17 September 2019 — Tuesday
YESTERDAY in GOLD, SILVER, PLATINUM and PALLADIUM
The gold price blasted higher on the Saudi Arabia bombing news the moment that trading began at 6:00 p.m. EDT in New York on Sunday evening. Needless to say it ran into ferocious opposition almost instantly — and the price was capped and turned lower around 8:25 a.m. China Standard Time on their Monday morning. That sell-off lasted until around 11 a.m. CST — and from there it chopped very quietly sideways until shortly before 2 p.m. in after-hours trading in New York. A bit of selling pressure reappeared — and the gold price was carefully closed back below $1,500 spot by 5:00 p.m. EDT.
The high and low ticks were reported by the CME Group as $1,512.80 and $1,496.90 in the October contract — and $1,519,70 and $1,503.40 in December.
Gold was closed in New York on Monday afternoon at $1,497.90 spot, up an even $10 on the day. Net volume was a bit over 332,000 contracts — and there was 18,000 contracts worth or roll-over/switch volume on top of that.
The price activity in silver was very similar, although it had a extra ticks higher…the first at noon in Shanghai — and the other at the 11 a.m. EDT London close. But the gains in both those rallies had pretty much vanished by the end of the Monday trading session.
The high and low ticks in silver were recorded as $18.075 and $17.69 in the December contract.
Silver was closed on Tuesday at $17.825 spot in the December contract. Net HFT silver volume was a bit under 106,500 contracts — and there was 3,000 contracts worth of roll-over/switch volume in this precious metal.
Platinum also jumped up a bit on the bombing news — and its price was capped and turned lower at 8 a.m. CST on their Monday morning. It was sold back to almost unchanged by 11 a.m. in Shanghai — and then didn’t do much until shortly after 11 a.m. in Zurich. It edged a bit higher from there, but ran into ‘something’ around 2 p.m. in Zurich/8 a.m. in New York — and its price was blasted lower until the 10 a.m. EDT afternoon gold fix in London. It crept unevenly higher from that juncture into the 1:30 p.m. COMEX close — and didn’t do a thing after that. Platinum was closed at $935 spot, down 11 bucks from Friday.
Palladium was down 9 dollars by 11 a.m. China Standard Time on their Monday morning, but began to edge higher from there, with the high tick of the day…around $1,606 spot…coming at 10 a.m. in Zurich. It then wandered unevenly sideways until the same 2 p.m. CEST/8 a.m. EDT as platinum. That special ‘someone’ showed up in palladium at that point as well — and the low tick was set shortly after the afternoon gold fix in London. It recovered quickly off its low — and then really didn’t do much of anything for the remainder of the Monday session. Palladium was closed at $1,584 spot, down 6 bucks from Friday.
The dollar index closed very late on Friday afternoon in New York at 98.26 — and opened down 14 basis points once trading commenced around 6:35 p.m. EDT on Sunday evening, which was 6:35 a.m. China Standard Time on their Monday morning.. It’s 98.03 low tick was set around 7:25 p.m. EDT/7:25 a.m. CST — and it’s a reasonable assumption to make that the usual ‘gentle hands’ appeared. It rallied rather smoothly from there until a very few minutes before the 11 a.m. EDT London close — and its 98.71 high tick was set at that juncture. It traded very quietly and unevenly sideways for the remainder of the day. The dollar index finished the Monday session at 98.61…up 35 basis points from its close on Friday.
Of course, there was no correlation whatsoever between what precious metal price were doing — and what was going in in the currency market yesterday.
Here’s the DXY chart from Bloomberg. Click to enlarge.
And here’s the 6-month U.S. dollar index chart, courtesy of the folks over at the stockcharts.com Internet site. The delta between its close…98.18…and the close on the DXY chart above, was 43 basis points on Monday. Click to enlarge as well.
The gold stocks gapped up at the open — and then were sold back below unchanged briefly, as the gold price was hit for a few bucks shortly after the equity markets opened in New York yesterday morning. That was short-lived, as the gold price turned on a dime — and the shares followed. The gold price was capped and turned lower for the final time a few minutes after the London close — and the stocks followed the gold price until shortly after 1 p.m. EDT — and the proceeded to trade unevenly higher by a hair going into the 4:00 p.m. close of trading. The HUI finished up 1.51 percent.
The silver equities followed the gold shares up until silver’s price was also capped and turned lower a few minutes after the London close — and from that juncture they traded unevenly sideways with a slight negative bias until the equity markets closed at 4:00 p.m. in New York. Nick Laird’s Intraday Silver Sentiment/Silver 7 Index close higher by 2.71 percent. Click to enlarge if necessary.
Here’s Nick’s 1-year Silver Sentiment/Silver 7 Index chart, updated with Monday’s doji. Click to enlarge as well.
And, for a pleasant change, the three usual laggards…Buenaventura, Peñoles — and Hecla…weren’t laggards yesterday. Hecla closed up 8.29%.
The CME Daily Delivery Report showed that 6 gold and 147 silver contracts were posted for delivery within the COMEX-approved depositories on Wednesday.
In gold, the two short/issuers were ADM and Advantage, with 4 and 2 contracts out of their respective client accounts. The three long/stoppers were Advantage, Morgan Stanley and JPMorgan, with 3, 2 and 1 contracts — all for their respective client accounts.
In silver, the three short/issuers were ABN Amro, ADM and Advantage…with 109, 24 and 14 contracts — and all from their respective client accounts. There were six long/stoppers in total. The largest was Advantage, with 68 for its client account. In second spot was JPMorgan, with 51 contracts in total…49 for clients, plus 2 for its own account. In third spot was CME Group, picking up 14 contracts for its own account, which it immediately reissued as 5×14=70 one-thousand troy ounce mini silver contracts. ADM picked up 41 of those — and Advantage stopped the other 29.
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 September rose by 4 contracts, leaving 29 still open, minus the 6 contracts mentioned a few paragraphs ago. Friday’s Daily Delivery Report showed that only 1 gold contact was actually posted for delivery today, so that means that 4+1=5 more gold contracts were added to September. Silver o.i. in September declined by 74 contracts, leaving 374 still around, minus the 147 contracts mentioned a few paragraphs ago. Friday’s Daily Delivery Report showed that 98 silver contracts were actually posted for delivery today, so that means that 98-74=24 more silver contracts were just added to the September delivery month.
There were no reported changes in GLD on Monday, but there was another hefty withdrawal from SLV, as an authorized participant removed another 2,899,591 troy ounces.
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 trading on Friday, September 13 — and this is what they had to report. They added 25,173 troy ounces of gold, plus 59,800 troy ounces of silver.
Other than what was reported in GLD, SLV and Zürcher Kantonalbank reported above, there was very little activity in any of the other gold and silver ETFs on Monday.
There was no sales report from the U.S. Mint on Monday.
There was a tiny bit of activity in gold over at the COMEX-approved depositories on the U.S. east coast on Friday. There was 2,636.382 troy ounces/82 kilobars [SGE kilobar weight] dropped off at Brink’s, Inc. — and in the ‘out’ category, there was 198 troy ounces that departed Delaware. I won’t bother linking this.
There was a bit more activity in silver, as one truckload…624,535 troy ounces…was shipped into Brink’s, Inc. — and the only ‘out’ activity was 15,216 troy ounces that departed Delaware. The link to that is here.
The only activity over at the COMEX-approved gold kilobar depositories in Hong Kong on their Friday was one lone kilobar…32.151 troy ounces…that was taken out of Brink’s, Inc. I shan’t bother linking this activity, either.
Here are the usual two charts that Nick passes around on the weekend. They show the amount of gold and silver in all known depositories, ETFs and mutual funds, as of the close of business on Friday, September 13. During the ‘week that was’…there was a net 555,000 troy ounces of gold taken out — and in silver, that number was a whopping 6,939,000 troy ounces that was withdrawn on a net basis. Click to enlarge for both.
I have a have a lot of stories/articles for you today.
As the economy cycles down through fall, there is new, alarming data by professional services firm BDO USA LLP, first reported by The Wall Street Journal, that indicates retail bankruptcies continue to rise as store closures have already outpaced all of 2018.
BDO warned that the recent acceleration of the retail apocalypse was primarily due to last year’s weak holiday shopping season.
The rate of bankruptcy filings and store closures this year have jumped to crisis levels, expected to continue into 2020.
David Berliner, who leads business restructuring at BDO, said the trend is rather alarming but could slow into late 2019. “I don’t think the pace of the bankruptcy filings will be as large as it was in the first half,” he added.
BDO found many retailers are dealing with massive debt loads, over expansion due to cheap money, private equity-ownership pressures, and changing consumer behavior. It was the weak consumer in the 2018 shopping season that led to the acceleration of store closures in 2019.
Retail sales in 1H19 were lackluster, due to smaller tax refunds for consumers, trade war uncertainties and tariffs, and inclement weather, which forced many retailers to offer significant discounts, according to BDO.
This longish chart-filled commentary showed up on the Zero Hedge website at 9:31 a.m. EDT on Monday morning — and it’s the first offering of the day from Brad Robertson. Another link to it is here.
Late last Friday, we warned that a “dollar funding storm” is set to make landfall in the U.S. amid a series of converging sources of pressure that we said would result in “secured funding markets breaking higher“, among which:
- elevated UST supply,
- bloated dealer balance sheets and year-end regulatory constraints, and
- a banking system near reserve scarcity.
Ironically, it was the rising recession concerns in August – manifesting in the form of an inverted yield curve, cash hiding in repo, and a slow build in UST supply – that kept secured funding pressures at bay. However, as we explicitly noted last Friday, “clear signs of funding pressure could emerge starting next week with sizeable coupon settlements and the mid-September corporate tax date.”
Fast forward to today, i.e. “next week” when the dollar funding storm we warned about has just made thunderous landfall and the overnight general collateral repo rate, an indicator of secured market stress and by extension, dollar funding shortages, soared from Friday’s close of 2.25% to a high of 3.80%, a spike of over 150bps…Click to enlarge.
Commenting on today’s shocking move, BMO rates strategist Jon Hill said that “secured funding markets are clearly not functioning well,” adding that a jump like this, one which is not happening during the traditional quarter end window dressing period, is “bordering on chaos.”
Needless to say, such a move – without a clear catalyst – is a clear indication that plumbing in the overnight funding markets has just snapped, and is badly broken to be trading so far above the effective funds rate. As Bloomberg adds, the spike suggests the next few months could be volatile given the expected increase in Treasury supply, bloated dealer balance sheets, regulatory issues and a banking system where reserves are scarce.
Picking up where he left off in his Friday note, BofA head of rates strategy Mark Cabana said that while “one day is not a big deal, if funding pressures persist, it implies a loss of control of funding markets,” adding what we pointed out previously, namely that “If the market is struggling now, it raises questions about how well the market will handle the fourth-quarter funding squeeze.”
We’ll see how this turns out — and if Mr. Powell has anything to say about it in his remarks after the FOMC meeting tomorrow afternoon EDT. This is another Zero Hedge news item. It was posted on their Internet site at 2:15 p.m. EDT on Monday afternoon — and another link to it is here. Bill King, of King Report fame had this to say about it in his Tuesday blog…”A big negative on Monday was the surge in repo rate. The overnight rate hit 7% during the final hour of trading. It settled at 5% after the close. Some pundits proffered the view that a day or two of a funding squeeze would not be a problem. But if the need for funds continues, let alone accelerates, look out.”
You now understand as well as we do why the money system is doomed. Today’s dollar is fake, with no firm connection to the real world of time, resources, and output.
The “wealth” it produces is fake too. We saw that last week; in the 50 years after WWII, household net worth averaged about 350% of GDP. Then, suddenly it shot up to over 500%. Where did that extra money – about $30 trillion of extra household wealth – come from?
Among the many, it’s slim pickins. Real median household income was a little over $60,000 in the late ’90s; it’s still a little over $60,000. But among the few, it’s high cotton all year round. Joel Kotkin elaborates:
The top 1% in America captured just 4.9 percent of total U.S. income growth in 1945-1973, but since then the country’s richest classes has gobbled up an astonishing 58.7% of all new wealth in the U.S., and 41.8 percent of total income growth during 2009-2015 alone…
You already know what was really going on; the fix was in.
This rather brief commentary from Bill appeared on the bonnerandpartners.com Internet site early on Monday morning EDT — and another link to it is here.
Governments are in the flimflam business.
Pared down to the bare essentials, governments can be very useful in passing and enforcing a small number of very basic laws. These laws should be limited to policing those who would seek to aggress against others, or their property. Governments may also have a value in providing protection from invasion – organizing an army of able-bodied people to address this collective problem, if and when it occurs.
And that’s about it. Beyond that, the private sector can, and almost always does, do a better job at virtually everything else. Therefore, a government should be small, cost very little to run and do as little as possible.
But since a government already exists, why not have it do more? Why not assign to it some of those tasks that tend not to attract businessmen?
Well, the simple, but almost universally little-understood, reason is that governments do not actually produce anything. They are, in fact, a parasitical construct that consumes money but creates nothing of worth.
This worthwhile commentary from Jeff was posted on the internationalman.com Internet site on Monday morning EDT — and another link to it is here.
The controversy between Israel and Russia regarding airstrikes of Iranian targets in Syria and Iraq continues, despite the meeting Between Prime Minister Benjamin Netanyahu and Russian President . This was reported on Friday by Independent Arabia.
According to the report, Moscow has prevented three Israeli airstrikes on three Syrian outposts recently, and even threatened that any jets attempting such a thing would be shot down, either by Russian jets or by the S400 Anti-aircraft missiles.
The source cited in the report claims a similar situation has happened twice, and that during August, Moscow stopped an airstrike on a Syrian outpost in Qasioun, where a S300 missile battery is placed.
Moreover, it was claimed that another airstrike planned for a week later on a Syrian outpost in the Qunaitra area and a third airstrike on a sensitive area in Latakia. This development is what pushed Netanyahu to have his quick visit in Russia to try and convince Putin to ignore Israel’s attacks in Syria. According to the Russian source, Putin let Netanyahu know that his country will not allow any damage to be done to the Syrian regime’s army, or any of the weapons being given to it, because giving such a permission would be seen as giving Israel leniency – something that contradicts Russia’s goal of assisting the Syrian regime.
This story has multiple sources…The Jerusalem Post — and Independent Arabia…and this iteration put in an appearance on the informationclearinghouse.com Internet site on Saturday sometime — and I thank Brad Robertson for pointing it out. Another link to it is here.
Saudi Arabia’s oil production was cut by half after a swarm of explosive drones struck at the heart of the kingdom’s energy industry and set the world’s biggest crude-processing plant ablaze — an attack blamed on Iran by the top U.S. diplomat.
Iran-backed Houthi rebels in Yemen, who’ve launched several drone attacks on Saudi targets in the past, claimed responsibility for the assault on the kingdom’s Abqaiq plant.
U.S. Secretary of State Michael Pompeo said in a tweet there’s no evidence the attacks came from Yemen and blamed Iran directly, but didn’t offer evidence for that conclusion either. President Donald Trump spoke with Saudi Crown Prince Mohammed Bin Salman by telephone but hasn’t commented directly. Dow Jones reported that Saudi and U.S. officials are investigating the possibility that cruise missiles were launched from Iraq, which is much closer than Yemen.
About 5.7 million barrels per day of output has been suspended, Saudi Aramco said in a statement. “Work is underway to restore production and a progress update will be provided in around 48 hours,” said Amin H. Nasser, Aramco’s president and chief executive officer.
That’s affected about half of Saudi Arabia’s oil production. Gas output was also disrupted, with 2 billion cubic feet in daily output, about half of normal production, stopped by the attack, SPA news agency said, citing the kingdom’s Energy Minister Abdulaziz bin Salman. Operations in Abqaiq and Khurais are halted for now.
“Abqaiq is the heart of the system and they just had a heart attack,” said Roger Diwan, a veteran OPEC watcher at consultant IHS Markit.
This Bloomberg news story was posted on their website at 10:32 p.m. PDT on Friday night — and was last updated about twenty hours after that. Swedish reader Patrik Ekdahl was the first reader through the door with this story — and another link to it is here. A parallel Bloomberg story to this is headlined “Pompeo Blames Iran for Drone Attack on Saudi Oil Industry” — and that’s from Patrik as well. Then there’s this story from the off-guardian.org Internet site headlined “Oiling for War: The Houthi Attack on Abqaiq” — and that comes courtesy of Roy Stephens.
In recent decades, the U.S. has sold the Saudis hundreds of billions of dollars of military equipment. Did our weapons sales carry a guarantee that we will also come and fight alongside the kingdom if it gets into a war with its neighbors?
Before Trump orders any strike on Iran, would he go to Congress for authorization for his act of war?
Sen. Lindsey Graham is already urging an attack on Iran’s oil refineries to “break the regime’s back,” while Sen. Rand Paul contends that “there’s no reason the superpower of the United States needs to be getting into bombing mainland Iran.”
Divided again: The War Party is giddy with excitement over the prospect of war with Iran, while the nation does not want another war.
How we avoid it, however, is becoming difficult to see.
John Bolton may be gone from the West Wing, but his soul is marching on.
This commentary from Pat put in an appearance on his Internet site on Monday sometime — and I thank Phil Manuel for sliding it into my in-box in the very week hours of Tuesday morning EDT. Another link to it is here.
GATA doesn’t get invited anymore to financial conferences in Toronto and Vancouver now that touting mining shares takes precedence over warning monetary metals investors about manipulation of the markets by governments and central banks. But at the Sprott Natural Resources Symposium in Vancouver six weeks ago the president of Miles Franklin Precious Metals, Andy Schectman, gave a wonderful presentation about the comprehensive deception being waged against the monetary metals by governments, central banks, and their investment bank allies.
This 23-minute video presentation was posted on the youtube.com Internet site on Saturday sometime — and it’s link here. I found this embedded in the daily blog that I get from Miles Franklin Precious Metals every day — and I borrowed the previous paragraph from the GATA dispatch about it.
Two current and one former JPMorgan Chase & Co executives were charged over allegedly participating in market manipulation in the trade of precious metals including gold, silver, platinum and palladium between 2008 and 2016, the Department of Justice said on Monday.
The three men – global precious metals desk head Michael Nowak, precious metals trader Gregg Smith, and former trader Christopher Jordan, who left JPMorgan in 2009 – were charged with a racketeering conspiracy and other federal crimes, it said in a statement.
A spokesman for JPMorgan declined to comment. One of the largest gold traders in the world, the bank said in an August regulatory filing it was “responding to and cooperating with” investigations by various authorities, including the Department of Justice, relating to trading practices in the metals markets.
Reuters reported on Sept. 12 that Nowak and Smith had been placed on leave from the bank pending the ongoing investigation.
“It’s truly regrettable that the DOJ decided to go forward with a prosecution of Mike Nowak, who has done nothing wrong. We look forward to representing him at trial and expect him to be fully exonerated,” Nowak’s attorneys, David Meister and Jocelyn Strauber of Skadden, Arps, Slate, Meagher & Flom LLP, said in an emailed statement.
The defendants “and their co-conspirators allegedly engaged in a complex scheme to trade precious metals in a way that negatively affected the natural balance of supply-and-demand,” Federal Bureau of Investigation (FBI) Assistant Director William Sweeney said in the statement.
“Not only did their alleged behavior affect the markets for precious metals, but also correlated markets and the clients of the bank they represented,” said Sweeney, who works in the FBI’s New York Field Office.
Ted Butler found it rather outrageous that one of the lawyers defending JPMorgan’s Nowak is, in fact, a former CFTC Enforcement Division head — and was holding that position during the time period that these offenses occurred over at JPMorgan. You couldn’t make this stuff up! This Reuters story, filed from Washington, was posted on their website at 4:47 a.m. EDT on Monday morning — and was updated about eight hours later. It comes to us courtesy of Doug Milne — and another link to it is here.
Who would have thought that JPMorgan’s precious metals trading desk is the functional equivalent of the mafia, and that its one-time leader, Blythe Masters, was the mafia’s don?
Well, almost everyone who didn’t mind being designated a conspiracy theorist for years. And now comes vindication, because this has just been confirmed by the DOJ, which accused the PM trading desks at JPMorgan of being deeply involved in what prosecutors described as a “massive, multiyear scheme to manipulate the market for precious metals futures contracts and defraud market participants.”
In an indictment unsealed on Monday morning, the DoJ charged Michael Nowak, a JPMorgan veteran and former head of its precious metals trading desk and Gregg Smith, another trader on JPM’s metals desk, in the probe. (Blythe Masters was somehow omitted).
“Based on the fact that it was conduct that was widespread on the desk, it was engaged in in thousands of episodes over an eight-year period — that it is precisely the kind of conduct that the RICO statute is meant to punish,” Assistant Attorney General Brian Benczkowski told reporters.
Here are all the gory details, as this Zero Hedge story has the entire DoJ indictment document embedded in this article. It might just has well have come straight from Ted Butler, as it contains every detail of what he’s spoken about regarding JPMorgan since they took over Bear Stearns in March of 2008. It was posted on their website at 1:52 p.m. on Monday afternoon EDT — and it certainly falls into the must read category. Another link to it is here. Bloomberg carried the story as well — and it’s headlined “JPMorgan’s Metals Desk Was a Criminal Enterprise, U.S. Says” — and I thank Dan Moore for that one.
When JPMorgan Chase & Co. took over Bear Stearns more than a decade ago, it got two traders with a new trick.
Their strategy: Use multiple fake orders to manipulate the prices of precious metals futures. The maneuver, adopted by the traders’ new colleagues at JPMorgan, became part of a spoofing and rigging campaign so expansive that federal authorities have now likened it to a criminal enterprise operating inside the U.S.’s biggest bank.
In a criminal indictment unsealed on Monday, U.S. prosecutors accused three JPMorgan traders of rigging futures trades in precious metals for nearly a decade, making millions of dollars for the bank at the expense of counterparties that included the bank’s own clients.
The charges were the latest turn in a years-long investigation that has previously yielded guilty pleas from traders at several banks, including two from JPMorgan. Prosecutors said more than a dozen JPMorgan employees ultimately helped make manipulative “spoof” trades for the bank, in part by using the strategy their new colleagues brought in May 2008.
That pair, Gregg Smith and Christiaan Trunz, showed their new JPMorgan colleagues “a new style of layering multiple deceptive orders at different prices in rapid succession,” prosecutors wrote. The strategy made their market spoofing more difficult to execute and detect, prosecutors wrote in the indictment of Smith and two others. Trunz pleaded guilty last month and is cooperating with authorities.
The strategy was adopted by Michael Nowak, who was JPMorgan’s global head of precious metals trading when he was put on leave last month.
Federal prosecutors charged Nowak, Smith and a third man, Christopher Jordan, of “conspiracy to conduct the affairs of an enterprise involved in interstate or foreign commerce through a pattern of racketeering activity” — counts more commonly known as RICO charges. That language, rarely used in big bank cases, suggests that JPMorgan may face deeper legal jeopardy that goes beyond the individuals who have already been prosecuted.
JPMorgan declined to comment.
As Chris Powell says at the beginning of this GATA dispatch…”A powerful vindication of silver market analyst and whistleblower Ted Butler, who long has said the racket began with JPMorganChase’s acquisition of Bear Stearns.” This Bloomberg story appeared on their Internet site at 4:26 a.m. EDT on Monday morning — and was updated about ten hours later. It’s definitely worth reading — and another link to it is here.
A £1 million golden toilet has been stolen from the birthplace of Winston Churchill. The dirty crime involved thieves ripping the 18-carat gold commode from its plumbing, causing flooding at the Oxfordshire palace.
Thames Valley Police arrested a 66-year-old man in connection with the theft after they received a report of a burglary at Blenheim Palace early Saturday morning.
Thieves broke into the historical site and stole a “high value toilet made out of gold that was on display at the palace,” Detective Inspector Jess Milne said.
“Due to the toilet being plumbed in to the building, this has caused significant damage and flooding.”
The golden toilet was named ‘America’ and was part of a contemporary art exhibition at the palace. Created by Italian artist Maurizio Cattelan, it was plumbed into a wooden chamber opposite the room where former U.K. prime minister Churchill was born, and visitors were able to queue up to use it.
The toilet has not been recovered, and police have issued an appeal for anyone who may have information to come forward.
This rather laughable news item showed up on the rt.com Internet site at 2:10 p.m. Moscow time on their Saturday morning, which was 7:10 a.m. in New York — EDT plus 7 hours — and it was updated about forty-eight hours later. The first person through the door with this gold-related news item was U.K. reader Tariq Khan — and another link to it is here. There was a story on this from the telegraph.co.uk Internet site about this with the very cheeky headline… “£4.8m golden lavatory stolen from Blenheim Palace … police have nothing to go on” — and I found that in a GATA dispatch.
The PHOTOS and the FUNNIES
After taking the photos of the pontoon boats shooting the rapids on the Thompson River on June 23 in Saturday’s column…this first photo was about 7 kilometers/4 miles away looking out over the river, mainly WSW, with the coastal mountain range in the background. That’s a CP train snaking its away along the canyon, with the CN rail bed on the opposite bank. The Trans-Canada Highway heads south at the turn, just visible near the centre of the photo — and then follows the Fraser River. B.C. Highway 12 to Lillooet branches off to the right…northwest up the Fraser River canyon at Lytton, a very few kilometers around that same corner. The Thompson River flows into the Frazer River at Lytton. Click to enlarge. The second photo shows Lytton from Ferry Road, with the confluence of the Thompson and Frazer Rivers barely visible just to the left of center of the photo. Only the difference in water colour makes it obvious. The last shot shows the Lytton ferry across the Fraser, that takes you to the settlements on the other side. We’ve been there — and done that, but it’s a story for another day. Click to enlarge.
Not that there was any doubt in most people’s minds, but the fact that JPMorgan is the capo di tutti capi of the price management scheme in the precious metals in general — and silver in particular, was put up in lights by the U.S. Department of Justice on Monday. The manipulation deniers can say whatever they want, but the facts of the case now speak for themselves.
And as Chris Powell stated in one his dispatches yesterday…” [It’s] a powerful vindication of silver market analyst and whistleblower Ted Butler, who long has said the racket began with JPMorgan Chase’s acquisition of Bear Stearns.” And it also jibes quite nicely with what Jim Rickards has said in the public domain about JPMorgan over the years, calling them “the biggest criminal organization the world has ever known.”
And to top it all off, just about everything that’s in the indictment is what Ted has written about for the last ten or so years regarding the take-over of Bear Stearns by JPMorgan.
Of course it remains to be seen at what point in this ongoing and now public conspiracy, that JPMorgan will exit stage left as short seller of last resort — and sometimes first resort as well. If or when they do, the remaining short sellers will be on the hook for potentially catastrophic losses. And if I were a short seller of any size in the precious metals arena in the COMEX futures market, I would be looking to cover as quickly as I could…because the first person out the door will lose the least.
I suppose, as Ted Butler said on the phone yesterday, that doesn’t preclude ‘da boyz’/Big 8 traders from engineering another price decline. But if they did, they would be doing it full view of the DoJ…who are obviously wise to the whole scheme from A to Z…but didn’t come out and say it exactly those words. I’m sure Ted will have lots to say in his mid-week commentary for his paying subscribers on Wednesday.
Here are the 6-month charts for the four precious metals, also courtesy of stockcharts.com — and the only change worth noting, was the change in the silver price. Copper gave back all of Friday’s gains — and the gap higher in WTIC is the highlight of the day. Click to enlarge for all.
And as I type this paragraph, the London open is less than a minute away — and I note that the gold price chopped quietly sideways throughout most of the Far East trading session on their Tuesday, but was turned quietly lower shortly before 2 p.m. China Standard Time — and is down $3.70 the ounce. Silver’s price path was virtually identical — and it’s lower by 6 cents as London opens. Ditto for platinum — and it was sold lower at 2 p.m. CST — and is down 3 bucks. Palladium was up 11 dollars or so by shortly after 8 a.m. CST — and it has been sold very unevenly lower since. It’s off its current low by a hair — and is now down 2 dollars as Zurich opens.
Net HFT gold volume is coming up on 55,500 contracts — and there’s only a tiny 696 contracts worth of roll-over/switch volume in this precious metal. Net HFT silver volume is about 14,500 contracts — and there’s a tiny 229 contracts worth of roll-over/switch volume on top of that.
The dollar index hasn’t been doing much of anything since trading commenced around 7:45 p.m. EDT on Monday evening in New York, which was 7:45 a.m. China Standard Time on their Tuesday morning. But it ticked higher starting a few minutes before 2 p.m. CST — and is up 11 basis points as of 7:45 a.m. BST in London/8:45 a.m. CEST in Zurich.
Well, the FOMC meeting starts today — and with the oil refinery bombing in Saudi Arabia on the weekend, plus the rather dicey situation that exists in the repo market right now — and topped off by an ever-rising dollar index, I wouldn’t want to hazard a guess as to what Powell will have to say tomorrow afternoon at 2 p.m. EDT.
But whatever he has to say will most likely move the markets — and it just remains to be seen in which direction they move, or are allowed to move.
And as I post today’s efforts on the website at 4:02 a.m. EDT, I note that the price of gold and silver jumped a bit higher starting a few minutes before the London open, as the dollar index hit its current high tick — and headed a bit lower. And as London closes, gold is now down only 60 cents the ounce — and silver by 3 cents. Platinum and palladium barely missed a beat in their quiet downward price paths, with the former down 5 dollars — and the latter by 9 as the first hour of Zurich trading ends.
Gross gold volume is around 68,500 contracts — and minus the tiny amount of roll-over/switch volume, net HFT gold volume is a bit under 67,000 contracts. Net HFT silver volume is coming up on 16,000 contracts — and there’s still only 255 contracts worth of roll-over/switch volume on top of that.
The dollar index topped out about five minutes before the London/Zurich opens — and has headed lower since — and is only up 4 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.