink… we thought… and the president wasn’t fool enough to risk it.

He’s setting up the Fed to take the blame for the next sell-off. He doesn’t want fingers pointing at him.

But in the most recent tweets, it looks like tariffs were never a negotiating tactic, but an end in themselves:

“Tariffs will bring in FAR MORE wealth to our Country than even a phenomenal deal of the traditional kind. Also, much easier and quicker to do. Our Farmers will do better, faster, and starving nations can now be helped.

Tariffs will make our Country MUCH STRONGER, not weaker. Just sit back and watch!”

If this were true, of course – that you could tax imports and make yourself richer and stronger – there would be many more tariffs in the world. And not just for countries. States… and even counties… would close their borders to imports.

This commentary from Bill was posted on the bonnerandpartners.com Internet site on Monday morning EDT — and another link to it is here.


Taxes: Slightly Up From Slavery — Doug Casey

To eliminate misunderstanding as to what taxes are, it is helpful to define the word “theft.” One good definition is “the wrongful taking and carrying away of the personal goods of another.” The definition does not go on to say, “unless you’re the government.”

There is no difference, in principle, between the State taking property and a street gang doing so, except that the State’s theft is “legal” and its agents are immune from prosecution. Many people do not accept that analogy, because the government is widely viewed as being of, for, and by the people, even though it’s also acknowledged as acting badly from time to time.

Every year at tax time promoters of big government haul out an assortment of nostrums to sedate the lambs as they are shorn. One of the worst is “Taxes are the price we pay for civilization,” a statement of Supreme Court Justice Oliver Wendell Holmes. It is a splendid example of how, if a lie is big enough and is repeated often enough, it can come to be accepted.

Actually, the truth is almost exactly the opposite. As Mark Skousen, economist and author, has pointed out: “Taxation is the price we pay for failing to build a civilized society. The higher the tax level, the greater the failure. A centrally planned totalitarian state is a complete failure of civilization, while a totally voluntary society is its ultimate success.”

This commentary by Doug appeared on the internationalman.com Internet site on Monday sometime — and another link to it is here.


The Colleges Are Training Tomorrow’s Board Room Executives — Dennis Miller

Good friend Ronnie (fictitious name) has owned a popular bar near a prestigious university for decades. He has me convinced the colleges are doing a great job of preparing the executives of tomorrow.

As I sipped on my iced tea, I noticed young folks in line at his cash machines waiting to withdraw cash. I asked, “why two machines?” He told me when they get packed the lines are long.

Ronnie explained the cash machines only dispense $20 bills. You can withdraw anywhere from $20 to $400. Regardless of the amount, the service charge is $3.99. Withdraw $20 – your credit card gets charged $23.99.

He continued, “It’s very common to see the same credit card being used to withdraw $20 bucks 3-5 times a night.” He continued, “We sell $20 buckets of beer. Every time it’s their turn to buy they go to the cash machine, take out $20 and order another bucket. What do they teach them in college?

What a great lesson for these young people. They are learning the value of “instant gratification”. Go to a cash machine, charge your credit card, get about $.80 on a dollar, party all night and worry about it later. If you are lucky, maybe someone else will clean up your mess.

Do you have to be in the MBA program to learn to pay the minimum balance each month? If you hit your credit limit, just get another card and continue the process – party on!

This commentary from Dennis showed up on his Internet site early on Monday morning EDT — and another link to it is here.


U.S. police raid Venezuelan embassy to evict pro-Maduro activists defending it from ‘illegal seizure

Pro-Maduro activists occupying the Venezuelan embassy in Washington have refused to vacate the premises in defiance of a notice threatening them with arrest and police entering the building but stopping short of evicting everyone.

We are expecting the police to come in and violate the Vienna convention with their fictional government, non-government claiming that we should leave,” the Embassy Civilian Protection Collective said in a video message shortly before the police arrived at the doors of the diplomatic premises to the cheers of the pro-Guaido camp outside.

We’re going to be prepared to be arrested. We’re not going to leave voluntarily.”

Amid the standoff for control of the building, Venezuela’s Vice Minister of Foreign Affairs for North America reminded Washington that an intrusion would be a breach of international law. “The Government of the Bolivarian Republic of Venezuela has not authorized the entry of police officers into the former Embassy building in Washington, DC. This intrusion is yet another violation of international law by U.S. authorities and aggression against Venezuela,” Carlos Ron said on Twitter.

The crisis surrounding the Venezuelan embassy in Washington began after U.S. authorities forced diplomats loyal to President Maduro to leave the premises more than one month ago. Just before departing for Caracas, the diplomats appointed by Maduro allowed the peace activists to occupy the building.

A failed U.S.-backed coup attempt in Venezuela inflamed the situation at the embassy, with the pro-Guaido camp blocking any attempts by activists to sneak supplies inside. Several people were arrested as they attempted to throw food and hygiene products through the open windows, while authorities cut the power and water supply to the diplomatic compound.

Another international law broken by the U.S.  This news item put in an appearance on the rt.com Internet site at 12:43 a.m. Moscow time on their Tuesday morning, which was 5:43 p.m. in Washington — EDT plus 7 hours.  I thank George Whyte for sharing it with us — and another link is here.


Pompeo Skips Moscow Trip to Pressure E.U. Officials in Brussels on Iran

It seems for the State Department lately it’s all Iran and Venezuela all the time, or perhaps there’s just an aversion to real diplomatic work.

After snubbing Germany’s Merkel last week to make an unplanned stop in Iraq to pressure leaders there into resisting cooperation with Iran, Secretary of State Mike Pompeo on Monday scrapped a scheduled trip to Moscow, diverting his plane for a surprise visit to Brussels to presumably crash an E.U. meeting exploring ways of salvaging the Iran nuclear deal.

It appears the “maximum pressure” campaign involves America’s top diplomat throwing his weight around in person anywhere around the globe there might be dissent among U.S. allies.

This news item was posted on the Zero Hedge website at 10:20 a.m. EDT on Monday morning — and another link to it is here.


Bomb Iran Half Way Back to the Stone Age — Eric Margolis

Is it just a coincidence that TV networks are re-running old ‘Dirty Harry’ films just as a powerful U.S. Naval armada and Air Force B-52 bombers are headed for what could be a clash with Iran? Here we go again with the ‘good guys’ versus the ‘bad guys,’ and ‘make my day.’

Maybe it’s more bluffing? The current U.S. military deployment was scheduled before the latest flare-up with Iran, but the bellicose threats of White House neocon crusaders like John Bolton and Mike Pompeo certainly create the impression that the U.S. wants war.

Adding to the warlike excitement, President Trump just ordered seizure of a large North Korean bulk cargo ship. This was clearly a brazen act of war and violation of international law. More dangerous brinkmanship by administration war-mongers who increasingly appear besotted by power and hubris.

So much for the president who vowed to avoid foreign wars – and so much for the millions of anti-war voters who believed him.

Why does Trump let his two horsemen of the apocalypse get away with this?

This brief, but very worthwhile commentary from Eric was posted on the unz.com Internet set on Saturday sometime — and I thank Larry Galearis for bringing it to our attention.  Another link to it is here.  There was also this article in The New Yorker that Patricia Caulfield sent out way — and it’s headlined “Is Trump Yet Another U.S. President Provoking a War?


U.S. “smart enough” not to want war against Iran unless Pompeo & Bolton get their way

The U.S. is “smart enough” not to ignite a war with Iran because it will push the world to the brink of economic disaster and lead to a shortage of oil. But Washington and Gulf hawks could get their way, an analyst told RT.

Tensions in the already troubled Persian Gulf ratcheted up again after the United Arab Emirates claimed that four commercial ships – among them two Saudi tankers – were targeted in what they loosely called a “sabotage operation.” The UAE and Iran called to investigate the incident which is still surrounded by mystery.

But could the alleged “act of sabotage” be conveniently used to pin the blame on Iran – an arch-rival of many Gulf monarchies – and eventually become a prelude to military action against the country?

Some regional powers are eager to take aim at Iran but the U.S. is not, believes Mohammad Marandi, a professor at the University of Tehran. “I think that the Israeli regime, the Saudis and the Emiratis are looking for a war but the US government doesn’t want a war except for [John] Bolton and maybe [Mike] Pompeo,” he told RT.

The United States knows that if there is a war, all the oil and gas [facilities] in the Persian Gulf and all the tankers will be destroyed.

These facilities are located close to each other which makes them especially vulnerable in case of war. If annihilated, they will not be rebuilt for years, plunging the world into “a great economic depression.”

This interesting and worthwhile news item was posted on the rt.com Internet site at 3:34 p.m. Moscow time on their Monday afternoon, which was 8:34 a.m. in Washington — EDT plus 7 hours.  I thank George Whyte for sending it our way — and another link to it is here.


QE Party Over, Bank of Japan Stealth-Tapers Further — Wolf Richter

Total assets on the balance sheet of the Bank of Japan at the end of April ticked up from March but were flat with the record in February: ¥562 trillion ($5.1 trillion). This amounts to a gigantic 102.2% of nominal GDP. But the BOJ has been tapering its asset purchases since peak QE at the end of 2016, and the growth has slowed to a snail’s pace, by Abenomics QE standards.

Despite the BOJs repeated promises of adding ¥85 trillion to its balance sheet every year, the BOJ hasn’t done that since peak QE in 2016 when it added ¥93 trillion. The additions have consistently decreased since then. Over the 12 months through April, it has added merely ¥27 trillion, the lowest 12-month increase since early days of ramping up Abenomics in March 2013. This amounts to a stealth taper:

Meanwhile, the government of Japan has been borrowing and issuing new debt with reckless abandon, and the gross national debt outstanding has ballooned to ¥1.12 quadrillion, or 203% of nominal GDP (measured in yen).

But no problem: the BOJ started buying every Japanese government security that wasn’t nailed down, with the government selling new securities to the banks, and the banks selling them to the BOJ for a small profit. In addition the BOJ mopped up what was coming on the market. The BOJ now holds 43% of all outstanding Japanese government securities, up from 25% in January 2015.

This very interesting 6-chart article from Wolf put in an appearance on his website on Saturday sometime — and I thank Richard Saler for pointing it out.  Another link to it is here.


Ed Steer Gold & Silver Daily: If JP Morgan Allows It…

Ed Steer joins us from Metals & Markets this week, where we are talking market manipulation and a whole lot more…

Ed Steer of Ed Steer’s Gold & Silver Digest interviewed by James Anderson for SD Bullion
This week we are welcoming a first-time guest to the show, a man with multiple decades of investing experience and documentation of the precious metals markets, Mr. Ed Steer.

Ed has been an outspoken critic of the precious metals price discovery complex and commercial bank concentration. His comments on the ongoing Department of Justice prosecution of ex-JP Morgan precious metals traders is worthy of your ears.

What did Ed think of former CFTC commissioner Bart Chilton’s recent admissions about JP Morgan’s involvement in the silver and precious metal complex?

What has surprised Ed over the years, and what does he believe is in store for the monetary metals in the coming decade?

Tune-in to the interview in its entirety below for the answers to those questions and a whole lot more:

I did this 15-minute audio interview with host James Anderson for the folks over at the silverdoctors.com Internet site last Wednesday — and it showed up on their website on Saturday.  The interview begins at the 2:20 minute mark — and another link to it is here.


Platinum supply may move into deficit this year — Lawrie Williams

Platinum has probably been vying with silver as the worst performing precious metal over the past few years, but the latest pgm specialist Johnson Matthey analysis paints a more positive picture for the metal’s future.  It has been hugely overshadowed on the pricing front by its much more volatile sister metal, palladium, over which it has traditionally held a strong price advantage. However the platinum price premium over palladium has reversed in the past couple of years which have seen the latter metal’s price surge dramatically on what, on the face of things, appear to be much stronger supply/demand fundamentals.

In short, palladium became the go-to catalytic metal of choice for gasoline (petrol) fuelled engines, due to its historic lower price and in the light vehicle market gasoline is the dominant fuel for internal combustion engine vehicles.  Platinum had retained its dominance in the diesel sector, but the VW scandal, and the targeting of diesel as the more dangerous environmental polluter has reduced the mass market end in this sector and platinum had appeared to be heading for several years of production surpluses, with the price suffering accordingly.  Consequently the palladium price surged ahead of that of platinum at end-September2017 and hasn’t looked back since then with analysts predicting big platinum production surpluses and palladium deficits.

However the latest analysis from Johnson Matthey in its just released PGM Market Report, suggests platinum supply could also move into deficit in the current year.  The report notes that a surge in investment buying and higher automotive consumption (primarily from an ever-growing diesel truck market)  will underpin a 9% demand gain for platinum in 2019, offsetting weakness in the Chinese platinum jewellery market, where platinum faces increased competition from karat gold jewellery.

Johnson Matthey reckons overall automotive demand for platinum will rise by 3% this year, primarily due to greater platinum use on trucks. In China, the company states,  “platinum consumption on heavy duty vehicles will increase sharply, with strict China 6 emissions legislation due to be implemented in some provinces and cities starting in July 2019. The new regulations will apply nationwide from July 2020, while India will also introduce strict emissions regulations for trucks next year.

This commentary from Lawrie put in an appearance on the Sharp Pixley website on Monday — and another link to it is here.


Biggest ever” treasure trove of Roman coins found in Britain

A hoard of early fourth-century Roman coins, which was discovered by two metal-detecting enthusiasts, is thought to be the largest haul of its kind to be found in Britain.

The discovery was made in July 2017 near the village of Rauceby in Lincolnshire, which 59-year-old Rob Jones and his friend Craig Paul, 32, had searched for years.

Lincolnshire County Council archaeologist Dr Adam Daubney said the coins may have been buried as part of a ceremonial ritual.

The coins were found in a ceramic pot, which was buried in the centre of a large oval pit – lined with quarried limestone,” he said.

What we found during the excavation suggests to me that the hoard was not put in the ground in secret, but rather was perhaps a ceremonial or votive offering.”

The Rauceby hoard is giving us further evidence for so-called ‘ritual’ hoarding in Roman Britain.”

This news item appeared on the msn.com Internet site on Saturday sometime — and another link to it is here.


The PHOTOS and the FUNNIES

This first photo is one I posted on Saturday….a telephoto shot of some cattle in a pasture a few miles northeast of Merritt.  I’m posting it again so you can see the difference between the image taken with a telephoto vs. a wide-angle lens in the second photo.  It hardly looks like the same place.   Both were taken from the same spot within minutes of each other.  The choice of lens and cropping techniques can significantly alter one’s perspective of any given scene.  The last photo of a yellow-bellied marmot was taken about a week later a handful of miles south of Kamloops.  Note how its lower incisor teeth have grown unnaturally long.  One wonders how it is able eat.  I though these were rare animals when I first arrived here because I’d never seen one before, but have discovered that they are not.  Click to enlarge for all three.


The WRAP

As I already carefully noted at the top of today’s missive, gold did close above its 50-day moving average, but was carefully closed below the $1,300 spot mark.  Of course silver wasn’t allowed even a sniff of its 200-day — and came awfully close to setting a new low for this engineered price decline on an intraday basis yesterday.  Platinum was hauled down below its 50-day moving average yesterday, after breaking above it intraday on Friday — and that’s despite the bullish supply/demand fundamentals the Lawrie Williams spoke of in his commentary in today’s Critical Reads section.

Copper also took a hit yesterday — and is now below its 200-day moving average by 6 cents or so.  WTIC was closed a tad below its 50-day moving average yesterday — and also broke below its 200-day on an intraday basis.  Those two moving averages are only fifty cents apart, so it wasn’t a herculean task to accomplish that feat.

Here are the 6-month charts for the Big 6 commodities — and you can check out all these changes for yourself.  Click to enlarge.

And as I type this paragraph, the London open is less than ten minutes away — and I see that the rather unimpressive rallies in all four precious metals that began in early Tuesday morning trading in the Far East were capped and then turned lower starting at various times during that period. At the moment ‘da boyz’ have gold down $2.70 — and they now have silver back at unchanged on the day. Platinum is now up only 5 bucks — and palladium is up only 4 dollars as Zurich opens.

Net HFT gold volume is getting up there…coming up on 54,000 contracts — and there’s 3,600 contracts worth of roll-over/switch volume in this precious metal. Net HFT silver volume is nothing out of the ordinary at something over 8,700 contracts — and there’s 2,700 contracts worth of roll-over/switch volume on top of that.

The dollar index opened down 3 basis points once trading commenced in New York on Monday evening — and has been chopping unevenly sideways since — and is down 4 basis points as of 7:45 a.m. in London/8:45 a.m. in Zurich.


Today, at the close of COMEX trading, is the cut-off for this week’s Commitment of Traders Report — and unless ‘da boyz’ can completely reverse Monday’s rally — and then some, then there will undoubtedly be a rather large increase in the commercial net short position in gold in that report, as last night’s Preliminary Report showed an alarming increase in the total open interest in gold yesterday. But the jury is still out on silver.


And as I post today’s column on the website at 4:02 a.m. EDT, I note that both gold and silver are off their post-London opens by a bit. Gold is down $1.70 an ounce — and silver is now up 3 cents. Noting much has happened in platinum, as it’s up dollars, but palladium is now higher by 8 bucks.

Gross gold volume is pretty beefy at around 65,500 contracts — and minus roll-over/switch volume, net HFT gold volume is around 57,300 contracts. Net HFT silver volume is a bit over 9,800 contracts — and there’s 3,232 contracts worth of roll-over/switch volume in this precious metal.

The dollar index began to edge higher about half an hour before the London/Zurich opens — and is now up 3 basis point as the first hour of London and Zurich trading draw to a close.

That’s all I have for today, which is more than enough — and I’ll see you here on Wednesday.

Ed

Short Sellers Run Rampant in the Precious Metal Stocks

11 May 2019 — Saturday

YESTERDAY in GOLD, SILVER, PLATINUM and PALLADIUM


The gold price didn’t do much of anything in Far East trading on their Friday — and the low tick of the day, such as it was, came minutes after the London open.  It chopped quietly and unevenly higher from there, with every tiny rally attempt turned back before it could get too far.  The high tick, such as it was, came at noon in New York — and it edged unevenly lower into the 5:00 p.m. EDT close.

Once again, the low and high price ticks aren’t worth looking up.

Gold was closed at $1,285.80 spot, up $2.40 on the day.  Net volume was nothing special at 206,000 contracts — and there was a tiny bit under 36,000 contracts worth of roll-over/switch volume on top of that.

The silver price rose and fell a nickel or so in morning trading in the Far East on their Friday — and then didn’t do much of anything until after the noon silver fix was put to bed in London.  It began to head lower from there — and there was a rather vicious down/up price spike at the 8:20 a.m. EDT COMEX open, with the subsequent rally being capped minutes before 9 a.m.   It was sold lower going into the afternoon gold fix in London — and then crawled very quietly and unevenly higher until COMEX trading ended at 1:00 p.m. EDT.  Most of that tiny gain disappeared by the time trading ended at 5:00 p.m. in New York.

The price shenanigans at the COMEX open, only occurred in the spot month — and the low and high ticks aren’t worth looking up in this precious metal, either.

Silver was closed at $14.735 spot, up 1.5 cents from Thursday.  Net volume was very quiet at around 41,400 contracts — and there was just under 4,600 contracts worth of roll-over/switch volume on top of that.

Platinum rallied a bunch in morning trading in the Far East, before running into ‘something’ — and from about 10:35 a.m. China Standard Time onwards, it chopped very unevenly sideways until shortly before 10:30 a.m. in New York.  It rallied a bunch more from there — and that rally appeared to get capped a few minutes after 12 o’clock noon EDT — and it crawled sideways into the close from there.  Platinum finished the day at $863 spot, up 16 bucks from Thursday’s close.

Palladium began to head higher starting at 8:00 a.m. CST on their Friday morning — and that rally appeared to get stopped in its tracks the moment it broke back above the $1,300 spot mark just after 9 a.m. CST.  The price didn’t do much of anything after that, but was sold a bit lower starting shortly after 1 p.m. in Zurich.  The low of the Friday session was set about fifteen minutes after the COMEX open in New York — and it headed sharply higher from there until fifteen minutes before the Zurich close.  From that juncture it crept unevenly sideways until trading ended at 5:00 p.m. EDT in New York.  Platinum finished the Friday session at $1,333 spot, up 52 dollars on the day and, like platinum, would have closed considerably higher, if allowed, which it obviously wasn’t.

The dollar index closed very late on Thursday afternoon in New York at 97.32 — and then chopped  quietly but nervously sideways until some economic news or other appeared at 8:30 a.m. in New York.  The 97.13 low tick was set around 10:35 a.m. EDT — and it edged higher until around 3:15 p.m. — and didn’t do a whole lot after that.  The dollar index finished the day at 97.32…unchanged from Thursday’s close.

Once again the action in the currencies had zero to do with what was happening in the precious metals.

Here’s the intraday DXY chart, courtesy of the folks at ino.com.  The ‘click to enlarge’ feature does not help with this chart.

And here’s the 5-year U.S. dollar index chart from the stockcharts.com Internet site — and the delta between its close…97.12…and the close on the ino.com chart above, was 20 basis points on Friday.  Click to enlarge.

The gold shares continue to get pounded into the dirt.  Although they opened unchanged once again, they were soon headed lower — and after chopping sideways from about 10:30 a.m. EDT onward, they were sold down to their respective low ticks starting around 3:10 p.m. in New York trading.  The HUI closed down 1.95 percent.

And as bad as the price action was in the gold stocks, it was even worse in the silver equities.  The trading pattern was the same as the gold shares, but Nick Laird’s Intraday Silver Sentiment/Silver 7 Index got clocked by 3.95 percent.  Click to enlarge if necessary.

And here’s Nick’s 1-year Silver Sentiment/Silver 7 Index chart, updated with Friday’s doji — and as you can see, the silver equities are now back below their lows of November 2018.  I didn’t think that was possible.  Click to enlarge.

Here are the usual charts from Nick that show what’s been happening for the week, month-to-date — 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 except for gold, the other three precious metals are in the red, but only by the tiniest of amounts.  But its the equities, particular the silver ones, that got hammered hardest.  Click to enlarge.

The month to date chart still shows gold to be the only precious metal in positive territory, but only by the tiniest amount.  Yes, the other three precious metals are down as well, but not by amounts that I consider material.  But the performance of their related equities is brutal.  Click to enlarge.

The year-to-date chart — and gold is still hanging in their with a slight gain and, of course, both platinum and palladium are still up on the year, despite the ongoing attempt by ‘da boyz’ to drive them lower.  And what can I say about their associated equities that I haven’t already said.  Click to enlarge.

As I said in commentary earlier this week, the price declines we’re witnessing in the precious metal shares has been out of all proportion to the declines in the underlying precious metals — and it has been particularly egregious since the beginning of May.  I don’t know if this is redemptions from precious metal mutual funds or hedge funds or not.  But checking over at the shortsqueeze.com Internet site just now, I noticed that the short positions in both First Majestic Silver and Pan American Silver shares have certainly risen by notable amounts during the two weeks ending on April 30, the last report available.  So I would suspect that aggressive and on-going short selling is the main culprit here.  The only positive thing about this is that during the next major rally, they will be rocket fuel added to the next big rally in silver — and with the COT set-up back in what I’m sure Ted would call “wildly bullish” territory, it shouldn’t be that far off…so keep the faith!


The CME Daily Delivery Report showed that 2 gold and 19 silver contracts were posted for delivery within the COMEX-approved depositories on Tuesday.

In gold, the lone short/issuer was Advantage — and the lone long/stopper was JPMorgan.  All transactions involved their respective client accounts.

In silver, the two short/issuers were ABN Amro and Advantage, with 15 and 4 contracts out of their respective client accounts.  As usual, JPMorgan stopped the most…11 in total…8 for clients and 3 for its own account.  In second and third places were Advantage with 5 contracts for its client account — and Standard Charter with 2 contracts for its own account.

So far this month, there have been 189 gold contracts issued/reissued and stopped — and that number in silver is 3,360 contracts.

Of that silver volume, JPMorgan has issued 698 contracts from its client account — and stopped 914 contracts for its client account.  It has also stopped 638 silver contracts for its own in-house/proprietary trading account far in May as well.

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

The CME Preliminary Report for the Friday trading session showed that gold open interest in May fell by 9 contracts, leaving 119 still around, minus the 2 contracts mentioned a couple of paragraphs ago.  Thursday’s Daily Delivery Report showed that 11 gold contracts were actually posted for delivery on Monday, so that means that 11-9=2 more gold contracts were added to the May delivery month.  Silver o.i. in May declined by 5 contracts, leaving 323 still open, minus the 19 contracts contracts mentioned a few paragraphs ago.  Thursday’s Daily Delivery Report showed that 13 silver contracts were actually posted for delivery on Monday, so that means that 13-5=8 more silver contracts were added to May.


There was a very chunky withdrawal from GLD on Friday, as an authorized participant took out 215,662 troy ounces…almost 7 tonnes.  There were no reported changes in SLV.

Since April 1…when this latest series of engineered price declines began in gold and silver…there has been 1,690,673 troy ounces of gold removed from GLD.  In that same time period, there has been 7.28 million troy ounces of silver added to SLV.  Doesn’t anyone find that rather peculiar…or is it just me?

The U.S. Mint had a tiny sales report on Friday.  They sold 500 troy ounces of gold eagles — and 92,000 silver eagles.

Month-to-date the mint has sold 500 troy ounces of gold eagles — and 160,000 silver eagles.  There is no retail demand.

The Royal Canadian Mint in Ottawa finally got around to publishing their 2018 Annual Report on their website yesterday.  As usual, they’re getting more secretive every year about what they’re up to — and this report is further proof of that, as they say absolutely nothing of value.  Only the charts hint at the precipitous decline in the sales of mint bullion products since JPMorgan disappeared as a buyer of silver and gold maple leafs around September of 2016.  Here’s a snip from Page 23 of their 2018 Annual ReportClick to enlarge.

For the second day in a row, there was no in/out movement in gold over at the COMEX-approved depositories on the U.S. east coast on Thursday.

It was a pretty busy day in silver, as 1,089,730 troy ounces were received — and 933,345 troy ounces were shipped out.  In the ‘in’ category, there was one truckload…599,240 troy ounces…dropped off at CNT — and the remaining 490,490 troy ounces found a home over at Canada’s Scotiabank.  In the ‘out’ category, there were withdrawals from HSBC USA, Brink’s, Inc. — and CNT.  Those amounts totalled…329,124 troy ounces, 96,475 troy ounces — and 91,494 troy ounces respectively.  But the big news was in the paper category, as 3,032,376 troy ounces was transferred from the Registered category — and back into Eligible.  There was 2,037,484 troy ounces transferred at CNT…826,517 troy ounces at Brink’s, Inc. — and 100,021 troy ounces at HSBC USA.  I didn’t talk to Ted about this, but I’m sure he would suspect that this is silver that JPMorgan has taken delivery of in May, either for itself or clients, that it has no room for in its own vault, so it’s keeping it right where it currently sits.  They only did the paper transfer because Ted says that it’s cheaper to store in the Eligible category, than it is in Registered.  Without doubt, he’ll have something to say about this in his weekly review later today.  The link to all this action is here.

There was some activity over at the COMEX-approved gold kilobar depositories in Hong Kong on their Thursday.  They received 1,180 kilobars — and shipped out only 30 of them.  Except for the 180 kilobars dropped off at Loomis International, the rest of the in/out activity was at Brink’s, Inc.  The link to that, in troy ounces, is here.


The Frome Hoard is a hoard of 52,503 Roman coins found in April 2010 by metal detectorist Dave Crisp near Frome in Somerset, England. The coins were contained in a ceramic pot 45 cm (18 in) in diameter, and date from A.D. 253 to 305. Most of the coins are made from debased silver or bronze. The hoard is one of the largest ever found in Britain, and is also important as it contains the largest group ever found of coins issued during the reign of Carausius, who ruled Britain independently from 286 to 293 and was the first Roman Emperor to strike coins in Britain.

The hoard was discovered on 11 April 2010 while Crisp was metal detecting in a field near Frome where he had previously found late Roman silver coins. The late Roman coins, eventually totalling 62, were probably the remnants of a scattered hoard, 111 of which had been found on the same farm in 1867. Whilst searching for more coins from the scattered hoard he received what he called a “funny signal” and on digging down about 35 cm (14 in) he found a small radiate coin, and the top of a small pot. Realising that this must be an intact coin hoard he stopped digging and filled in the hole he had made. In 22 years of detecting Crisp had never made such a significant find.

Of the 52,503 coins found, 44,245 have been identified, and the remainder are classified provisionally as “illegible” until cleaning and conservation has been completed. Of the identifiable coins, 14,788 were minted under the central Roman Empire, 28,377 were minted under the breakaway Gallic Empire, and 766 were minted under the Britannic Empire of Carausius. About 5% of the coins identified so far are from the period of Carausius, who ruled Britain from 286 to 293, and the hoard includes five silver denarii issued by Carausius, which were the only type of silver coin to be struck anywhere in the Roman Empire at that time.  Click to enlarge.


The Commitment of Traders Report, for positions held at the close of COMEX trading on Tuesday, May 7…showed a smallish decrease in the Commercial net short position in silver — and a smallish increase in the short position in gold.

In silver, the Commercial net short position declined by 4,701 contracts, or 23.5 million troy ounces.

They arrived at that number by adding 1,894 long contracts — and they reduced their short position by 2,807 contracts.  It’s the sum of those two numbers that represents their change for the reporting week.

Under the hood in the Disaggregated COT Report, the Managed Money traders did very little, increasing their short position on a net basis by only 401 contracts.  They reported adding 3,951 long contracts, but also increased their short position by 4,352 contracts — and it’s the difference between those two numbers which represents their change for the reporting week.

I suspect, but could be wrong, that a large portion of the Managed Money traders that added to their long positions during the reporting week were of the value investing variety — and the Managed Money traders that went short were of the brain-dead/moving average-following type.  That is my explanation for such a bifurcated change in the position of the Managed Money traders.

The difference between what the Managed Money traders did — and the Commercial net short position…4,701 minus 401 equals 4,300 contracts, was made up by the traders in the other two categories, as both decreased their net long positions during the reporting week.

The other very notable feature of the Disaggregated Report was that the traders in the ‘Producer/Merchant’ category…read JPMorgan…decreased their short position by a net 5,464 contracts during the reporting week.

Here’s the snip from the Disaggregated COT Report so you can see these changes for yourself.  Click to enlarge.

The Commercial net short position in silver is now down to 83.3 million troy ounces which, although not a record low number, is still extremely bullish.

According to Friday’s Bank Participation Report, four U.S. banks hold a gross long position of 5,096 COMEX contracts in silver — and it’s a given that every contract of that amount is held by JPMorgan.  I’ll have more about this in my commentary on this month’s Bank Participation Report further down.

Here is the 3-year COT chart for silver from Nick Laird, updated with this week’s data point — and the change should be noted.  Click to enlarge.

We’re still loaded for a rally of some magnitude in silver — and how high it goes and how long it takes still remains in the hands of JPMorgan…as they are the short sellers of last resort…although they have been short sellers of first resort when necessary.   As Ted says, what they do or don’t do when that rally begins, is all that matters.


In gold, the commercial net short position increased by 8,047 contracts, or 804,700 troy ounces of paper gold.

They arrived at that number by decreasing their long position by 5,210 contracts — and they also increased their short position by 2,837 contracts.  It’s the sum of 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 — and a bit more, as they followed their Pavlovian instincts as expected of them.  They increased their net long position by 9,471 contracts, which was bigger than the increase in the commercial net short position by…9,471 minus 8,047 equals 1,424 contracts.

And, as always, it was the traders in the ‘Other Reportables’ and ‘Nonreportable’/small trader categories that made up that tiny difference, as both groups decreased their net long positions by a bit.

The big surprise was in the ‘Producer/Merchant/JPMorgan’ category where, despite the fact that the commercial net short position rose by 8,047 contracts during the reporting week, these traders…read JPMorgan…actually went net long during the reporting week to the tune of 3,023 contracts.  It was the traders in the ‘Swap Dealer’ category that did all the heavy lifting on the commercial side, as they increased their net short position by a chunky 11,070 contracts during the reporting week.

The commercial net short position in gold is now up to 9.64 million troy ounces.

Friday’s Bank Participation Report shows that five U.S. banks hold a gross long position of 6,833 COMEX contracts in gold and, like in silver, it’s pretty much a given that it’s all held by JPMorgan — and I’ll have more to say on this further down, as will Ted in his weekly review later today.

Here’s Nick’s 3-year COT chart for gold, updated with Friday’s data.  Click to enlarge.

The set-up in the COMEX futures market in gold, is still bullish — and made more so by the fact that JPMorgan is net long both precious metals.  The only fly-in-the-ointment for me is that gold’s 200-day moving average still sits there…unbroken to the downside — and I’m still wondering if ‘da boyz’ have that in their sights.

In the other metals, the Manged Money traders in palladium decreased their net long position in this precious metal by 660 contracts, which is the same amount that they increased it by in the prior week.  The Managed Money traders are net long the palladium market by 9,282 contracts.  Total open interest in palladium is 21,485 COMEX contracts, down 1,200 contracts from the previous week.  It’s a very tiny market.  In platinum, the Managed Money traders decreased their net long position by 4,097 contracts.  The Managed Money traders are still net long the platinum market by a fairly hefty 17,762 contracts.  Total open interest is 74,901 contracts.  With copper down big-time during the reporting week, the Managed Money traders increased their net short position in that metal by a further 16,884 contracts during the reporting week — and are now net short the COMEX futures market by a whopping 27,156 contracts.  They’re even more short now, as copper was closed below its 200-day moving average for the last three days in a row since the Tuesday cut-off.


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 101 days of world silver production, which is unchanged from last week’s report — and the ‘5 through 8’ large traders are short an additional 61 days of world silver production, up 2 days from last week’s report — for a total of 162 days that the Big 8 are short, which is a bit over 5 months of world silver production, or about 378.1 million troy ounces of paper silver held short by the Big 8.  [In the prior week’s COT Report, the Big 8 were short 160 days of world silver production.]

In the COT Report above, the Commercial net short position in silver was reported as 83.3 million troy ounces.  As mentioned in the previous paragraph, the short position of the Big 8 traders is 378.1 million troy ounces.  The short position of the Big 8 traders is larger than the total Commercial net short position by a chunky 378.1 minus 83.3 equals 294.8 million troy ounces.

The reason for the difference in those numbers…as it always is…Ted’s raptors, the 34-odd small commercial traders other than the Big 8, are net long that amount.  How ridiculous is that, you ask?  Very ridiculous, dear reader.

As I mentioned in my COT commentary in silver above, JPMorgan was long the COMEX futures market in silver by 5,096 contracts as per yesterday’s Bank Participation Report.

The Big 4 traders now in that category are short, on average, about…101 divided by 4 equals…25.25 days of world silver production each.

The four traders in the ‘5 through 8’ category are short 61 days of world silver production in total, which is 15.25 days of world silver production each.

Ted’s of the opinion [at least he was two weeks ago] that there are most likely three Managed Money traders with short positions large enough in the COMEX futures market to inhabit the Big 8 category now.  I didn’t ask him yesterday, but I doubt that this situation has changed materially since then.

The Big 8 commercial traders are short 37.9 percent of the entire open interest in silver in the COMEX futures market, which is virtually unchanged from the 38.0 percent they were short in last week’s report.  And once whatever market-neutral spread trades are subtracted out, that percentage would be a bit under the 45 percent mark.  In gold, it’s now 36.5 percent of the total COMEX open interest that the Big 8 are short, down a bit from the 37.9 percent they were short in last week’s report — and something a bit over 40 percent once the market-neutral spread trades are subtracted out.

In gold, the Big 4 are short 33 days of world gold production,unchanged  from what they were short in last week’s COT Report.  The ‘5 through 8’ are short another 24 days of world production, also unchanged from what they were short last week…for a total of 57 days of world gold production held short by the Big 8.  Based on these numbers, the Big 4 in gold hold only 57 percent of the total short position held by the Big 8…also unchanged 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 62, 75 and 83 percent respectively of the short positions held by the Big 8.  Silver is down 1 percentage point from a week ago, platinum is unchanged from last week — and palladium is also unchanged — and still at a record high!

If you look at the above ‘Days to Cover’ chart, you can see these percentages for yourself between the red and the green bars for each precious metal.


The May Bank Participation Report [BPR] data is extracted directly from the data in yesterday’s Commitment of Traders Report.  It shows the number of futures contracts, both long and short, that are held by all the U.S. and non-U.S. banks as of Tuesday’s cut-off in all COMEX-traded products.  For this one day a month we get to see what the world’s banks are up to in the precious metals —and they’re usually up to quite a bit.  The May Bank Participation Report covers almost all of April, plus the first five trading days in May, as the cut-off for this report was on Tuesday the 7th.

In gold, 5 U.S. banks are net short 27,281 COMEX contracts in the May BPR.  In April’s Bank Participation Report [BPR] these same 5 U.S. banks were net short 45,742 contracts, so there was a huge drop of 18,461 contracts from a month ago.  It’s the second consecutive month where the short positions of the U.S. banks has declined by this sort of number.

This is the smallest short position held by the U.S. banks since August of 2018.

As I mentioned in my COT commentary above, this BPR in gold shows a gross long position of 6,833 contracts held by these five U.S. banks — and it’s a virtual certainty that JPMorgan holds that entire amount.  So they are obviously not one of the five U.S. banks that are short the COMEX futures market in gold.  So, who is?  I put Citigroup at the very top of that list by a wide margin, followed by HSBC USA and Goldman.  As for the who the other two might be, I have no clue.  But I suspect that their short positions would not be material.

Also in gold, 28 non-U.S. banks are net short 55,851 COMEX gold contracts, which is a hair under two thousand contracts per bank.  In the April’s BPR, these same 28 non-U.S. banks were net short 57,734 COMEX contracts…so the month-over-month change is down by a bit…1,883 contracts.

However, as I always say at this point, I suspect that there’s at least two large non-U.S. bank in this group, including Scotiabank, that holds a fairly hefty short position in gold.  That means that the short position in gold held by the remaining 26 non-U.S. banks are immaterial.

At the low back in the August 2018 BPR [for July] these same non-U.S. banks held a net short position in gold of only 1,960 contacts! — and the May 2019 BPR was the first month where these non-U.S. banks have shown a month-over-month decrease.  So they’re still short big time — and almost a record short position to boot.

As of this Bank Participation Report, 33 banks [both U.S. and foreign] are net short 18.5 percent of the entire open interest in gold in the COMEX futures market, which is down a very decent amount from the 23.5 percent they were short in the April BPR.

Here’s Nick’s chart of the Bank Participation Report for gold going back to 2000.  Charts #4 and #5 are the key ones here.  Note the blow-out in the short positions of the non-U.S. banks [the blue bars in chart #4] when Scotiabank’s COMEX short position was outed by the CFTC in October of 2012.  Click to enlarge.

In silver, 4 U.S. banks are net short 9,642 COMEX silver contracts in May’s BPR.  In April’s BPR, the net short position of these same 4 U.S. banks was 20,016 contracts, so the short position of the U.S. banks is down a substantial 11,627 contracts from March BPR which, like for gold, was the second month in a row of big declines in the short positions held by these U.S. banks.

To give you an idea of how low this short position for these 4 U.S. banks is, this is the smallest net short position held by these banks since November 2014 — and the second smallest U.S. bank short position on record going back to 2011!

Since Ted figures that JPMorgan is not short any of that amount — and is in fact long the COMEX futures market in silver by 5,096 contracts…as per this Bank Participation Report.  Then it becomes pretty obvious that Citigroup and HSBC USA now hold the lion’s share of the remaining short position of these four U.S. banks.  And whoever the other two banks may be, their short positions, like the short positions of the two smallest banks in gold, are immaterial as well.

Also in silver, 22 non-U.S. banks are net short 28,005 COMEX contracts…which is up a bit from the 27,626 contracts that 24 non-U.S. banks were short in the April BPR.  I would suspect that Canada’s Scotiabank [and maybe one other] still holds a goodly chunk of the short position of these non-U.S. banks.  I believe that a number of the remaining 20 non-U.S. banks may actually net long the COMEX futures market in silver.  But even if they aren’t, the remaining short positions divided up between these other 20 non-U.S. banks are immaterial — and have always been so.

As of May’s Bank Participation Report, 26 banks [both U.S. and foreign] are net short 18.9 percent of the entire open interest in the COMEX futures market in silver—which is down a bit from the 23.9 percent that they were net short in the April BPR — with much, much more than the lion’s share of that held by Citigroup, HSBC USA, Scotiabank — and maybe one other non-U.S. bank.

Here’s the BPR chart for silver.  Note in Chart #4 the blow-out in the non-U.S. bank short position [blue bars] in October of 2012 when Scotiabank was brought in from the cold.  Also note August 2008 when JPMorgan took over the silver short position of Bear Stearns—the red bars.  It’s very noticeable in Chart #4—and really stands out like the proverbial sore thumb it is in chart #5.  Click to enlarge.

In platinum, 5 U.S. banks are net short 17,112 COMEX contracts in the May Bank Participation Report.  In the April BPR, these same banks were net short 10,710 COMEX contracts…so there’s been a whopping increase of 6,402 contracts [60 percent] month-over-month.  [At the ‘low’ back in July of 2018, these same five U.S. banks were actually net long the platinum market by 2,573 contracts.] That’s quite a change for the worst since then.

Also in platinum, 20 non-U.S. banks are net short 11,487 COMEX contracts in the May BPR, which is up a bit [14 percent] from the 10,069 COMEX contracts they were net short in the April BPR.  [Note: Back at the July 2018 low, these same non-U.S. banks were net short only 1,192 COMEX contracts.]

It’s obvious that the banks have been aggressively shorting platinum during the last month to prevent it from rising like the palladium price, which it would have done quite handily if allowed to trade in a free market, which it just as obviously wasn’t.

And as of May’s Bank Participation Report, 25 banks [both U.S. and foreign] are net short 38.2 percent of platinum’s total open interest in the COMEX futures market, which is a big jump up from the 30.5 percent they were net short in April’s BPR.

Here’s the Bank Participation Report chart for platinum — and the big rise in the world bank’s short position is more than obvious.  Click to enlarge.

In palladium, 4 U.S. banks are net short 7,298 COMEX contracts in the May BPR, which is up a bit [14 percent] from the 6,389 contracts that ‘3 or less’ U.S. banks held net short in the April BPR.

Also in palladium, 15 non-U.S. banks are net short 687 COMEX contracts—which is down from the 885 COMEX contracts that ’12 or less’ non-U.S. banks were short in the April BPR.  That’s the lowest short position that the non-U.S. banks have held since March 2016.

When you divide up the short positions of these non-U.S. banks more or less equally, they’re completely immaterial…especially when you compare them to the positions held by the 4 U.S. banks.

As of this Bank Participation Report, 19 banks [U.S. and foreign] are net short 37.1 percent of the entire COMEX open interest in palladium.  In April’s BPR, the world’s banks were net short 30.5 percent of total open interest, so there’s been an increase in the short position of the banks in this precious metal over the last month…all of it courtesy of the those 4 U.S. banks.

And just as a point of interest, these 4 U.S. banks hold over 91 percent of the total short positions held in palladium by all the worlds’ banks combined.

Please remember that this is a very tiny market — and it doesn’t take too many contracts to move it.

Here’s the palladium BPR chart.  You should note that the U.S. banks were almost nowhere to be seen in the COMEX futures market in this metal until the middle of 2007—and they became the predominant and controlling factor by the end of Q1 of 2013 — and are even more so today.  Click to enlarge.

So, with JPMorgan out of their short positions in both silver and gold, they’ve left the rest of the world’s banks [plus the other short holders] in even more peril than they were a month ago when the April Bank Participation Report came out.

And it should be mentioned that along with JPMorgan being free and clear in the COMEX futures market in silver and gold — and now long those markets, Ted figures they’re sitting on 20 million ounces of physical gold, plus around 850 million troy ounces of silver as well.

Are they set to reap massive rewards on a rise in precious metal prices that they allow to happen?  You betcha.  In the process, they’ve pulled off Ted’s perfect double cross…leaving all others holding the short position bag.  Will they actually pull the trigger on this finally and at last — and if so…when?  I don’t know for sure, but if it does, you won’t need me or anyone else to tell you that fact, as it will be…as Ted always says…”evident in the price.”

I have an average number of stories for you today, including a couple that had to wait for my Saturday missive because of length and/or content reasons.


CRITICAL READS

The Only Real Way to “Fix” Capitalism — Bill Bonner

World stock markets are already down more than $2 trillion – supposedly on “trade war worries.”
And now, Friday has come. Tariffs have gone up. $200 billion worth of Chinese imports now face levies of 25%, up from 10%.

And the trade negotiations with China continue. Foreign markets are selling off a bit more, but not catastrophically.

These negotiations are a big waste of time, from an economic point of view. But they seem to have helped Donald Trump’s approval ratings. There’s nothing like a war – even a loopy trade war – to rally the masses.

What won’t help his ratings is a big, premature market sell-off. Trump wants to blame the coming recession/bear market on the Fed. He can’t afford to trigger it now…

This commentary from Bill was posted on the bonnerandpartners.com Internet site early on Friday morning EDT — and another link to it is here.


Doug Noland: Deal or No Deal

Why would Beijing return a 150-page draft with “systematic edits” that they surely knew would risk blowing up months of negotiations? “Liu last week told Lighthizer and Mnuchin that they needed to trust China to fulfill its pledges through administrative and regulatory changes… Both Mnuchin and Lighthizer considered that unacceptable, given China’s history of failing to fulfill reform pledges.”

The U.S. was demanding that China change existing laws to incorporate trade concessions along with agreeing to “an enforcement regime more like those used for punitive economic sanctions – such as those imposed on North Korea or Iran – than a typical trade deal.”

China views U.S. demands to change laws as an infringement of national sovereignty. And I can imagine Chinese officials have utter disdain for a U.S.-dictated “enforcement regime.” Xi and Putin’s private talks – and close personal relationship – surely coalesce around their mutual revulsion to U.S. hegemony including its aggressive command of international organizations and authority over punitive economic sanctions. The U.S. was pushing vehemently for concessions the Chinese likely considered red line issues. Beijing made the calculated decision to push back. Have increasingly contentious U.S. military excursions in the Taiwan Strait and South China Sea been a factor? Less than a trust-building exercise. Huawei? How much is Maduro on the hook to the Chinese? Kim Jong Un (aka “Rocketman”) up to his old tricks mere coincidence?

That so many things are coming to head is no coincidence. Late-stage historic global Bubble. The rise of insecurity, populism in the U.S., President Trump and the Chinese as a popular (can’t lose) political target. The rise of Chinese economic might, financial power, technological prowess, global influence and rapidly expanding military capabilities. The multi-decade global Bubble has caused unprecedented wealth inequality, uncertainty and fragility – within and between nations. And an increasingly disenchanted U.S. middle-class has manifested into a country deeply divided economically, socially and politically – more distrustful of its institutions and seeking scapegoats.

Deal or No Deal, this week had me pondering the next crisis. It will, after all, be the first international market crisis in an era of competing global powers. Do the rivals come together or seek advantage at the other’s expense? I grimaced some months back when President Trump began using his Twitter account to troll the struggling Chinese markets and economy. And in this age of the strongman head of state, where will this leave central bankers when things turn dicey? Has the era of putting a select group of like-minded global central bankers in a room and empowering them to orchestrate a strategy to reliquefy the world run its course?

This very worthwhile weekly commentary from Doug showed up on his website in the very wee hours of Saturday morning — and another link to it is here.


Trump’s Vanity Will Destroy the Global Economy — Tom Luongo

Last year I asked the question “Will Trump torch the global economy on the bonfire of his vanity?

A year later we have the answer. It’s a resounding, “Yes.”

I wrote after Trump pulled out of the JCPOA:

“Donald Trump wants regime change in Iran. His cancellation of the JCPOA was a decision born of his myopia. He has surrounded himself with people who reinforce his view and manipulate him via his vanity.

And the price of implementing his current plan will be a global debt crisis which no one will escape.”

Today Trump has pushed this plan to its extreme. He’s fomented a trade war with China and threatened sanctions on anyone doing any business will Iran outside its border, now including all strategic metals.

He’s threatened Lebanon with extinction and Iraq as well. His foreign policy mouthpieces are making pronouncements and twisting arms.

And none of this for the United States. He’s doing this for the basest of reasons. His ego. And, for him, that means doing everything to support his upcoming “Deal of the Century” between the Palestinian authorities and Israel. That it is the first step towards peace in the Middle East.

But it isn’t.

This very worthwhile commentary/opinion piece showed up on Tom’s website on Thursday sometime — and I thank Brad Robertson for pointing it out.  Another link to it is here.


Are All the World’s Problems Ours? — Patrick Buchanan

In 2003, George W. Bush took us to war to liberate Iraq from the despotism of Saddam Hussein and convert that nation into a beacon of freedom and prosperity in the Middle East.

Tuesday, Mike Pompeo flew clandestinely into Baghdad, met with the prime minister and flew out in four hours. The visit was kept secret, to prevent an attack on the Americans or the secretary of state.

Query: How successful was Operation Iraqi Freedom, which cost 4,500 U.S. lives, 40,000 wounded and $1 trillion, if, 15 years after our victory, our secretary of state must, for his own security, sneak into the Iraqi capital?

Topic of discussion between Pompeo and the prime minister:  In the event of a U.S. war with Iran, Iraqis would ensure the protection of the 5,000 U.S. troops in country, from the scores of thousands of Iranian-trained and Iranian-armed Shiite militia.

That prospect, of war between the U.S. and Iran, had been raised by Pompeo and John Bolton on Sunday, when the USS Abraham Lincoln carrier task force and a squadron of U.S. bombers were ordered into the Middle East after we received reports Iran was about to attack U.S. forces.

The attack did not happen. But on Thursday, Tehran gave 60 days’ notice that if it does not get relief from severe U.S. sanctions, it may walk out of the nuclear deal it signed in 2015 and start enriching uranium again to a level closer to weapons grade.

The countdown to a June confrontation with Iran has begun.

This very interesting and worthwhile commentary from Pat put in an appearance on his Internet site on Friday sometime — and I ‘borrowed’ it from a Zero Hedge story late yesterday morning EDT.  Another link to it is here.


Why I’m Pro-Detente with Russia – Paul Jay interviews Stephen Cohen

I realized it wasn’t the Soviet Union that was the great danger, it was the potential of nuclear war, and it’s still the case today — says Stephen Cohen on ‘Reality Asserts Itself‘ with Paul Jay.

This 21-minute video interview is a must watch in my opinion.  I thank Larry Galearis for sending it along on Tuesday, but I thought it best to wait to post it in my Saturday missive.  It showed up on therealnews.com Internet site on Monday.


Pompeo to Meet With Putin, Lavrov During Russia Visit

Secretary of State Mike Pompeo will meet with Russian President Vladimir Putin and Foreign Minister Sergey Lavrov during a trip to Russia next week, according to the U.S. State Department.

They are set to discuss the “the full range of bilateral and multilateral challenges” while meeting in the southern city of Sochi on May 14.

This will be the second Lavrov-Pompeo meeting this month – the first being May 6 talks in Finland which lasted an hour and paved the way for next week’s sit-down, according to Russia’s top diplomat.

On May 3, President Trump and Putin had a 90-minute telephone conversation during which Trump says they discussed special counsel Robert Mueller’s investigation into Russian meddling in the 2016 U.S. election.

We discussed, he sort of smiled when he said something to the effect that it started off as a mountain and it ended up being a mouse, but he knew that, because he knew there was no collusion whatsoever, so pretty much that’s what it was,” said Trump after the call.

This very brief news item appeared on the Zero Hedge website at 8:49 a.m. on Friday morning EDT — and it’s from Brad Robertson as well.  Another link to it is here.


Mr. Pompeo Goes to Sochi and Moscow — Adrei Martyanov

OK, U.S. Secretary of the State Pompeo will travel to Russia to, quoting AFP:

The top U.S. diplomat will meet Putin on Tuesday in the Black Sea resort of Sochi to “discuss the full range of bilateral and multilateral challenges,” the State Department said.”

It is, of course, a positive development, once one considers alternatives, but as Russian media report (in Russian), while Iran, Venezuela and other hot issues are on the agenda, it is the issue of arms control which Washington is most interested in. Obviously State Department paints this seemingly noble effort with a broad brush, talking about multi-lateral negotiations (well, China, it’s you)–this is all fine and dandy, who would argue against that. Except, two teeny-weeny issues:

1. China’s Intermediate Range missiles–that means reach of any U.S. base around China, Diego Garcia included, and that is a big no-no for the U.S. in a scenario of China’s containment, but…

2. By far the most important issue for the U.S. are those mysterious weapons nasty Russkies invented to prevent peaceful triumphant spread of democracy–those weapons will be discussed. Of course, to no avail.

Russia once trusted the U.S., in [the] 1990s. We all know how it all played out, for Russia. So, do not expect Russia to be so utterly stupid as to even negotiate any latest weapon systems many of which…drum roll…are “ambivalent”. You know, exactly as the United States proclaims its “no first use” ambivalence supported by the vague justifications for the use of nuclear weapons, as the saying goes–two can play the game. Then, of course, nobody in Russia takes Trump (or his Pompeo envoy) seriously anymore. Trump is militarist and his overtures to Russia, from the inception, have nothing to do with desire to reach stable and just geopolitical equilibrium but a desire to “triangulate” and enroll Russia in U.S., most likely, last stand against China. People in Kremlin can calculate and do operate within reality-based paradigm, a feature everyone of any significance in Moscow knows is missing from current American outlook on herself and the world outside Washington D.C.

Well, dear reader, this very brief commentary from Andrei is definitely worth reading — and I thank Larry Galearis for sending it along on Friday evening.  Another link to this very worthwhile article is here.


China Car Sales Tank 16.6% in April, Falling For a Record 11 Months in a Row

No country has better exemplified the global automobile recession than China. Sales for the world’s largest auto market continue to deteriorate, with the latest report confirming that passenger vehicle sales in China tanked yet again – this time dropping 16.6% year-over-year to 1.54 million units, following a 12% decline in March and an 18.5% slide in February. In addition, April SUV sales fell 14.7% to 642,220 units.  Click to enlarge.

The last time retail auto sales were up in China was all the way back in May 2018, meaning sales have declined for a record 11 months in a row.

The country’s slowing economy and continued trade tensions with the United States are weighing on consumer sentiment among its 1.4 billion people. Additionally, changes in tax policies and import tariffs have also acted as a headwind for car demand. Cars were the only consumer product category in China that shrank the first two months of 2019.

This chart-filled Zero Hedge article was posted on their website at 10:25 p.m. on Friday evening — and another link to it is here.


The Reason Renewables Can’t Power Modern Civilization is Because They Were Never Meant To

Over the last decade, journalists have held up Germany’s renewables energy transition, the Energiewende, as an environmental model for the world.

Many poor countries, once intent on building coal-fired power plants to bring electricity to their people, are discussing whether they might leapfrog the fossil age and build clean grids from the outset,” thanks to the Energiewende, wrote a New York Times reporter in 2014.

With Germany as inspiration, the United Nations and World Bank poured billions into renewables like wind, solar, and hydro in developing nations like Kenya.

But then, last year, Germany was forced to acknowledge that it had to delay its phase-out of coal, and would not meet its 2020 greenhouse gas reduction commitments. It announced plans to bulldoze an ancient church and forest in order to get at the coal underneath it.

After renewables investors and advocates, including Al Gore and Greenpeace, criticized Germany, journalists came to the country’s defense. “Germany has fallen short of its emission targets in part because its targets were so ambitious,” one of them argued last summer.

If the rest of the world made just half Germany’s effort, the future for our planet would look less bleak,” she wrote. “So Germany, don’t give up. And also: Thank you.”

But Germany didn’t just fall short of its climate targets. Its emissions have flat-lined since 2009.

This very interesting — and very worthwhile article appeared on the forbes.com Internet site on Monday — and for content reasons, I though it best to wait for today’s column.  I thank Roy Stephens for pointing it out — and another link to it is here.


Rediscovering the Value of Honest Money:  Bob McTeer…Federal Reserve Bank of Dallas

It seems you can hardly pick up a paper or turn on the news these days without seeing something about all the efforts on Capitol Hill to redefine the way Congress and the president carry out their fiscal responsibilities. The balanced budget amendment. A line-item veto. Legislation to limit unfunded federal mandates. When you stop and think about it, you have to wonder how things got so bad in the first place.

Traditionally, Americans have expected prudence in government spending. The government and public took it for granted that budgets should be balanced, except, perhaps, in major emergencies or extraordinary circumstances, such as war or depression. But once Keynes convinced us that the budget was a legitimate policy tool to be manipulated to fine-tune the economy, the moral commitment to a balanced budget withered away. I would argue that much the same thing has happened to our resolve against inflation.

The advantages of price stability, or a stable value of the dollar, are many and varied. Price stability is a worthy goal in itself, and it also offers the best financial environment for achieving other important national goals, such as maximum output and employment growth. Since many of the advantages of price stability are self-evident, I am somewhat perplexed as to why the constituency for it seems so weak among the business community and the public. One gets the impression that most people are content with 3-percent inflation, even though the rule of 72 says that prices will double every 24 years with 3-percent inflation.

For much of our history, sound money was imposed externally by our commitment to gold convertibility, directly or indirectly. Going off the gold standard in the early 1970s may have been the smart thing to do under the circumstances; it may even have been the only alternative at the time. I must admit, however, that our experience with price stability since then has not been as good as it was before.

This astonishing ‘Volume 1, Number 1’ commentary from the Federal Reserve Bank of Dallas dates from 1996.  John Lawton Jeffcoat III, who sent me this article, had this to say about it…”That first newsletter… all of it, but especially the last article on page four by Sirico, is spectacularly self-indicting, and I am just bewildered as to why the Fed would publish something so honest and revealing and admitting of their tremendous moral failings for behaving as they do.  Yet it is not published apologetically or repentantly… but unashamedly as if to say, “We are fully aware of the depth of our evil, as explained here by our associates, and we will continue down this path anyway.””  This 4-page article is still posted on the dallasfed.org Internet site — and it’s definitely worth reading if you have the time — and another link to it is here.


South African Gold Output Extends Biggest Drop in a Decade

South African gold production shrank for an 18th straight month in March, extending the longest run of contractions since the financial crisis.

Output of the precious metal dropped 18% from a year earlier compared with a 21% decline in February, Pretoria-based Statistics South Africa said in a statement Thursday. Production contracted for 29 months through January 2009.  Click to enlarge.

Key Insights:

  • South Africa used to be the world’s top producer of the metal but deeper ore bodies, labor strife, high costs and policy uncertainty have crimped output.
  • A strike by members of the Association of Mineworkers and Construction Union that started in November and ended in mid-April has slashed output at the South African operations of Sibanye Gold Ltd., the biggest producer of the metal from local mines.
  • Total mining output declined 1.1% from a year earlier, compared with a revised contraction of 8.1% in February.
  • The country is the world’s biggest platinum producer. Output of platinum-group metals, which include palladium, fell for the first time in seven months, shrinking 0.5%.

The information and chart posted above is all there is to this Bloomberg article which showed up on their Internet site at 2:41 a.m. PDT [Pacific Daylight Time] on Thursday.  It’s something I found on Sharps Pixley yesterday morning — and another link to the hard copy is here.


The PHOTOS and the FUNNIES

These three photos were taken from close by Monck Provincial Park — and heading back to Merritt, which is only about a fifteen minute drive or so.  The first shot is along the north shore, looking southwest towards the south end of Nicola Lake.  The ‘community’ in the center of the photo is mainly composed of summer cabins, although some people live there year round.  The second photo was taken from the center of a pasture at the end of the lake, looking back at those same summer cabins.  The last shot was taken with a moderate telephoto lens, which compresses distance — and shows where the lake drains into the Nicola River.  Note the low water level.  A tiny portion of B.C. Highway 5A is visible near the center of this photo.  Click to enlarge.


The WRAP

Today’s pop ‘blast from the past’ dates from 1978 — and was this “British glam rock band’s“last international big hit — and what a hit it was.  Bass player Steve Priest, standing to the left of lead singer Brian Connolly, is amazing to watch — and the link to the youtube.com video is here.  If you’re into ‘bass covers’…a less glamorous version of Priest’s bass guitar abilities is linked here.

Today’s classical ‘blast from the past’ is classical in some ways, but it is somewhat contemporary in others.  The Sorcerer’s Apprentice (French: L’apprenti sorcier) is a symphonic poem by the French composer Paul Dukas, completed in 1897. Subtitled “Scherzo after a ballad by Goethe“, the piece was based on Johann Wolfgang von Goethe’s 1797 poem of the same name. By far the most performed and recorded of Dukas’s works, its notable appearance in the Walt Disney 1940 animated film Fantasia, has led to the piece becoming widely known to audiences outside the classical concert hall.  Here’s the original orchestral version as performed by the Russian Philharmonic/Moscow Symphony Orchestra — and it’s linked here.


Gold and silver prices were obviously on a very short leash on Friday — and although platinum and palladium showed definite signs of life, their respective prices weren’t allowed to get too far out of line.

And I’ve already discussed the sorry state of the precious metal mining equities in the first part of today’s column.  It’s most disheartening to know that despite the pain their shareholders are going through, the mining executives in all these companies that we own stock in, won’t do a thing to help us or their industry, even though they all know full well what’s happening — and who’s doing it.  But that’s why the World Gold Council and Silver Institute exist…to ensure that their members never lift a finger, or a quivering voice on our, or their own behalf.

The gold price continues to be held close under both its 50 and 100-day moving averages, as you can see on the 6-month chart below — and silver is well below any moving average that matters.  Platinum traded above its 50-day moving average on an intraday basis on Friday, but was not allowed to close above it.  The palladium price was halted safely below its 100-day moving average.

The 6-month charts below for both gold and platinum are plotted with their respective 50 and 100-day moving averages, the other four charts have the normal 50 and 200-day moving average traces.  Click to enlarge for all.

It was obvious that the equity markets were going to have a bad day on Friday, even before trading began in New York yesterday morning.  They opened down — and continued that way until ‘something’ turned them around — and from down a whole bunch, the Dow Jones was muscled higher and actually finished in positive territory.  A 550 point intraday move.

Of course this would have not been possible without the intervention of the Plunge Protection Team in New York.  Equally busy has been the Chinese equivalent of the U.S. PPT…the Chinese National Team.  And it’s no secret that the Bank of Japan has been actively buying up Japanese equities for years now in order to prop up their equity markets.

What this means is that the equity markets in these countries would fall to their intrinsic values if not continually propped up.  It’s no coincidence that all three of these countries are drowning in sea of debt that can never be repaid, at least not at the ‘value’ of their respective currencies today.

These are all Frankenstein economies in every sense of the word.  Unless continuous power is fed to them, they will not stand up, or walk and talk on their own.

I noted that Uber is off to a bad start or, as the folks over at Barron’s neatly put it yesterday…”Uber Starts in Reverse”.  I try not think about Tesla at all — and then there’s the FANG stocks.  With a ‘T’ and ‘U’ to add now, it’s only a matter of time before a new acronym that includes them will spring up.  These are all business models based on fantasy — and are just masquerading as going concerns.  But the band plays on anyway.  Meanwhile, the real economy continues to slowly sink into the mire.

All the while the lunatics in the White House asylum continue to trash international law in a similar manner in which they have already trampled the U.S. Constitution into the dirt.  If you haven’t read that very brief piece in the Critical Reads section headlined “Mr. Pompeo Goes to Sochi and Moscow“…the time to read it is now, before you read any further.

And with Bolton’s carrier and bomber task forces now in the Middle East “postured and ready to defend U.S. forces and interests in the region” — and on the lookout for any aggressive acts from “Iran or its proxies“…what could possible go wrong?  And as I mentioned in my column the other day — and in an e-mail exchange with George Whyte just now…”purely defensive of course…but the slightest provocation, then look out.  And if they don’t get one, because Iran has already stated thatWe have been very clear that we have no interest in escalation…then then the “U.S., or its proxies”…will produce one themselves.”

These are very dangerous times — and as I stated in an Internet interview on Wednesday, if there’s going to be big trouble anywhere, it will start in the Middle East, courtesy of the U.S. deep state.

That’s why I speculated in my column on Friday that maybe the precious metals have been on ‘care and maintenance’ waiting for this event [or another just like it] to manifest itself, so they can finally take their foot off precious metal prices — and the rest of the commodity complex at the same time.  Then the central banks will get all the inflation they could possible want.

Jamie Dimon, a “silver-plated” card-carrying member of the deep state if there ever was one, has himself and his firm in position to profit handsomely from it — and most likely all his other friends in the deep state as well.

How did it come to this…if it does, that is.

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

Ed