Author Archives: edsteer

Ted Butler: Stranger Than Fiction

28 June 2019 — Friday

YESTERDAY in GOLD, SILVER, PLATINUM and PALLADIUM


The gold price certainly didn’t do much on Thursday.  It was sold quietly lower in Far East trading until the London open — and then it inched higher until the COMEX open, where it was tapped lower — and traded briefly below $1,400 spot for a minute or so.  From that point it edged quietly higher until trading ended at 5:00 p.m. EDT in New York.

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

Gold finished the day at $1,409.20 spot, up 60 cents from Wednesday’s close.  Net volume was very heavy once again at just over 318,500 contracts —  and there was 18,500 contracts worth of roll-over/switch volume in this precious metal.

The silver price was forced to follow an almost identical price to gold in Far East and London trading, although there were some variations during the COMEX trading session in New York.  It was certainly obvious, at least to me, that silver was kept from closing above unchanged on the day.

The high and low ticks aren’t worth looking up for silver, either.

Silver was closed at $15.225 spot, down 1.5 cents from Wednesday.  Net volume was pretty heavy at a bit under 77,500 contracts — and there was just under 22,000 contracts worth of roll-over/switch volume out of July and into future months.

Platinum was down four bucks by shortly after 10 a.m. China Standard Time on their Thursday morning — and then didn’t do much until about 12:30 p.m. CEST in Zurich.  It ticked higher from that juncture — and was up a dollar by the COMEX open. It was sold lower from there — and the low tick was set at noon in New York.  It jumped up 5 dollars by 1 p.m. EDT — and didn’t do much of anything after that.  Platinum was closed at $812 spot, down 2 dollars on the day.

Palladium was up 8 bucks by 11 a.m. CST on their Thursday morning, but was down 3 dollars by the Zurich open.  From that point it chopped unevenly sideways a handful of dollars either side of the $1,500 spot mark until around 1 p.m. in Zurich trading.  Then away it went to the upside, with the high of the day coming at the COMEX close — and it ended up closing on its high of the day in the thinly-traded after-hours market.  Palladium finished the Thursday session at $1,532 spot, up 32 dollars from Wednesday.

The dollar index closed very late on Wednesday afternoon in New York at 96.21 — and opened down 4 basis points once trading commenced at 7:45 p.m. EDT on Wednesday evening, which was 7:45 a.m. China Standard Time on their Thursday morning.  From that juncture it didn’t do much until 9:10 a.m. CST, when it began to head higher.  All the gains that mattered were in by 12:30 p.m. CST — and the index chopped quietly sideways until a few minutes before London opened — and it began to head lower from there.  The 96.14 low tick of the day was printed around 11:55 a.m. in London.  It edged unevenly higher until 9:55 a.m. in New York, but fell back to around the unchanged mark very shortly thereafter — and from that point, it chopped very quietly sideways until trading ended at 5:30 p.m. EDT.  The dollar index finished the Thursday session at  96.19…down 2 basis points from Wednesday’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…95.74…and the close on the DXY chart above, was 45 basis points on Thursday.  Click to enlarge as well.

The gold stocks gapped down a bit at the open — and then hit their respective low ticks a minute or two before 11 a.m. in New York trading.  They chopped quietly higher from there, but couldn’t quite squeeze a positive close, as the day traders showed up in the last ten minutes with their sell orders.  The HUI closed down 0.32 percent.

The silver equities sold off in a similar manner at the New York open, but were down almost two percent at their lows, which also came a minute or so before 11 a.m. EDT.  They also chopped higher from there, but ran into a bout of selling around 11:30 a.m…which lasted for about forty-five minutes — and a positive close became “a bridge too far” at that point — and the day traders did the rest ten minutes before trading ended at 4:00 p.m.  Nick Laird’s Intraday Silver Sentiment/Silver 7 Index closed down 0.66 percent.  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.

The CME Daily Delivery Report for Day 1 of July deliveries showed that 371 gold and 2,620 silver contracts were posted for delivery within the COMEX-approved depositories on Monday.

In gold, of the five in total, the largest short/issuer by far was JPMorgan, with 272 contracts — and in distant second place was Advantage with 40 — and ADM in third spot with 31.  All contracts involved their respective client accounts.  There were eight long/stoppers in total.  Marex Spectron was the largest with 101 contracts for its client account — and in second place was ABN Amro with 99 contracts for its client account.  Coming in third was JPMorgan, stopping 88 contracts for its in-house/proprietary trading account.

In silver, there were seven short/issuers in total — and the largest by far was JPMorgan, with 1,400 contracts out of its so-called ‘Client Account’.  In second, third and fourth place were International F.C. Stone with 480…ABN Amro with 360 — and ADM with 134 contracts…all from their respective client accounts as well.  There were thirteen long/stoppers in total — and head-and-shoulders above the rest was HSBC USA picking up 1,341 contracts for its own account.  JPMorgan stopped 439 contracts…Morgan Stanley 429…ABN Amro 145 — and Citigroup stopped 131 contracts.  All these were for their respective client accounts.

The link to yesterday’s Issuers and Stoppers Report is here — and it’s worth a look, if you have the interest.

The CME Preliminary Report for the Thursday trading session showed that gold open interest in July fell by 151 contracts, leaving 425 still around, minus the 371 contracts mentioned a few paragraphs ago.  Silver o.i. in July cratered by another 9,628 contracts, leaving just 3,873 left, minus the 2,620 mentioned a few paragraphs ago.

All of the remaining 119 gold contracts scheduled for June delivery, will be delivered today.


For the third day in a row there was a withdrawal from GLD.  This time an authorized participant took out 66,046 troy ounces.  And, for the first time in seven days, there was a deposit into SLV, as authorized participant added a very decent 2,574,902 troy ounces.  Ted figures that this ETF is owed considerably more physical silver than that.

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

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

It was another reasonably busy day in silver, as two truckloads…1,198,140 troy ounces…were reported received — and all of that ended up at CNT.  There was 542,228 troy ounces shipped out.  Of that amount, there was 540,228 troy ounces shipped out of HSBC USA — and the remaining 2,000 troy ounces departed Delaware.  The link to that activity is here.

There was a bit of activity over at the COMEX-approved gold kilobar depositories in Hong Kong on their Wednesday.  They reported receiving 700 of them, but didn’t ship out any.  All of these gold kilobars ended up at Brink’s, Inc. as per usual — and the link to that, in troy ounces, is here.


Here are three more charts that Nick Laird passed around the other day.  They show European gold imports and exports, updated with April’s data. This first chart shows that they imported 96.3 tonnes — and exported 110.9 tonnes. Click to enlarge.

These next two charts show the countries and tonnages that were received by each country in the Euro Zone — and the second shows what countries exported gold — and the tonnage associated with eachClick to enlarge for both.

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


CRITICAL READS

Albert Edwards: This Was the Final Recessionary Shoe, and it Has Now Fallen

Exactly three months ago, in late March, the 3 month-10 year spread inverted for the first time since 2007…an event which sparked near-panic in the market as historically curve inversion has preceded the last 7 recessions.

However, while the inversion was certainly a memorable event, the question on everyone’s lips is how do risk assets perform once the curve flattens and/or inverts. According to back-tests from Goldman, since the mid-1980s, significant stock draw-downs (i.e. market crashes) began only when term slope started steepening after being inverted.

In other words, as we noted then, “Curve Inversion Is Bad, But It’s The Steepening After That Kills.”

Fast forward to today, when in his latest bearish missive, SocGen’s permabear Albert Edwards picks up where we left off, and in a note titled “the final recession shoe has now fallen“, he notes that while inversion of the U.S. yield curve is seen as a reliable precursor to U.S. recessions, “it has a long and variable lead time“, and instead “a far more immediate and present danger of recession occurs when after inversion, a rapid steepening occurs.”

Sound familiar?

In any case, as we first commented in early 2019, Edwards notes that this subsequent steepening “usually informs investors the cycle is over and it is time to flee for the hills.”

Well, for those who haven’t figured out the punchline yet, rapid curve steepening is now occurring, and as Edwards gleefully concludes, this “suggests recession may indeed either be imminent or else it has already arrived.”

This worthwhile commentary was posted on the Zero Hedge website at 12:45 p.m. on Thursday afternoon EDT — and I thank Brad Robertson for this one.  Another link to it is here.  A parallel ZH story is headlined “Goldman Warns Risk of Market Crash is Highest Since the Financial Crisis, Nearing 60%” — and that’s from Brad as well. Then this ZH piece from last night…”Paul Singer Warns a 40% Market Crash is Coming


Inflation Has Distorted The U.S. Markets — Bill Bonner

Yesterday [Wednesday] once again, the Dow rose in the morning on news that a deal with China was 90% done – and fell later, as investors realized that they couldn’t believe anything that came out of Washington.

Meanwhile, the president of the United States of America says he’d rather have a European – an Italian, no less – as head of the Federal Reserve.

Powell? Draghi? In America as in Europe, Italian as in English, the phenomenon is the same. We say “inflation,” you say “inflazione.” What’s the difference?

But this is not your grandfather’s inflazione. This is inflation of asset prices, not consumer prices. And Mario Draghi is as good at it as Jay Powell is.

Every day seems to bring some new absurdity, each one more dizzying than the one before. We’re almost laughed out.

This interesting commentary from Bill…filed from Portlaw, Ireland…showed up on the bonnerandpartners.com Internet site early on Thursday morning EDT — and another link to it is here.


Doug Noland: History Rhymes

But extending the “Terminal Phase” has ensured a historic parabolic surge in systemic risk. Consumer (chiefly mortgage) borrowings have increased 17.2% over the past year (40% in two years!). Thousands of uneconomic businesses continue to pile on debt. Unprecedented over- and mal-investment runs unabated. Millions more apartments are constructed. The bloated Chinese banking system continues to inflate with loans of rapidly deteriorating quality.

Global risk markets have been conditioned for faith both in Beijing’s endless capacity to sustain the boom and global central bankers’ determination to sustain system liquidity and economic expansion. So long as Chinese Credit keeps flowing at double-digit rates, inflating perceived wealth ensures Chinese spending and finance continue to buoy vulnerable emerging market booms and the global economy more generally. Global risk markets remain more than content.

At this stage, however, global bonds have adopted an altogether different focus: China’s financial and economic structures are untenable. Sustaining rapid Credit growth is increasingly fraught with peril. With market players now questioning Beijing’s implicit guarantee for smaller and mid-sized banks and financial institutions, financial conditions are in the process of tightening at the financial system’s “periphery.” And tightened Credit conditions have begun to reverberate in the real economy.

And what about the possible impact of a positive G20 and momentum toward a U.S./China trade deal? Stocks, no surprise, are readily excitable. For global safe haven bonds, however, it’s of little consequence. How can this be? Because even a trade deal would at this point have minimal impact on what has become deep and rapidly worsening structural impairment. Trade deal or not, Chinese exports to the U.S. will decline, right along with capital investment. Even with a deal, the Chinese financial system faces the consequences of years of rapid expansion as economic prospects deteriorate. Sure, 6% growth as far as the eye can see. That implies a further surge in consumer debt and even more dangerous mortgage finance and apartment Bubbles. Unparalleled overcapacity and maladjustment.

I would closely follow unfolding developments in Chinese Credit – funding issues for small and mid-sized banks; ructions in the money markets; trust issues with repo collateral, inter-banking lending, and counterparties; vulnerabilities in local government financing vehicles (LGFV); heightened concerns for speculative leverage; and the overarching issue of the implicit Beijing guarantee of essentially the entire Chinese financial system. The overarching issue is one of prospective losses of monumental dimensions. These losses will have to be shared in the marketplace. As much as global markets bank on Beijing bankrolling China’s entire financial apparatus, the Chinese government will not welcome the prospect of bankrupting itself.

This week’s edition of Doug Noland’s weekly commentary is certainly a must read — an it appeared on his website very early on Saturday morning EDT — and another link to it is here.


Doug Casey on False Flags and Pretexts For the Next War

I’d go so far as to say that most wars are started with false flags in one way or another, where the real bad guy is disguised.

The people who run nation states are never of the highest moral character. In fact, when it comes to political leaders, the scum rise to the top. These people are necessarily Machiavellian and capable of anything; they have to be in order to claw their way to the top of the political snake pit. Even if a person is basically decent when he gets into politics, he’ll inevitably be corrupted by his environment—and the fact he’s expected to exert power and use force to preserve the interests of the State. You can expect mainly duplicity and sanctimony from them.

International Man: There have been many instances of false flag events that have changed the course of history—by leading to wars, military interventions, and political upheavals. What do you think are some of the most notable historical examples, like the Gulf of Tonkin for instance?

Doug Casey: That’s an excellent one. The Gulf of Tonkin was entirely fabricated by the Johnson administration, which was looking for an excuse to invade Vietnam.

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


Perth Mint Gold Bullion Sales in May Drop to 25-Month Low

Sales of Australian bullion products slowed in May, for a second month in a row, figures from The Perth Mint of Australia show.

The Mint’s silver sales registered at a three-month low while its gold sales logged in at the lowest level in 25 months.

Perth Mint sales of gold coins and gold bars reached 10,790 ounces last month, registering declines of 46% from April and 27.1% from May of last year. The monthly tally was the weakest since April 2017 when the Mint sold 10,490 ounces.

Year-to-date gold sales at 114,251 ounces are 7.5% lower than 123,491 ounces sold in the first five months of 2018.

May sales of the Mint’s silver coins and silver bars at 681,582 ounces dropped 24.8% from April but grew 22.3% from May 2018.

For the year so far, silver sales at 3,935,784 ounces register 2.9% lower than the 4,052,011 ounces sold during the same period last year.

This precious metal-related news item showed up on the coinnews.net website on Thursday sometime — and I plucked it from the Sharps Pixley website.  Another link to it is here.


Ted Butler: Stranger Than Fiction

Yesterday, the Department of Justice and the Commodity Futures Trading Commission announced yet another settlement, both criminal and civil, for “spoofing” and market manipulation in COMEX precious metals, this time against Merrill Lynch, a unit of Bank of America. The infractions occurred hundreds of times starting at least in 2008 and continuing through 2014. While Merrill Lynch and Bank America settled criminal charges via a deferred prosecution agreement and a $25 million fine, separate criminal charges are pending against a number of former individual traders.

Considering that a straight criminal charge and/or conviction could easily have resulted in, effectively, putting Merrill Lynch out of business (many cities, states and government entities are forbidden from doing business with convicted felons), Merrill and BAC got off easy. For the umpteenth time, price manipulation is the most serious market crime possible and Merrill just dodged a bullet that could have been fatal.

Not so lucky, of course, were the many victims of Merrill Lynch’s criminal activities who are unlikely to collect a penny for the long-running gold and silver price manipulation. Apparently, this is what comes of high-level corporate crime in the U.S. – a wrist slap of a fine, a dubious trophy on some prosecutor’s mantle and an avoidance of the real issues.

What makes this all stranger than fiction is that the settlement covers nearly the exact time period that the CFTC (with DOJ involvement according to the late Bart Chilton) was involved in a formal five year investigation into a COMEX silver investigation which ended in 2013 with no findings of wrongdoing. Neither the CFTC nor the Justice Department could find anything wrong with silver (or gold) back then, but now each can recite chapter and verse about all the wrongdoing that took place at that time. What are the odds that the CFTC could have been inundated with more allegations of a silver manipulation than any other complaint in its history and for it to conclude repeatedly those allegations had no substance, only to come back years later saying plenty was wrong? Thanks for nothing.

This commentary from Ted put in an appearance on the silverseek.com Internet site at 8:53 a.m. MDT on Thursday morning — and it’s definitely worth reading.  Another link to it is here.


The PHOTOS and the FUNNIES

Continuing on our back-road trip from Merritt to Princeton on May 5, we came across this valley, complete with a creek — and the right-of-way for the long-defunct Kettle Valley Railway.  You can see it running across the center of the first photo.  The timber bridge over the road in the gap, was taken down years ago, but people still drive that route anyway — and it’s only for the bravest of souls.  The second photo is from the rail-bed itself…looking north.  And while on top, I came across this one tiny violet…smaller than a dime, sticking out amongst the pebbles.  A quick addition of an extension tube made short work of this macro shot.  Depth-of-field…in millimeters — and fractions thereof…is at a premium at these close quarters.  Click to enlarge.


The WRAP

It was really a ‘nothing’ day from a precious metal price standpoint…with the obvious and glaring exception of palladium.  Everything else appeared to on ‘care and maintenance’…so there’s not much to see, or to say.

Here are the 6-month charts for all four precious metals, plus copper and WTIC.  Click to enlarge.

And as I type this paragraph, the London open is less than a minute away — and I see that the the gold price began to head sharply higher staring about an hour after trading began at 6:00 p.m. EDT in New York on Thursday evening.  The price was capped and driven lower by ‘da boyz’ starting shortly before 10 a.m. China Standard Time on their Friday morning.  It was kicked downstairs some more going into the London open — and gold is now up only $2.10 the ounce.  Silver was up about 9 cents by minutes before 10 a.m. CST, but once JPMorgan et al were through with it, it’s now down a penny on the day.  It was about the same for platinum and palladium in the early going, but neither was hit as hard in afternoon trading in the Far East — and the former is up 3 bucks currently — and the latter by 11 as Zurich opens.

Net HFT gold volume is way up there at a bit over 100,000 contracts — and there’s 3,214 contracts worth of roll-over/switch volume on top of that.  Net HFT silver volume is around 14,000 contracts — and roll-over/switch volume is only 445 contracts.  Most of this net volume is in the new front month for silver, which is September.

The dollar index opened unchanged once trading commenced at 7:45 p.m. EDT in New York on Thursday evening, which was 7:45 a.m. CST on their Friday morning.  It dipped to its current low tick…such as it was…at 8:30 a.m. CST — and then crept quietly higher until 1:40 p.m. in Shanghai.  At that juncture it was sold sharply lower at that point, which was the same moment that gold and silver prices were hit in the Far East.  And as of 7:45 a.m. BST in London, the index is down 4 basis points.


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 already bracing myself.

In his mid-week commentary on Wednesday, silver analyst Ted Butler had this to say about it: “As far as what to expect in Friday’s COT report, I’m going to stick with my previous guesses of 50,000 net contracts in gold — and 15,000 net contracts in silver for managed money buying and commercial selling, although higher numbers in gold wouldn’t surprise me. My main concern is what JPMorgan may have done.”

I had a subscriber ask for a copy of the companies that I hold shares in yesterday, so I passed it along.  Then it suddenly occurred to me that I hadn’t posted it in this column for a while, so here it is again.


And as I post today’s column on the website at 4:02 a.m. EDT, I note that the gold price has crept a bit higher during the first hour of London trading — and is up $3.30 an ounce. Silver is now up a penny. Platinum is up 2 dollars, but ‘da boyz’ smoked palladium…from up 11 dollars at the Zurich open…it’s now down 12 bucks as the first hour of Zurich trading ends.

Gross gold volume is around 127,500 contracts — and minus what little roll-over/switch volume there is, net HFT gold volume is a bit over 119,000 contracts. Net HFT silver volume is about 16,300 contracts — and there’s only 684 contracts worth of roll-over/switch volume on top of that.

The dollar index continues to head lower — and as of 8:45 a.m. in London/9:45 a.m. in Zurich, the index is now down 12 basis points.

That’s it for today — and I hope you have a good weekend.  For all my Canadian subscribers, I hope you have a safe and happy ‘Canada Day’ long weekend.

I’ll see you here tomorrow.

Ed

The Precious Metals Show Some Signs of Life

03 April 2019 — Wednesday

YESTERDAY in GOLD, SILVER, PLATINUM and PALLADIUM


The gold price chopped unevenly sideways once trading began at 6:00 p.m. EDT on Monday evening in New York — and the low tick of the day was set a few minute before 1 p.m. China Standard Time on their Tuesday morning.  From there it rallied quietly and nervously for the remainder of the Tuesday session, closing on its high tick of the day…such as it was.

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

Gold finished the day at $1,292.10 spot, up $4.80 on the day.  Net volume was relatively quiet at 187,500 contracts — and roll-over/switch volume was a bit under 10,000 contracts on top of that.  And it should also be mentioned that gold’s low tick in Far East trading yesterday, was a slight new intraday low for this move down.

Silver was down a nickel or so by 1 p.m. CST on their Tuesday afternoon.  It edged back to unchanged by the 2:15 p.m. afternoon gold fix in Shanghai.  It was back below the $15 spot mark by 9 a.m. in London — and then didn’t do much until 1 p.m. GMT/8 a.m. EDT.  It was sold down a dime or so by minutes after 8:30 a.m. in COMEX trading in New York — and that was its low tick of the day.  It rallied a bit until shortly before 10:30 — and then inched unevenly higher until trading ended at 5:00 p.m. EDT.  Like for gold, silver also closed on its high of the day…such as it was.

The low and high ticks in this precious metal, like yesterday, are barely worth looking up…but here they are anyway…$14.905 and $15.09 in the May contract.

Silver finished the Monday session at $15.085 spot, up one whole cent on the day.  Net volume was nothing out of the ordinary at 54,500 contracts — but roll-over/switch volume was pretty heavy at just under 16,500 contracts. A tiny new intraday low in silver was set yesterday as well.

Platinum was up 2 bucks by the 2:15 p.m. afternoon gold fix in Shanghai on their Thursday afternoon and, like silver and gold before it, was sold lower until a few minutes after 10 a.m. in Zurich.  It edged unevenly higher until the equity markets opened in New York yesterday morning — and then was sold back into negative territory by the 1:30 p.m. EDT COMEX close.  From that juncture, it stair-stepped its way higher until trading ended at 5:00 p.m.  Platinum closed at $849 spot on Tuesday, up 1 whole dollar from Monday.

Palladium traded very unevenly sideways in the Far East on their Tuesday — and was down about 6 bucks by 10 a.m. CEST in Zurich.  Its low tick was set an hour and change later — and it crept up a bit in price until the 8:20 a.m. EDT COMEX open.  Then it blasted higher until a short seller of last resort appeared a few minutes later and, like platinum was sold sharply lower until 11:30 a.m. in New York.  From that point it rallied back to above unchanged — and most of the gains that mattered were in by the 1:30 p.m. COMEX close.  From there, it chopped quietly sideways for the remainder of the Tuesday session.  Palladium was closed at $1,411 spot, up 10 dollars on the day.

The dollar index closed very late on Monday afternoon in New York at 97.23 — and opened up 10 basis points once trading began at 7:44 p.m. EDT in New York on Monday evening, which was 7:44 a.m. in Shanghai.  It chopped quietly sideways, with a very slight positive bias, until the 10 a.m. EDT afternoon gold fix in London.  The ensuing tiny rally topped out at the 97.52 mark around 11:50 a.m. in New York — and then chopped unsteadily lower until trading ended at 5:28 p.m. EDT.  The dollar index finished the Tuesday session at 97.36…up 13 basis points from Monday’s close.

It was yet another day where there was no correlation between what was happening in the currency markets — and price moments in the precious metals.

Here’s the DXY chart from BloombergClick to enlarge.

Here’s the 6-month U.S. dollar index chart, courtesy of the folks over at stockcharts.com — and the delta between its close…96.92…and the close on the DXY chart above, was 44 basis points on Tuesday.  Click to enlarge.

The gold shares opened unchanged — and then chopped very unsteadily higher from that juncture, with their respective highs came a few minutes after the 1:30 p.m. COMEX close.  They headed very unevenly lower from there until around 3:35 p.m. in New York trading — and then notched a bit higher into the 4:00 p.m. EDT close from there.  The HUI finished up on the day by 0.64 percent.

The silver equities opened down about half a percent — and then were all over the map after that.  Their respective highs, such as they were, came shortly after 1 p.m. EDT, but they quickly sank back into the red, as Nick Laird’s Intraday Silver Sentiment/Silver 7 Index closed down 0.48 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.

The CME Daily Delivery Report for Day 4 of the April delivery month showed that 131 gold and 20 silver contracts were posted for delivery within the COMEX-approved depositories on Thursday.

In gold, of the six short/issuers in total, the largest was Advantage with 59…followed by JPMorgan and Marex Spectron with 29 and 26 contracts.  All were issued from their respective client accounts.  There were seven long/stoppers in total.  Citigroup stopped 69 for its own account, JPMorgan stopped 21 for its client account — and in third place was HSBC USA, picking up 19 contracts for its own account as well.

In silver, of the four short/issuers, Marex Spectron was the largest with 11 — and ADM and Advantage issued 4 contracts apiece.  Of the three long/stoppers JPMorgan and Morgan Stanley picked up 16 and 3 contracts for their respective client accounts.

Marex Spectron just stopped a bunch of gold and silver contracts during the first three delivery days in April — and here they are reissuing some of that.

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 April fell by 1,120 contracts, leaving 1,334 still around, minus the 131 mentioned a few paragraphs ago.  Monday’s Daily Delivery Report showed that 1,131 gold contracts were actually posted for delivery today, so that means that 1,131-1,120=11 more gold contracts were just added to the April delivery month.  Silver o.i. in April fell by an even 100 contracts, leaving 97 still open, minus the 20 contracts mentioned a few paragraphs ago.  Monday’s Daily Delivery Report showed that 121 silver contracts were actually posted for delivery today, so that means that 121-100=21 more silver contracts just got added to April.


For the second day in a row there was a withdrawal from GLD.  This time an authorized participant took out 151,102 troy ounces.  There was also a small withdrawal from SLV…133,839 troy ounces…and a withdrawal of that size usually represents a fee payment of some kind.

There was another smallish sales report from the U.S. Mint.  They sold 500 troy ounces of gold eagles — 500 one-ounce 24K gold buffaloes — 500 one-ounce platinum eagles — and 276,500 silver eagles.

The only activity in gold over at the COMEX-approved depositories on the U.S. east coast on Monday was 5,002 troy ounces that was shipped out of Canada’s Scotiabank.  Nothing was reported received.  But there was some paper activity, as 89,768 troy ounces was shifted from the Eligible category — and into Registered…47,726 troy ounces at HSBC USA — and the remaining 42,041 troy ounces was at Canada’s Scotiabank.  These transfers are certainly related to the April delivery month.  The link to all this is here.

It was much busier in silver, as 1,197,608 troy ounces…two truckloads…was reported received, but only 101,640 troy ounces were shipped out.  All of the ‘in’ activity was at CNT.  Most of the ‘out’ activity was at Brink’s, Inc…96,716 troy ounces.  The remaining 4,923 troy ounces departed CNT.  There was also 894,009 troy ounces transferred from the Registered category — and back into Eligible.  Of that amount…796,285 troy ounces was transferred at CNT — and the remaining 97,723 troy ounces was transferred at Brink’s, Inc.  Ted would suspect that these transfers, particularly the one at CNT, represents silver that JPMorgan took delivery of in March, but is keeping in other warehouses, because their silver depository is full.  He may or may not broach this subject in his mid-week commentary this afternoon.  The link to all this activity is here.

There was decent activity over at the COMEX-approved gold kilobar depositories in Hong Kong on their Monday.  They reported receiving 2,390 of them — and shipped out 1,372.  All of this occurred at Brink’s, Inc. of course — and the link to that, in troy ounces, is here.


Here are two charts that Nick passed around on Monday.  They show U.S. Mint sales, updated with the March data.  So far this year, sales have been a bit higher in Q1 of 2019 than they were were over the same time period last year…but that’s not saying a whole heck of a lot.  Click to enlarge for both.

Another quiet news day — and I don’t have much for you once again.


CRITICAL READS

Durable Goods Orders Slump in Feb – Weakest Annual Growth in 16 Months

After a modest rebound from October’s collapse, Durable Goods Orders were expected to slide lower once again in February but the drop (down 1.6% MoM) was slightly better than expected (down 1.8% MoM).

Additionally, January’s data was revised lower (from +0.3% to +0.1%).  Click to enlarge.

On a year-over-year basis, durable goods headline data rose at only 1.844% – the weakest since Oct 2017.

Capital Spending proxy (Cap Goods Non-Defense, Ex-Air) slipped 0.1% (worse than expected) for the third time in four months, suggesting corporate investment remains subdued amid a slowing global economy and uncertainty over the trade war with China.

Critically, non-defense aircraft and new parts orders plunged 31.1% MoM – and this is before Boeing’s impact.

This brief 4-chart article from Zero Hedge comes courtesy of Brad Robertson.  It appeared on their Internet site at 8:39 a.m. on Tuesday morning EDT — and another link to it is here.


Recession Signs Everywhere — John Mauldin

This month, the Federal Reserve joined its global peers by turning decisively dovish. Jerome Powell and friends haven’t just stopped tightening. Soon they will begin actively easing by reinvesting the Fed’s maturing mortgage bonds into Treasury securities. It’s not exactly “Quantitative Easing I, II, and III,” but it will have some of the same effects.

Why are they doing this? One theory, which I admit possibly plausible, was that Powell simply caved to Wall Street pressure. The rate hikes and QT were hitting asset prices and liquidity, much to the detriment of bankers and others to whom the Fed pays keen attention. But that doesn’t truly square with his 2018 speeches and actions. The Fed’s March 20 announcement suggests more is happening.

I think two other factors are driving the Fed’s thinking. One is increasing recognition of the same slowing global growth that made other central banks turn dovish in recent months. The other is the Fed’s realization that its previous course risked inverting the yield curve, which was violently turning against its fourth-quarter expectations and possibly toward recession (see chart below, courtesy of WSJ’s “Daily Shot”). That would not have looked good in the history books, hence the backtracking.

On the second point… too late. The yield curve inverted, and recession forecasts became suddenly de rigueur among the same financial punditry that was wildly bullish just weeks ago.

My own position has been consistent: Recession is approaching but not just yet. Yet like the Fed, I am data-dependent and the latest data are not encouraging. Today, we’ll examine this and consider what may have changed.

This loooong commentary from John put in an appearance on the Zero Hedge website at 4:25 p.m. on Tuesday afternoon EDT — and it’s worth your while…if you have the time, that is.  I thank Brad Robertson for sending it our way — and another link to it is here.


A Message From the Future: Thanks a Lot… You Jerks — Bill Bonner

Remember, yesterday and today, we let the shades speak.

We make no predictions. Nor do we connect any dots.

Instead, we merely stand back and marvel at the gall… the conceit… the shameful, egotistical, self-dealing of it. We’re talking about the vanity of the living.

And rather than pass judgement ourselves, we call upon the dead… and the unborn… to do the talking. Yesterday, we heard from the ghosts of the past. Today, the phantoms of the future tell their tale:

Thanks. I’ll get right down to it. Thanks a lot… you jerks.”

You’re supposed to leave your children and grandchildren a richer, safer world. You are doing neither.”

This commentary from Bill was posted on the bonnerandpartners.com Internet site sometime ealry on Tuesday morning EDT — and another link to it is here.


China Sends Over 120 Troops to Venezuela In Defiance of U.S. Warnings

It doesn’t appear last Friday’s strong warning from national security adviser John Bolton for countries “external to the Western Hemisphere” to keep their militaries out of Venezuela had the intended effect. Bolton’s and other White House statements saying “Russia has to get out” came following Russian Air Force planes landing in Caracas with about 100 troops, which the Kremlin said were there as “specialists” servicing existing defense equipment contracts.

And now according to Al-Masdar News, citing defense analyst photographs and local reports, “more than 120 soldiers from the Chinese People’s Liberation Army arrived at Venezuela’s Margarita Island to deliver humanitarian and military supplies to the government forces.”

The military flight appears to have touched down on Sunday, two days after a prior Chinese cargo plane delivered 65 tons of medicine and other aid to Venezuela. The Chinese troops are also there ostensibly to assist with the humanitarian mission, but it appears Beijing is also now alongside the Russians pushing back against Washington ultimatums to stay out of Venezuela, after repeatedly condemning any external coup plotting against President Nicolas Maduro.

We strongly caution actors external to the Western Hemisphere against deploying military assets to Venezuela, or elsewhere in the Hemisphere, with the intent of establishing or expanding military operations,” Bolton had warned in his statement.

Early in the now months-long crisis since Maduro’s reelection, Paul Craig Roberts predicted the following:

“If Russia and China quickly established a military presence in Venezuela to protect their loans and oil investments, Venezuela could be saved, and other countries that would like to be independent would take heart that, although there is no support for self-determination anywhere in the Western World, the former authoritarian countries will support it. Other assertions of independence would arise, and the Empire would collapse.”

And we previously highlighted the not so minor issue of China over the past decade lending over $50 billion to Caracas as part of an oil-for-loan agreements program. It underscores just how quickly what appears a new White House full court press for regime change could bring Washington again into indirect conflict with both China and Russia.

Good luck with their regime change plans now, dear reader.  This Zero Hedge news story showed up on the Zero Hedge website at 12:46 p.m. EDT on Tuesday afternoon — and it’s another contribution from Brad Robertson.  Another link to it is here.


Brexit: PM asks Corbyn to help break deadlock

Theresa May will ask the E.U. for an extension to the Brexit deadline to “break the logjam” in Parliament.

The PM says she wants to meet Labour leader Jeremy Corbyn to agree a plan on the future relationship with the E.U.

But she insisted her withdrawal agreement – which was voted down last week – would remain part of the deal.

Mr Corbyn said he was “very happy” to meet Mrs May, and would ensure plans for a customs union and protection of workers’ rights were on the table.

The cross-party talks offer has angered Tory Brexiteers, with Boris Johnson accusing ministers of “entrusting the final handling of Brexit to Labour“.

The 3-ring Brexit circus continues.  This article appeared on the bbc.com Internet site yesterday afternoon London time — and I thank Swedish reader Patrik Ekdahl for sending it our way.  Another link to it is here.


The Biggest Saudi Oil Field Is Fading Faster Than Anyone Guessed

It was a state secret and the source of a kingdom’s riches. It was so important that U.S. military planners once debated how to seize it by force. For oil traders, it was a source of endless speculation.

Now the market finally knows: Ghawar in Saudi Arabia, the world’s largest conventional oil field, can produce a lot less than almost anyone believed.

When Saudi Aramco on Monday published its first ever profit figures since its nationalization nearly 40 years ago, it also lifted the veil of secrecy around its mega oil fields. The company’s bond prospectus revealed that Ghawar is able to pump a maximum of 3.8 million barrels a day — well below the more than 5 million that had become conventional wisdom in the market.

As Saudi’s largest field, a surprisingly low production capacity figure from Ghawar is the stand-out of the report,” said Virendra Chauhan, head of upstream at consultant Energy Aspects Ltd. in Singapore.

The Energy Information Administration, a U.S. government body that provides statistical information and often is used as a benchmark by the oil market, listed Ghawar’s production capacity at 5.8 million barrels a day in 2017. Aramco, in a presentation in Washington in 2004 when it tried to debunk the “peak oil” supply theories of the late U.S. oil banker Matt Simmons, also said the field was pumping more than 5 million barrels a day, and had been doing so since at least the previous decade.

This interesting article put in an appearance on the Bloomberg website at 4:34 a.m. PDT on Tuesday morning — and was updated about twelve hours later.  I thank Patrik Ekdahl for this story as well — and another link to it is here.


Draft law to bring international gold reserves back to Romania passes in the Senate

Romanian senators adopted a draft law introduced by PSD leader Liviu Dragnea and senator Serban Nicolae to force Romania’s National Bank (BNR) to bring almost all of Romania’s gold back from reserves being held at the Bank of England in London, according to profit.ro.

The supporters of this project say that the BNR should no longer pay the fees to hold the gold abroad, considering that Romania has reached the status of a functional economy.

The project will now be sent to the Chamber of Deputies for debate. The Legislative Council says that such a change of the BNR statute needs endorsement from the Central European Bank.

Of the reserve, the BNR can store gold abroad only with the purpose of obtaining revenue. Gold held by the BNR abroad cannot exceed 5 percent of the total amount of gold reserve,” the project reads. The current estimate is that 65 percent of Romania’s gold is being held abroad.

This gold-related news item showed up on the business-review.eu Internet site at 8:15 a.m. CEST on their Tuesday morning — and I found it on the Sharps Pixley website.  Another link to it is here.


Perth Mint’s gold sales jump 68 percent in March

The Perth Mint said on Monday its gold products sales in March surged about 68 percent from the previous month, touching the highest level since November last year.

Sales of gold coins and minted bars in March rose to 32,757 ounces from 19,524 ounces in February, the mint said in a blog post.

Silver sales last month jumped 60.2 percent from the previous month and touched their highest since October last year at 935,819 ounces.

In March, benchmark spot gold prices posted their second straight monthly decline, falling about 1.6 percent, hurt by a strong dollar.

The Perth Mint refines more than 90 percent of newly mined gold in Australia, the world’s second-largest gold producer behind China.

This tiny Reuters story, posted on their website on April 1, was picked up by the finance.yahoo.com Internet site — and it’s another precious metal-related news item I found on the Sharps Pixley website.  Another link to the hard copy is here.


The PHOTOS and the FUNNIES

Here are the last three photos from our brief stop at Harrison Lake/Hot Springs.  We took a drive around the lake as far as we could get — and I took this first shot along the shore looking about NNW.  Click to enlarge.

These second two shots were taken along the same road beside  the lake.  These are frozen waterfalls…water that seeps out of the rock during the winter months and freezes as it attempts to run to the ground.  And as impressive as these ice waterfalls are, I’ve seen much bigger ones.  The lake is just out of frame across the road on the left.  Click to enlarge for both.


The WRAP

I was happy to see a bit of life in the precious metals yesterday.  And it should be pointed out once again that ‘da boyz’ set new intraday lows in both silver and gold yesterday, but only by tiny amounts.  I also note that WTIC traded above — and closed above its 200-day moving average on Tuesday as well.

Here are the 6-month charts for the four precious metals, plus copper and WTIC — and these changes should be noted…if you’re interested, that is.  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 has been chopping quietly sideways ever since trading began at 6:00 p.m. EDT in New York on Tuesday evening — and is currently sitting an unchanged. The silver price didn’t do much until a few minutes after 8 a.m. China Standard Time on their Wednesday morning. It then crept higher until around noon in Shanghai — and has been edging quietly sideways since — and is 5 cents the ounce. Platinum began to rally at the same time as silver — and its choppy rally has it up 8 bucks currently. Palladium has been chopping quietly sideways in Far East trading…with a slightly positive bias…and as Zurich opens, it’s up 3 dollars.

Net HFT gold volume is a bit under 32,000 contracts — and there’s only 319 contracts worth of roll–over/switch volume on top of that. Net HFT silver volume is about 10,600 contracts — and there’s 865 contracts worth of roll-over/switch volume in that precious metal.

The dollar index opened down 6 basis points when trading began at 7:44 a.m. EDT on Tuesday evening in New York. It began to sink quietly lower almost immediately — and the current low tick was set at 2:04 p.m. CST on their Wednesday afternoon. It has crept a few basis points higher since then — and as of 7:45 a.m. BST in London/8:45 a.m. CEST in Zurich, the dollar index is down 19 basis points.


Yesterday, at the close of COMEX trading, was the cut-off for this Friday’s Commitment of Traders Report — and companion Bank Participation Report.  Even without those tiny new intraday lows in both gold and silver on Tuesday, both reports will show big improvements in the commercial net short positions — and the short positions of the world’s banks.

And as I post today’s column on the website at 4:02 a.m. EDT, I see that gold was sold a bit lower starting just before the London open — and it’s currently down $1.00 the ounce. Silver is up 6 cents. Platinum is now up 9 dollars, but palladium is up by only 2.

Gross gold volume is 44,000 contracts — and minus what little roll-over/switch volume there is, net HFT gold volume is a bit over 43,000 contracts. Net HFT silver volume is a bit over 12,000 contracts — and there’s 1,130 contracts worth of roll-over/switch volume on top of that.

The dollar index has rolled over a bit since before the London open — and as of 8:45 a.m. in London/9:45 a.m. in Zurich, it’s down 28 basis points.

That’s it for yet another day — and I’ll see you here tomorrow.

Ed

Russia Adds 1 Million Ounces of Gold to Its Reserves in August

21 September 2018 — Friday

YESTERDAY in GOLD, SILVER, PLATINUM and PALLADIUM


The gold price really didn’t do much on Thursday, which is certainly amazing considering how badly the dollar index got hammered in the early going.  It traded flat until around 9 a.m. China Standard Time on their Thursday morning — and by 11 a.m. CST, it was up a couple of bucks and change. — and from there traded sideways for a bit, before healing lower starting a few minutes before 1 p.m. CST on their Thursday afternoon.  The low tick of the day came at 9 a.m. in London — and it began to head a bit higher starting right at the noon silver fix.  It ran into ‘opposition’ almost the moment that COMEX trading began in New York — and the rally ended with the high tick of the day being set at the afternoon gold fix, which was right at gold’s 50-day moving average.  It was sold lower from there until 11:45 a.m. EDT.  From there it crawled higher into the 1:30 p.m. EDT COMEX close.  It was sold a bit lower over the next hour, before edging a bit higher into the close.

Despite all the words in the previous paragraph, the low and high ticks aren’t worth looking up for the third day running.

Gold finished the Thursday session in New York at $1,206.90 spot, up $3.20 on the day.  Net volume was nothing special once again at a bit over 223,000 contracts — and roll-over/switch volume amounted to 9,900 contracts on top of that.

The silver price also traded flat until 9 a.m. China Standard Time — and it really wanted to sail from there, but was obviously capped a few minutes after 10 a.m. CST as the price appeared to go ‘no ask’.  At that point, it very briefly broke above its 20-day moving average [in the December contract] by two cents.  It was hauled lower immediately — and then, also like gold, it was sold down hard starting at the London open.  The price pattern from there was similar in most respects to gold’s for the remainder of the New York trading session.

The high and low ticks in this precious metal were reported by the CME Group as $14.385 and $14.21 in the December contract.

Silver was closed at $14.305 spot, up 8 cents from Wednesday.  Not surprisingly, net volume was pretty heavy at 83,300 contracts — and roll-over/switch volume in this precious metal was only 1,579 contracts.  It’s taking a fair amount of paper silver these days to keep it below its 20-day moving average — and this has been going on most of the week.

Platinum was up a few dollars in Far East trading, but was sold down to its low tick of the day starting at 10 a.m. CEST in Zurich trading.  The low tick of the day was set about an hour later — and it chopped unevenly higher from there until about 3:30 p.m. in the thinly-traded after-hours market in New York.  And it should be very obvious from the the saw-tooth price pattern, that its rally was being actively managed.  Platinum was closed on the Thursday at $833 spot, up 11 bucks.

Palladium was up 6 dollars by 10 a.m. in Zurich and, like platinum, it was then sold down a tiny bit to its low tick of the day.  Its quiet rally after that ran into ‘something’ about 10:30 a.m. in New York — and it was sold lower until noon EDT.  It gained some of that back by 1 p.m. — and traded ruler flat from there until trading ended at 5:00 p.m. EDT.  Palladium finished the Thursday session at $1,049 spot, up 16 bucks.

It was yet another trading day where palladium [and platinum] would have close materially higher, if allowed.  The same can be said of silver and gold as well.

The dollar index closed very late on Wednesday afternoon in New York at 94.55 — and then proceeded to trade flat for the first ninety minutes or so after trading recommenced at 6:00 p.m. EDT on Wednesday evening.  It then headed lower — and was down 10 basis points by 11 a.m. China Standard Time on their Thursday morning.  It rallied a very small handful of basis points until a few minutes before 1 p.m. CST — and then began to head lower from there.  That decline accelerated minutes after 12 o’clock noon in London — and it appeared that the usual ‘gentle hands’ showed up just minutes after the COMEX open in New York.  The 93.83 low tick was set at that juncture.  The ensuing ‘rally’ lasted until precisely noon EDT — and it headed lower from there, making it back almost to its low of the day 3:30 p.m.  From that point it inched higher into the close.  The dollar index finished the Thursday session in New York at 93.91…down 64 basis points from Wednesday’s close.

Once again it was more than obvious that JPMorgan et al didn’t allow precious metal prices to reflect that fact.

And here’s the 6-month U.S. dollar index chart.  The dollar index is down about 300 basis points since mid August, but you’d never know it by looking at the gold and silver price charts in The Wrap section of today’s column.

The gold stocks gapped up a percent at the open in New York on Thursday morning, but immediately after that began to head lower.  Their collective lows were set a few minute before noon EDT — and they rallied quietly but unsteadily higher for the remainder of the day, closing down 0.14 percent.  Call it unchanged.

With a minor variation in the first thirty minutes of trading on Thursday morning, the silver equities followed their golden brethren like a shadow — and Nick Laird’s Intraday Silver Sentiment/Silver 7 Index also closed unchanged…up 0.01 percent.  Click to enlarge if necessary.

 

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

The CME Daily Delivery Report showed that zero gold and 28 silver contracts were posted for delivery today within the COMEX-approved depositories on Monday.  In silver, the only short/issuer that mattered was Advantage with 27 from its client account.  The two long/stoppers were JPMorgan and ADM with 18 and 10 contracts for 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 September remained unchanged at 17 contracts.  Wednesday’s Daily Delivery Report showed that zero gold contracts were posted for delivery today.  Silver o.i. in September fell by 297 contracts, leaving 983 still open.  Wednesday’s Daily Delivery Report showed that 707 silver contracts were actually posted for delivery today, so that means that another 707-297=410 silver contracts were added to the September delivery month.


For the third day in a row there were no reported changes in either GLD or SLV.

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

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

It was certainly more interesting in silver.  There was 697,117 troy ounces received — and all of that [much more than a truck load] went into HSBC USA’s warehouse.  There was 534,719 troy ounces shipped out…303,900 from CNT — and the remaining 230,819 troy ounces departed Brink’s, Inc.  But the real eye-opener was the 6,700,703 troy ounces that was transferred from Registered category — and back into Eligible over at CNT.  The link to all this activity is here.

There was some decent activity over at the COMEX-approved gold kilobar depositories in Hong Kong on their Wednesday.  They reported receiving exactly 5,000 of them — and shipped out only 125.  All of this occurred at Brink’s, Inc. — and 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 their August data — and they reported adding 1 million troy ounces/31.1 metric tonnes of gold to their reserve during that monthThat brings their total declared gold holdings up to an even 2,000 metric tonnes/64.3 million troy ounces.

The 800,000 troy ounces that Russia’s central bank purchased in July, plus the million ounces they bought in August, is far in excess of the amount of gold that they actually mined during those two months.

Where might this extra gold be coming from, you ask?  Well, there are only two possible places:  They’re either buying it on the open market, or they have been purchasing far more of their domestic gold production than they’ve been reporting, but are just now moving it into ‘official’ reserves.

With all that money they have laying around after dumping just oodles of U.S. treasuries in recent months, that’s certainly what I’d be doing with it.

Here’s Nick Lairds’ most excellent chart updated with August’s data.  Click to enlarge.

Another day where I don’t have all that many stories for you, but I do have a Cohen/Batchelor interview today.


CRITICAL READS

The Kavanaugh Scandal: Another Deep State Distraction — Bill Bonner

The papers are full of fire and brimstone concerning Supreme Court nominee Brett Kavanaugh… and what happened in a boozy bedroom long ago.

The New York Times calls it “an explosive charge”…

It was 36 years ago. The accusation: There was a party, alcohol. A 17-year-old boy was drunk and started groping a 15-year-old girl, pinning her down and covering her mouth so she couldn’t scream. Today, she doesn’t remember some of the details. He insists it didn’t happen at all.

Poor Christine Blasey Ford – the accuser – decided to do her public duty. Why she thought the Senate should know about Mr. Kavanaugh as a 17-year-old is not clear.

But she set off an uproar… at least, a Washington-style uproar, circa 2018.

We’ve never met Mr. Kavanaugh. Nor have we followed his career or parsed his legal decisions. But we’ve been in a bedroom more than once. And we were once 17 years old.

And if every public servant were disqualified on the basis of what he got up to in high school, Washington would be empty.

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


Investors Beware Of Central Bank Deception! — Dennis Miller

Chuck Butler’s recent Dow Theory Letter article (behind paywall), “Central Bank Frustrations” was an eye-opener. Chuck removes any illusions about “trusting” central bankers. He quotes former Fed Chairman Ben Bernanke:

Given the fundamental factors in place that should support the demand for housing, we believe the effect of the troubles in the subprime sector on the broader housing market will likely be limited.”

Soon after, the housing market crashed due to subprime loans.

Fed Chairman Bernanke called this “collateral damage”.

Chuck supplies facts and lets us arrive at our own conclusions:

So, let’s look at the Fed’s track record, shall we? Did you know that in 105 years, the Fed has never accurately forecast a recession?

This commentary by Dennis appeared on his Internet site on Thursday morning — and another link to it is here.


Tales of the New Cold War: 1 & 2: What Vladimir Putin is not — John Batchelor interviews Stephen F. Cohen

Part 1: This is an important podcast that covers the very recent Syrian event involving the shoot down of the Russian military plane by a Syrian S-200 anti air missile late Monday. And John Batchelor opens the discussion with this news item. While Putin did say the shoot down was the “result of a series of tragic events and chance circumstances”, he also said that the investigations would continue and there would be no retaliatory reaction. But there would be changes made in how the Syrian air defences would respond in future and that these changes “would be noticed”. He also corrected the much stronger accusations of the Syrians and his own military that Israel had caused the tragedy. For Professor Cohen this was a reminder that every day is fraught with danger in this New Cold War and every day the American mainstream media is filled with anti Putin vilification – the NYTimes and Washington Post, for example, recently published eight stories like this in one day.  And this process has now been institutionalized in the MSM. This institution can thus be broken down into 8 different aspects: Putin as the usurper of Yeltsin, Putin as despot, Putin as a Stalinist, Putin as organizer of a kleptocracy, Putin kills people who threaten him (because he is ex-KGB and still a thug), Putin as a fascist, white supremacist, Putin as the foreign aggressor, and Putin as hostile to America. Each of these is given detailed inspection and discussion from the historical perspective by both pundits.

But most of these aspects is soundly defeated by historical facts; most are preposterous (and overwhelmingly dependent for credibility on the naivety and ignorance of the American public. L.) Briefly it was Yeltsin who was the enemy of a fledgling democracy and Putin reclaimed that process when he was legally appointed to his position; Putin was anti-Stalin (built Wall of Grief) and Putin reigned in the oligarchs and did not help the worst of them. (Putin has actually made it illegal for any Russian corporation that would put profits ahead of hurting the Russian people. L.)

Part 2: The list and discussion continues with Putin as a kleptocracy was more a Yeltsin creation, and Putin slowly took back what Yeltsin privatized, enough, as Cohen explains, to save his people. The relationship is still uneasy and Putin is still watchful for abuses, but Russia has grown and recovered and the people hold Putin responsible for that Russian recovery and their salvation. But here Batchelor makes a very fine point that American society is a much more the highly developed kleptocracy than Russia (and the people also know who is responsible for the decline. – L.) Next, Putin was an ex-KGB analyst – which is no more evil than a CIA specialist – and Cohen considers this history as “turning him into a European man”. Cohen considers the accusation that Putin is a fascist and white supremacist is ludicrous. Putin is the successful leader of the most multi-ethnic nations of the world and, as Cohen states, a master race worldview would be impossible politically for a modern Russian leader. However, the view that Putin is anti-American. is at least now true. Is Putin aggressive? His whole pattern of dealing with provocation by the West has been reactive, not aggressive. His main critics accuse him of not being aggressive enough – as, for example, dealing with the latest incident of the loss of his plane in Syria.

********************************

It is sometimes frustrating to listen to a historian of the calibre of Stephen F. Cohen and a learned pundit like John Batchelor spend so little time on a single event like the shoot down of a Russian plane that could have caused a war.  But as an historian’s discussion they are more focused on the series of events leading up to the event than any single isolated news event. But the Syrian situation is very complicated for the Russian leader. Has Putin been damaged politically and geopolitically from his overly generous (perhaps) reasonableness with Israel and even U.S. adversaries?

What are his options given the podcast discussion? Putin has stated that there will be an appropriate response that will be quite noticeable in the air defence area in Syria. At a guess this means bolstering the quality of Syrian air defences – perhaps with the addition of S-300 anti-air systems that would provide the means to 1) avoid a similar event, 2) provide deniability for the Russian Israeli “lobby”(a.k.a. – fifth column group) to claim Putin’s actions are anti-Israeli, and 3) provide a more “aggressive” reaction for his own war party adherents who accuse him of being too non aggressive. He has additional problems, as every time Israel, or the U.S., or other U.S. satrap allies open fire on Syrians and Russians– how much provocation can he ignore when his own ally is attacked? Is the agreement with Turkey to delay (?) the attack on Idlib also a ploy to avoid a direct military confrontation with the U.S. that might lead to war? Does his lack of aggression suggest weakness to Washington thereby encouraging an escalation of provocations? Or does it mean he should stall as much as he can to hope for a change in diplomacy with Washington? These are serious questions that surely must plague the Russian leader, and the background history is certainly vital for understanding the scope and complexity of Syria. I urge readers to also listen to the podcast as much of the events of the U.S. MSM institution confusions are discussed in much greater detail.

This 2-part audio interview showed up on the audioboom.com Internet site on Tuesday — and I thank Larry Galearis for his always excellent executive summary, plus his own read on the situation at the end.  Each part is twenty minutes long.  The link to Part 1 is in the headline — and here.  And the link to Part 2 is here.  If I remember, this will be posted in Saturday’s column as well, if you don’t have time for it just now.


Putin’s Hesitation Has Lost Syria’s Idlib Province — Paul Craig Roberts

The provocations that Putin invites are now escalating. Peter Ford, former British ambassador to Syria, points out that Washington has quickly taken advantage of Putin’s hesitancy in Syria to escalate the pretexts on which Washington will launch a military attack on the Syrian forces. Formerly Washington’s pretext was to be a false flag “chemical attack” that would be blamed on Syria. Washington’s new pretext precludes the liberation of Idlib as Washington has declared that any attempted liberation of the province from Washington’s terrorist allies will result in a U.S. military attack on Syria. Indeed, even a refugee flow whether or not caused by a Syrian attack is deemed to be a “humanitarian issue” that justifies a U.S. military attack on Syria. President Trump’s Special Envoy for Syria, James Jeffrey, just announced that the United States will not tolerate an attack, period.

Clearly, the Syrian/Russian liberation of Idlib from Washington’s terrorists cannot now happen, unless Putin is willing to establish such air superiority over Syria, backed up by Russian weapons, that the U.S. would be incapable of launching an attack. Washington’s escalation of its provocations means that Putin would have to accept the risk of destroying any US attack forces that were sufficiently reckless to test the defenses.

Another puzzle is Putin’s decision to pacify Erdogan by substituting a demilitarized zone in Idlib instead of liberating the province. How did Putin and Erdogan reach the fantasy conclusion that the US and its terrorist allies in Idlib province would cooperate with their demilitarization plan? Has Russian foreign policy dissolved into self-delusion?

We are watching unfold my concern that the acceptance of provocations results in more provocations and that the provocations escalate in their danger. What will Putin do now? If he backs down again, he can expect a yet more dangerous provocation until the only choice becomes surrender or nuclear war.

This brief, but very worthwhile commentary by Paul was posted on his website on Thursday sometime — and it’s courtesy of Larry Galearis as well.  Another link to it is here.


U.S. Accelerates Talks With North Korea After Kim-Moon Summit

U.S. Secretary of State Michael Pompeo called Wednesday for a new round of talks with North Korea with the goal of ridding the North of nuclear weapons by the end of Donald Trump’s first term, saying he was heartened by progress made at a summit this week between the two Koreas.

In a statement, Pompeo said the U.S. welcomed Kim Jong Un’s promise to dismantle a missile test site — under the eye of international inspectors — and move to shutter North Korea’s main Yongbyon nuclear production site if the U.S. takes what the North calls “corresponding measures.”

Pompeo signaled that reciprocation may be coming.

On the basis of these important commitments, the United States is prepared to engage immediately in negotiations to transform U.S.-DPRK relations,” Pompeo said, referring to North Korea by its formal name, the Democratic People’s Republic of Korea.

Pompeo invited North Korean Foreign Minister Ri Yong Ho to meet him in New York next week on the sidelines of the United Nations General Assembly and for North Korean officials to meet his envoy for the issue, Stephen Biegun, starting a process toward denuclearization by 2021 and a “lasting and stable peace regime on the Korean Peninsula.”

That’s language that both sides have used to describe a treaty to end the Korean War, which was never formally declared over. North Korea has sought such an accord, but the U.S. has been reluctant to do so for fear it would add to pressure to remove the thousands of American troops

Of course, dear reader, that would be the ultimate goal at the end of this peace/reunification process.  This Bloomberg story, was posted on their Internet site at 9:07 p.m. Denver time on Wednesday evening, but was updated 24 hours later, complete with a new headline.  The old one read “North Korea agrees to dismantle a key missile test site under the watch of international inspectors“.  Another link to it is here.


Global growth may have peaked, OECD says

In its latest interim outlook released Thursday, the OECD has projected global growth to settle at 3.7 percent in both 2018 and 2019. That level sits just below levels recorded prior to the financial crisis ten years ago.

The recently appointed chief economist of the OECD, Laurence Boone, told CNBC‘s Charlotte Reed on Thursday that the world economy on the whole was “hitting a plateau” and there was evidence of increased divergence between different economies.

Boone highlighted rising protectionism, emerging market vulnerability, politics, and finance as four main risks behind the tapering off in growth rates.

The OECD report has called for a gradual normalization of monetary policy but said it should be at a varying degree across different economies.

Speaking to CNBC, Boone said the normalization of policy in the United States was pushing the dollar upwards and creating a drag on emerging market economies.

These guys are a bit behind the times, as global growth peaked years ago.  This article showed up on the cnbc.com Internet site very early on Thursday morning EDT — and I thank Swedish reader Patrik Ekdahl for pointing it out.  Another link to it is here.


Central bank demand for gold reaches 3-year high

Central banks’ demand for gold reached a three year high, rising 8% during the first half of 2018 compared to the same period last year, according to a World Gold Council market update on central bank buying activity released today.

Data reveals that 2018 H1 marks the strongest year for central bank gold buying since 2015 ­– a total of 193.3 tonnes of gold have been added to central bank reserves so far, compared to 178.6 tonnes during the same period in 2017.

Emerging market central banks have played a key role, with Russia, Turkey and Kazakhstan accounting for 86% of central bank purchases in the first half of 2018.

An IMF Financial Statistics Report reveals that Egypt recently bought gold for the first time since 1978, and that India, Indonesia, Thailand and the Philippines have re-entered the gold market after years-long absences.  And Bloomberg reported that the Bank of Mongolia has purchased 12.2 tonnes of gold so far this year.

The World Gold Council believes that many emerging market central banks are turning their attention to gold as after years of exposure to the U.S. dollar, and as a natural currency hedge against other reserve currencies.

This gold-related news item is worth a few minutes of year time.  It put in an appearance on the mining.com Internet site early on Thursday afternoon EDT — and my thanks go out to Mark Barooshian for sending it our way.  Another link to it is here.


The Real Story:  Bear Stearns and JPMorgan — Ted Butler

There is compelling new proof of a silver (and gold) price manipulation. The evidence connects the investment bank JP Morgan Chase, the dominant force in world commodity trading, the U.S. Commodity Futures Trading Commission (CFTC), the primary commodity regulator, and the U.S. Treasury Department, the arranger of every conceivable bailout.

This week, I received a copy of a letter, dated October 8, sent from the CFTC to a California Congressman, Gary G. Miller. It discussed allegations of a silver market manipulation because of the data in the monthly Bank Participation Report. The data in that report for August showed that one or two U.S. banks held a massive short position in COMEX silver futures of 33,805 contracts, or more than 169 million ounces. This is equal to 25% of annual world mine production, and was up more than five-fold from the prior month’s report. After this position was established, silver prices fell more than 50%, in spite of a widespread shortage in retail forms of investment silver. Never before had there been a such a large concentrated position in any market, including every manipulation case in the CFTC’s history. Concentration and manipulation go hand in hand. You can’t have one without the other.

The letter was sent to me by a reader who had the foresight to write to his Congressman. Of course, the CFTC denied that a silver manipulation existed, as they always have. This proves that the Commission responds much quicker to a member of Congress than it does to hundreds of ordinary citizens and investors. In the future, should you decide to write to the CFTC, be sure to do so through your elected representatives.

What was remarkable (and disturbing) about the letter was that it strongly confirms an analysis I presented in an article dated September 2, titled, “Fact Versus Speculation”. In that article, I speculated that the shocking increase in the silver short position by one or two U.S. banks was related to the takeover of Bear Stearns by JP Morgan in March.

This must read commentary by Ted was posted on the investmentrarities.com Internet site back on 10 November 2008.  Several or my subscribers have asked how Ted knows that JPMorgan took over the silver short position of Bear Stearns way back then.  The answer lies in this commentary, plus in the embedded and hyperlinked article mention just above. Another link to this very worthwhile commentary is here.


The PHOTOS and the FUNNIES

Today’s critter is “Glaucus atlanticus“…a species of sea slug, a pelagic aeolid nudibranch, a shell-less gastropod mollusk in the family Glaucidae.  They float upside down by using the surface tension of the water to stay up, where they are carried along by the winds and ocean currents.  Humans handling the slug may receive a very painful and potentially dangerous sting.  Click to enlarge.


The WRAP

It was another day where JPMorgan was at battle stations keeping gold below its 50-day moving average — and silver below its 20-day.  They were successful, but they left no room for error — and in morning trading in the Far East on their Friday, silver punched above its 20-day moving average by a few more pennies, before being hauled lower.  How long they’re prepared to keep this up remains to be seen, but the walls, ceiling and floor are closing in from all directions.

Here are the 6-month charts for all four precious metals and, once again, I provide the 6-month silver chart showing its 20 and 50-day moving averages, so you can see how fine a line that JPMorgan is actually walking.  Platinum is heading towards overbought territory, but palladium is already hugely overbought — and would actually be even more overbought than that if the powers-that-be weren’t holding it back.  The ‘click to enlarge‘ feature helps with the first four only.

And as I type this paragraph, the London open is less than ten minutes away — and I see that the gold price traded mostly sideways during the first two hours after it began at 6:00 p.m. EDT on Thursday evening in New York.  It spiked up to its 50-day moving average briefly around 10:20 a.m. CST on their Friday morning, but was sold down from there — and has been chopping quietly sideways since.  At the moment, gold is up $1.90 an ounce.  Silver crawled unsteadily higher — and was up a dime by shortly before 2 p.m. CST on their Friday afternoon — and obviously above its 20-day moving average.  It has been sold lower since — and is up only 4 cents currently.  Platinum and palladium didn’t do much in Far East trading.  The former is up a dollar — and the latter is down 2 bucks as Zurich opens.

Gross gold volume is coming up on 43,500 contracts — and net of what little roll-over/switch volume there is, net HFT gold volume is 41,000 contracts.  Net HFT silver volume is about 16,800 contracts — and there’s only 391 contracts worth of roll-over/switch volume in that precious metal.

The dollar index traded virtually ruler flat until precisely 2:00 p.m. CST — and began to edge a bit higher at that juncture — and twenty minutes before the London open, it’s now up 5 basis points.

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.  As I mentioned in this space yesterday, the above charts for both silver and gold indicates that any changes will be immaterial, although there will certainly be short covering/long buying by the brain-dead/moving average-following Managed Money traders in both platinum and palladium…especially the latter.

I’m off to bed, as I have an early-morning meeting today — and I want to be fully awake for it, so I’m signing off an hour earlier than normal.

Have a good weekend — and I’ll see you here tomorrow.

Ed

JPMorgan’s Last Swing For the Fences?

30 June 2018 — Saturday

YESTERDAY in GOLD, SILVER, PLATINUM and PALLADIUM


The gold price dipped briefly into negative territory in early Far East trading on their Friday morning — and the swan dive in the U.S. dollar index at 10:30 a.m. China Standard Time wasn’t allowed to manifest itself in the price, as ‘da boyz’ were standing by with whatever paper gold was necessary to cap the price.  The gold price was turned lower at the 2:15 p.m. CST afternoon gold fix in Shanghai — and it really didn’t do much from there until at, or just before, the afternoon gold fix in London.  The tiny rally that developed at that point was capped and sold lower starting at 1 p.m. EDT — and the sell-off continued into after-hours trading as well.

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

Gold finished the Friday session in New York at 1,252.40 spot, up $4.40 from Thursday’s close.  Net volume was pretty respectable for a Friday in summer, at 209,000 contracts — and roll-over/switch volume was a bit under 15,600 contracts.

The price path for silver was similar, except more ‘volatile’.  It was turned lower at the afternoon gold fix in Shanghai as well — and the low tick, like for gold, came about 9:40 a.m. EDT in New York.  It rallied from there, but ran into ‘resistance’ right away — and also like gold, was sold lower starting just before the COMEX close.

The low and high ticks in this precious metal were reported by the CME Group as $15.91 and $16.12 in the July contract.  In the new front month, September, the low was reported as $16.00 — and the high as $16.22.

Silver was closed on Friday afternoon in New York at $16.09 spot, up 11.5 cents from Thursday.  Net volume was very healthy at 62,300 contracts — and there was a bit over 5,800 contracts worth of roll-over/switch volume in this precious metal.

Like silver and gold, platinum was sold lower until the dollar index did its mid-morning face plant in the Far East on their Friday — and after that, it was forced to trade very much like the silver price.  Platinum finished the Friday session at $852 spot, up 4 dollars on the day.

With some minor variations, palladium traded in a similar manner to platinum for most of the Friday trading session.  That changed at 1 p.m. in New York, as it received the same treatment as gold as silver at that point.  Palladium was closed at $948 spot, up 10 bucks from Thursday.

The dollar index closed very late on Thursday afternoon in New York at 95.29 — and traded mostly sideways until 10:30 a.m. China Standard Time on their Friday morning.  A trap door got opened under the dollar index at that juncture — and that was the start of long stair-step decline that lasted right until the end of trading in New York on Friday afternoon. The 94.48 low tick was set around 4:30 p.m. EDT.  The dollar index shows that it finished the day at 94.52…down 77 basis points from Thursday…but the ino.com DXY chart below doesn’t show the last forty-five minutes of trading data, so this close may not be entirely accurate.

Here’s the 3-day dollar index, so you can see the entire 24-hour move starting at 6:00 p.m. on Thursday evening in New York…including the 10:30 a.m. CST/10:30 p.m. EDT face plant.

And here’s the 6-month U.S. dollar index — and one has to wonder how long this dollar index ‘rally’ will last?

The gold stocks began to rally the moment that trading began at 9:30 p.m. EDT in New York on Friday morning.  Their respective highs came shortly after 1 p.m. — and shortly before the silver price was turned lower in COMEX trading.  The shares crawled quietly lower from there into the close, as the HUI finished up 2.25 percent.

The silver equities followed an almost identical price path as their golden brethren, but Nick Laird’s Intraday Silver Sentiment/Silver 7 Index closed higher by only 1.52 percent.  Click to enlarge if necessary.

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

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 it’s mostly red across the board. But the declines in stock prices weren’t much when compared to the declines in the underlying precious metals themselves — and I certainly take heart from that.  Click to enlarge.

The month-to-date chart is a complete sea of red, even the loses over the last month didn’t amount to much considering how badly the underlying metals got hammered by JPMorgan et al.  Gold was down about 44 bucks for the month — and silver well over a dollar from its high tick. It could have been far worse.  Click to enlarge.

The year-to-date graph still isn’t very happy looking, as ‘da boyz’ now have all four precious metals down on the year.  But, as has been the case right from the start of 2018, the silver equities are still outperforming the gold stocks by a goodly margin — and that’s despite the fact that both gold and silver are down about the same percentage in price year to date.    Click to enlarge as well.

Just like I said in this space last week, where we go from here from a price perspective in both the equities — and their underlying precious metals, is still very much in the hands of JPMorgan et al…but mostly just JPMorgan.  However, with the COMEX futures market structure in all four precious metals as wildly bullish as we’re ever likely to see them, the path of least resistance is higher prices — and that will occur whenever JPMorgan decides, or is told to step aside.  The only thing not known is if ‘da boyz’ will appear as shorts sellers of either first and last resort once again.  I think not, but that’s just my opinion.


The CME Daily Delivery Report for Day 2 of July deliveries showed that 14 gold and 1,583 silver contracts were posted for delivery within the COMEX-approved depositories on Tuesday.  In gold, ADM and Advantage issued 8 and 6 contracts out of their respective client accounts — and HSBC USA stopped 7 contracts for its own account, plus Merrill and Advantage picked up 4 and 3 contracts for their respective client accounts. In silver, Of the nine short/issuers in total, the two largest by far were Scotia Capital USA[?] with 827 contracts out of its in-house/proprietary trading account — and Merrill with 432 contracts out of its client account.  In distant 3rd and 4th spots were HSBC USA and ABN Amro, with 99 and 96 contracts out of their respective client accounts.  There were twelve long/stoppers in total — and the three largest were the same as they were on Day 1…Goldman Sachs with 829 contracts for its own account…Australia’s Macquarie Futures with 173 contracts for its house account as well — and JPMorgan with 124 contracts for its client account.  And in distant third and fourth place were HSBC USA and ABN Amro, with 99 and 94 contracts for their respective client accounts.  The link to yesterday’s Issuers and Stoppers Report is here.

The question I have is:  Who the heck is Scotia Capital USA?  I would suspect that they’re a spin-off — and completely separate legal entity from Canada’s Bank of Nova Scotia/Scotiabank.  I’ll wait for Ted’s thoughts on this, if he has any.

The CME Preliminary Report for the Friday trading session showed that gold open interest in July declined by 19 contracts, leaving 199 still open, minus the 14 contracts mentioned two paragraphs ago.  Thursday’s Daily Delivery Report showed that 15 gold contracts were actually posted for delivery on Monday, so that means that 19-15=4 gold contracts disappeared from the July delivery month.  Silver o.i. in July fell by 1,831 contracts, leaving 3,358 still around, minus the 1,583 mentioned above.  Thursday’s Daily Delivery Report showed that 1,888 contracts were actually posted for delivery on Monday, so that means that 1,888-1,831=57 more silver contracts just got added to July.


There was another smallish withdrawal from GLD yesterday, as an authorized participant took out 47,362 troy ounces.  But over at SLV there was a huge deposit.  This time an a.p…most likely with the initials JPM…added 2,070,185 troy ounces.  I would suspect that Ted will have something to say about the goings-on in both these ETFs in his weekly review later today.

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

For the month of June, the mint sold 19,500 troy ounces of gold eagles — 6,000 one-ounce 24K gold buffaloes — and 435,000 silver eagles.

There was very little activity in gold over at the COMEX-approved depositories on the U.S. east coast on Thursday.  Nothing was reported received — and only 402 troy ounces were withdrawn.  That activity was at Canada’s Scotiabank, which I won’t bother linking.

It was quite a bit busier in silver, as 1,139,598 troy ounces were received — and 596,678 troy ounces were shipped out.  In the ‘in’ category, there was one truck load…599,981 troy ounces…dropped off at CNT — and 452,456 troy ounces were left at Scotiabank.  The remaining 87,160 troy ounces found a home over at Brink’s, Inc.  All of the silver in the ‘out’ category was shipped out of HSBC USA.  In addition to all this physical movement, there was an eye-watering 3,546,332 troy ounces transferred from the Eligible category and into Registered.  The lion’s share of that amount…3,422,734 troy ounces was switched over at CNT — and the remaining 123,505 troy ounces, at Brink’s, Inc.  All of this would be in preparation for July delivery I would think.  The link to all this action is here.

There was decent activity over at the COMEX-approved gold kilobar depositories in Hong Kong on their Thursday.  They only received 200 of them, but shipped out 2,189.  All of this activity was at Brink’s, Inc. of course — and the link to that, in troy ounces, is here.


The Commitment of Traders Report, for positions held at the close of COMEX trading on Tuesday, was way better than even my wildest hopes, as there was the expected improvement in gold…and it wasn’t exactly small — and there was also a huge improvement in silver, which I wasn’t expecting at all.

In silver, the Commercial net short position fell by a very chunky 9,510 contacts, or 47.5 million troy ounces of paper silver.  The decrease wasn’t a total surprise, but the size of it certainly was.

They arrived at that number by adding 1,598 long contracts, plus they reduced their short position by 7,912 contracts as well — and it’s the sum of those two numbers that represents the change for the reporting week.

Ted said that the ‘Big 4’ traders only appeared to have covered about 400 short contracts, but that’s certainly because there’s a big Managed Money trader in this category now.  The ‘5 through 8′ large traders reduced their extreme and record short position by around 1,100 contracts during the reporting week — and Ted’ raptors, the 30-odd small Commercial traders other than the Big 8, added approximately 8,000 new long contracts.

Under the hood in the Disaggregated COT Report, the Managed Money traders made up a bit over half of the weekly change, as they reduced their long position by only 885 contracts, but some of those traders piled in on the short side to the tune of 4,790 contracts — and it’s the sum of those two numbers…5,675 contracts…that represents their change for the reporting week.  The difference between that number — and the Commercial net short position…9,510 minus 5,675 equals 3,835 contracts– and that was made up by the traders in other two categories, as the ‘Other Reportables’ increased their short position by about 1,000 contracts — and the ‘Nonreportable’/small traders increased their short position by around 2,800 contracts.

The Commercial net short position in silver now stands at 245.1 million troy ounces, down a very decent amount from last week’s report.  Ted says that the big Managed Money trader that now inhabits the Big 4 category, masked the fact that JPMorgan most likely covered around 3,000 more contracts of their short position during the reporting week — and that puts their short position at about 30,000 contracts, or 150 million troy ounces of paper silver.  As of this COT Report, JPMorgan owns about 60 percent of the entire Commercial net short position in silver.

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

Well, with the Managed Money traders selling only 885 long contracts during the reporting week, it certainly appears that the Managed Money traders hanging onto their long positions aren’t going to be selling them…because they would have done so already if they were going to.  And if that’s the case, the bottom is in for the silver price as of Thursday close.  JPMorgan really was picking up nickels on Wednesday and Thursday, because that’s all that was available.

I certainly look forward to what Ted has to say about all this, as he’s the real authority on it.


In gold, the commercial net short position fell by 19,161 contracts, or 1.92 million troy ounces of paper gold.  I was expecting a reduction, but nothing this size.

They arrived at that figure by adding 10,126 long contracts, plus they reduced their short position by 9,035 contracts as well — and it’s the sum of those two numbers that represents the change for the reporting week.

Ted said that the Big 4 traders covered approximately 2,800 short contracts — and the Big ‘5 through 8’ traders covered about 3,800 short contracts as well. Ted’s raptors, the 42-odd small commercial traders other than the Big 8, added 12,600 long contracts.  So, like in silver, it was Ted’s “all for one — and one for all” scenario, as they all got the memo.

Under the hood in the Disaggregated COT Report it was, also like in silver, only partly due to Managed Money traders, as the increased their long position by 548 contracts, but also added to their short position to the tune of 11,100 contracts — and it’s the difference between those two…10,552 contracts…that represents their change for the reporting week, a bit over half of what the commercial traders bought back.  The difference, as it always is, was made up by the traders in the other two categories, but they went about it in very different fashions, as the ‘Other Reportables’ decreased their long position by about 9,200 contracts — and the ‘Nonreportable’/small trader actually increased their long position by around 700 contracts.  Here’s a snip from the Disaggregated Report so you can see these changes in all three categories for yourself.  Click to enlarge.

The commercial net short position in gold is now down to 9.50 million troy ounces.  And I would suspect, that like in silver, the Managed Money traders are done selling longs — and going short in gold as well.

Here’s the 3-year COT chart for gold.  It was bullish last week at this time — and even more extreme this week.  Click to enlarge.

Since the Tuesday cut-off, there have been two more days of careful salami slicing by JPMorgan et al…but mostly just JPMorgan — and it goes without saying that if we could see a COT Report as of the close of COMEX trading on Thursday, we’d see an even more wildly bullish set-up than we have now.  And that’s just silver and gold I’m talking about.

The COT Report for platinum showed that the Managed Money traders went even further onto the short side during the reporting week, to another new record.  I didn’t think that was possible.  There was a big improvement in palladium as well.  And then there’s copper.  The Managed Money traders really outdid themselves, as they sold 21,308 longs, plus they added 8,757 short positions.  Of course things have gotten even more extreme in these three metals in the two trading days since the Tuesday cut-off.

Unless JPMorgan is prepared to show up as short seller of last resort on the next rallies…whenever they’re allowed to commence…this certainly looks like their last swing for the fences to me.   But if they do decide to step in at some point during the next rally, then they’ve gone to a lot of effort over the last two weeks for no reason at all.

So we wait some more.


Here’s Nick Laird’s “Days to Cover” chart updated with yesterday’s COT data for positions held at the close of COMEX trading on 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.  These are the same Big 4 and ‘5 through 8’ traders discussed in the COT Report above.  Click to enlarge.

For the current reporting week, the Big 4 traders are short 144 days of world silver production—and the ‘5 through 8’ large traders are short an additional 87 days of world silver production—for a total of 231 days, which is a bit under 8 months of world silver production, or about 539.1 million troy ounces of paper silver held short by the Big 8.  [In the COT Report last week, the Big 8 were also short 234 days of world silver production.]

In the COT Report above, the Commercial net short position in silver was reported as 245.1 million troy ounces.  As mentioned in the previous paragraph, the short position of the Big 8 traders is 539.1 million troy ounces.  The short position of the Big 8 traders is larger than the total Commercial net short position by a chunky 539.1 minus 245.1 equals 294.0 million troy ounces.  The reason for the difference in those numbers…as it always is…is that Ted’s raptors, the 30-odd small commercial traders other than the Big 8, are long that amount.  And if you think that’s preposterous, you would be right about that.

As stated earlier, Ted estimates JPMorgan’s short position at 30,000 contracts, down 3,000 contracts from last week’s report, or 150 million troy ounces of paper silver.  That translates into about 64 days of world silver production.  That number represents about 27 percent of the short position of the Big 8 traders — and about 44 percent of the short position held by the Big 4 traders.  This is simply grotesque.

The Big 4 traders are short 144 days of world silver production — and once you subtract out the 64 days that JPM is short, that leaves 80 days split up between the other three large traders…a bit under 27 days each.  And since those contracts are obviously not split up evenly between them, it’s a certainty that one of these traders has a short position something under 27 days — and the other, more than 27 days.  But whatever those three number are, they can’t add up to more than 80 days.  But it all fairness, it should be pointed out that there’s a Managed Money trader now in the Big 4 category — and this certainly distorts the numbers.  I would think they would be a few days lower than 27 if the Managed Money trader wasn’t there.

The four traders in the ‘5 through 8’ category are short 87 days of world silver production in total — and off their record high short position of last week by two whole days.  They’re short a bit under 22 days of world silver production each, which is down a hair from what each was short in last week’s COT Report.  Back in mid May, these same ‘5 through 8’ small traders were short a bit under 12 days of world silver production each.  Now they’re up to a bit under 22 days short each, which is an increase of more than 80 percent during the last six weeks.

The smallest of the traders in this category holds something less than 22 days — and the largest, something more than that amount.  So it’s a mathematical certainty that the smallest of the Big 4 traders holds a short position of over 22 days, but under 27 days  — and the second smallest of the Big 4…something around the 27 day mark [the average of the remaining ‘Big 3’ traders] of world silver production held short.  That means [another mathematical certainty] that the second largest short in the Big 4 category [Scotiabank?] only has a short position slightly larger than the average of 27 days.  JPMorgan remains, as always, the King Short, with a short position that is a bit more than twice the size of the other three traders in the Big 4 category — and just under three times the size of the traders in the ‘5 through 8’ category.  These are fairly substantial declines from the prior reporting week — and it’s more proof that JPMorgan is covering their short position in silver as fast they can.

By the way, there is very little wiggle room in these numbers — and are 95+ percent accurate.

It certainly appears that the trap is being set for the other commercial traders in gold.  Ted has been talking about this for a few weeks now — and you’ll read more about it in the quote in The Wrap section.  But it now appears, that with another COT Report under our belts, the Big 7 Commercial traders in silver appear destined to suffer the same fate at the hands of the ‘Big 1’ Commercial trader, as a silver trap looks ready to be sprung by JPMorgan as well.

The Big 8 commercial traders are short 49.3 percent of the entire open interest in silver in the COMEX futures market, which is down a hair from the 50.0 percent that they were short in last week’s COT Report.  And once whatever market-neutral spread trades are subtracted out, that percentage would be something approaching 55 percent.  In gold, it’s now 37.6 percent of the total COMEX open interest that the Big 8 are short, down a bit from the 39.0 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 41 days of world gold production, which is down 1 day from what they were short last week — and the ‘5 through 8’ are short another 20 days of world production, which is also down 1 day from what they were short the prior week, for a total of 61 days of world gold production held short by the Big 8 — which is down 2 days from what they were short in last week’s report.  Based on these numbers, the Big 4 in gold hold about 67 percent of the total short position held by the Big 8…which is 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, 64 and 75 percent respectively of the short positions held by the Big 8.  Silver is unchanged from the previous week’s COT Report, platinum is down 1 percentage point from a week ago — and palladium is down a hefty 5 percentage points from last week’s report.


Saxony, Frederick Christian, Conventionsthaler 1763

Mint: Dresden     Metal: Silver     Full weight: 27.97 grams

There’s just no news out there that’s worth posting so, once again, I have an embarrassingly small number of stories for you for a Saturday.


CRITICAL READS

Doug Noland: A Decisive Quarter

Booming markets ensure imaginations run wild. Importantly, reality began to gain the upper hand during the quarter. The global Bubble faltered. The world is not robust – there are, indeed, fragilities everywhere. EM is a potential disaster. China is increasingly vulnerable. China and Asian debt has become a huge global risk. I worry about Brazil.

And this age of populism and the “strongman” politician actually does matter to the markets. Trump Tariffs. China ready to “punch back.” Erdogan to dictate Turkish rate policy? The new Italian government to play hardball with the EU. Immigration becoming a pressing political issue from Washington to Frankfurt. A new leftist President in neighboring Mexico. Well, booming markets were content to disregard the global rise of populism, divisiveness and autocracy. Faltering markets will now amplify these troubling trends. All the makings for savage bear markets.

It was A Decisive Quarter: The world became more divided; the “Atlantic Alliance” became more divided; Europe became more divided; Asia became more divided; and the United States turned only more divided. U.S. stock performance during the quarter should not distract from the ominous storm clouds forming globally – in the markets, economically, socially and geopolitically. Global markets were also more divided, though I would expect Contagion from the Periphery to now make more discernable headway toward the Core.

Doug’s Credit Bubble Bulletin was posted on his website in the wee hours of Saturday morning EDT — and is always a must read for me.  Another link to it is here.


E.U.’s sanctions against Crimea extended for another year

The European Union is committing to its policy of perceiving revolutionary determination as its course of legitimacy. Apparently, a referendum gaining nearly 100% popular support isn’t sufficient to qualify for the self determination of a region. Therefore, the E.U. will continue to consider the Crimea as politically a part of the Ukraine. This, of course, means that the E.U. has reason for its sanctions regime against Crimea, which it will be extending for yet another year.

Deutsche Welle reports:

The European Union extended economic sanctions on Crimea and its port city of Sevastopol on Monday. The 28-member bloc imposed the measures after Russia annexed the Black Sea peninsula four years ago.

The E.U. said it remains “firmly committed to Ukraine’s sovereignty and territorial integrity,” reiterating that “it does not recognize and continues to condemn this violation of international law.”

The measures — which will now stay in place until June 23, 2019 — ban the import of products originating in Crimea. They also prevent E.U. nationals or companies based in the bloc from investing or buying real estate in Crimea and Sevastopol, and ban E.U. cruise ships from docking there, except in an emergency.

The move comes three weeks after French lawmakers voted in favor of a resolution to lift parallel sanctions targeting Russia — currently set to expire at the end of next month — over its role in an ongoing conflict in eastern Ukraine. “(The sanctions are) totally ineffective today to solve this international crisis and are dangerous for France’s interests,” said conservative MP Thierry Mariani, who put forward the resolution.

The bulls hit continues on this issue.  I expected the Italians to vote against this — and I wasn’t amused to see them follow the status quo.  This news item appeared on theduran.com Internet site at 6:37 p.m. EDT on Thursday evening — and I thank Larry Galearis for pointing it out — and another link to it is here.


Tales of the New Cold War: Summiteering Eve — John Batchelor interviews Stephen F. Cohen

Part 1:  John Batchelor opens the discussion with a short history of the successes and failures of post war summits between the U.S. and the Soviet Union; what stands out is the multiple times presidents met with Soviet leaders to work out the problems. Most presidents from Eisenhower on had at least one summit, and Cohen concurs and proceeds to address a detailed history of the most important of these meetings to ensure that younger listeners have a good understanding of the importance of them. Cohen points out that wartime summits between the leaders were about that war as allies fighting Germany, but post war they became about avoiding war with each other. This discussion is about the coming summit between Trump and Putin that hopefully will happen sometime in July. And Professor Cohen was at the last summit as an observer/consultant in 1985 in Geneva between Gorbachev and Reagan and brings that perspective to this discussion. Cohen informs us about what a formal summit is like as opposed to a behind closed doors meeting. The former is partly a media event with theatrical trimmings to solve basically three things: to ratify a partnership to solve a national security problem between them, to force cooperation where the politics at home make this difficult, and finally these summits hopefully foster a sympathetic relationship as a media event. They are important as public opinion can be significantly altered, sometimes fundamentally/strategically altered. But the history of these things shows a very mixed result of some successes and failures. Nixon’s summit, for example, won him his legacy with the creation of détente and was a great success.

Part 2: Batchelor opens this session with the Reagan/Gorbachev summit in Geneva. The political background was rocky with the Korean airliner shoot down incident, and even more serious the false alarm of an American nuclear attack that was almost acted upon at the Soviet end. This was the time of “Star Wars” and his two summits during his presidency were successful. He cancelled with Gorbachev a whole category of nuclear weapons. President Bush continued the meetings but the process was complicated by the fall of the Soviet Union. But none of these past presidents, from Eisenhower to Clinton, had the difficulties that Trump is bearing with his summit. Cohen lists them: He has no political support at all at home. This is unprecedented. In addition to this, in Cohen’s opinion, the danger of war between the two countries has never been greater. And Batchelor adds that not only has Trump no support, he has very active opposition from numerous fronts. He then asks what the agenda will be? Cohen in turn wonders if there will be enough trust between the two for discussion and then adds the worry that if there are agreements achieved, can Trump deliver in Washington? This is a danger for both leaders that failure would be a political problem at home for them. Nevertheless, Cohen deems the agenda will include the new nuclear arms race, how to regulate the use of cyber warfare activities, the Syria situation, fighting terrorism, resolving Ukraine by the Minsk Accords, stopping NATO exercises in Europe, and finally to re-staff the embassies in both countries.

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As the pundits have said there are many outcomes possible should a summit come to pass, and commentary about will happen is completely speculative. We have seen the theatre elements already with Trump’s summit with North Korean, Kim and for inexplicable reasons the world collectively breathed a sigh of relief. But we know that Kim is not going to give without receiving in turn, and he likely won’t give up his nukes. Russia will be just as difficult to deal with as Trump’s “America First” slogan, which means “take as much as possible and give little in return” is just as failure prone in North Korea as it will be in Russia. But in Trump’s style of negotiation, allegedly successful in real estate, may prove impotent in summits. The other factor weighing down the probabilities of success is the Russian attitude (as stated in the podcast) that Trump may not be able to produce any concessions due to his opposition in Washington. This will probably see the Russian side as less willing to concede in negotiations. Another factor Russians feel wary about is that Trump’s narcissistic problems will add a component of stubbornness to the already overwhelming suspicions that he is badly informed about both the realities of Russia and also has a weak grasp of the many problems of his own country. We are reminded that facts do not rule Washington diplomacy, mythology does. He is only sure about his own goals – again, “America First” is going to be the style – and he will be prepared as well as this allows. Again this is problematic for success.  The Russians, on the other hand will have a better understanding of both American problems and what they need for their own national security concerns. Trump has not failed yet at a major summit and it he will need, in my opinion, a failure or two in this area in order to bring to him a better sense of realities.

This 2-part audio interview was posted on the audioboom.com Internet site on Tuesday — and I though it best to wait until today’s column for the usual length and content reasons.   As always, I thank Larry Galearis for his always excellent executive summary — and closing commentary.  Each part is about twenty minutes long — and the link to Part 1 is in the headline and here — and the link to Part 2 is here.


No 5th Column in the Kremlin? Think again! — The Saker

Following the re-appointment of Medvedev and his more or less reshuffled government, the public opinion in Russia and abroad was split on whether this was a good sign of continuity and unity amongst the Russian leadership or whether this was a confirmation that there was a 5th column inside the Kremlin working against President Putin and trying to impose neo-liberal and pro-western policies on the Russian people. Today I want to take a quick look at what is taking place inside Russia because I believe that the Russian foreign policy is still predominantly controlled by what I call the “Eurasian Sovereignists” and that to detect the activities of the “Atlantic Integrationist” types we need to look at what is taking place inside Russia.

The Russian 5th column and its typical operations

First, I want to begin by sharing with you a short video translated by the Saker Community of one of the most astute Russian analysts, Ruslan Ostashko, who wonders how it is that a rabidly pro-western and vociferously anti-Putin radio station named “Ekho Moskvy” manages not only to elude normal Russian legislation, but even gets money from the gas giant Gazprom, which is majority owned by the Russian state. Ekho Moskvy is also so pro-Israeli that it has earned the nickname “Ekho Matsy” (Ekho Moskvy means “Echo of Moscow” whereas “Ekho Matsy” means “Echo of the Matzo”). Needless to say, that radio has the unwavering and total support of the U.S. Embassy. It would not be an exaggeration to say Ekho Moskvy serves as an incubator for russophobic journalists and that most of the liberal pro-western reporters in the Russian media have been, at one time or another, associated with this propaganda outfit. In spite of this or, more accurately, because of this, Ekho Moskvy has been bankrupt for quite a while already, and yet – it continues to exist. Just listen to Ostashko’s explanations (and make sure to press the ‘cc’ button to see the English language captions)…

This longish, but interesting commentary from the Saker was posted on his Internet site on Friday sometime — and I’ve only skimmed it.  I’ll read the rest of it this weekend.  It’s another offering from Larry Galearis — and another link to it is here.


Price drop spurs India gold demand, buyers eye bigger dips

Gold demand improved this week in India as prices fell to their lowest level in nearly three months, while demand elsewhere in Asia remained tepid as investors waited for prices to fall further.

There is modest rise in demand from jewellers, but still gold is trading at a discount,” said Harshad Ajmera, the proprietor of JJ Gold House, a wholesaler in the eastern Indian city of Kolkata.

Dealers in India were offering a discount of up to $2 an ounce over official domestic prices this week, compared with a premium of $1 last week. The domestic price includes a 10 percent import tax.

Improving retail demand is giving jewellers some confidence. They are placing small orders,” said a Mumbai-based dealer with a private bullion importing bank, adding “falling rupee is still confusing some.

This gold-related Reuters news item, co-filed from Mumbai and Bengaluru, put in an appearance on their website at 4:38 a.m. EDT on Friday morning — and I found it on the Sharps Pixley website.  Another link to it is here.


Silver denarius of Augustus shows famous celestial event

A famous celestial event of antiquity was recorded on an ancient coin.

A silver denarius of Augustus (also known as Caesar Augustus), issued circa 19 to 18 B.C., depicts the so-called Julian star.

The wreathed head of Augustus graces the obverse.

The reverse of the coin shows the “Julian Star,” a bright comet that appeared in the heavens during the summer of 44 B.C., a few months after the assassination of Julius Caesar (March 15, 44 B.C.).

Based on eyewitness descriptions, the comet was clearly visible in the daytime, making it one of the brightest comets on record, the auction firm said. It has never reappeared and may have been destroyed on a suicidal dive into the sun.

The ancients did not understand the nature of comets as celestial ice balls moving within our Solar System, and the apparition was held to signal the ascension of Caesar’s soul to the heavens,” according to the catalog. “This proved quite useful in Octavian’s effort to get the Senate to deify his adoptive father. During his later reign as Augustus, he made extensive use of the comet in state propaganda.”

This news item, complete with a nifty photo, showed up on the coinworld.com Internet site on Friday sometime — and another link to it is here.


The PHOTOS and the FUNNIES

Today’s ‘critter’ is the whistling heron, a bird I ran across when I was researching the great white heron/great egret in Friday’s column. It hails from South America — and is not very big…60 cm tall maybe — and a bit over a kilo in weight.


The WRAP

Note: This quote from Ted is from his weekly review last Saturday…a week ago today.

It has now become obvious to me that JPMorgan has embarked on a concerted plan to buy back as many of its gold short positions from other commercials (raptors) as possible over the past month — and not from managed money traders, because the lower prices required to trigger managed money selling would have also attracted raptor buying competition for JPM. By allowing gold prices to trade up to, but not penetrating the key moving averages in gold, JPM was able to buy from the raptors without tripping off managed money buying.

At the same time, due to different market circumstances in silver, while JPMorgan was able to buy back important quantities of gold shorts without much of a gold rally, the silver market realities were such that JPM couldn’t do the same in silver and, in fact, had to resort to selling short silver to keep the price capped while it pulled off its gold short covering. You’ll recall that over the past month (not including the latest reporting week), JPMorgan was the biggest silver short seller, adding 20,000 new shorts, while it was buying back gold shorts. JPM had no choice – it had to cap the price of silver if it hoped to keep gold below its moving averages and buy back gold shorts from the raptors.

With this [past] week’s buyback of both gold and now silver shorts, it appears that JPMorgan is now close to completing its double cross of other commercials in both metals. It is possible for JPM to buy back more of its short positions in both metals at lower prices, but that would require managed money selling, which in turn, would bring out more raptor buying — and buying competition for JPM. In gold, with the managed money net long position at two year lows — and a giant increase in managed money short selling this past reporting week, there wouldn’t appear to be much more managed money selling capacity left.Silver analyst Ted Butler: 23 June 2018


Today’s pop ‘blast from the past’ is one I’ve posted before, but it’s been at least a year or more, so it’s time for a revisit.  It was a monster hit back in 1978 — and is one of those timeless classics that just about anyone can identify right from the opening bar.  The link is here.

The summer solstice in the northern hemisphere was a bit over a week ago — and I forgot all about it for last Saturday’s column.  So here is Italian composer Antonio Vivaldi’s Concerto No. 2 in G minor, Op. 8 RV315 “L’estate” [Summer] which he composed around 1721 — and published in Amsterdam in 1725.  The soloist in this recording is Mari Silje Samuelsen — and the link is here.


I’m not sure much, if anything, should be read into Friday’s precious metal price action, or lack thereof.  But I was less than amused that ‘da boyz’ showed up to put out the precious metal rallies that began at 10:30 a.m. CST — and ended at the afternoon gold fix in in Shanghai.  Volumes were very elevated during that period — and it was obvious that they were throwing whatever COMEX paper at those rallies to ensure that they went away.  After that, gold and silver et al, were basically on ‘care and maintenance’ during the remainder of the Friday session, despite the big decline in the dollar index that was ongoing as the trading day moved along.

But as you already know, dear reader, what’s happening in the currency markets becomes irrelevant when JPMorgan et al are out and about in the COMEX futures market — and we’ve seen ample evidence of that over the last two weeks.

Here are the 6-month charts for all four precious metals, plus copper.  A new intraday low was set in platinum yesterday, along with a tiny new closing low in copper for this move down as well.  The ‘click to enlarge‘ feature helps a bit with the first four.

Not a thing has changed since last week.  The emerging markets are still a mess, both economically and monetarily — and this rising dollar index thingy is only exacerbating the situation for all of them.

Closer to home, there’s lots of happy talk, most of which is of the “whistling past the graveyard” variety.  A look under the hood in the ‘developed world’ economies, regardless of which side of the Atlantic or Pacific you choose, reveals a string of Potemkin villages that no longer fools anyone.  Only central bank largess of endless asset and bond purchases has prevented the implosion of the world’s economic, financial and monetary system.

It is long past being saved — and removal of any of the supporting structure will bring instant contagion, along with equally instant liquidity issues.  The problems with emerging markets are but the thin edge of that wedge — and it will get thicker in a hurry if things continue on as they are.

So, with one eye on a seemingly intractable financial and monetary situation not only in the U.S…but world wide…I’m trying to figure out where JPMorgan fits into all of this, along with their absolutely manic efforts to cover as many of their short positions in gold [and the other precious metals] as they can. They’re certainly doing it for a reason, but a reason not know to us, at least not yet.

I suspect, as I said earlier, that what we’re witnessing is most likely their “last swing for the fences” — and at some point in the not-very-distant future, this price management scheme will come to a rather abrupt end.

JPMorgan would certainly be one of the first to know that — and getting its house in order in preparation for that moment, would be at the top of their “to do” list.  Sticking it to everyone else will be a casualty of such an event — and JPMorgan is never known to come out on the losing end of anything.  They are, as Jim Rickards has said in the public domain on more than one occasion over the years…”the biggest criminal organization the world has ever known“.

So, as I’ve said on more than one occasions, if this scenario I’ve painted is close to being correct, then all we can do is await the ‘event’ that triggers it — and hope that we survive whatever the power-that-be/deep state have prepared for us.

And on that rather unhappy note, I’m done for the day — and the week — and I’ll see you here on Tuesday.

Ed