<![CDATA[Ed Steer's Gold & Silver Daily]]> http://www.caseyresearch.com/feeds/main Stay abreast of the news that's moving the gold and silver markets in The Gold & Silver Daily. en <![CDATA[Silver’s ETF Demand Outpaces Gold By the Most Ever]]> http://www.caseyresearch.com/gsd/edition/silvers-etf-demand-outpaces-gold-by-the-most-ever/ http://www.caseyresearch.com/gsd/edition/silvers-etf-demand-outpaces-gold-by-the-most-ever/#When:08:16:00Z "It was another unhappy day for precious metal enthusiasts"

¤ Yesterday In Gold & Silver

The gold price chopped around unchanged in a very right range during all of Far East and most of London trading on Friday---and that state of affairs lasted until just minutes before 9 a.m. EDT.  At that point the selling pressure began anew---and JPMorgan et al had the gold price down to a new low by around 1:35 p.m. EDT, just a few minutes after the close of Comex trading.  After that, the price rallied a few dollars into the close.

The high and low ticks were recorded by the CME Group as $1,229.20 and $1,214.20 in the December contract.

Gold finished the Friday session in New York at $1,216.20 spot, down $8.60 from Thursday's close.  Net volume was very decent at 167,000 contracts.

Brad Robertson sent us the 5-minute tick gold chart once again---and you can see the big volume spike that occurred at 10:45 a.m. in New York, which shows as 8:45 a.m.MDT on this chart.  The big volume spike was on the secondary low, not the absolute low.

After the obligatory down tick at the 6 p.m. open in New York on Thursday evening, the silver price never got a sniff of positive territory after that---and followed almost an identical path to gold except for the fact that the HFT boyz and their algorithms really put the boots to the technical funds, as they closed silver just off its low tick of the day.

The high and low were recorded as $18.595 and $17.78 in the December contract.

Silver closed in New York yesterday at $17.79 spot, down a whopping 73 cents from Thursday's close.  Net volume was very heavy at 64,000 contracts.

Platinum was up a few bucks by noon in Hong Kong trading, but that was its high---and it slowly got sold down, hitting its low about 12:45 p.m. EDT---and about 45 minutes after the Zurich close.  The boyz close platinum down 9 bucks.

Palladium's high was also at noon in Hong Kong---and the decline in price from there was very orderly until around 10:20 a.m. EDT.  The HFT boyz and their algorithms showed up---and that was that, as they hit palladium for another 18 bucks.

The dollar index closed late on Thursday afternoon in New York at 84.29---and then traded flat until a few minutes after 12 o'clock noon Hong Kong time---and then away it went to the upside once again.  By the close of trading, the index had gained 49 basis point, everything it lost on Thursday, and closed at 84.78.

The gold stocks opened down a bit---and continued lower, hitting their low tick a few minutes before 2 p.m. EDT, which more or less coincided with the low tick in gold.  The HUI closed down another 1.69%.

The silver equities also opened down a hair, but hung in there until around 10:15 a.m. before heading lower with a vengeance---and there was no recovery at all, as they close on their absolute low tick.  Nick Laird's Intraday Silver Sentiment Index closed down another 3.32%.  The silver stocks have now given back all of their gains for 2014.

The CME Daily Delivery Report showed that 5 gold and 149 silver contracts were posted for delivery within the Comex-approved depositories on Tuesday.  The biggest short/issuer was Jefferies with 147 contracts---and there were about a dozen long/stoppers---and you can take a look at yesterday's Issuers and Stoppers Report linked here, if you wish to see the list. 

The CME Preliminary Report for the Friday trading session showed that 24 gold and 403 silver contracts are still open in the September contract---and don't forget to subtract the figures in the previous paragraph to get the up-to-date number.

There was a withdrawal from GLD yesterday.  This time it was 250,032 troy ounces---8 metric tonnes of the stuff.  And as of 1:18 a.m. EDT this morning, there were no reported changes in SLV.

The U.S. Mint had a sales report.  They sold 2,000 troy ounces of gold eagles---500 one-ounce 24K gold buffaloes---and 100,000 silver eagles.

Month-to-date the mint has sold 39,500 troy ounces of gold eagles---8,000 one-ounce 24K gold buffaloes---1,760,000 silver eagles---and 400 platinum eagles.  Based on these sales numbers, the silver/gold ratio for the month stands at 37 to 1.

There was a very decent amount of gold shipped out of the Comex-approved depositories on Thursday---160,755 troy ounces to be exact---with virtually all of it coming out of Canada's Scotiabank.  Nothing was reported received---and the link to that activity is here.

In silver, it was almost the same thing, as 282,291 troy ounces were shipped out---and with the exception of a few thousand ounces, it came out of Scotiabank as well.  Nothing was reported received there, either---and the link to that activity is here.

Here's a very sad looking 5-year silver chart---and what it shows is that the closing price on Friday was the lowest in four year---and it takes us all the way back to the beginning of the runaway bull market in silver in September of 2010.  All the gains in the interim have vanished thanks to JPMorgan et al.

The Commitment of Traders Report, for positions held at the close of Comex trading on Tuesday, was pretty much in line with the expectations that both Ted Butler and I had.

The Commercial net short position in silver fell by 6,394 contracts, or 32.0 million troy ounces.  The Commercial net short position is now down to 117.8 million troy ounces, which is still shy of its low back in late May/early June.  The managed money long selling/short buying accounted for 5,925 contracts of the decline during the reporting week.  Ted pegs JPMorgan's short-side corner in the Comex gold market at 13,000 contracts, down a thousand from the prior week's report.

The Commercial net short position in gold dropped by 21,712 contracts or 2.17 million ounces---and the new and improved Commercial net short position now stands at 7.62 million troy ounces.  The Managed Money in the technical fund category accounted for 19,912 contracts of the total amount.  As Ted Butler says, it's the Commercial traders running the Managed Money up and down through the moving averages that is determining the price, which they do for fun, profit---and price management purposes.  Supply and demand fundamentals no longer matter.  Ted says that JPMorgan's long-side corner in the Comex gold market was unchanged at 25,000 contracts, or 2.5 million ounces, compared to the prior week's report.

And, without doubt, there has been massive improvement since the Tuesday cut-off.  Of course we'll have to wait until next Friday's report before we see how much it was.

Here's Nick Laird's "Day of World Production to Cover Comex Short Positions" of the 4 and 8 largest traders in all physical commodities traded on the Comex.  Three of the four precious metals are still permanently pinned to the right-hand side of this chart---and gold would be there as well, except for JPMorgan's long-side corner in that metal.

Since the 20th of the month fell on a weekend, the good folks over at The Central Bank of the Russian Federation updated their website with August's data yesterday.  It showed that they increased their physical gold reserves by another 300,000 troy ounces during that period---and they now hold 35.8 million troy ounces in their reserves.  Here's Nick's most excellent chart showing that change.

Despite my best efforts, I have a decent number of stories for you today.

¤ Critical Reads

Marc Faber: There's a bubble in everything---everywhere!

Even after the Dow and the S&P 500 closed at new all-time highs, closely followed contrarian Marc Faber keeps sounding the alarm.

"We have a bubble in everything, everywhere," the publisher of The Gloom, Boom & Doom Report told CNBC's "Squawk Box" on Friday. Faber has long argued that the Federal Reserve's massive asset purchasing programs and near-zero interest rates have inflated stock prices.

The catalyst for a market decline, as he sees it, could be a "raise in interest rates, not engineered by the Fed," referring an increase in bond yield

There are two short interviews back to back here, both totaling a bit over 4 minutes---and they run concurrently.  The first reader through the door with this CNBC video clip yesterday, was Ken Hurt.

Household Net Worth Hits Record $81.5 Trillion In Q2 Driven By Stock Market Surge

[Early Thursday], the Fed released its latest Z.1 (Flow of Funds report) for the second quarter, there were no surprises: thanks to the relentless liquidity injections by global central banks (charted here) resulting in record stock market levels, total household net worth rose once more, increasing by $1.4 billion in the quarter (up from a downward revised $1.2 billion in the previous quarter) to a new record high $81.5 billion.

This was the result of a $95.4 trillion in total assets, offset by $13.9 trillion in liabilities, mostly mortgage debt of $9.4 trillion, as well as some $3.2 trillion in consumer credit, which may or may not account entirely for the student debt bubble.

But perhaps most importantly, the percentage of financial assets as a percentage of total, just rose to the record high level it has never in the past surpassed: 70.3%. As the chart below shows, this is the highest proportion that financial assets have ever hit in the entire history of modern US society. Every time financial assets hit 70.3% of total, either housing values finally pick up and offset the disproportional increase in financial assets, or there has been a crash in financial asset values themselves.

This article, with some excellent charts, appeared on the Zero Hedge website at 1:46 p.m. EDT on Thursday---and it's the first of two stories in a row that I found in yesterday's King Report.

Doug Noland: Only for wonks

Of late, talk has been that the ECB’s balance sheet would come to the rescue. Count me as deeply skeptical of all the bullish ECB “QE” liquidity propaganda. As such, I see a world of somewhat waning liquidity abundance with an increasingly destabilizing King Dollar bias. There’s risk that escalating EM stress and attendant “hot money” outflows lead to a self-reinforcing de-risking/de-leveraging dynamic. EM companies and countries at this point have way too much dollar-denominated debt. At some point, contagion might negatively impact market expectations for the global economy at large, perhaps leading to a more generalized global “risk off” backdrop.

From the Z.1 we know that Security Credit was up $161bn year-over-year, or 13.7%, to a record $1.333 TN. Fed Funds and Repurchase Agreements were little changed y-o-y at $3.792 TN. Security Broker/Dealer Assets were actually down about 5% y-o-y to $3.388 TN. Funding Corps were down 3.3% y-o-y to $1.312 TN. Clearly, securities leveraging remains integral to overall Credit system operations.

At the same time, there are important sources of global leverage outside the purview of Fed monitoring and Z.1 reporting. There are myriad avenues for “carry trades,” securities shorting and “off-shore” securities financing vehicles, not to mention the murky world of (hundreds of Trillions of) derivatives.

Doug's commentary was posted on the prudentbear.com Internet site on Friday evening---and it's a must read that I'll deal with later today.  I thank reader U.D. for sending it along.

The Scotland Referendum: Who Voted How And Why?

The following post-referendum poll from Lord Ashcroft does a good summary of who voted how and why. However, the most telling distinction is the following:

  • Voters aged 16-17: YES: 71%; NO: 29%
  • Voters aged 65+: YES: 27%; NO: 73%

How will last night's vote look like in 5, 10 or 15 years when today's 17 year olds are Scotland's prime demographic?

This short Zero Hedge article has an excellent set of numbers---and it's worth a minute of your time.  I thank reader U.D. for sharing it with us.  There was a story about this subject as well posted on the euobserver.com Internet site yesterday.  It's headlined "Scotland's referendum - nothing and everything changes".  My thanks go out to Roy Stephens for that one.

Spain, Italy, Belgium: Battle lines drawn for independence after Scottish vote

The Scots have lost their stab at independence by a tiny 10-percent margin. Analysts predicted that only a ‘yes’ vote would send waves throughout Europe, but the dire economic situation of other independence-seeking regions can’t be eclipsed so easily.

In a historic referendum on Thursday, Scotland voted 55 to 45 percent to stay in the four-nation United Kingdom.

This 'yes' vote, many have said, would become a major precedent for others to follow - but can this apparent loss by an already prosperous Scotland serve as a demotivator for others? After all, according to the Venetians, or the Catalans, the far more centralized nature of their own main governments - just one factor to consider here - puts them in a markedly different situation to that of Scotland.

This article appeared on the Russia Today website at 9:47 a.m. Moscow time on their Friday morning, which was 1:47 a.m. EDT---and it's courtesy of Roy Stephens.

Catalonia to press ahead with referendum after Scottish No

Catalan leader Artur Mas has said the Scottish referendum has reinforced his plan to hold a similar vote at home.

Speaking in Barcelona on Friday (19 September), he noted that the devolved Catalan parliament is likely to pass a law on the referendum later the same day.

“I will sign the decree on this consultation in Catalonia. In fact, I will call this consultation on 9 November as agreed some months ago with the majority of Catalan political forces”.

He said he would have preferred it if Scotland had voted Yes.

This news item showed up on the euobserver.com Internet site at 4:06 p.m. Europe time yesterday---and it's the second story in a row from Roy Stephens. 

Europe's Banks Show Tepid Interest as E.C.B. Begins Program of Cheap Loans

Banks borrowed less than expected from the European Central Bank in a disappointing start for a program intended to encourage more lending to businesses and households and to pump money into the ailing eurozone economy.

The central bank said on Thursday that it would allot nearly 83 billion euros, or about $107 billion, to 255 commercial banks next week. Estimates of how much money banks would borrow had varied widely, but many analysts said before the announcement that anything less than €100 billion would be a disappointment.

The program is part of a broader effort by the central bank to inject as much as €1 trillion into the eurozone economy, and the borrowing data on Thursday was closely watched as an indicator of whether the central bank would be able to meet its goal. The loans are meant to drive down the cost of borrowing and encourage lending, especially in countries like Italy and Portugal, where a lack of credit has impeded economic growth.

This article appeared on The New York Times website on Thursday sometime---and it's something I found in yesterday's edition of the King Report.

CIA puts on hold all spying operations in Western Europe

The CIA’s European Division has halted its operations in Western Europe in response to several spying scandals in Germany and the continent’s negative reaction to the revelations of spying by the National Security Agency on European leaders and citizens.

The stand-down order has been in effect for two months. It was designed to give CIA officers time to examine whether they were being careful enough and to evaluate whether spying on allies is worth running the risk of discovery, a U.S. official who has been briefed on the situation told the Associated Press.

Case officers in friendly European countries have largely forbidden from undertaking "unilateral operations" such as meeting with sources they have recruited within allied governments. The continent’s countries have long been used as safe venues to conduct meetings between CIA officers and sources from the Middle East and other high priority areas; those encounters have been rerouted to other locales.

The spying stand-down comes at an inopportune time, AP reported, citing worries over Western extremists heading to Syria and Iraq to join with the Islamic State, as well as the standoff with Russia over influence on Ukraine and the independence movement in the eastern part of the country. Tensions have grown between the US and its European allies since Edward Snowden's NSA revelations in June 2013.

This very interesting story appeared on the Russia Today website at 6:20 p.m. Moscow time on their Friday evening---and it's another contribution from Roy Stephens. 

War over? Both sides in Ukraine conflict sign treaty banning military action

Kiev and self-defense forces signed a memorandum aimed at effectively halting all fighting in eastern Ukraine after talks in Minsk. It creates a buffer zone, demands a pullback of troops and mercenaries, and bans military aviation flybys over the area.

The signed memorandum consists of nine points, former Ukrainian president Leonid Kuchma told journalists following peace talks in Minsk, Belarus.

“The first one is stopping the use of weapons by both sides, the second is terminating new formations of units on military bases as of September 19. The third is banning the use of all types of weapons and offensive action,” Kuchma said.

The agreement outlines a buffer zone of 30 km (18.6 miles) and bans all military aircraft from flying over part of eastern Ukrainian territory, except for the OSCE's aerial vehicles, Kuchma told RIA Novosti following the meeting.

This story showed up on the Russia Today website at one minute to midnight Moscow time on their Friday night, which as 3:59 p.m. EDT.  I thank Roy Stephens for sending it our way.

Third convoy carrying Russian humanitarian aid crosses Ukrainian border

The 200 trucks are carrying foods, including cereals and canned products, power generators, medical supplies, warm clothes and bottled drinking water - 2,000 tonnes all in all.

Before the convoy’s departure Ukrainian customs officials and International Red Cross representatives were repeatedly invited to inspect the cargo. Both refused without offering any reasons.

It is a third batch of Russian humanitarian aid being delivered to the southeast of Ukraine by truck The first two convoys delivered a total of four thousand tonnes humanitarian supplies to Lugansk.

This article showed up on the itar-tass.com Internet site at 5:22 a.m. Moscow time on their Saturday morning---and once again I thank Roy Stephens for finding it for us.

G20 states are for Russia’s participation in G20 November summit — official

The Group of Twenty (G20) members have supported Russia’s participation in the G20, Australian chief treasurer Joe Hockey told reporters on Friday. He will preside over the G20 meeting of foreign ministers and heads of Central Banks that will be held on September 20 -21.

Asked whether Australia would try to block Russia’s participation in the G20 summit in Brisbane due in November, Hockey said not Australia, but G20 members take decisions on anybody’s participation in G20 work.

The G20 member countries say the door should not be closed, and Russia should take part in the forum. The dialogue should be continued, according to all the G20 member countries. He said G20 is an economic, not a political forum.

This article appeared on the itar-tass.com Internet site at 8:34 a.m. on Friday morning Moscow time---and it's another story from Roy Stephens.

China Fines GlaxoSmithKline $492 Million, Seeks to Jail Former Manager for Bribery

Drug maker GlaxoSmithKline was fined $492 million on Friday for bribing doctors in China in the biggest such penalty ever imposed by a Chinese court.

The court sentenced the company's former China manager, Briton Mark Reilly, and four Chinese co-defendants to prison but postponed the sentences for two to four years, suggesting they may never be served. The court said it granted leniency because the defendants confessed.

The case, first publicized in mid-2013, highlighted the widespread use of payments to doctors and hospitals by sellers of drugs and medical equipment in a poorly funded health system that Chinese leaders have promised to improve. The fine is the largest such penalty ever imposed by a Chinese court.

This very interesting article showed up on the newsmax.com Internet site at 7:38 a.m. EDT on Friday---and it's the first offering of the day from West Virginia reader Elliot Simon.

Japan postpones new sanctions against Russia — source

Japan has decided to delay the announcement of a new round of sanctions against Russia over the Ukraine crisis, which had been earlier planned for Friday, senior government sources have told ITAR-TASS.

The postponement comes as Tokyo wants to follow Moscow’s reaction towards the move. However, Japan has not yet decided to call off the sanctions and is expected to detail the restrictions later.

The announcement could be made next week during the visit of Japanese Prime Minister Shinzo Abe to New York, where he will attend the session of the United Nations General Assembly.

Japanese media reports said Tokyo was due to announce the expansion of sanctions against a range of individuals from Russia and the self-proclaimed Luhansk and Donetsk People’s Republics, to be subject to the asset freeze and visa ban.

This article put in an appearance on the itar-tass.com Internet site on Friday morning Moscow time---and it's the final offering of the day from Roy Stephens, for which I thank him.

Japan government cuts economic view, warns of stalling consumption

Japan's government cut its overall economic assessment for the first time in five months as private consumption is struggling to recover from the slump caused by April's sales tax hike, clouding the outlook for a sustained recovery.

The government on Friday cut its view on private consumption, which accounts for about 60 percent of the economy, saying that consumer spending is seen pausing although a pick-up trend remains intact.

The assessment followed a run of weak indicators, including falling household spending, which raised doubt about the strength of an expected bounce in the current quarter - a crucial factor for Prime Minister Shinzo Abe's decision in December on whether to proceed with a second tax rise next year.

So much for rampant money printing.  A Japanese bond isn't worth the paper it's printed on.  This Reuters story, filed from Tokyo, was posted on their website at 12:25 p.m. EDT on Friday---and it's another article I found in yesterday's edition of the King Report.  It's worth reading.

Three King World News Blogs

1. Art Cashin: "The Next 7 Days May Trigger a Global Stock Market Crash"  2. Bill Fleckenstein: "Responds to Outrageous CNBC Interview"  3. John Ing: "Russians Stunned as Chinese Leader Pushed Gold Backed Yuan

[Please direct any questions or comments about what is said in these interviews by either Eric King or his guests to them, and not to me. Thank you. - Ed]

Lawrence Williams: The future for gold is physical

At an event [on Thursday] to mark the start of Shanghai Gold Exchange’s gold trading in the city’s free-trade zone (SFTZ) and the creation of the International Board, the Shanghai Gold Exchange and the World Gold Council have stated they will be actively cooperating to develop the SFTZ as an international hub for gold and to work together to develop the gold market in the region. The event was attended by Zhou Xiaochuan, Governor of the People’s Bank of China, Mr. Xu Luode, the Chairman of Shanghai Gold Exchange and Aram Shishmanian, CEO of the World Gold Council.

This collaboration follows on from a partnership signed between the China Gold Association and the World Gold Council in Beijing last week at the China Gold Congress and Expo, which they jointly sponsored. This partnership seeks to promote further international enterprise in China and to enhance the global understanding of China’s role within the global supply chain.

As we commented on the report concerning WGC and PBoC co-operation, one hopes these co-operations are close and will thus help lift the veil on some of the statistical anomalies that beset analytical reports on the massive Chinese gold sector.

This commentary by Lawrie was posted on the mineweb.com Internet site on Thursday---and is worth reading.

Julian Phillips: Of course gold is manipulated -- the London Gold Pool, 1961-68

In his latest commentary about gold market manipulation, Julian Phillips of the Gold Forecaster letter reviews the establishment of the London Gold Pool, the gold market-rigging mechanism of the Western central banks in the 1960s. The U.S. dollar survived the gold pool's collapse, Phillips writes, because the dollar was still required to purchase oil from the Middle East.

I found this gold-related story embedded in a GATA release yesterday---and I thank Chris Powell for writing the above paragraph of introduction.

What are your questions for former Fed Chairman Alan Greenspan in New Orleans?

GATA again will have a big part in the New Orleans Investment Conference this year, what with GATA Chairman Bill Murphy and your secretary/treasurer making presentations, your secretary/treasurer debating Casey Research founder Doug Casey about whether the gold market is manipulated, and former Federal Reserve Chairman Alan Greenspan not only speaking but taking questions from the audience.

Conference sponsor Brien Lundin of Gold Newsletter and the Jefferson Companies in Louisiana is asking for help in devising questions for Greenspan, and GATA has appended his appeal.

This GATA release from yesterday is worth your time, if you have any left, that is.

Silver’s ETF Demand Outpaces Gold by Most Ever

Investors in exchange-traded funds backed by silver have stayed loyal to the metal longer than those who bought gold.

The CHART OF THE DAY shows shares outstanding for the biggest U.S. silver ETF surpassing those for the nation’s largest gold fund by the most since 2006, when the iShares Silver Trust was created. Retail buyers are sticking with silver even as prices fell 4.4 percent this year, the most of any precious metal. Gold’s 2 percent gain wasn’t enough to halt declines in selling, and assets in the SPDR Gold Trust are set for a second annual loss.

“The perception is that silver will do well, and should outperform gold as the economic recovery strengthens,” Tom Kendall, the head of commodities research at Credit Suisse in London, said in a telephone interview. “Belief in silver’s dual properties, as a financial asset and also as an industrial metal, appears to remain strong.”

Well, dear reader, there's nothing in here that you don't already know, as Ted Butler and I have been talking about this for several months already. The reasons given for why silver is pouring into SLV is mostly bulls hit, but it's nice to see that at least one news outlet has considered it worth featuring.  This silver-related article was posted on the Bloomberg website at 5 p.m. MDT on Thursday---and I thank Elliot Simon for bringing it to our attention.

¤ The Funnies

The first photo is of an osprey that reader Mark O'Brien sent me yesterday.  We met at the Casey Conference here in San Antonio---and he's provided a photo for us before---and this one is certainly worth sharing as well.  The second is an echidna that Nick Laird found wandering around his yard---and since most won't have the foggiest idea of what they are, it's worth posting as well. 

¤ The Wrap

It occurred to me that there were two separate warm up games in which silver ran to $50; in April 2011 and thirty years before that in 1980, when the Hunt Brothers were found to have manipulated the price of silver higher. In fact, the long term chart of silver is defined by the two sharp surges to $50 on those two occasions, amid years of flat or declining prices, not dissimilar to the past three and a half years. To my knowledge, few other commodities have that unusual double spike in price that exists in silver.

More remarkable is that each silver price run to $50 came from extremely low price levels existing in the years before the two price spikes. In other words, when silver does run, history indicates that it runs like it is on fire; racking up the biggest percentage gains of all. Those two facts alone – that silver ran to $50 twice and the gains far exceeded the historic gains of any commodity (or market) – should be enough to attract investors at current depressed prices. After all, no one can deny that silver can’t go to $50 again, seeing how it’s been there twice already. And if it does run again, the percentage gains will likely exceed any other commodity or market. - Silver analyst Ted Butler: 17 August 2014

While I was sitting around the dinner table with a group of my readers who were kind enough to come to the conference, two names came up while we were talking about my pop 'blasts from the past'.  Those names were Paul Anka and Carlos Santana.  So rather than choose, here's one by each.  For Paul Anka click here---and for Carlos Santana click here.

The subject of classical guitar also came up, as did one of my recent 'blast from the past' featuring that instrument, so here's another.  It's not exactly classical---but it's a gas!  The link is here.

Well, it was another unhappy day for precious metal enthusiasts as da boyz and their algorithms worked their magic once again---and even I was taken aback by the pounding that JPMorgan et al handed to silver.  But that is their problem child---and the only question remaining is "are we at the bottom yet?"

As both Ted and I have mentioned on several occasions, it's not the price at the low---it's the number of long contracts that JPMorgan et al can get the brain-dead/black-box technical funds to sell, along with the number of short contracts that they can entice them into buying at the same time.  We weren't there with yesterday's COT Report, but we should be there now.

And there should be no question as to how we got where we are---and that's because of the paper games played in the Comex futures market, all aided and abetted by the CME Group and the CFTC.  It's flat out illegal, but who's going to stop them?

Here are the 2-year charts for all four precious metals that show you where we are vs. where we've been over the longer term.

But looking forward as I did several times last week, we should now only concern ourselves with how da boyz react when the technical funds begin to cover as the next rally commences.  Will they let the tech funds off easy like they did last time, or will this time be different? 

Stay tuned.

I'm done for the day---and the week.

I'll be here on Tuesday, but that report will be brief as well, as Monday is a travel day---and I get back into Edmonton in the evening.

]]>
Sat, 20 Sep 2014 08:16:00 +0000
<![CDATA[Super-Rich Rush to Buy ‘Italian Job’-Style Gold Bars]]> http://www.caseyresearch.com/gsd/edition/super-rich-rush-to-buy-italian-job-style-gold-bars/ http://www.caseyresearch.com/gsd/edition/super-rich-rush-to-buy-italian-job-style-gold-bars/#When:06:02:00Z "Another day of engineered price declines across the board"

¤ Yesterday In Gold & Silver

Not surprisingly the HFT boyz and their algorithms were busy right from the moment that trading began in New York at 6 p.m. on Wednesday evening, taking gold down another few bucks.  The price recovered from there---and then traded flat until at, or just after, the noon London silver fix on their Thursday morning.  At that point the boyz showed up again and took gold down to a new low for this move down about five minutes before the 8:20 a.m. Comex open.  Gold rallied off that low---and then got cut off at the knees again at, or shortly after the 10 a.m. EDT London p.m. gold fix.  It then traded flat for the remainder of the Thursday session.

The CME Group recorded the low and high ticks as $1,216.30 and $1,228.70 in the December contract.

Gold closed in New York yesterday at $1,224.80 spot, up $1,60 on the day.  Net volume was very decent at 145,000 contracts.

Brad Robertson sent us the 5-minute tick chart for gold----and you can see that more that 90 percent of the volume occurred during the down-up move between the London silver fix and 10:40 a.m. EDT.  Add two hours for New York time.

Silver was subject to the same treatment, so I'll spare you the play-by-play, as the chart pattern was almost a carbon copy of gold's.

JPMorgan et al put the lumber to platinum and palladium as well---and also during the same time period---and they both closed at new lows for this move down as well.  Here are the charts.

The dollar index closed late on Wednesday afternoon in New York at 84.73---and then rallied to its 84.81 high at 8 a.m. Hong Kong time on their Thursday morning.  From there the index slid lower for the remainder of the Thursday trading session---and closed at 84.29---down 44 basis points on the day, giving up a large portion of its gain from the Fed news on Wednesday.

You will carefully note, dear reader, that none of the precious metals gained anything back on Thursday that they lost during the "sell precious metals/buy the dollar index" rampage that went on, on Wednesday.  It never works like that, or rather, it's not allowed to work like that.

The gold stocks opened lower and moved lower until they rallied a bit along with gold once the London p.m. 'fix' was in.  Despite the fact that the gold price traded flat from there, the stocks continued to weaken---and the late-day rally that started minutes before 2 p.m. EDT also sold off a bit into the close as the HUI finished down another 1.32 percent.

The silver equities began the same way as gold, but there was no late-day rally to save them, as Nick Laird's Intraday Silver Sentiment Index closed down another 2.27%.

The CME Daily Delivery Report showed that zero gold and only 6 silver contracts were posted for delivery within the Comex-approved depositories on Monday.  Nothing to see here.

The CME Preliminary Report for the Thursday trading session showed that there are 24 gold and 379 silver contracts still open in the September delivery month---minus the contracts mentioned in the previous paragraph.

There were no reported changes in GLD yesterday---and as of 9:38 p.m. EDT yesterday evening, there were no reported changes in SLV, either.

The U.S. Mint had another tiny sales report.  They sold 1,500 troy ounces of gold eagles---and that was all.

There were no reported deposits in either gold or silver over at the Comex-approved depositories on Wednesday.  There was a 4,212 troy ounce withdrawal in gold---and 244,249 withdrawn in silver.

In keeping with my schedule in San Antonio, I've kept the number of stories down the bare minimum once again.

¤ Critical Reads

The Fed Fesses Up: After Printing $3 Trillion It Sees No “Escape Velocity”……Ever!

Wall Street’s and the media’s attention was riveted single-mindedly on whether or not the Fed would include in its statement the two words, “considerable time,” the two vaguest, stretchable latex words available that describe absolutely nothing and leave the door wide open for wishful thinkers of every stripe. That’s what the Fed’s gyrations since the financial crisis have so successfully accomplished; they have reduced the market, a place of price discovery, to a crummy joke.

The Fed delivered those two words, but during the press conference, Fed Chair Janet Yellen doused them with so many qualifiers that they’ve become even more meaningless, if that were even possible.

Wishful thinkers still see Yellen as a pure dove, while others worry that she has turned into a closet hawk who is afraid of letting this tsunami of free liquidity inflate asset bubbles and build up risks so immense that even a minor hiccup would bring down the entire financial system once again. And this time, under her watch.

Clearly, FOMC members, and particularly Yellen, would try hard to dodge blame. But after having printed $3 trillion, and after having forced short-term rates to near zero – and below the rate of inflation – for what likely will be more than six years, and after having messed with the markets throughout, they too can imagine that blame for the fiascos these policies might end up causing will be hard to dodge.

This guest commentary by Wolf Richter was posted on David Stockman's website on Thursday some time---and today's first article is courtesy of Roy Stephens.

Dirty Secret of $1 Trillion Loans is When You Get Your Money Bac

Imagine a trillion-dollar market that runs on faxes and phone calls while routinely tying up investors’ money for months before they get any return.

That’s not fiction: It’s the unregulated market for leveraged corporate loans. In a financial system that is increasingly automated, the origination and trading of loans is in the relative dark ages while money pours in from mainstream investors such as Kansas and New York pension plans and mutual funds catering to individuals seeking high yields in an era of near-zero interest rates.

The antiquated structure of a market that’s ballooned from a mere $35 billion in 1997 poses a growing threat, raising the odds of gridlock in a downturn when investors expect to get their money back with a click of a button. As of yet, no regulators have taken responsibility for fixing the deficiency.

This longish, but very interesting Bloomberg article, filed from New York, appeared on their Internet site at 9:29 a.m. Denver time yesterday morning---and it's courtesy of reader Howard Wiener.

CNBC Anchor Calls Out Fed-Hater Bill Fleckenstein In Startling Shouting Match

Bill Fleckenstein of Fleckenstein Capital appeared on CNBC's Futures Now program on Tuesday.

It was kind of a strange segment.

Futures Now host Jackie DeAngelis came out swinging, asking Fleckenstein right at the top if he was willing to admit that he had misunderstood monetary policy.

Sounding taken aback, Fleckenstein answered: "I don't misunderstand monetary policy. I closed my short fund in 2009 because I knew the Fed would print money."

"If you want to pursue idiots like the Fed, and their crazy policies, and you think you can get out in time, go for it," Fleckenstein said. 

This article, with the 2:27 minute video clip at the bottom of the page, was posted on the CNBC website at 11:52 a.m. EDT on Tuesday---and I thank reader David Ball for sending it our way.

Scotland Rejects Independence From Britain in a Close Vote

Voters in Scotland rejected independence from Britain in a referendum that had threatened to break up a 307-year union, according to projections by the BBC and Sky early Friday.

The outcome was a deep disappointment to the vocal, enthusiastic pro-independence movement led by the Scottish first minister, Alex Salmond, who had seen an opportunity to turn a centuries-old nationalist dream into reality, and forced the three main British parties into panicked promises to grant substantial new power to the Scottish Parliament.

The decision spared Prime Minister David Cameron of Britain a shattering defeat that would have raised questions about his ability to continue in office and diminished his nation’s standing in the world.

This article appeared on The New York Times website---and Roy Stephens sent it our way very late last night.  Roy also sent a Reuters article about it linked here.

‘Flemish independence: better to become good friends than stay together in a bad marriage’

An independent Flanders with Brussels as its capital will be best for the Flemish people who represent 60 percent of the Belgium population, and provide 80 percent of its economy, Flemish MP Tom van Grieken told RT.

Following in the footsteps of Scotland, Veneto in Italy and Catalonia in Spain, and Belgium’s Flemish region may become the next to hold a referendum on independence. The Flanders area of northern Belgium has been claiming its own sovereignty for years, and if it succeeds, Belgium may be no more, along with its being the symbol of a united Europe.

The 2008 financial crisis has boosted separatism movements in Europe, with rich and developed regions in a number of countries starting to voice their discontent with policies from the capital, and the necessity to feed economically weak regions. However, for such Scotland, Catalonia and Flanders it is also a question rooted in the history of the formation of the countries they belong to.

Dutch-speaking Flanders and French-speaking Wallonia have always been rich and well-developed regions, connected to each other despite language and cultural differences. The artificial creation of the Belgian state put these nations into a difficult situation, forcing them to coexist with people they don’t feel any connections with. Meanwhile, Scotland’s independence vote has inspired the Flemish people with hope to finally create their own state.

This interesting article put in an appearance on the Russia Today website at 11:43 a.m. on their Thursday morning, which was 3:43 a.m. EDT---and it's another contribution from Roy Stephens.

President Poroshenko Comes Calling on Washington—Bearing Big Lies and a Tin Cup

Ukrainian President Petro Poroshenko’s visit to Washington [was] the consummation of a marriage made back in February, when the Obama administration ripped up a compromise agreement between elected president Yanukovich and the rebels who were seeking to overthrow him. Overnight, the U.S. government endorsed the rebels’ seizure of power, and it has not wavered in its support of the coup leadership from that point.

Poroshenko will arrive in town buoyed by Congressional passage of H.Res. 726, a resolution “Strongly supporting the right of the people of Ukraine to freely determine their future, including their country’s relationship with other nations and international organizations, without interference, intimidation, or coercion by other countries.”

The lie is in the very title of the bill, however, as in supporting an anti-democratic coup against a legally elected government, the US has undermined, not supported, the right of the Ukrainian people to “freely determine their future… without interference…by other countries.”

This guest commentary by Daniel McAdams appeared on the David Stockman website on Thursday---and once again I thank Roy Stephens for sending it.

Obama declines to give Ukraine 'lethal aid' despite Poroshenko's plea

President Barack Obama has declined to supply Ukraine with “lethal aide” despite the passionate plea for more military equipment that Ukrainian President Petro Poroshenko made to Congress earlier on Thursday.

During a White House meeting between the two leaders that occurred after Poroshenko’s address to Congress, President Obama said the United States would keep working to mobilize the international community in order for the conflict in Ukraine to be solved diplomatically, Reuters reports.

Following the meeting, Poroshenko said he was pleased with Washington’s help, and expressed hope that the shaky ceasefire in Ukraine would eventually lead to stability and peace.

Earlier in the day, however, Poroshenko suggested that NATO give “special” security status to Ukraine. Addressing the US Congress, he called on Washington to provide Kiev with “more military equipment, lethal and non-lethal” to “keep peace” in the eastern part of his country.

This is the second article from the Russia Today website.  It was posted there at 2:48 p.m. Moscow time yesterday afternoon---and it's also another offering from Roy Stephens.  Roy also sent a link to Poroshenko's speech in front of the Imperial Senate. [I know, it is nauseating, but still, please do watch it.  What Poroshenko is saying is that which the US deep state is thinking, and as such, it deserves our utmost attention (even if that means grabbing a psychological barf bag). - The Saker]---and the link is here

The Tower of Babel Comes to Paris: The Folly of Obama’s “War” on ISIS

U.S. imperialism was once a fearsome force—-mainly for ill. Under the latter heading, Washington’s savage destruction of Vietnam four decades ago comes readily to mind. But now the American Imperium has become just a gong show on the Potomac—even as its weapons have gotten more lethal and its purposes more  spurious and convoluted.

There is no more conspicuous proof than Obama’s quixotic “war” on ISIS. The quote marks are necessary, of course, because the White House insists that this is merely a counter-terrorism project that is not really a war; that the campaign to “degrade, disrupt and destroy” the Islamic State will not deploy a single American soldier—at least not one with his or her boots on; and that the heavy lifting on the ground against the barbaric ISIS hordes will be conducted by a “broad coalition” of so far nameless nations.

In truth, the whole thing is a giant, pathetic farce. There will be no coalition, no strategy, no boots, no ISIS degradation, no gain in genuine safety and security for the American homeland. This is an utterly misbegotten war against an enemy that has more urgent targets than America, but a war which will nonetheless fire-up the already boiling cauldron of Middle Eastern tribal, religious and political conflict like never before. There is no name for what Obama is attempting except utter folly.

Even before Secretary Kerry brought his medicine show to Paris, it was evident there is no coalition of the willing—or even the bought.

This commentary by David Stockman showed up on his website on Thursday sometime---and it's the final contribution of the day from Roy Stephens, for which I thank him.

Jim Rickards on Europe and China

Jim was interviewed on Russia Today's "Boom Bust" program on Wednesday and, as usual he has lots to say.  The interview runs from the 3:40 minute mark to the 11:20 minute mark.  Also on the program following Jim, is Marshall Auerback---and there aren't any flies on him, either.

I thank reader Harold Jacobsen for bringing this interview to our attention.

Three King World News Blogs

The first interview is with David P. out of Europe---and it's headlined "A Major War is Now Raging in the Gold Market"---and the second with Egon von Greyerz is entitled "Here is the Great-Game Changer That Will Shock the World".  And lastly is this commentary by Nigel Farage---and it bears the headline "The Chilling Truth About Putin, Europe and Gold"

[Please direct any questions or comments about what is said in these interviews by either Eric King or his guests to them, and not to me. Thank you. - Ed]

Super-rich rush to buy 'Italian Job'-style gold bars

The super-rich are looking to protect their wealth through buying record numbers of "Italian job" style gold bars, according to bullion experts.

The number of 12.5 kg gold bars being bought by wealthy customers has increased 243pc so far this year, when compared to the same period last year, said Rob Halliday-Stein founder of BullionByPost.

The bars which are made from pure gold and are worth more than £300,000 each at today's prices of $1,223 (£760) an ounce.

The sales of 1kg gold bars, worth about £25,000 each, has doubled during the three months ended August, when compared to the same period last year, according to ATS Bullion sales figures.

Sales of the more popular gold coins such as the quarter ounce sovereign and one ounce Krugerrand have also doubled this year, according to figures from BullionByPost.

This gold-related news item appeared on The Telegraph's website at 10:45 a.m. BST on Thursday London time---and I found it embedded in a GATA release.  It is, of course, worth reading.

Gold and silver end game is here, Embry tells USA Watchdog

USA Watchdog's Greg Hunter this week interviewed Sprott Asset Management's John Embry about manipulation of the monetary metals markets. "I have never seen it any more intense in terms of pressure in the paper market, which indicates we are near the end and there is something seriously wrong with the system," Embry says.

The interview is headlined "Gold and Silver End Game Here: John Embry" and can be read and watched at USAWatchdog.com Internet site. Harold Wiener was one of the first people through the door with this interview, but I borrowed the above paragraph of introduction from Chris Powell.

China Opens Gold Market to Foreigners Amid Price Ambition

China will give foreign investors direct access to its gold market for the first time today as the biggest-consuming nation seeks to exert more influence over prices while boosting the yuan’s global use.

The Shanghai Gold Exchange will start trading contracts in the city’s free-trade zone that will be linked to its domestic spot market and available to about 40 international members including Goldman Sachs Group Inc. and UBS AG. Access was previously limited to some Chinese units. Gold in China this year cost as much as $31 an ounce more and $42 less than the London spot price, according to data compiled by Bloomberg.

“It’s indicative of the ambition to move the gold market more to where the consumption is,” Victor Thianpiriya, commodity strategist at Australia & New Zealand Banking Group Ltd., said by phone from Singapore. “It makes sense that price discovery occurs in the center of consumption.”

This Bloomberg article, co-filed from Singapore and Beijing, appeared on their website at 8:05 a.m. MDT yesterday---and it's another article I found in a GATA release very early yesterday morning.

¤ The Funnies

¤ The Wrap

This was the real lesson of the 2011 price run – unlike 1980, silver ran to $50 without a big buyer, just as it will likely be on the next big move up. The actions taken in 2011 to smash the price – two $15 declines in a week or less – because they were so in your face, will be hard to replicate in light of how accepted the manipulation premise has become. So many more observers are aware of the silver manipulation today that the actions of 2011 will not be easily replicated. But if you think such outrageous efforts to smash the price will succeed, then the solution is simple – sell at $50.

I don’t think corrupt government and exchange officials will turn back silver at $50 the next time it gets there; leaving only one resolution, namely, that the price must burn itself out to the upside. Here’s how the price of silver will truly explode – with no artificial exchange interference, all the buying from both investors and industrial users must be satisfied by actual selling or because the price gets too high to consider buying. In that case, almost by definition, the price must go a lot higher than $50. - Silver analyst Ted Butler: 17 September 2014

Well, dear reader, it was another day of engineered price declines across the board in all four precious metals---with all of them occurring during the same time frame, which is hardly indicative of a free market.  Here are the 6-month charts for all four precious metals, so you can see the salami slicing both on Thursday and Wednesday.

The other interesting aspect of Thursday's new lows was the fact that da boyz didn't have the fig leaf of a skyrocketing dollar index to hide behind.  This time they had to do the dirty with the dollar heading down to a 44 basis point loss on the day vs. the 66 basis point rally it had on Wednesday.  Pinning the rise and fall of the precious metals on what's going on with the dollar index is such bulls hit---but we hear it a lot.

Just like yesterday, I'm filing early again---and as I write this paragraph, it's 12:30 p.m. Hong Kong time---and the London open is still two and a half hours away.  The gold price got sold down five bucks or so in early morning trading in the Far East, but then rallied back above unchanged by noon in Hong Kong---and has now been sold back down to unchanged.  It was the same in silver, but it's now about a nickel below its Thursday closing price in New York.  Platinum and palladium aren't doing much.  Gold volume is already north of 26,000 contracts, which is monstrous for this time of day---and silver's volume is already at 4,200 contracts, which is more than double what it was this time yesterday.  The dollar index isn't doing a thing.

Today we get the Commitment of Traders Report for positions held at the close of Comex trading on Tuesday---and Ted and I are hoping for a more impressive set of numbers than we got in last Friday's report.  It's too bad that Wednesday and Thursday price action won't be included, as both days set new lows yet again for this move down in all four precious metals---and on big volume as well.  But whatever the numbers are, I'll have them for you tomorrow.

And as I sent this off into cyberspace at 2:14 a.m. EDT, I see that the gold price is jumping around a bit, silver is down---and platinum and palladium still aren't doing much.  Gold volume is now over 40,000 contracts, an astounding number for this time of day---and silver's volume is north 6,000 contracts, a pretty big number as well. The dollar index is up a handful of contracts.

That's all I have for today.  Since today is Friday, I shan't hazard a guess as to how the trading action will go for the remainder of the day, but nothing will surprise me, nor should it you.

Have a good weekend, or what's left of it if you live west of the International Date Line---and I'll see here tomorrow.

]]>
Fri, 19 Sep 2014 06:02:00 +0000
<![CDATA[Eric Sprott: Get Your Money ‘Out of Banks and Into Something Tangible’]]> http://www.caseyresearch.com/gsd/edition/eric-sprott-get-your-money-out-of-banks-and-into-something-tangible/ http://www.caseyresearch.com/gsd/edition/eric-sprott-get-your-money-out-of-banks-and-into-something-tangible/#When:05:52:00Z "I'd forgotten all about the FOMC meeting"

¤ Yesterday In Gold & Silver

The gold price didn't do much during most of the Wednesday trading session.  But that all changed at precisely 2 p.m. EDT when Janet spoke---and that was that.  The initial down spike at that time didn't amount to much, but about forty minutes later the HFT boyz put in an appearance and quickly had gold down to a new low.  The sell-off ended at precisely 4 p.m. EDT---and from there it traded sideways into the 5:15 p.m. close of electronic trading.

The high and low ticks were recorded by the CME Group as $1,240.50 and $1,222.00 in the December contract.

Gold finished the Wednesday session at $1,223.20 spot, down $11.70 from Tuesday's close.  Net volume was 125,000 contracts with a big chunk of that occurring between 2 and 4 p.m. in New York.

Here's the New York Spot Gold [Bid] chart on its own, so you can see the Comex trading in more detail.

Brad Robertson sent along the 5-minute tick gold chart---and you can see the big volume on the engineered price decline.  Don't forget to add two hours for EDT.

The silver chart was very similar except for a brief [and capped] rally at the Comex open.  Then it traded sideways until 2 p.m.---and you already know the rest.

The high and low in silver yesterday were recorded as $18.80 and $18.49---however, it wasn't a new low for silver, as that would be tough to do, as the metal is basically sold out to the downside.

Silver closed on Wednesday at $18.52 spot, down 16.5 cents from Tuesday.  Net volume was 32,500 contracts.

And here's the New York Spot Silver [Bid] chart---and for the most part, it looks similar to gold's.

Platinum hit its high of the day about half an hour before Zurich opened---and it was all down hill to its 4:30 p.m. EDT low.  It recovered a few bucks into the close---and it, too, hit a new low for this move, down 13 bucks on the day.

Palladium hit its high just before lunch in Zurich---and it, like platinum, got sold down as well, closing almost on its low, down an even ten bucks---but nowhere near a new low.

The dollar index closed late on Tuesday afternoon in New York at 84.07---and traded basically flat until a few minutes before Yellen opened her mouth at 2 p.m.  The dollar rallied---and then retreated but, once again, it looked like the HFT boyz spun their algorithms---and away went the dollar to the upside.  I'm sure there was a certain amount of short covering involved, but it didn't start by itself.  The dollar index closed at 84.73---up 66 basis points on the day---and massively in overbought territory.

And here's the 3-year dollar index to put what's currently happening in some sort of historical perspective.

The gold stocks traded a tad lower for most of the New York session yesterday, but after the initial sell-off at 2 p.m. EDT, they had the audacity to rally into positive territory before the HFT boyz and their algorithms showed up---and it was all over, except for the crying, as the HUI closed down 2.45%.

The silver stocks followed an identical pattern, but Nick Laird's Intraday Silver Sentiment Index closed down 'only' 1.88%.

The CME Daily Delivery Report showed that only 1 gold and 9 silver contracts were posted for delivery within the Comex-approved depositories on Friday.

The CME Preliminary Report for the Wednesday trading session showed that there are 28 gold contracts still open in September, down 4 contracts from yesterday's report.  In silver, there are 389 contracts still open, after 233 contracts were subtracted for the deliveries posted for today.

There were no reported changes in GLD yesterday but, once again, there was another big deposit into SLV.  This time an authorized participant added 959,072 troy ounces of the stuff.

The good folks over at Switzerland's Zürcher Kantonalbank updated their website with the latest activity in their gold and silver ETFs---and they're still going down.  As of the week ending last Friday, their gold ETF shed another 7,507 troy ounces---and their silver ETF dropped by 99,636 troy ounces. 

There was a tiny report from the U.S. Mint yesterday. They sold 3,000 troy ounces of gold eagles---and that was all.

There was no in/out movement in gold over at the Comex-approved depositories on Tuesday.  However, silver more than made up for it as 591,510 troy ounces were received---and an eye-watering 2,447,550 troy ounces were shipped out.  The deposit was at CNT---and 90 percent of the withdrawal was from Brink's, Inc.  The link to that action is here

The in/out movement in Comex silver, along with the continued deposits into SLV are simply stunning---and it's for good reason that Ted Butler can't figure out why more people aren't talking about it, as this is big news.

While on that subject, here's a timely chart that Nick Laird slid into my in-box yesterday.  It shows the total weekly silver holdings of all transparent silver ETFs---and the big increase in the last couple of months [to a new all-time high] is all because of the silver pouring into SLV.

I have less stories today, but I hope you find the odd one of interest.

¤ Critical Reads

Yellen: Fed balance sheet to take years to shrink

Federal Reserve Chair Janet Yellen says "it could take until the end of the decade" to shrink the Fed's record investment portfolio to more normal levels.

The Fed's response to the 2008 financial crisis has swollen its balance sheet to more than $4.4 trillion from less than $1 trillion roughly six years ago. Fed officials responded to the downturn in the economy with three rounds of bond purchases to try to hold down long-term borrowing rates to spur spending.

The Fed plans to end its latest round of buying Treasurys and mortgage bonds after its next meeting in October. It would then look to reduce its balance sheet once it begins raising a key short-term rate from its record low near zero.

The above three paragraphs are all there is to this brief AP story from yesterday---and it's courtesy of West Virginia reader Elliot Simon.

U.S. House passes Fed audit bill but measure is seen doomed in Senate

The U.S. House of Representatives today overwhelmingly passed a bill that would open up Federal Reserve monetary policy decisions to a congressional audit, reviving a measure passed in 2012.

But the legislation approved by the Republican-dominated House is expected to meet a fate similar to its predecessor's: death in the Democratic-controlled Senate.

The "Federal Reserve Transparency Act" passed 333-92 in a bipartisan vote. It is largely similar to the 2012 "Audit the Fed" bill championed by former libertarian Representative Ron Paul.

I thank reader Brad Robertson for sending me this Reuters story yesterday, but I borrowed the headline from a GATA release. 

Food-stamp enrollment in Illinois outpaces job creation by nearly 2-to-1

Illinois’ sluggish jobs recovery is coming at a tremendous cost. For every post-recession job created in Illinois, nearly two people have enrolled in the Supplemental Nutrition Assistance Program, commonly known as food stamps.

In the recession era, the number of Illinoisans dependent on food stamps has risen by 745,000. Without adequate job creation in the state, Illinois families have had no choice but to depend upon food stamps to put bread on the table.

The Prairie State has had the worst recovery from the Great Recession of any state in the U.S. There are nearly 300,000 fewer Illinoisans working today than in January 2008, and 170,000 fewer payroll jobs.

This interesting article was posted on the illinoispolicy.org Internet site on Tuesday---and I found it in yesterday's edition of the King Report.

Scottish independence vote spurs Texan secessionists

Thursday’s vote to decide whether Scotland should be independent of the United Kingdom has bolstered Texans campaigning to split the state from the United States.

Texas Nationalist Movement president Daniel Miller, who wants the state’s legislature to put the secession question on a state-wide ballot, said Scotland’s referendum is a positive sign for his movement.

“If Scotland can do it, so can Texas,” Miller told Reuters. The top US cattle- and oil-producing state would be the 12th largest economy in the world, larger than Mexico or Spain, said Miller, whose organisation has campaigned for secession since the late 1990s.

Miller said Scotland’s referendum has increased interest in the Texas movement and the fact that a free Texas would lose big federal institutions like NASA and multiple military bases was of no concern to him.

“Win or lose, the Scottish referendum is both serving as a source of inspiration and information about what’s happening here in Texas,” Miller said.

This news item appeared on the france24.com Internet site on Wednesday sometime---and it's the first offering of the day from Roy Stephens.

$30 million bounty set to identify who shot down MH17 in Ukraine

$30 million will be given to those who help identify the perpetrators of the downing of the Malaysian Airlines flight MH17 in eastern Ukraine that killed all 298 on board, said an independent German fraud investigation company.

Two months have passed since the Malaysia Airlines plane on its way from Amsterdam to Kuala Lumpur was shot-down in eastern Ukraine on July 17 with 298 crew and passengers on board who all died in the crash. A preliminary report into the disaster carried out by Dutch investigators and issued on September 9 said that the MH17 crash was a result of structural damage caused by a large number of high-energy objects that struck the Boeing from the outside.

The investigation company Wifka, based in Schleswig-Holstein, north Germany said that it has been charged with investigating the case of the downing.

Wifka said that the client who preferred to stay anonymous will pay $30 million dollars to whoever provides evidence that identifies those behind the shoot down.

This story appeared on the Russia Today website at 4:11 p.m. Moscow time on their Wednesday afternoon, which was 8:11 a.m. EDT in New York.  It's the second offering in a row from Roy Stephens.  South African reader B.V. sent us a similar story headlined "‘£18million for whoever tells us who shot down MH17’: German detective agency offers huge bounty after anonymous backers provide massive war chest".  It was posted on the dailymail.co.uk Internet site yesterday as well.

Ukrainian Prime Minister Orders to Keep Troops on Full Combat Alert

Ukrainian Prime Minister Arseniy Yatsenyuk said Wednesday he had ordered the defense minister to keep the country's armed forces in the highest state of combat readiness.

"I ask the defense minister and the interior minister [to ensure] full combat readiness and supply everything that the army or the National Guard needs," he said.

Earlier on Wednesday, a Russian Foreign Ministry's human rights representative stressed the countries, truly interested in putting an end to the crisis in Ukraine, must suppress the attempts to derail the ceasefire by what he called the "war party" in Kiev.

This short article appeared on the RIA Novosti website at 4:22 p.m. Moscow time yesterday afternoon---and I thank Roy Stephens for sending it.

Russia Calls Law on Special Status of Donbas 'Step in Right Direction'

Russia views the recent Ukrainian law on special status of parts of the Donetsk and Luhansk region as a step in the right direction, the Foreign Ministry said on Wednesday.

"This document is regarded by Russia as a step in the right direction and in line with the agreements outlined in the Geneva joint statement by Russia, Ukraine, the United States and the EU on April 17, as well as in the Berlin declaration of July 2," the ministry said in a statement.

"It creates a foundation for the launch of a comprehensive constitutional process in Ukraine, including the start of a dialogue aimed at facilitating the national reconciliation in that country," the statement said.

The ministry also expressed hope that all the provisions of the law would be strictly implemented by Kiev authorities in order to avoid a return to confrontation and violence in eastern Ukraine.

This story is also from the RIA Novosti website.  This one showed up there at 6:05 p.m. Moscow time yesterday evening---and once again my thanks go out to Roy Stephens.

Pay up, Gazprom tells Ukraine

The future relationship between Ukraine and natural gas company Gazprom depends on resolving lingering debt issues, the Russian company said.

Gazprom says it's owed $5.3 billion from Ukrainian energy company Naftogaz. Similar debt issues in 2006 and 2009 resulted in suspension of gas deliveries, and Gazprom said it's time to pay up.

"The future relationships between the companies are fully dependent on settling the debt payout issue," the company's board said in a statement Tuesday.

This UPI story appeared on their Internet site at 8:41 a.m. EDT yesterday---and it's another contribution from Roy Stephens.

Cold Turkey: Ankara not keen on supporting US led anti-ISIS coalition

Turkey remains a key ally of the US despite Ankara’s refusal to back Washington’s bombing campaign against the Islamic State in Syria, the State Department said. Ankara is fighting claims that militants are entering Syria and Iraq through its territory.

"When it comes to Turkey, we share a partnership with them that's essential," deputy spokeswoman Marie Harf said on Wednesday.

"They play a key role obviously in the region. And ISIS is a threat to Turkey's security. And they felt the ripple effect from this, quite frankly, more than most countries in the region."

Turkey was present at a meeting last week, where the US tried to get a coalition together to deal with the problem presented by the Islamic State (IS, formerly ISIS/ISIL). Although 10 Muslim nations in the Middle East did sign up, such as Saudi Arabia and Qatar, Turkey abstained.

This news item appeared on the Russia Today website at 4:12 p.m. Moscow time on their Wednesday afternoon---and it's the final offering of the day from Roy Stephens, for which I thank him on your behalf.

People's Bank of China pumping 500bn yuan through SLF to top 5 banks

Sina.com reports that the PBOC will use their Standard Lending Facility to add 500bn in liquidity.

Not sure what to make of this news on the face of it as they have been drawing liquidity out of the system, but nothing around this size.

Update: Sina.com is citing a banking analysist Qui Guanhua whi says they will be providing 100bn yuan to each bank today and tomorrow with a 3 month duration.

It looks like a short term pump rather than anything more worrying but we’ll keep an eye on it.

That's all there is to this story that was posted on the forexlive.com Internet site on Tuesday---and it's another article I found embedded in yesterday's edition of the King Report.

Jim Rickards: Hedge Against the Next Crisis

Cash, gold and “real” assets, such as infrastructure and agricultural resources, are the place to be for investors, argues best-selling author and economist James Rickards.

Rickards, who wrote The Currency Wars and The Death of Money, is adamant that he is not a pessimistic sort of guy. But he has few soothing words to say about the economy.

The global economy, in his view, has been in depression since 2007 and investors may yet face either deflation or much higher inflation – and potentially both.

“Ultimately inflation has to come,” he says.

Jim made these comments when he was speaking in Australia last week---and an executive summary of what he had to say was posted on the afrsmartinvestor.com.au Internet site.  I thank Harold Jacobsen for digging this up for us.

Three King World News Blogs

1. Rick Rule: "Massive Fund Flows Pouring Into Gold and Silver"  2. Gerald Celente: "Propaganda Aside, It's Bad Out There and Getting Worse"  3. Victor Sperandeo: "Legend Warns of Destructive New Policies for U.S. and Europe"  

[Please direct any questions or comments about what is said in these interviews by either Eric King or his guests to them, and not to me. Thank you. - Ed] 

Gold loses luster on Fed; Barclays cuts forecast

Gold prices dipped Wednesday on concerns about a stronger dollar ahead of the Federal Reserve policy statement and in response to Barclays lowering its gold forecast.

But the precious metal may get a reprieve in the short term as the Fed’s statement, released after gold settled, reiterated that the central bank will keep interest rates low for a “considerable time” after it curtails its bond buying program.

As for the vote on Scotland’s independence, Edward Meir of INTL FCStone expects the “no” vote to prevail, but said markets could get dicey if it doesn’t.

“We do expect to see a massive short-covering rally in gold if Scotland votes ‘yes’, an event that should be momentous in terms of the economic fallout on both the U.K. and Europe,” Meir said.

Well, dear reader, the only reason that gold 'dipped' yesterday, is because JPMorgan et al were standing by to make sure it happened.  This marketwatch.com story showed up on their website at 3:22 p.m. EDT yesterday---and I found this article over at the Sharps Pixley website.

Mike Kosares: Scottish secession, not the Fed, just knocked gold down

Gold has been knocked down last night, not by anything said or done by the Federal Reserve yesterday, but by rising fear of Scotland's secession from the United Kingdom and the separatism it is likely to encourage throughout Europe, Mike Kosares of Centennial Precious Metals in Denver writes.

This fear---and the usual algorithmic trading programs, Kosares contends, have goosed the dollar.

This has "Zip-a-Dee-Doo-Dah" about Scotland.  Da boyz always like to hit gold and silver at the 6 p.m. EDT open---and after what they did earlier in the day, the down ticks at the open were 'all the usual suspects' in action, kicking the precious metals while they were down.  This commentary appeared on the usagold.com Internet site yesterday---and I found it over at the gata.org Internet site.

Facing Death in the Search for Silver

This brief 3:47 minute video clip, was 'borrowed' from The Telegraph---and posted on The New York Times website at 3:47 p.m. EDT on Tuesday.  And I was wrong, this is Roy Stephens' last offering of the day.

Sprott's Thoughts: Get Your Money ‘Out of Banks and into Something Tangible’

In a recent call with Eric Sprott, founder of Sprott Inc., he said he was still buying physical gold -and planned to keep buying it for as long as he could. The gold shortage that he talked about in our May interview is still there, and economically, things aren’t getting better. “When people finally decide they want to buy gold, there probably won’t be any gold,” he explained.

This interview by Henry Bonner was posted on the sprottglobal.com Internet site on Wednesday---and it's definitely worth reading.

¤ The Funnies

These two photos of juvenile lesser scaups are two more from Sunday.  I was lucky on the first one, as the bird was dry.  The scaup is a diving duck---and they also have a 'wet' look, which you can see in the group shot that follows---and I apologize for the red reflection in these shots as well, but better that, than no shots at all.  I also have to be careful what I say about ducks from this point onward, as I had an ornithologist correct me on one of my duck photos from a week or so ago.  It was juvenile goldeneye, not a scaup.  I also have at least one English teacher reading this column---and I have to watch my "its and it's" far more carefully, as well.

¤ The Wrap

Almost eerily, the exact same cause (insufficient physical supply) resulted in the silver price run to $50 in 2011. Unlike what occurred in 1980, there was no coordinated manipulative buying in the price run in 2011; only broad-based investor buying, particularly in the publicly traded silver Exchange Traded Funds (ETFs), like SLV. If the crooks at the CFTC and CME had been able to pin the 2011 silver run to futures speculators manipulating the price upward, they would have taken that action by now. The reality is that there was no Hunt-like culprit to blame for the 2011 price run, so the actions taken by the regulators to cause prices to crash were strictly to bail out silver short sellers, particularly JPMorgan; just like occurred in 1980. - Silver analyst Ted Butler: 17 September 2014

I'd forgotten all about the FOMC meeting, so I was shocked when I first say the swan dive in gold and silver once I'd checked into the hotel in San Antonio.  But once I discovered the reason, all became clear.  It was just JPMorgan et al using this opportunity to kick the crap out of these two metals once again, especially if they could set new lows in the process, which they proceeded to do in both gold and platinum.

Here are the 6-month charts for all four precious metals as of yesterday's close.

It's not even lunchtime in Hong Kong as I check on trading in the Far East---and it should have come as no shock to anyone that the HFT boyz and their algorithms were standing at the ready when trading began at 6 p.m. EDT in New York yesterday evening.  All four precious metals got smacked---and both gold and platinum set new lows for this move down.

Not surprisingly, volumes in gold and silver are very decent as well---15,000 in gold and 4,000 in silver, which is very high for this time of day.  Of course I'm sure that the technical funds/managed money were pitching longs and going short in all four precious metals, with JPMorgan et al gobbling up the opposite side of those trades.  The dollar index is down 9 basis points as of 11:15 a.m. Hong Kong time.

I'm off to bed, as it's been a very long day---and after yesterday's surprise, nothing will faze me when I check the charts this morning.

See you tomorrow.

]]>
Thu, 18 Sep 2014 05:52:00 +0000
<![CDATA[Gold’s Move From West to East is Said Intended to Rebalance FX Reserves]]> http://www.caseyresearch.com/gsd/edition/golds-move-from-west-to-east-is-said-intended-to-rebalance-fx-reserves/ http://www.caseyresearch.com/gsd/edition/golds-move-from-west-to-east-is-said-intended-to-rebalance-fx-reserves/#When:05:50:00Z "I was not overly happy with the price action on the rallies"

¤ Yesterday In Gold & Silver

Looking at the Kitco chart below, you can see that the gold price made four attempts to rally during the Tuesday trading session, with the most impressive one coming at 11:40 a.m. EDT when the dollar index fell out of bed.  But each time there was a not-for-profit seller in the wings to make sure that those rallies didn't go anywhere, by throwing whatever Comex paper was necessary at them.

The low and high ticks were recorded as $1,232.20 and $1,243.20 in the December contract.

Gold closed in New York yesterday at $1,234.90 up only $2.20 on the day when all was said and done.  Obviously the price would have finished quite a bit higher if JPMorgan hadn't shown up when the did.  Net volume was only 113,000 contracts, so it wasn't overly difficult for 'da boyz' to keep the gold price in line.

After the obligatory down tick at the 6 p.m. open, the chart pattern in silver was more or less the same, so I won't dwell on it much further, but the price capping after the 11:40 a.m. rally is more than obvious.

The low and high ticks were reported by the CME Group as $18.61 and $18.885 in the December contract as well.

Silver finished the Tuesday session at $18.685 spot, up 3 whole cents from Monday. Net volume was 35,500 contracts.

The platinum and palladium charts looked similar in some ways to the gold and silver charts, with the most conspicuous feature in both being the rally at 11:40 a.m. EDT.  Platinum finished up 4 dollars---and palladium closed up 8 bucks.  Here are the charts.

The dollar index closed late on Monday afternoon in New York at 84.25---and then jumped around in a 25 basis point range for a large portion of the Tuesday session---and really looked like it wanted to head south a couple of times, but it appeared that a willing buyer was showing up to catch the proverbial falling knife until it really took at header at 11:40 a.m. EDT.  It's low tick of 83.90 was met with a buyer of last resort---and it rallied back to just above the 84.00 mark, closing the Tuesday session at 84.07---down 18 basis points.  I'm just speculating here, but it's a good bet that the dollar index would have closed significantly lower if left to its own devices, which it apparently wasn't.  Here's the 3-day chart.

The gold stocks opened a bit lower, but then quickly rallied into positive territory once gold rallied in New York.  But more than half of those gains disappeared by the end of the Tuesday session---and the HUI only finished up 0.48%.

The silver stocks got sold down much harder at the open---and the subsequent rally into positive territory didn't hold---as Nick Laird's Intraday Silver Sentiment Index closed down 0.15%.

The CME's Daily Delivery Report showed that zero gold and 251 silver contracts were posted for delivery within the Comex-approved depositories on Thursday.  There were only two short/issuers---Jefferies with 196 contracts and Barclays with 55. There's a decent list of long/stoppers---and it's worth a quick look. The link to yesterday's Issuers and Stoppers Report is here.

The CME Preliminary Report for the Tuesday trading session showed that there are still 33 gold contracts open in September---and 609 silver contracts, down 15 from Monday's report.  But from those 609 contracts must be subtracted Thursday's 251 contract delivery.

I wasn't entirely surprised to see a withdrawal from GLD yesterday.  This time an authorized participant withdrew 134,637 troy ounces.  And as of 8:23 p.m. EDT yesterday evening, there were no reported changes in SLV.

There was another sales report from the U.S. Mint.  They sold 3,000 troy ounces of gold eagles---500 one-ounce 24K gold buffaloes---and 850,000 silver eagles.

Over at the Comex-approved depositories on Monday, they reported that 32.250 troy ounces of gold were withdrawn---and all of it was from Canada's Scotiabank.  Nothing was reported received.  The link to that activity is here.

It was much busier in silver, of course, as 598,756 troy ounces were received---and a smallish 30,417 troy ounces were removed.  The big deposit was at CNT.  The link to that action is here.

As promised, I have a lot fewer stories today---and will probably have less as the balance of the week progresses.

¤ Critical Reads

BlackRock calls for U.S. stock market reforms

BlackRock Inc, the world's largest asset manager, has asked regulators to force exchanges to lower their access fees and require greater transparency of broker dealer-run trading venues known as "dark pools."

The New York-based company outlined a set of proposals aimed at boosting public confidence in the equity markets in a letter on its website to the U.S. Securities and Exchange Commission dated Sept. 12. It said that while the market is "not broken or in need of large scale change," improving current rules would help promote fairness, order and efficiency.

Questions about the safety and fairness of the mostly electronic markets have risen in recent years following a raft of high-profile trading glitches by numerous market participants, causing hundreds of millions of dollars of losses. Those concerns hit the mainstream in late March with author Michael Lewis' book "Flash Boys: A Wall Street Revolt," which claimed the markets were rigged in favor of high-speed traders.

This Reuters story, filed from New York, appeared on their Internet site at 6:01 p.m. EDT on Monday evening---and it's something I found in yesterday's edition of the King Report.

United Offers $100,000 Buyouts to Flight Attendants

United Airlines, the only major U.S. carrier to post a quarterly loss this year, is offering its flight attendants buyouts of as much as $100,000 as it seeks to rein in costs.

Employees who accept the early-exit plan will be eligible for lump-sum payments, said a spokeswoman, Megan McCarthy, who declined to disclose the formula needed to reach the maximum. United also is recalling 1,450 furloughed attendants, most of whom took voluntary leave one to two years ago, she said.

United, a unit of United Continental Holdings Inc., is hoping for at least 2,100 takers from an attendants workforce of more than 23,000 after some senior employees sought the offer, McCarthy said. Attendants back from furlough also will help United bolster airports that were too thinly staffed, she said.

This Bloomberg story, filed from Atlanta, showed up on their website at 10 p.m. Denver time on Monday evening.  Reader Michael Cheverton, who sent me this story, had this to say about it---"Hi Ed, the staggering part about this article is that they say UAL shares are up 31% this year. For an industry that is in shambles and a company that will probably never make a profit again, that says something pertinent about just how screwed up the markets are."  He would be right about that.

France’s ‘super-rich’ take their fortunes to Belgium

A fifth of France’s 100 richest people have moved a total of €17 billion to neighbouring Belgium in recent years, a report showed at the weekend, saying the exodus is largely due to French socialist President François Hollande’s tax policies.

The report, published in Belgian financial daily L’Echo, lists France’s richest man, LVMH CEO Bernard Arnault, media moguls Stéphane Courbit and Bernard Tapie, as well as the Mulliez family, which controls the Auchan supermarket chain, among those who have made the move.

But many of France’s wealthy appear to have crossed over the border only recently.

Many “have shown up in the past three years, in other words since François Hollande was inaugurated as president,” the paper writes, attributing it to the socialist government’s pressure to get the economy back into the black amid soaring unemployment and a ballooning deficit. 

This news item showed up on the france24.com Internet site sometime on Monday---and it's the first contribution of the day from Roy Stephens.

Putin, Merkel Discuss Ukrainian Ceasefire, Gas Deliveries to Europe

Russian President Vladimir Putin and German Chancellor Angela Merkel discussed in a phone call on Monday the situation around the current ceasefire regime and deliveries of Russian gas to Europe, the Kremlin said.

"Putin and Merkel exchanged opinions on the situation with deliveries of Russian natural gas to EU member-states and agreed that the consultations in a three party format should continue," a statement on the Kremlin website said.

The leaders also discussed the development of the situation in Ukraine with focus on the importance of strict compliance with the ceasefire regime by the sides of the internal Ukrainian conflict and the effective monitoring of the situation by the Organization for Security and Cooperation in Europe, the Kremlin said.

This article appeared on the RIA Novosti website at 11:57 p.m. Moscow time on their Monday night, which was 3:57 p.m. in New York.  I thank South African reader B.V. for sharing it with us.

Gas onus on Ukraine, Gazprom says

Reliable natural gas deliveries to Europe depend largely on contractual issues in Ukraine, Russian energy company Gazprom said Tuesday.

Gazprom in June cut gas supplies to Ukraine because of ongoing disputes over pricing and debt. Ukraine pays some of the highest prices for natural gas in the region. Russia had offered a discounted price, though the Ukrainian government said it suspected the offer was politically motivated.

Russia meets about a quarter of Europe's gas needs, though most of that gas runs through the Soviet-era transit network in Ukraine. Similar rows in 2006 and 2009 left European consumers in the cold and Gazprom says the onus is now on Ukraine.

This UPI article put in an appearance on their website at 10:28 a.m. EDT on Tuesday---and it's the second contribution of the day from Roy Stephens.

Russia Central Bank Responds To Domestic Dollar Shortage, Starts Currency Swaps

With the ruble hitting record lows once again today against the U.S. dollar, it appears concerns over U.S. dollar liquidity are growing in Russia. The Russian central bank has unveiled an FX swap operation, allowing firms to borrow dollars in exchange for Rubles for a duration of 1 day (at a cost of 7%p.a.). Of course, this squeeze on USD funding - driven by Western sanctions - will, instead of isolating Russia, force Russian companies (finding USD transactions prohibitively expensive) into the CNY-axis, thus further strengthening the Yuanification of world trade and the ultimate demise of the USD as reserve currency.

And funding sanctions appear to have driven the Central Bank to supply U.S. dollar liquidity into an apparently squeezed market...

As Bloomberg reports---"Sanctions and closed access to foreign-exchange liquidity from the West” is feeding demand for dollars, DmitryPolevoy, chief economist ING.

Foreign-exchange liquidity has “virtually dried out,” with volumes sinking to about $100 million per day, compared with $1 billion to $2 billion previously, according to Natalia Orlova, the chief economist for OAOAlfa Bank in Moscow.

This article appeared on the Zero Hedge website at 2:50 p.m. EDT yesterday afternoon---and it's another contribution from reader B.V.

What draws Modi to China

Modi is due to visit the U.S. in exactly twelve days from now. But there is nothing of the American rhetoric that used to mark a Manmohan Singh visit to the White House.

An idea was thought of initially to propitiate Modi by granting him the privilege of addressing the US Congress. But it has been quietly shelved.

The heart of the matter is that there had been a pronounced 'militarization' of India's strategic outlook through the past 10-15 years, which was a period of high growth in the economy that seemed to last forever.

In those halcyon days, geopolitics took over strategic discourses and pundits reveled in notions of India's joint responsibility with the United States, the sole superpower, to secure the global commons and the 'Indo-Pacific'. 

This longish commentary falls into the must read category, especially for any serious student of the New Great Game.  It was posted on the Asia Times website yesterday sometime---and it's courtesy of Roy Stephens.

China's leaders refuse to blink as economy slows drastically

China’s leaders have brushed aside warnings of an incipient credit crunch in the Chinese economy, determined to purge excesses from the financial system despite falling house prices and the deepest industrial slowdown since the Lehman crisis.

Industrial production dropped 0.4pc in August from a month earlier, a rare event that highlights how quickly China is coming off the boil. The growth of fixed asset investment fell to record lows.

“It is a shockingly sharp deceleration,” said Wei Yao, from Société Générale. “What is surprising is the calm response from Beijing. The new leadership’s tolerance for short-term pain seems to have jumped by another big notch.”

Electricity output has dropped 2.2pc over the past year as the authorities continue to force dinosaur industries into closure, chipping away at excess capacity.

This commentary by Ambrose Evans-Pritchard showed up on the telegraph.co.uk Internet site at 7:59 p.m. BST on Monday---and I thank Roy Stephens for sending it our way.  It's worth reading.

Three King World News Blogs

1. John Embry: "War in Silver Rages as People’s Confidence in the West Fades".  2. Stephen Leeb: "China, Russia, Gold---and a New World Order Rising From the East"  3. Jeffrey Saut: "Warren Buffett, Charlie Munger, City Slickers---and Just One Thing"

[Please direct any questions or comments about what is said in these interviews by either Eric King or his guests to them, and not to me. Thank you. - Ed] 

Gartman Letter cites Koos Jansen and Gold Newsletter on Chinese gold demand

Regarding Chinese gold demand, which we wrote about yesterday, it is open to debate and our old friend, Brien Lundin of the Jefferson Companies in New Orleans, wrote to share his insights. We've chosen to share them further with our readers, with his approval. Brien wrote:

* * *
Hi, Dennis:

In your letter this morning, you noted that Chinese gold demand was recently reported to be down about 50 percent year over year. This is erroneous information from the World Gold Council, as I've been noting in Gold Newsletter -- that there's a lot of misinformation on this topic. The mainstream financial media keeps parroting numbers from the World Gold Council and other sources, which typically rely on import statistics from Hong Kong.

However, China has recently opened up new ports of entry for gold, a move that has correspondingly reduced the import numbers from Hong Kong.

"Much more relevant are gold delivery statistics from the Shanghai Gold Exchange, which directly indicate wholesale gold demand in China. Koos Jansen is today's leading reporter of Chinese gold demand dynamics, and he relies on the Shanghai Gold Exchange numbers for his analyses. Using the SGE reports, Jansen notes that Chinese gold demand year to date is down about 17 percent from last year's torrid pace.

This commentary appeared in a GATA dispatch yesterday.

China advances gold exchange launch, Singapore delays contract

China will launch its international gold exchange 11 days ahead of schedule, sources said on Tuesday, racing ahead in the scramble to set up an Asian bullion benchmark as rival Singapore is forced to delay its gold contract due to technical issues.

Asia, home to the world's top two gold buyers - China and India, has been clamouring to gain pricing power over the metal and challenge the dominance of London and New York in trading.

The state-run Shanghai Gold Exchange (SGE) will launch the global gold bourse in the Shanghai free-trade zone on Thursday, two sources familiar with the matter told Reuters. The SGE had initially planned the launch for Sept. 29.

This gold-related article showed up on the Reuters website at 12:41 a.m. on Tuesday---and it's another story I found over at the gata.org Internet site.

Gold's move from West to East is said intended to rebalance FX reserves

China may join other emerging countries in boosting gold reserves as the precious metal makes up a smaller share of its foreign-exchange holdings compared with developed economies, said a London-based researcher.

The country hasn't announced any changes to state gold reserves since authorities in 2009 said holdings totaled 1,054.1 metric tons. While China holds the world's biggest foreign-exchange reserves, bullion accounts for 1.1 percent of the total, compared with about 70 percent for the U.S. and Germany, the biggest gold holders, World Gold Council data show.

"It is clear that Western central banks over time will be reducing their reserves and China and other Asian countries will be increasing," David Marsh, managing director at the Official Monetary and Financial Institutions Forum, said in a Sept. 11 interview in Beijing. "Gold will become more traded among central banks in the next 30 years because there are colossal imbalances in world gold holdings as a percentage of overall asset reserves."

Central banks, net buyers of gold for 14 straight quarters, last year helped limit bullion's losses that were the most since 1981 and may increase purchases to as much as 500 tons this year after adding 409 tons last year, the London-based council said Aug. 14. The precious metal rose 3 percent this year as geopolitical tensions boosted demand for a haven.

I found this Bloomberg story embedded in a GATA release yesterday---and it's certainly worth reading.

¤ The Funnies

This Canada goose was using its wings to balance as it picked its way over the rocks as it came from the water onto land.  I wasn't planning on keeping these, because they didn't appear to have any redeeming features when I viewed them on the screen on the back of the camera.  However, when I put them up on the computer monitor at home, I was amazed at the complexity of the feather structure on the underside of the wing.  You don't normally get this view of a goose---and if you do, it's fleeting.  However a shutter speed of 1/4,000 of a second stopped the wing action cold---and they can be examined at your leisure.

¤ The Wrap

An additional signal in the physical silver market that has been unusual and unexpected (at least by me) are the deposits into the big silver ETF, SLV. This week close to 6.5 million oz. of silver were deposited into the trust and over the past four weeks nearly 14 million oz. have been deposited. I don’t recall a previous occasion of extended price weakness and significant metal inflows into the SLV, so the deposits were certainly unexpected by me. Clearly, there have been no net inflows into the big gold ETF, GLD, further highlighting the deposits into SLV. Between a different COMEX warehouse movement pattern and dissimilar ETF metal flows, the stagnant level of silver/gold price ratio becomes even more suspicious.

The real question is who is behind the net new buying of SLV shares? By process of elimination, we know it’s not technical trend-following or price-momentum traders because these traders never buy on extended price declines. By default, the new net buyers of shares of SLV must be value-type traders, attracted by silver’s low and undervalued price. As such, it would appear that these new buyers in SLV are unlikely to sell on yet-lower silver prices and may continue to buy. I may be missing something, but I don’t see how this is bearish. - Silver analyst Ted Butler: 13 September 2014

I must admit that I was not overly happy with the price action on the rallies in both gold and silver yesterday.  It was obvious, at least to me, that they got capped in the same old way.  Volume wasn't overly heavy, so maybe I'm overreacting, but I must admit to be overly sensitive to what happens to rallies, especially in silver, before they get out of hand.  Let's see what happens next time this happens. 

Here are the 6-month gold and silver charts with Tuesday's data included.

And as I type this paragraph, it's barely noon Hong Kong time---and the London open is still three hours away.  I'm way ahead today because I have a plane to catch early tomorrow morning---and I'll be filing today's column as soon as I can, as 5:00 a.m. comes way too early.

At the moment, none of the precious metals are doing a thing.  Gold volume is 7,400 contracts---and silver's net volume is only 1,500 contracts.  As you can tell, unless there is some serious price action, there's no Globex volume worth mentioning between the 6 p.m. open in New York---and the London open the following morning.  The real big volume is always in New York.

Yesterday was also the cut-off for Friday's Commitment of Traders Report---and although I'm expecting good things in it, yesterday's volume/price action will certainly take away a bit from the positive number, as 'da boyz' were either selling longs or going short against all comers in the gold and silver 'rallies' we had yesterday.

And as I fire this off to Stowe, Vermont at 2:10 a.m. EDT, gold, silver and platinum are up a bit---and palladium is flat.  Gold and silver volume is fumes and vapours at 8,700 and 1,700 contracts respectively.  The dollar index is flat.

See you tomorrow.

]]>
Wed, 17 Sep 2014 05:50:00 +0000
<![CDATA[Indian Trade Deficit Widens as Gold Imports Surge 176%]]> http://www.caseyresearch.com/gsd/edition/indian-trade-deficit-widens-as-gold-imports-surge-176/ http://www.caseyresearch.com/gsd/edition/indian-trade-deficit-widens-as-gold-imports-surge-176/#When:06:14:00Z "They took the precious metals lower than even I expected"

¤ Yesterday In Gold & Silver

NOTE:  I'm off to the Casey Conference in San Antonio tomorrow morning---and until my Tuesday column next week, my daily offerings from the Lone Star State [including the one tomorrow] are going to be shockingly short, with the Critical Reads and The Photos and Funnies sections taking the biggest hits.  Besides my presentation, I have lots of events I will be participating in while I'm there---and something has to get sacrificed.  I hope you'll agree that it's better than no column at all. - Ed

Gold got sold down a few dollars by the HFT boyz at the Sunday open in New York---and it printed another new low for this move down.  From there gold rallied a bit, with the high of the day coming shortly before 1 p.m. BST in London.  Then the New York crowd took over---and the gold price got sold down a bit, although it did manage to finish up on the day.

The low and high ticks, such as they were, were reported by the CME Group as $1,226.30 and $1,239.20 in the December contract.

Gold finished the Monday session at $1,232.70 spot, up $4.40 from Friday's close.  Net volume was pretty light at only 91,000 contracts.

Silver opened down, as usual---as it has except for one day this month so far.   Then, like gold, it rallied until around lunchtime in Hong Kong---and chopped sideways in a very tight range for the remainder of the Monday trading day.

The low and high ticks aren't worth the effort to look up.

Silver finished the Monday session at $18.655 spot, up 4.5 cents from Friday's close.  Net volume was certainly on the lighter side at only 24,500 contracts.

Platinum didn't do a lot, but rallied sharply just before lunch in Zurich.  That rally got stepped on around 2 p.m. Europe time---and 'da boyz' in New York turned a gain into a five dollar loss by the close of electronic trading at 5:15 p.m. EDT.  The trading pattern for palladium was very similar---and the decent rally in that metal also met its maker at 2 p.m. Zurich time, about twenty minutes before the Comex open.  Palladium finished up a buck.

The dollar index closed late on Friday afternoon in New York at 84.22---although the ino.com chart below shows it opened in New York on Sunday evening at 84.15.  From there it rallied to its 84.40 high minutes after 8 a.m. EDT, which was the time that the rallies in all four precious metals came to an end.

From that high, the index sold off 20 basis points by the 10 a.m. EDT London p.m. gold fix---and then rallied a handful of basis points into the close.  The index closed at 84.25.  Here's the 3-day chart.

The gold stocks opened in positive territory, but fell into negative territory right away---and then struggled back as the trading day in New York wore on.  The stocks managed to close in positive territory, as the HUI edged higher, up 0.12%.

The silver equities followed a similar path, but couldn't manage to get back above unchanged after their initial sell-off.  Nick Laird's Intraday Day Silver Sentiment Index closed down 0.36%.

The CME Daily Delivery Report showed that only 5 gold and 5 silver contracts were posted for delivery within the Comex-approved depositories on Wednesday.  With a big chunk of silver contracts left to deliver in September, you have to wonder what the short/issuer[s] is/are waiting for, as it's not beneficial to them to wait until the last minute---unless, of course, they're waiting for the silver to deliver.

The CME Preliminary Report for the Monday trading session showed that there are still 33 gold contracts open in the September contract, down 12 contracts from Friday's report.  In silver, there are still 609 contracts left, down 15 from Friday---and subtracting the 5 contracts posted for delivery in each metal in the previous paragraph, doesn't change things much.

I was rather surprised [but happy] to see that there was no withdrawal from GLD yesterday---and as of 7:40 p.m. EDT yesterday evening there were no reported changes in SLV, either.

The U.S. Mint had another sales report yesterday.  They sold 7,000 troy ounces of gold eagles---3,000 one-ounce 24K gold buffaloes---and 200 platinum eagles.

Over at the Comex-approved depositories on Friday, there was a big 112,258 troy ounce gold deposit into HSBC USA---the custodian for GLD---and a tiny 1,794 troy ounces were reported withdrawn.  The link to that activity is here.

In silver, it was another fairly busy day, as there was 625,813 troy ounces deposited---and 5,049 troy ounces removed.  The lion's share of that disappeared into the vault over at Brink's, Inc.  The link to that action is here.

Since this is my Tuesday column, I have a fair number of stories for you today and, as usual, the final edit is all yours.

¤ Critical Reads

BIS central bank warns against 'illusion of permanent liquidity'

Loose monetary policies have created an "illusion of permanent liquidity" that is spurring investors to make risky bets and push up asset prices, the Bank for International Settlements said Sunday.

"The longer the music plays and the louder it gets, the more deafening is the silence that follows," Claudio Borio, who heads the BIS's monetary and economic unit, told reporters.

"Markets will not be liquid when that liquidity is needed most," he warned, urging "sound prudential policies (and) extra prudence on the part of market participants themselves".

This AFP story appeared on the france24.com Internet site at 4:25 p.m. Europe time on Sunday---and I thank South African reader B.V. for today's first story.  Reuters had a similar story.  It was headlined "Central banks inflating 'elevated' asset prices: BIS"---and I found that one at the gata.org Internet site on Sunday.

Inflation Watch: How Much $1 Used To Get You!

The dollar ain't quite what it used to be.  While a buck can't get you more than a quick snack today, you once could get three barrels of whiskey or ounce of silver for it.  Here are a few things that you used to get for just 110 cents from inflation [rampant money printing - Ed] stepped in.

This tiny, but very interesting article, is certainly worth a minute of your time.  It showed up on the Zero Hedge website at 3:06  p.m. EDT on Sunday---and it's courtesy of reader Harry Grant.

Record S&P 500 Masks 47% of NASDAQ Mired in Bear Market

Beneath the U.S. stock market’s record-setting gains, trouble is stirring.

About 47 percent of stocks in the NASDAQ Composite Index are down at least 20 percent from their peak in the last 12 months while more than 40 percent have fallen that much in the Russell 2000 Index and the Bloomberg IPO Index. That contrasts with the Standard & Poor’s 500 Index, which has closed at new highs 33 times in 2014 and where less than 6 percent of companies are in bear markets, data compiled by Bloomberg show.

The divergence shows the appetite for risk is narrowing as the Federal Reserve reins in economic stimulus after a five-year rally that added almost $16 trillion to equity values. It’s been three years since investors saw a 10 percent decline in the S&P 500 and they’re starting to avoid companies that will suffer the most when the market stumbles, said Skip Aylesworth, a portfolio manager for Hennessy Funds in Boston.

No surprises here, as this bubble is being blown up by fewer stocks each passing day.  This Bloomberg article, filed from New York, showed up on their Internet site at 2:33 p.m. Denver time on Monday---and it's another article I found in a GATA release.

Deutsche Bank Strategists: Bonds are in a Bubble

Most of the bubble talk these days focuses on stocks. But Deutsche Bank strategists led by Jim Reid see frothiness brewing in the global government bond market.

"The worry is that there is nowhere left for this bubble to go given that it is now in the hands of the lenders of last resort (governments and central banks with regulators ensuring other large captive buyers)," they write in a commentary obtained by MarketWatch.

"Although we think this bubble needs to be maintained to ensure the solvency of the current financial system, the best case scenario is that it slowly pops over time via negative real returns for bondholders. The worst-case scenario being future restructuring."

The Barclays U.S. Treasury 20-Year-Plus index has returned 15.5 percent so far this year.

Bond-investment star Jeff Gundlach, CEO of DoubleLine Capital, doesn't see a bubble brewing in Treasurys. He told CNBC that doesn't anticipate major moves by Treasurys for the rest of the year, with the Federal Reserve unlikely to raise interest rates anytime soon.

This article put in an appearance on the moneynews.com Internet site at 9:08 p.m. EDT on Sunday evening---and I thank West Virginia reader Elliot Simon for sharing it with us.

NYT: Subprime Loans Rear Their Ugly Heads Again

Remember the subprime mortgage loans that helped spark the 2008-09 financial crisis?

They may be gone for a while, but other areas of the subprime lending market, particularly auto loans, have begun to look worrisome, The New York Times reports.

Deep subprime auto loans, those made to people with credit scores below 550, soared 13 percent in the second quarter from the year-earlier period, according to Experian.

"We're five years into the new cycle, so you've got to imagine that there are excesses cropping up," William Ryan of Portales Partners research firm told the paper.

Why should anyone be surprised at this turn of events?  This is another news item from the moneynews.com Internet site.  This one showed up there at 1:31 p.m. EDT yesterday---and it's the second offering in a row from Elliot Simon.

Calpers to Exit Hedge Funds, Divest $4 Billion Stake

The California Public Employees’ Retirement System plans to divest the entire $4 billion that it has with hedge funds, saying they’re too expensive and complex.

The decision to eliminate 24 hedge funds and six hedge fund-of-funds, isn’t related to the performance of the program, said Ted Eliopoulos, the interim chief investment officer. The board of the $298 billion pension, known as Calpers, hasn’t decided where to invest the money after the pullout, which will take about a year, he said.

“We concluded that we would eliminate the hedge fund program in order to reduce the complexity, reduce the costs in the program, particularly in relation to our view that given the scale of Calpers, we would not be able to scale a hedge fund program to a size that would really move the needle,” Eliopoulos said today in an interview.

The largest U.S. pension is getting out of hedge funds even as other large public plans such as New Jersey’s add to the private portfolios. Calpers has been working to reduce risk after the global financial crisis wiped out more than a third of its wealth, forcing it to increase contributions from taxpayers to cover losses. Calpers first invested in hedge funds in 2002 to help meet target returns to cover the growing cost of government retiree benefits.

This Bloomberg news item, filed from Sacramento, appeared on their Internet site at 5:30 p.m. EDT yesterday---and I thank reader G. Roberts for sending it our way.

A constitutional amendment to take Big Money out of U.S. politics dies quietly

This week the U.S. Senate considered a constitutional amendment that would have allowed Congress and state legislatures to limit the power of money in politics. The debate was not much covered in the media because the outcome was so predictable. But the party-line vote that killed it should not go unnoted.

A remarkable majority of the American public — 79 percent according to Gallup — want campaign finance reform. The right and left, the Tea Party and Occupy Wall Street, even Jon Stewart and Bill O’Reilly agree that, left unchecked, Big Money corrupts politics and undermines democracy.

That was one of the few things Thomas Jefferson and Alexander Hamilton agreed on, and both the American and French Revolutions were fought in part to get the financial power and privilege of aristocracy out of governance.

But even George III after Yorktown and Louis XVI on the eve of execution were more popular than Congress is today, and the strangely perverse partisanship that characterized the debate on the amendment this week helps to explain why.

This interesting Reuters article appeared on their website last Friday sometime---and I thank Harry Grant who sent it our way on Saturday.

Scots Independence Campaign Nears Climax as Polls Diverge

Prime Minister David Cameron will return to Scotland for the second time in a week to fight for the future of the U.K. as campaigning ahead of the referendum on independence reaches its climax.

Activists were out in force across Scotland during the final weekend before the Sept. 18 ballot that might trigger the breakup of the union after more than three centuries. With opinion polls showing contradictory findings, both the “yes” and “no” campaigns said they were poised to win, introducing further uncertainty to financial markets fixed on Scotland.

Scottish First Minister Alex Salmond, the head of the pro-independence campaign, and Alistair Darling, the former U.K. chancellor of the exchequer who fronts the Better Together group, reprised arguments today over the economy, the pound and state-funded health care if Scots back independence. With the debate increasingly polarized, the focus now is on appealing to undecided voters in the final three days of the campaign.

This Bloomberg article, co-filed from London and Edinburgh, showed up on their Internet site at 8:30 a.m. MDT on Sunday---and it's the first offering of the day from Roy Stephens.

Treasure Map: The NSA Breach of Telekom and Other German Firms

According to top-secret documents from the NSA and the British agency GCHQ, the intelligence agencies are seeking to map the entire Internet, including end-user devices. In pursuing that goal, they have broken into networks belonging to Deutsche Telekom.

When it comes to choosing code names for their secret operations, American and British agents demonstrate a flare for creativity. Sometimes they borrow from Mother Nature, with monikers such as "Evil Olive" and "Egoistic Giraffe." Other times, they would seem to take their guidance from Hollywood. A program called Treasure Map even has its own logo, a skull superimposed onto a compass, the eye holes glowing in demonic red, reminiscent of a movie poster for the popular "Pirates of the Caribbean" series, starring Johnny Depp.

Treasure Map is anything but harmless entertainment. Rather, it is the mandate for a massive raid on the digital world. It aims to map the Internet, and not just the large traffic channels, such as telecommunications cables. It also seeks to identify the devices across which our data flows, so-called routers.

Furthermore, every single end device that is connected to the Internet somewhere in the world -- every smartphone, tablet and computer -- is to be made visible. Such a map doesn't just reveal one treasure. There are millions of them.

The breathtaking mission is described in a Treasure Map presentation from the documents of the former intelligence service employee Edward Snowden which SPIEGEL has seen. It instructs analysts to "map the entire Internet -- Any device, anywhere, all the time."

This longish, but very interesting essay, showed up on the German website spiegel.de at noon Europe time on Sunday---and my thanks go out to Roy Stephens once again.

Outrage as E.U. blocks democratic challenge to U.S. trade deal: Comment

There is something rotten in the state of Europe when an unelected, unaccountable EU body can glibly inform millions of us that we no longer have the right to question its most dangerous and unpopular policies.

This is exactly what has just happened, as the European Commission has announced that it will not allow a European Citizens' Initiative (ECI) to challenge the secret trade talks it is holding with the US government, supposedly on our behalf.

The ruling is a slap in the face for the 230 civil society organisations from across Europe that have lined up behind the initiative, and the millions of European citizens they represent. The ECI is the only vehicle available to us to challenge the shadowy bureaucrats of the European Commission. Now even this seems to be too much scrutiny for them.

The negotiations on the Transatlantic Trade and Investment Partnership (TTIP) have become one of the hottest political topics across Europe. TTIP is effectively a new bill of rights for multinational corporations, granting them unprecedented powers and undermining vital labour, environmental and food safety standards in the name of 'free' trade.

This commentary appeared on the politics.co.uk Internet website at 10:03 a.m. BST last Friday afternoon---and it's worth reading.   I thank South African reader B.V. for his second contribution to today's column.

The E.U.’s Fiscal Watchdogs—–Still Howling and Toothless as France and Italy Pile on the Debt

When it comes to fiscal policy in the E.U., you can break whatever fiscal rules you want, provided you are big enough.

France qualifies, so does Germany. If you are small like Greece and Cyprus, then you may find yourself in bed with the Troika.

For the third time France has declared it will heavily overshoot its already twice-delayed budget deficit target next year, setting up tough negotiations with European partners previously reluctant to grant Paris more time to bring its public finances within E.U. limits.

Michel Sapin, finance minister, announced that the required deficit target of 3 per cent of national output was being pushed back a further two years to 2017 in the latest sign of the deep-seated economic problems confronting President François Hollande and his socialist government.

This excellent commentary by Mike 'Mish' Shedlock was posted on David Stockman's website on Sunday---and I thank Roy Stephens for sending it.

Only a monetary 'nuclear bomb' can save Italy now, says Mediobanca

The OECD has drastically cut its growth forecast for Italy. The depression will drag on though most of 2015.

The economy will contract by 0.4pc this year. It will remain stuck in the doldrums next year with growth of just 0.1pc.

If so, Italy’s public debt will spiral to dangerous levels next year, ever further beyond the point of no return for a country without its own sovereign currency and central bank.

“This is catastrophic for the finances of the country. We’re heading for a debt ratio of 145pc next year,” said Antonio Guglielmi, global strategist for Mediobanca.

This Ambrose Evans-Pritchard blog is datelined Monday---and it's certainly worth reading.  I thank Roy Stephens once again.

Slovak Prime Minister Warns Ukraine of ‘Ultimate Disintegration’

Slovakia's Prime Minister Robert Fico on Saturday warned Ukraine about the perils associated with the European and possibly NATO integration, saying the east European nation was tittering on the brink of an ultimate collapse.

"I think that Ukraine will find it hard to stand against all the challenges associated with the EU integration, because it is now facing an absolute disintegration… I also disagree with the assumption that Ukraine could one day become a NATO member since this would undermine security in the region," Fico said in an interview with the Bratislava-based newspaper Novy Cas.

"Only diplomatic steps can put an end to what is now happening in Ukraine. Look, there's already been a third wave of senseless sanctions, and what has changed? Nothing. We can only expect more firm response measures from Russia," the Slovak official noted.

Robert Fico also told the country's daily that he would sooner step down than see a NATO military base built in Slovakia.

This short, but very interesting article put in an appearance on the RIA Novosti website at 9:16 p.m. Moscow time on their Saturday evening, which was 3:16 p.m. in New York.

Dutch stage tomato fight against Russian sanctions

Dutch stage tomato fight against Russian sanctions, and under one of the photos it says; The Netherlands vies with Mexico as the world's largest tomato exporter, and it sent $100 million worth to Russia last year. Dutch farmers have been offered a subsidy to either dispose of excess crops or donate them to food banks.

This 6-photo AP 'news' item appeared on the cbc.ca website, but it doesn't say what day.  I thank reader 'Andres A' for bringing it to our attention.

NATO members 'start arms deliveries to Ukraine'

NATO countries have started delivering arms to Ukraine to help its soldiers fight pro-Russian separatists in the east, the defence minister says.

Valery Heletey did not give details of the weapons being delivered or name the countries involved.

A similar statement earlier was denied by five NATO members, including the U.S.

This article appeared on the bbc.com Internet site at 3:07 p.m. EDT on Sunday afternoon---and it's courtesy of reader James Skinner.

Lavrov: No haste in MH17 tragedy probe, despite media hype

The report on the Malaysian jet crash is very “calm” and doesn’t provide much information about the tragedy, said Russian Foreign Minister Sergey Lavrov. He added that despite all the hype around the crash, the investigators do not seem to be in a hurry.

In a Saturday interview to Russian channel TV-Center, Foreign Minister Sergey Lavrov revealed he was disappointed by the latest report from Dutch experts on the reasons of Malaysia airplane crash. Malaysian airplane with 298 people on board crashed in Donetsk region July 17. Many western media outlets started accusing Russia without providing any evidence.

However, despite the political tensions, the report provided by the Dutch Safety Board from September 9 is “calm” while the investigators are taking their time with the probe.

“There are no demands that experts resume their work at the crash site,” Lavrov said. “There were also no attempts to go there to collect, as they say, the wreckage and to see how the whole plane looked like. Nobody spoke about it out loud.”

This Russia Today news item appeared on their website at 2:15 p.m. Moscow time on their Saturday afternoon, which was 6:15 a.m. EDT.  It's another contribution from Roy Stephens.

E.U., Kiev, Moscow gas talks suspended

A spokesperson for the Russian Energy Ministry said Monday it was postponing trilateral talks with the European Union and Ukraine.

Talks were scheduled for Saturday. A ministry spokesperson told state news agency RIA Novosti an alternate date depended on Energy Minister Alexander Novak's schedule.

"We told the European Commission that the proposed date is not suitable for us," the spokesperson said. "Another date is being discussed."

The European Union last week enforced new sanctions on the Russian energy sector in response to ongoing crises in eastern Ukraine.

This UPI story, filed from Moscow, appeared on their website at 8:58 a.m. EDT on Monday---and it's another contribution from Roy Stephens.

Washington’s War Against Russia — Paul Craig Roberts

The new sanctions against Russia announced by Washington and Europe do not make sense as merely economic measures. I would be surprised if Russian oil and military industries were dependent on European capital markets in a meaningful way. Such a dependence would indicate a failure in Russian strategic thinking. The Russian companies should be able to secure adequate financing from Russian Banks or from the Russian government. If foreign loans are needed, Russia can borrow from China.

If critical Russian industries are dependent on European capital markets, the sanctions will help Russia by forcing an end to this debilitating dependence. Russia should not be dependent on the West in any way.

The real question is the purpose of the sanctions. My conclusion is that the purpose of the sanctions is to break up and undermine Europe’s economic and political relations with Russia. When international relations are intentionally undermined, war can be the result. Washington will continue to push sanctions against Russia until Russia shows Europe that there is a heavy cost of serving as Washington’s tool.

This commentary by Paul was posted on this website on Sunday---and certainly falls into the must read category, especially for all students of the New Great Game.

Iran Blames U.S. for Violating States’ Sovereignty Under Pretext of Fighting IS

The Secretary of Iran’s Supreme National Security Council (SNSC) Ali Shamkhani blamed Washington for violating Syria’s and other regional countries’ sovereignty, Straits Times reports.

“The U.S. seeks to continue its unilateralism and violate the countries’ sovereignty under the pretext of fighting terrorism,” said Shamkhani in a statement, cited by the official IRNA news agency.

He also expressed his doubts concerning the efficiency of U.S. counter-terrorism policy, claiming that airstrikes targeting ISIS fighters won’t have any positive effect and will only strengthen the radical group’s positions.

Iran’s Parliament Speaker Ali Larijani supported Shamkhani’s position, calling US strategy “irrational”. He said that U.S. way of countering terrorism would not lead to transformation in the Middle-East and help to dismantle ISIS, but rather cause waves of alienation and resentment in the region.

This article was posted on the RIA Novosti website at 9:25 p.m. on Saturday evening Moscow time---and I thank reader B.V. for finding it for us.

Iran refuses to help 'self-serving' U.S. fight ISIS

Iran has refused an offer from the United States to join a global alliance preparing to combat Islamic State militants, according to Iran's supreme leader, Ayatollah Ali Khamenei.

Khamenei said Monday that the US offered to discuss a coordinated effort with Iran against Islamic State (IS, also known as ISIS or ISIL), a common foe in the region, in the midst of an escalating campaign of violence that continues to claim lives across Iraq in Syria.

“The American ambassador in Iraq asked our ambassador (in Iraq) for a session to discuss coordinating a fight against Daesh (Islamic State),” said Khamenei, the state-run Islamic Republic News Agency reported, according to Reuters.

“Our ambassador in Iraq reflected this to us, which was welcomed by some (Iranian) officials, but I was opposed. I saw no point in cooperating with a country whose hands are dirty and intentions murky.

This is a news item that appeared on the Russia Today website at 4:20 p.m. Moscow time on their Monday afternoon---and it's the second last contribution of the day from Roy Stephens.

China to invest $100 billion in India over 5 years

Chinese president Xi Jinping will bring along with him $100 billion or Rs 6 lakh crore of investment commitments over five years during his upcoming India visit next week. This is nearly thrice the $35 billion secured by Prime Minister Narendra Modi during his Japan trip.

Jinping will land in Modi's home state Gujarat on September 17 — the Prime Minister's birthday — following his visit of Tajikistan, Maldives and Sri Lanka.

Confirming this, Liu Youfa, China's consul-general in Mumbai, told TOI, "On a conservative estimate, I can say that we will commit investments of over $100 billion or thrice the investments committed by Japan during our President Xi Jinping's visit next week. These will be made in setting up of industrial parks, modernization of railways, highways, ports, power generation, distribution and transmission, automobiles, manufacturing, food processing and textile industries."

The above three paragraphs are all there is to this brief story that appeared on The Times of India website at 1:55 a.m. IST on their Saturday morning---and it's the final offering of the day from reader B.V.

Snowden claims NSA collected data on New Zealanders

Documents from former National Security Agency contractor Edward Snowden claim Australian and New Zealand Internet data on private citizens was collected by the NSA.

The documents indicate a major undersea telecommunications cable -- linking New Zealand, Australia and North America -- was tapped to collect the data, beginning in 2012 or early 2013. Moreover, the documents suggest the government of New Zealand was aware of the program.

Information on the data collection was published Monday in the Sydney, Australia, Morning Herald and the website The Intercept.

New Zealand Prime Minster John Key denied his country's intelligence agency, the Government Communications Security Bureau, was involved in the mass surveillance of citizens, although Snowden claimed Key was aware of the program.

This UPI article, filed from Auckland, showed up on their website 10:37 a.m. EDT on Monday.  It's the final offering of the day from Roy Stephens, for which I thank him.

Seven King World News Blogs/Audio Interviews

1. David P:  "Gold, Crazy Markets, War in Russia---and "The Entrance to Hell"  2. Dr. Paul Craig Roberts: "Accuses U.S. Banks of Gold and Silver Smash"  3. Robert Fitzwilson: "The Global Ticking Time Bomb, Economic War---and World War III"  4. James Turk: "We Are About to See a Repeat of 2011 in Gold and Silver"  5. Richard Russell: "Total Systemic Failure---and Worst U.S. Nightmare"  6. The first audio interview is with John Mauldin---and the second audio interview is with Dr. Paul Craig Roberts

[Please direct any questions or comments about what is said in these interviews by either Eric King or his guests to them, and not to me. Thank you. - Ed]

Sprott Money's Weekly Wrap-Up interviews your humble scribe

With Eric and John not available for the second Friday in a row, I drew the short straw once again.  This audio interview runs for 7:36 minutes---and it was posted on the sprottmoney.com Internet site on Friday.

Koos Jansen: China again buys the dip in gold---and silver gets scarcer

Declining gold prices again have pushed demand up on the Shanghai Gold Exchange as China buys the dips, while silver inventories on the Shanghai Futures Exchange continue to fall, gold researcher and GATA consultant Koos Jansen reports.

It was posted on the bullionstar.com Internet site on Friday at 3:57 p.m. Singapore time---and I found it embedded in a GATA release yesterday.  I thank Chris Powell for wordsmithing the above paragraph of introduction.

Ron Paul: Will the Swiss vote to get their gold back?

Former U.S. Rep. Ron Paul writes today that he hopes that the people of Switzerland vote to repatriate their gold when they hold a referendum on the issue on November 30.

Paul argues that approval of the proposal at referendum will repudiate the financial elites behind unlimited government. He writes:

"The Swiss people appreciate the work their forefathers put into building up large gold reserves, a respected currency, and a strong, independent banking system. They do not want to see centuries of struggle squandered by a central bank. The results of the November referendum may be a bellwether, indicating just how strong popular movements can be in establishing central bank accountability and returning gold to a monetary role."

Paul's commentary is headlined "Will the Swiss Vote to Get Their Gold Back?" and it was posted at the Internet site of the Ron Paul Institute for Peace and Prosperity on Sunday.  This article is one I found on the gata.org Internet site on Monday.

Anxious Scottish investors have been buying gold

Scottish investment in physical gold has surged by 42 percent in the past fortnight -- on top of the traditional rise in gold demand at this time of the year.

The figure, which comes from Bullionvault.com, the world's biggest online platform for private investors who want to trade physical gold and silver, suggests that anxious Scotland-based investors are turning to gold as a means of insuring against the uncertainties posed by a 'yes' vote in Thursday's referendum.

Bullionvault analysed customer data over the year, stripping out those of 50,000 customers who lived in the UK and then dividing this group further into postcodes north and south of the border.

It then averaged the proportion of transactions typically undertaken by Scotland-based traders out of the whole of the UK over the past year. That figure was then compared to the proportion of Scottish transactions undertaken in the first half of September.

This gold-related news story was posted on the telegraph.co.uk Internet site at 2:36 p.m. BST on their Monday afternoon---and it's another article I found over at the gata.org Internet site yesterday.

Export Growth to Lift Italian Gold Jewellery Demand and Bullion Imports to Six-Year High

Metallis are releasing this snapshot on Italy’s export-focused gold jewellery fabrication to coincide with the recent conclusion of the Vicenza Fair as this marks a good opportunity to review developments so far this year and prospects for the rest of 2014 for Italy and its main overseas markets.

The key findings of the consultancy’s recent research is that Italian gold jewellery demand is on track to rise 11% in 2014 to a six-year high of 128 tonnes. This marks a continuation of the growth seen in 2013, when fabrication made a historic turnaround; then a 24% rebound began a recovery from a decade or so of consecutive losses.

Domestic scrap is also forecast to finish 2014 down 22%, while inflows of scrap could fall by almost 30%. All this is slated to lift gross gold bullion imports by 15% to just over 105 tonnes, their highest level since 2008.

Even stronger growth of 39% for the first half is reported in shipments to China/Hong Kong. Meader noted, “this boom is interesting as it shows the 18-carat segment in China is still going strong, even if the far larger 24-carat sector, which Italy doesn’t serve, couldn’t match 2013’s heady results”.

This interesting story appeared on the sharpspixley.com Internet site on September 5.

Private homes in Iran hold more gold than Central Bank

The Shahrvand Daily reports that according to Gold and Jewelry Producers and Exporters, more than 100 tonnes of the country's gold is stashed in people's homes.

Although the former head of Iran's Central Bank under the Ahmadinejad administration had said the Bank had 500 tonnes of gold in storage, recent reports from the Central Bank put its gold stores at 90 tonnes: in other words, less than what is stored in Iranian homes.

The report by Shahrvand indicates: "Few countries in the world see the public move toward buying gold or foreign currency as investment and steering away from investing in production and adding value to the economy."

These three paragraphs are all there is to this gold-related story that appeared on the pyavand.com Internet site on Sunday---and it's another article I found on the sharpspixley.com Internet site.

AngloGold Ashanti of South Africa Abandons Spin Off Plans

AngloGold Ashanti, one of the world’s largest gold mining firms, said on Monday that it would abandon plans to spin off its international mining operations and raise $2.1 billion in new capital.

The company, based in Johannesburg, said last week that it was planning to spin off its operations outside of South Africa into a new entity to be listed in London. AngloGold Ashanti had also sought to raise new capital in order to reduce its debt ahead of the restructuring.

On Monday, the company said that a number of shareholders, although supportive of the strategic logic of the transaction, expressed concerns about several aspects of the deal, including the level of fund-raising needed for the restructuring to go forward.

“AngloGold Ashanti has, therefore, decided not to proceed with the restructuring and capital raising, as currently proposed,” the company said in a news release on Friday. “The company will continue to evaluate all options to address debt levels and unlock value, taking into account the feedback from its shareholders and its business needs.”

This news story showed up on The New York Times website at 9:31 a.m. EDT on Monday---and it's another story that Chris Powell posted on the gata.org website yesterday.

South African gold, PGM, diamond and copper outputs down sharply

The South African mining sector seems to be going through a particularly rough patch at the moment and this will also have a strongly negative effect on the country’s economy given the importance of metals and minerals in the country’s exports. According the latest Statistics South Africa preliminary data for July, the country’s overall mining production decreased by 7.7% year-on-year.

Not surprisingly, given that the month covered the tail end of the country’s debilitating platinum mining strike, platinum group metals output was down a huge 45.2% year on year.  PGMs had been one of the country’s most significant metal exports of late having comfortably overtaken gold – which, somewhat surprisingly, also saw a 14.6% year on year reduction in output.  Diamond production was down 10% and copper 15.9%

Top places for South African mineral sales values in July were held by coal at R8.13 billion (US$739 million) and iron ore R5.16 billion (US$469 million) despite the fall in global prices for these bulk metals and minerals. Even with the strike impact, PGMs followed close behind at R5.1 billion ($464 million) with gold nowadays only at R3.69 billion ($335 million).

The above three paragraphs are all there is to this interesting story that was posted on the mineweb.com website last Friday.  It's certainly worth skimming.

Indian trade deficit widens as gold imports surge 176%

India's trade deficit widened in August from a year earlier as imports of gold surged 176 percent after policy makers eased shipment curbs.

The shortfall was $10.8 billion last month, wider than $10.7 billion a year earlier, with exports rising 2.4 percent and imports growing 2.1 percent. Gold shipments surged to $2 billion from $739 million in August last year after the government allowed more banks and traders to buy bullion overseas.

India is easing emergency measures taken when the current-account deficit widened to an all-time high, as faster growth boosts inflows. While the shortfall will widen this year through March 2015 after shrinking in the previous 12 months, it will stay sustainable, according to a Reserve Bank of India report last month.

"We can manage with monthly gold imports of about $2 billion and the jump in the August number is largely due to last year's low base after a sudden clampdown," Shubhada Rao, an economist at Yes Bank Ltd. in Mumbai, said yesterday. "The jump may look alarming, but there is no reason for panic."

This Bloomberg article, filed from New Delhi, put in an appearance on their Internet site at 12:30 p.m. Denver time on Monday---and it's another gold-related story I found over at the gata.org Internet net site.

Diver Finds 2,750-year-old Gold Coin in Bulgaria

A diver has found what is believed to be the oldest gold coin ever discovered in Bulgaria, Bulgarian news agency BTA reported on September 9. The coin was found in shallow waters near the resort town of Sozopol on Bulgaria’s Black Sea coast.

The diver saw the gleaming coin by accident, the report said, and later passed it on to Bozhidar Dimitrov – a native of Sozopol and former diver himself, who is now head of the National History Museum in Sofia.

BTA quoted numismatist Vladimir Penchev from the National History Museum saying that the coin is not solid gold, but made of electrum – the naturally occurring alloy of gold and silver, used to mint some of the earliest metal coins in human history.

This particular coin appears to have been minted in the kingdom of Lydia in western Anatolya, sometime in the second half of the seventh century BCE, which put the coin’s age at more than 2750 years, he said.

This short, but very interesting article---with a photo to match---was posted on the sofiaglobe.com Internet site last Tuesday---and it's another article that Chris Powell posted on the gata.org Internet site yesterday.

¤ The Funnies

I was out at the usual spot on Sunday---and it was a lovely day.  I was surrounding by Canada geese on all sides, a few hundred.  Since there are only a dozen or so raised on the pond, the rest were obviously not local birds, as they're beginning to gather for the long migration to the southern U.S.A.  The first shot is of a group a bit less than 20 meters away---and this photo came right out of the camera untouched---and uncropped.

Sitting still for an hour or more has its virtues---and I got these excellent red-necked grebe shots.  It's just too bad about the reflection of the red building in the water.  I took a couple of dozen photos---and since I couldn't decide which of these two were the best, you're getting them both.  I'm sure the day will come when the parents stop feeding their brood, but it wasn't Sunday.

¤ The Wrap

[Last] week, 9.1 million ounces of silver were moved into or taken out from the COMEX silver warehouses, about the highest weekly turnover yet, as total inventories rose 1.6 million oz to 181.8 million oz.  Taken with the above average turnover over the past few weeks, if anything, the turnover seems to be intensifying. The 9.1 million oz turnover this week was more than 56% of all the silver mined in the world for a week (16 million oz). Considering that this spectacle of physical turnover is unprecedented in any other commodity, is it unreasonable to wonder why it exists only in silver and in the warehouses licensed by the COMEX?

An additional signal in the physical silver market that has been unusual and unexpected (at least by me) are the deposits into the big silver ETF, SLV. This week close to 6.5 million oz of silver were deposited into the trust and over the past four weeks nearly 14 million oz have been deposited. I don’t recall a previous occasion of extended price weakness and significant metal inflows into the SLV, so the deposits were certainly unexpected by me. Clearly, there have been no net inflows into the big gold ETF, GLD, further highlighting the deposits into SLV. Between a different COMEX warehouse movement pattern and dissimilar ETF metal flows, the stagnant level of silver/gold price ratio becomes even more suspicious. - Silver analyst Ted Butler: 13 September 2014

All in all, it was a pretty quiet trading day in both gold and silver on Monday---but both metals, along with platinum and palladium began to head south around 8 a.m. EDT as the dollar index peaked and began to head south as well.

Not that I want to stick my neck out, but if forced to bet, I'd guess that the bottom is in for all four precious metals and, like I said on Saturday, if we're not at the bottom, we're very close.  I said about a week or so ago that it wouldn't surprise me in the slightest if we got one more kick in the ass to downside before we were done---and that not only turned out to be the case, but they took the precious metals lower than even I expected.

Here are the 6-month gold and silver charts with Monday's data included.

If things remain quiet until the Comex close at 1:30 p.m. EDT this afternoon in New York, we should see another Commitment of Traders for the record books on Friday.

And as I write this paragraph, the London open is about 55 minutes away.  After opening flat in New York at 6 p.m. yesterday evening, the gold price rallied a few bucks---and is now trading sideways.  Ditto for silver, platinum and palladium.  Net gold and silver volumes are very quiet---gold a hair over 13,000 contracts and silver a few contracts over 3,600.  The dollar index, after falling 15 basis points in early Far East trading, is back to unchanged.

But as wonderful as current bullish structure is in the Comex futures market, how fast and how high we rally will be determined by how the Commercial traders respond as the technical funds/managed money traders begin to cover and go long.  Nothing else matters!!!

The last rally off the record COT structure back in very early June only added $100 to the gold price and $2.75 to the silver price, as the Commercial traders let the managed money traders off with barely a spanking.  If JPMorgan et al decided to put their hands in their pockets and go on vacation for a couple of weeks, we would have precious metal prices [particularly silver] that would be the stuff of legend for a thousand years.

So, we wait some more.

And as I hit the send button on today's effort at 5:55 a.m. EDT, I note that three of the four precious metals are moving higher, but palladium isn't doing much.  Net volume in gold is 19,000 contracts, but certainly doesn't reflect the volume associated with this current move to the upside, as the CME volume data is delayed by at least ten minutes.  The same can be said for silver, as its net volume is 5,800 contracts at the moment.  The dollar index went through a 25 basis point down-up-down move that has brought it back to basically unchanged.

Here's the Kitco gold charts as of 4:53 a.m. EDT.

With all four precious metals totally sold out to the downside, nothing will surprise me when I check the Kitco charts when I get up later this morning.

Enjoy your day---and I'll see you here tomorrow.

]]>
Tue, 16 Sep 2014 06:14:00 +0000
<![CDATA[India’s Gold Imports For June Were Highest in 12 Months]]> http://www.caseyresearch.com/gsd/edition/indias-gold-imports-for-june-were-highest-in-12-months/ http://www.caseyresearch.com/gsd/edition/indias-gold-imports-for-june-were-highest-in-12-months/#When:08:09:00Z "Not unexpectedly, it was another salami-slicing day"

¤ Yesterday In Gold & Silver

The HFT boyz and their algos didn't waste much time during the Friday trading session in gold, setting three new consecutive low ticks during the trading session.  The first came an hour before London opened, another at 10:40 a.m. EDT---and the last one coming in electronic trading about forty minutes after the Comex close.

The high and low prices for yesterday's trading session were recorded by the CME Group as $1,242.30 and $1,228.10 in the December contract.

Gold finished the Friday session at $1,228.30 spot, down $11.90 from Thursday's close.  Net volume was around 130,000 contracts.

Once again, the 6 p.m. Thursday evening open in silver started with a down tick.  That's happened every day this month so far.  Silver's low tick---and new low for this move down---came shortly after 10 a.m. Hong Kong time on their Friday morning.  The low was retested shortly before 1 p.m.---and the rally into the London open, ended at the open.  After that it chopped sideways and never got a sniff of positive territory for the remainder of the day.

The high and low ticks were recorded as $18.72 and $18.455 in the December contract.

Silver closed on Friday at $18.61 spot, down 6 cents from Thursday.  Net volume was around 37,500 contracts.

The platinum and palladium salamis also got sliced to new lows for this move down, but at different times of day.  Both precious metals rallied back and closed well off their lows: platinum for a slight loss---4 bucks---and palladium actually closed up 3 bucks.  Here are the charts.

The dollar index closed late on Thursday afternoon in New York at 84.27---and spent all of Friday chopping quietly lower, as the index closed at 84.22---down 5 basis points on the day.

As I said yesterday, what the dollar index is doing doesn't have much to do with the activity in the precious metals, but it makes a great talking point when that's the only thing that the price movement can be pinned on.  And, at times, JPMorgan et al use it maximum advantage, like now for instance.

The gold stocks opened down a percent---and barely got a glimpse of positive territory, but they did close off their lows by a little.  The HUI closed down 1.38%.

The price path of the silver equities was very similar but, as usual, they got sold down harder, as Nick Laird's Intraday Silver Sentiment Index closed down 2.39%.

The CME Daily Delivery Report showed that 25 gold and 26 silver contracts were posted for delivery within the Comex-approved depositories on Tuesday.  The link to yesterday's Issuers and Stoppers Report is here.

The CME Preliminary Report for the Friday trading session showed that the number of gold contracts open in September rose by 24 contracts---and now stands at 45 contracts.  In silver, that number declined by 123 contracts---and there are now 612 silver contracts still open in September.

There were no reported changes in GLD yesterday---and as of 6:56 p.m. EDT yesterday evening, there were no reported changes in SLV, either.

But I checked back on the iShares.com Internet site about three hours later---and saw to my amazement that another 3,356,976 troy ounces had been deposited by an authorized participant.  Almost 8 million ounces of silver has been deposited in SLV during the first ten business days of September---and since the SLV's low of 321.2 million ounces on June 22nd of this year---18.2 million ounces of silver have been deposited.  The WTF alarm bells should be ringing loudly that something is definitely going on 'under the hood' in the silver market.

There was a small sales report from the U.S. Mint yesterday.  They sold 2,000 troy ounces of gold eagles---and 30,000 silver eagles.

Month-to-date the mint has sold 23,000 troy ounces of gold eagles---4,000 one-ounce 24K gold buffaloes---810,000 silver eagles---and 200 platinum eagles.  Based on these sales, the silver gold ratio for September stands at 30 to 1, which is decidedly on the low side, as silver eagle sales have sagged since the big buyer disappeared several months ago.

There was no in/out activity in gold worthy of the name at the Comex-approved depositories on Thursday.  But, as usual, it was exactly the opposite in silver, as 1,156,984 troy ounces were reported received---and a further 238,833 troy ounces were shipped out.  Most of the in/out activity was at Canada's Scotiabank---and also at the CNT Depository.  The link to that action is here.

I must admit that I was more than underwhelmed by yesterday's Commitment of Traders Report.  Although the numbers were headed in the right direction in both silver and gold, they weren't the big numbers that both Ted and I were expecting.  In a word, it was disappointing, considering the fact that we carved new low ticks in both metals every day during the reporting week ending on Tuesday, September 9.

In retrospect---and a closer examination of the price charts for the reporting week---even though there were new lows set every day, the salami slices were pretty tiny.

In silver, the Commercial net short position only improved by 2,342 contracts, or 11.7 million ounces.  The Commercial net short position is still pretty hefty at a hair under 30,000 contracts, or 150 million troy ounces.

In the Managed Money category of the Disaggregated COT Report, these brain dead traders continued to pitch longs and go short, which is what their black boxes were telling them to do---so that's what they did.  In the latest report they sold 1,842 long contracts---and added another 1,457 short contracts---which is a swing of 3,299 contracts in total.

Ted says that JPMorgan reduced their short-side corner in the Comex silver market by about 3,000 contracts---and he pegs their current position around 14,000 contracts, or 70 million ounces, just under half of the current Commercial net short position.  And I'd be happy to bet $100 in the currency of your choice that Canada's Scotiabank is short the rest---and more.

In gold, the Commercial net short position declined by only 5,752 contracts, or 575,200 troy ounces of gold.  The Commercial net short position declined marginally to 9.80 million troy ounces.

Ted said that JPMorgan added a couple of thousand contracts to their long-side corner in the Comex gold market---and it now stands at 25,000 contracts, or 2.5 million troy ounces.

Without a doubt there was further improvement since the 1:30 p.m. cut-off on Tuesday, as the HFT boyz that work for JPMorgan et al continued to slice the salamis to the downside in all four precious metals.

Undoubtedly, this will manifest itself in next Friday's COT Report, but after a disappointing report yesterday, I shan't hazard a guess as to how much improvement there might be.  However, there are still two more reporting days to go between now and the Tuesday cut-off---and anything can happen between now and then in the silver market, which is getting more psychotic with each passing day.

I have much more to say about this situation in The Wrap at the bottom of today's column.

Even though it's my Saturday column, I don't have all that many stories.  Normally I have a decent amount.  I hope you have enough time in what's left of your weekend to read the ones you like.

¤ Critical Reads

Yahoo Faced $250,000-Day Fine for Not Giving U.S. User Data

Yahoo! Inc. said the U.S. government threatened in 2008 to fine it $250,000 a day for refusing to comply with national security-related requests for its users’ Internet data.

In small victory for Yahoo’s legal challenges to U.S. surveillance practices, a court today permitted the company to release 1,500 pages of documents that shed light on the scope and force of the government’s data-collection methods.

The company and competitors including Google Inc. and Facebook Inc. have been trying to protect their reputations following revelations that began in June 2013 by former government contractor Edward Snowden that the National Security Agency had access to information about the Internet use of the companies’ customers. Yahoo first challenged the NSA requests in court in 2007-2008.

This news item showed up on the newsmax.com Internet site at 6:27 p.m. EDT on Thursday evening---and it's courtesy of West Virginia reader Elliot Simon.

IEA again cuts forecasts for oil demand

The International Energy Agency Thursday trimmed its forecast for the rise in oil demand this year for the third month in a row, calling the recent slowdown in demand “nothing short of remarkable.”

In its closely watched monthly oil market report, the Paris-based energy watchdog said it expects global oil demand to grow by 0.9 million barrels a day in 2014, a decrease of 65,000 barrels a day compared with last month’s forecast and down by 300,000 barrels a day since July.

According to the IEA, oil demand growth in the second quarter was at its lowest in 2½ years, dented by economic weakness in Europe and China, a trend the agency expects will continue to weigh on demand.

This article appeared on the marketwatch.com Internet site at 5:18 a.m. EDT on Thursday morning---and I thank 'David in California' for sharing it with us.

Alasdair Macleod: Currency turbulence

You'd think that the U.S. dollar has suddenly become strong, and the chart below of the other three major currencies confirms it.

The U.S. dollar is the risk-free currency for international accounting, because it is the currency on which all the others are based. And it is clear that three months ago dollar exchange rates against the three currencies shown began to strengthen notably.

However, each of the currencies in the chart has its own specific problems driving it weaker. The yen is the embodiment of financial kamikaze, with the Abe government destroying it through debasement as a cover-up for a budget deficit that is beyond its control. The pound is being poleaxed by a campaign to keep Scotland in the union which has backfired, plus a deferral of interest rate expectations. 

And the euro sports negative deposit rates in the belief they will cure the Eurozone's gathering slump, which if it develops unchecked will threaten the stability of Europe's banks.

So far this has been mainly a race to the bottom, with the dollar on the side-lines. The US economy, which is officially due to recover (as it has been expected to every year from 2008) looks like it's still going nowhere. Indeed, if you apply a more realistic deflator than the one that is officially calculated, there is a strong argument that the US has never recovered since the Lehman crisis.

This commentary by Alasdair was posted on the goldmoney.com Internet site on Friday BST sometime---and I plucked it from a GATA release yesterday.

Martin Hutchinson: The death spiral of capitalism

No less than six sovereign borrowers are now paying negative nominal interest rates on their 2-year borrowing in euros. In other words, they are making money by going into debt. In real terms, medium-term U.S. TIPS and British index-linked gilts have had negative interest rates for several years. Contrary to the views of the happy Keynesians around us, this is very dangerous indeed. If negative interest rates were to persist, the world's stock of capital would eventually disappear. Without capital, we'd be back up the trees.

You don't even have to be a decent credit risk to borrow money at negative interest rates in euros—France's 2-year bond yield has just turned negative. Since France hasn't balanced its budget since 1969 and is enduring a prolonged period of stagnation caused by having one of the world's largest public sectors, to rational investors it ranks as a credit with substantial risk. Of course, today's bond-market investors aren't rational; their brains are fogged by six-years-and-counting of monetary "stimulus."

Negative interest rates are damaging for savers, who can't earn a return on their money without taking undue risks. However, over time they are even more damaging to the financial system as a whole because they reduce the capital stock outstanding, thereby de-capitalizing the economy. If risk-free interest rates are minus 1% in real terms, then after a year the capital stock is 1% smaller than it had been a year earlier (absent substantial net new savings). Of course, some investors have earned positive real returns by taking risks, but over the business cycle as a whole, those returns will disappear, as the risks turn out to have been misguided.

This longish essay, which is certainly worth reading if you have the time, was posted on the prudentbear.com Internet site on Monday.

Doug Noland: "King Dollar and the Peripheries"

An interesting week saw that Brazilian real get hammered for 4.2%, as Brazil’s stocks sank 6.2%. Venezuela Credit default swap (CDS) prices surged 158 bps to 1,464 bps (lagging Argentina at 1,840!). Turkish stocks were hit for 5.3%, in what Bloomberg called the emerging-market stocks’ “steepest decline in 15 months.” Commodities currencies were also pummeled. The Australian dollar dropped 3.6%, the South African rand 3.0%, the New Zealand dollar 2.1% and the Canadian dollar 1.9%. The Goldman Sachs Commodities Index was hit for 2.4%, trading this week to the lowest level since the tumultuous summer of 2012. Brent crude fell to a two-year low, wheat to a 50-week low and gold to an eight-month low. Spanish yields jumped 30bps, with Italian yields up 20 bps and France’s 17 bps. U.S. junk bond CDS jumped 21 bps this week. In the face of unsettled global risk markets, 10-year Treasuries jumped 15 bps this week.

Market and macro analysis remains extraordinarily challenging. The U.S. economy shows momentum and financial conditions remain ultra-loose. Wall Street strategists are universally bullish. A recent survey (Investors Intelligence) had the smallest reading of bears since 1987. Sentiment is buoyed by the view that it will be years before the Fed raises rates to the point where they would weigh on risk asset prices.

It’s no surprise that I see the greatest financial Bubble in history. I believe asset market inflation and Bubbles have been fueled by speculative leverage exceeding pre-2008 crisis levels. I see global financial and economic imbalances that have been exacerbated by six years of the most extreme monetary policy measures. By now, this type of analysis has been completely discredited. Few will care that I discern acute vulnerabilities.

Doug's latest Credit Bubble Bulletin didn't show up on the prudentbear.com Internet site until late Friday evening---and I'd been checking for it for hours on end, as I knew it would fall directly into the absolute must read category, which it does.

Russian Sailors to Take Part in Mistral Warship Sea Trials in France

Russian sailors, who are currently training to crew Mistral-class helicopter carriers, built in France for the Russian Navy, will go to sea Saturday morning to take part in sea trials of the first ship ordered by Moscow, the Vladivostok, a source familiar with the situation told RIA Novosti.

"Yes, Vladivostok will indeed sail Saturday morning for tests. As far as I know, about 200 Russian sailors and the same number of French personnel will be on board," the source said.

This is the first time the ship goes to the sea since the two crews of Russian sailors, a total of 400 people, arrived in the French town of Saint-Nazaire in June.

This news story was posted on the RIA Novosti website at 10:53 p.m. Moscow time on their Friday evening---and it's the first contribution of the day from South African reader B.V.

Hollande pledges to expand France’s role in battle against IS

President François Hollande promised on a visit to Baghdad Friday to increase French military aid to Iraq to help the country in its battle against a jihadist insurgency by the Islamic State (IS) organisation.

"I came here to Baghdad to state France's availability in providing even more military assistance to Iraq," he told a press conference alongside Iraqi President Fuad Masum.

Hollande did not specify what form an increase in military aid would take, reserving the details until after a conference on Iraqi security set for September 15 in Paris.

“The goal (of the conference) is to coordinate aid, support and action for the unity of Iraq and against this terrorist group,” Hollande told journalists.

This story showed up on the france24.com website on Friday sometime---and I thank Orlando, Florida reader Dennis Mong for finding it for us.

1.8m people, 11km line: Catalonians stage their biggest independence rally

Europe saw one of the largest demonstrations in recent years: at least 1.8 million people formed an 11km red-yellow line to show their support for the upcoming independence referendum. A mosaic was made in the form of a 'V' for 'vote'.

At least 1.8 million Catalans, dressed in red and yellow, the colors of the Catalan flag, gathered on Gran Via and Avenida Diagonal, two of the main streets in Barcelona. Seen from the air, the rally formed a 'V' 11km long. According to the organizers, 'V' represented 'vote', 'victory' and 'will' (voluntat in Catalan).

The number of people participated in the rally – 1.8 million - even surpassed the number of population in Barcelona, which is about 1.6 million. There were more people than the whole population in Luxemburg, Lichtenstein, Monaco or Vatican.

This colourful photo essay put in an appearance on the Russia Today website at 11:55 a.m. Moscow time on their Friday morning---and it's the first contribution of the day from Roy Stephens.

Switzerland's bank fines not tax deductible, cabinet decides

Criminal fines imposed on corporations should not be tax deductible, but tax rebates could be claimed on illegally gained profits that a court has ordered a company to pay back, the Swiss government advised on Friday.

The cabinet was responding to a parliamentary motion to clarify the situation in light of a CHF2.6 billion ($2.8 billion) fine imposed by the United States on Credit Suisse bank earlier this year for the part it played in tax evasion offences.

The suspicion that the bank might try to claim tax expenses against the fine raised political hackles, prompting the motion from centre-left Social Democrat parliamentarian Susanne Leutenegger Oberholzer.

This article appeared on the swissinfo.ch Internet site at 5:47 p.m. Europe time yesterday afternoon---and it's the second offering of the day from South African reader B.V.

MH17 crash: Investigation focuses on '25 metal shards'

The investigation into the downing of Malaysia Airlines flight MH17 is searching for clues in 25 pieces of metal recovered from bodies and debris.

Dutch officials heading the inquiry say they want to establish whether the iron fragments could prove the theory that a ground-to-air missile struck the plane.

Flight MH17 came down over eastern Ukraine on 17 July, killing all 298 people aboard, mostly Dutch citizens.  The investigation has been hampered by continued fighting near the crash site.

Detectives are relying heavily on forensic samples taken from bodies and baggage, as well as satellite data, interviews with witnesses, computer reconstructions, online evidence and intercepted communications.

This story was posted on the bbc.com Internet site at 11:18 a.m. EDT on Friday morning---and it's another contribution from reader B.V.

Uneasy calm in Ukraine's battle-scarred Donetsk

Since the start of a ceasefire last Friday, a fragile and uneasy calm has descended over eastern Ukraine's rebel stronghold of Donetsk, where the scars of five months of devastating clashes are plain for all to see.

But despite the pause in hostilities, the deep divisions between the separatists and the rest of Ukraine seem more entrenched than ever.

In the northern suburbs of the city, FRANCE 24's reporters encounter rebel soldiers guarding a bridge close to the front line – just a kilometre away, Ukrainian troops are dug in at what was once an international airport.

For the separatists, the ceasefire agreement changes little.

This news item appeared on the france24.com Internet site on Thursday---and once again I thank Roy Stephens for sending it.

‘There is no sincere will for peace in Ukraine from the main actors in the West’

Russia has been put into an impossible situation, meaning they are responsible not only for what has been done in Lugansk and Donetsk, but also for what has been done on the side of Kiev, political analyst Alexander Pavic told RT.

RT: Apparently, the truce in Ukraine is not enough for the EU to hold back on yet more sanctions. This somewhat contradicts what European leaders were saying earlier, doesn't it?

Alexander Pavic: The ceasefire was, first of all, the reflection of the very bad military situation for the regime in Kiev. They needed a breather to redirect, recompose their troops, to settle their fronts because they were losing badly, they were in danger of losing Mariupol. Unfortunately, the desire for peace was not honest, was not sincere. On the other hand, the chance to present peace should have been taken. We have had for the past few months one side, Russia, which has been bending over backwards to try to de-escalate the situation, we had several European countries who are trying as best as they could to also de-escalate [the situation] and raise the voice against sanctions. I’m talking about countries like Slovakia, even Italy, not official Germany so much but pretty important political forces inside Germany as well. Unfortunately, the voice from Washington and London was stronger, and as a result no ceasefire is going to be prominent until we have a change of direction, change of policy in the White House, in London and until Berlin decides it is working in the favor of Europe and not in favor of the EU, NATO and Anglo-American alliance.

As I've said before, dear reader, the U.S. and Britain want an armed conflict of some sort. This very interesting interview, which I consider worth reading, put in an appearance on the Russia Today website at 12:01 p.m. Moscow time on their Friday afternoon---and it's courtesy of Roy Stephens once again.

Russia, Ukraine, E.U. Reach Compromise on Kiev's European Integration

Russia, Ukraine and the European Union on Friday reached a crucial compromise on Kiev's free trade pact with the E.U. postponing its entry into force until the end of 2015, Russia's economic Development Minister Alexei Ulyukayev said.

"Until the date that we agreed upon - the end of 2015 - the Russian Federation pledges not to apply protective measures," Ulyukayev told reporters following the second round of trilateral ministerial talks on Ukraine-E.U. association agreement.

"We will continue the discussion of the issue that concerns us the most - what form [of a solution] we could find to alleviate our worries," Ulyukayev said.

"So far, we have agreed to continue dialogue for the next 15 months, we will present our arguments while our colleagues will offer theirs," the minister added.

This brief news item appeared on the RIA Novosti website at 8:41 p.m. Moscow time [12:41 p.m. EDT] on their Friday evening---and the stories from Roy Stephens just keep on coming.

West pushes crippling sanctions on Russia's oil industry despite Ukraine ceasefire

Europe and the U.S. are to press ahead with fresh economic sanctions against Russia despite the ceasefire in eastern Ukraine, aiming to choke off credit and technology vitally needed to arrest the decline of Russia’s oil industry.

The E.U. is to ban loans to five state-owned banks and three energy companies from Saturday, targeting new oil ventures the Arctic and the Siberia shale basin rather than gas operations.

U.S. President Barack Obama said his country will “deepen and broaden” its own array of measures. These are aimed directly at the Russian oil industry, threatening to paralyse Exxon’s $3.2bn joint venture in the Arctic with Rosneft. The sanctions may force BP to shelve its plans for shale development with Rosneft in the Volga Urals.

The rouble fell to a record low of 37.53 against the dollar. The MICEX index of stocks dipped 1.3pc yet it remains far above levels seen earlier this year, suggesting investors are starting to treat each wave of sanctions as political theatre.

This commentary by Ambrose Evans-Pritchard showed up on the telegraph.co.uk Internet site at 9:42 p.m. BST on their Thursday evening---and it's another offering from Roy Stephens.

U.S. intensifies sanctions on Russia over Ukraine

The United States hit Russia's largest bank, a major arms maker and arctic, deep water and shale exploration by its biggest oil companies with new sanctions on Friday to punish Moscow for its intervention in Ukraine.

The sanctions, coordinated with similar European Union steps, were triggered by what the West sees as Moscow's recent effort to destabilize eastern Ukraine by backing pro-Russian separatists with troops, heavy arms and cross-border shelling.. They are the latest economic penalties imposed by the West since Russia annexed Crimea from Ukraine in March.

The sanctions target companies including Sberbank, Russia's largest bank by assets, and Rostec, a conglomerate that makes everything from Kalashnikovs to cars, by limiting their ability to access the U.S. debt markets.

They also bar U.S. companies from selling goods or services to five Russian energy companies to conduct deep water, Arctic offshore and shale projects. The Russian firms affected are Gazprom, Gazprom Neft, Lukoil, Surgutneftegas and Rosneft.

This Reuters article, filed from Washington, appeared on their Internet site at 3:32 p.m. EDT yesterday afternoon---and it's another contribution from Dennis Mong.

Russia Threatens Lawsuits With WTO Over New Western Sanctions

New Western sanctions against Russia give Moscow additional incentives to appeal them in the World Trade Organization as they contradict the WTO regulations, Economic Development Minister Alexei Ulyukayev said Friday.

“I believe that even the previous round of sanctions was the reason enough to appeal with the WTO. And we will certainly do it,” Ulyukayev told reporters in Brussels.

“We will not rush the issue and prepare our appeals in the most argumentative and well-warranted manner,” the minister said.

This story appeared on the RIA Novosti website at 9:30 p.m. Moscow time on their Friday evening, which was 1:30 p.m. EDT.  It's courtesy of Roy Stephens.

Putin: West Makes Use of Ukrainian Crisis to Destabilize International Situation

Russian President Vladimir Putin said Friday that the West uses the crisis in Ukraine to destabilize the international situation, while the country itself is of no interest to anyone.

"I have a conspiracy theory that Ukraine itself is of no interest to anyone, but simply being used as a tool to destabilize international relations," Putin said after the Shanghai Cooperation Organization (SCO) summit.

"Ukraine is used as a tool, as a hostage to the desire of some participants in the international dialogue, to, say revive NATO. And not only as a military organization, but also as one of the key instruments of US foreign policy," the Russian leader said.

This is another story from the RIA Novosti website.  This one put in an appearance there at 8:36 p.m. Moscow time on Friday evening.  It's also courtesy of Roy Stephens.

Russia Containment 2.0---with Stephen Cohen and John Mearshiemer

What does Washington's "containment" policy mean? What threats does it pose? Will it work against today's Russia? And does this mean Washington has declared a new Cold War? CrossTalking with Stephen Cohen and John Mearsheimer.

This excellent 27:42 minute video interview appeared on the Russia Today website in late April---and it's now up on youtube.com.  If you're a student of the New Great Game, this is definitely worth watching.  I thank reader Larry Galearis for bringing it to our attention.

Sergey Lavrov: Throwing Russia off balance is ultimate aim

In an interview for the ITAR-TASS project 'Top Officials'---Foreign Minister Sergey Lavrov said that Washington and some European countries had made a decision to isolate Russia long ago

Over the more than ten years in office as Russia’s foreign minister Sergey V. Lavrov has appeared at thousands of news conferences and granted hundreds of interviews. Minutes before the interview that follows (which lasted for more than two hours) he first loosened and took off his necktie. Then he unbuttoned the top button of his shirt, but only the top one.

On the feeling of despair and the boiling point

- Sergey Viktorovich: you’ve had a really hot time for the past six months.

- And it’s not all over yet. Generally speaking, there has been no calm in foreign politics for a long time. But in summer I did have some time for recreation. In Russia, mind you.

- Don’t you get despaired due to the lack of calmness in foreign affairs?

- No, never ever. That’s not the type of feeling I may have deep down in my heart. We cannot afford to get desperate. We must keep doing our job right.

This very long one-on-one interview with Russian Foreign Minister Sergey Lavrov is also a must read for any serious student of the New Great Game.  It was posted on the ITAR-TASS Internet site at 1:11 p.m. Moscow time on their Thursday afternoon---and it's courtesy of reader B.V.  It had to wait for today's column for length reasons.

U.S. opposes Iran's presence at French-hosted conference on Iraq

U.S. Secretary of State John Kerry said on Friday it was "not appropriate" for Iran to join talks on confronting Islamic State militants, as he appeared to play down how fast countries can commit to force or other steps in an emerging coalition.

Kerry met Turkish leaders to try to secure backing for U.S.-led action against Islamic State militants, but Ankara’s reluctance to play a front line role highlighted the difficulty of building a willing coalition for a complex military campaign in the heart of the Middle East.

As he tours the region to gather support for President Barack Obama’s plan to strike both sides of the Syrian-Iraqi frontier to defeat Islamic State Sunni fighters, Kerry said Shi’ite Iran should have no role in talks on how to go about it.

This article was posted on the france24.com Internet site early this morning Europe time---and I thank Roy Stephens for sliding it into my in-box just after midnight Denver time this morning.

Robert Fisk on Isis campaign: Bingo! Here’s another force of evil to be ‘vanquished’

Resurrection, reinvention and linguistics. Barack Obama did the lot. And now he’s taking America to war in Syria as well as Iraq. Oh yes, and he’s going to defeat Isis, its “barbarism”, “genocide”, its “warped ideology” – until the bad guys are “vanquished from the earth”. What happened to George W. Bush?

But let’s go through this with a linguistic comb. First, Obama is going to resurrect the Sunni “Awakening Council” militias – a creature invented by a certain General David Petraeus – who were paid to fight al-Qaeda by the Americans during the U.S. occupation of Iraq, but who then got blasted by al-Qaeda and betrayed by the Shia-dominated Iraqi government. Obama has even invented a new name for these militias: he called them “National Guard Units” who will “help Sunni communities secure their own freedom from Isil”. National Guard indeed!

Then there’s the reinvention of the “moderate” Syrian opposition which was once called the Free Syrian Army – a force of deserters corrupted and betrayed by both the West and its Islamic allies – and which no longer exists. This ghost army is now going to be called the “Syrian National Coalition” and be trained – of all places – in Saudi Arabia, whose citizens have given zillions of dollars to al-Qaeda in Iraq, Isis, Isil, IS (you decide on the acronym), Jabhat al-Nusra and sundry other bad guys whom Obama now wants to “vanquish from the earth”.

Fisk carves Obama a new one in this commentary that appeared on the independent.co.uk Internet site on Thursday---and it's another contribution from reader B.V.

Global banks retreat as the U.S. and China tighten in lockstep

The world financial system is at an inflection point as the US and China both switch off monetary stimulus, a form of synchronized tightening by "G2" superpowers.

Bank of America has warned clients that the glory days of "maximum liquidity" we have enjoyed in the post-Lehman era are coming to an end, with sweeping implications for asset markets across the world.

The yield on 10-year US Treasuries - the benchmark price of global money - has already jumped 20 basis points to 2.54pc since mid-August as it becomes clear that the US economy has survived its Winter wobble and is moving into an incipient boom. Growth reached 4.2pc in the second quarter, with the ISM manufacturing gauge near 30-year peaks.

Bank of America expects yields to jump to 3.1pc this year, and 3.75pc by the end of 2015 as the Federal Reserve raises interest rates in earnest.

This commentary by Ambrose Evans-Pritchard showed up on the telegraph.co.uk Internet site at 8:19 p.m. BST on their Friday evening---and it's the final contribution of the day from Roy Stephens, for which I thank him.  [Note: This should be read in the context of what Doug Noland had to say in his Credit Bubble Bulletin posted further up in the Critical Reads section]

Three King World News Blogs

1. Paul Craig Roberts: "World's Most Powerful Banks to Loot U.S."  2. Ronald-Peter Stoferle: "World to Enter Second Terrifying 2008-Style Global Meltdown"  3. John Mauldin: "This Great Danger May Trigger a Worldwide Crash

[Please direct any questions or comments about what is said in these interviews by either Eric King or his guests to them, and not to me. Thank you. - Ed]

Hugo Salinas Price: Fiat money and independence for Scotland

Fiat currency is a cause of national separatism, currency wars, and social division between rich and poor, Hugo Salinas Price of the Mexican Civic Association for Silver writes this week in commentary headlined "Fiat Money and Independence for Scotland," posted at the association's Internet site, Plata.com

I found this commentary posted on the gata.org Internet site---and I hope the link works, as I always have problems getting this website to load up on my computer.  But I managed to get it to work this time---and it's certainly worth reading.

Gold price reform to focus on improved transparency, governance controls

Instead of scrapping the century-old London Gold Fix altogether, gold industry role-players are calling for the modernisation of the method used to determine global gold price benchmarks, which is currently the subject of ‘intense’ debate, but not regarded as fundamentally broken.

This comes after increased scrutiny by European and U.S. regulators of gold and silver fixes, along with other commodity benchmarks, regarding the processes and methods used to set commodity prices.

Incidents include the London Interbank Offered Rate, or Libor, case of widespread interest rate manipulation in 2012 and, more recently, Barclays, the group that controls South Africa’s Absa Bank, being fined £26-million by the U.K.’s Financial Conduct Authority in May for failures in internal controls that enabled a gold options trader to manipulate the setting of gold prices.

Industry players note that an optimal gold fix reform will require strengthening through transparency and governance improvements, among other improvement options.

As you already know, dear reader, the London p.m. gold 'fix' is only part of the problem.  It's the negative bias in London trading [since January 1, 1975] that is the overlying concern.  Pile on top of that the criminal CME Group, aided and abetted by the CFTC---and the problems of the London fixes, gold or silver, fade into insignificance.  I thank South African reader B.V. for his final contribution to today's column---and if you decide to read this commentary that was posted on the miningweekly.com Internet site yesterday, I'd do it for entertainment purposes only.

Koos Jansen: India's gold imports for June were highest in 12 months

Gold researcher and GATA consultant Koos Jansen reports that India's official gold imports for June were the highest in 12 months, which seems to contrast strangely with the Reuters report that India may be falling out of love with gold.

I found this story in a GATA release yesterday---and I thank Chris Powell for wordsmithing the above paragraph of introduction.  It's certainly worth your time.

7 Times People Found Money in Bizarre Places

A pot of gold doesn't always sit at the end of a rainbow.

Instead, it can sit quietly in backyards, bathroom walls and even right beneath your feet. Some people set out to hunt for treasure, while others somehow manage to accidentally stumble onto valuable items.

We took a closer look at those who found fortunes unexpectedly, and discovered that many strange places have been home to some of the world's most expensive treasures.

This interesting compilation appeared on the mashable.com Internet site a couple of days ago---and I thank Elliot Simon for today's last story. 

¤ The Funnies

¤ The Wrap

Looking ahead, given the extremely bullish COT set up at hand, it is not unreasonable to contemplate the nature of the next rally, even as the last few price slices to the downside are observed. Specifically, will the collusive commercials rush to aggressively sell to the technical funds who will, most assuredly, be buying aggressively as and when prices climb above the moving averages. You don’t need an IBM 360 to figure out that the technical funds will buy on higher prices, just what will be the commercials’ reaction.

Many would contend that the reasonable bet would be that, of course, the commercials will sell as much as necessary to cap prices on the next rally because that has almost always been the case. While I can’t argue that might occur yet again, I can argue that commercial price capping will end someday and with it the silver manipulation itself. That day is unknown to me but its coming is certainty why I hold silver (and buy call options). - Silver analyst Ted Butler: 10 September 2014

Today's pop 'blast from the past' dates from 1977---and neither the song nor the group that performs it, needs any introduction.  I've posted this before, but it's been a couple of years.  The link is here.

Today's classical 'blast from the past' dates from baroque era in the mid-18th century.  It's J.S. Bach's Concerto for Violin and Oboe in C minor, BWV 1060R which has a very interesting history, as it was a reconstruction from Bach's Concerto for two harpsichords.  This youtube.com video was recorded at the Vilnius National Philharmonic Hall in Lithuania in December of 2010.  The link is here---and it's a good a recording of this work as you're likely to hear.  The soloists are first rate---and not hard on the eyes, either.

Not unexpectedly, it was another salami-slicing day in all four of the precious metals, as the engineered price declines continued.  What I found interesting about them was the fact that they occurred at different times during the Friday session.  Normally they occur all at the same time, or close to the same time, but not yesterday.

Here are the 6-month charts for all four precious metals, updated with Friday's price/volume data.

Gold and silver prices are now lower than they were at the lows back in late May, early June of this year---and platinum hasn't been this oversold since mid-May of 2012.  If forced to bet ten bucks, I'd say we saw the lows for this move down yesterday---and if not, they aren't far off in time or in price.

Where we go from here was nicely summed up in Ted Butler's quote further up, so I won't bother reinventing the wheel by trying to say the same thing in my own words.

I mentioned in yesterday's column that "there's the possibility that the price management scheme may blow up before Tuesday's cut-off, as this sell-off appears to have some sort of urgency attached to it."

And if it does blow up, it will certainly be centered around the Comex futures market in silver.

Along with the reasons I gave in The Wrap yesterday---the frantic in/out movement in silver at the Comex for the last three plus years, the huge increase in SLV deposits since June, despite the negative price action---and one I forgot to mention was the non-technical fund long holder sitting in the bushes in the Managed Money category of the Disaggregated COT Report.  If they added to their long position during the last reporting week, it wasn't much--and was disguised by other traders pitching their long positions.

The last thing I have my eye on is the lead story in my Tuesday column which was headlined "CME Group Admits Its Exchanges Have Been Allowing Manipulative Trading Practices".  This Zero Hedge piece mentions [and posts it in its entirety] a letter from the CME Group to the CFTC dated August 28, 2014.  In that letter it states that "starting September 15, 2014 the CME will no longer tolerate "Disruptive market practices."---and you can read the complete list in the ZH article, which I urge you to do, even if you've already read it once.

Anyway, March 15 is Monday---and we should find out in reasonably short order if this "new rule 575" makes any difference.  I'm expecting that it will, but it's impossible to tell.

Along with that situation, I'm completely at ease with what Doug Noland said in his weekly Credit Bubble Bulletin which, if you haven't read, you can redeem yourself now by clicking here.

The salient paragraph reads "It’s no surprise that I see the greatest financial Bubble in history. I believe asset market inflation and Bubbles have been fueled by speculative leverage exceeding pre-2008 crisis levels. I see global financial and economic imbalances that have been exacerbated by six years of the most extreme monetary policy measures. By now, this type of analysis has been completely discredited. Few will care that I discern acute vulnerabilities."

Amen to that!

The world's economic, financial and monetary system are now totally out of control---and I'm sure the Jim Rickards is looking around for snowflakes, as the avalanche he predicted is most certainly at hand.

I await the Sunday night open in New York with more than the usual amount of interest, along with the remainder of the Monday trading session that follows.

I'm done for the day---and the week.

But before heading off to bed, I'd like to remind you one final time that this coming Monday is the last day you can sign up for that special discount for Casey OnePass and still save $1,749 on the full subscription package.

As you may already know, with the Casey OnePass, you get ALL of Casey’s newsletters (no CIA or CEC alert services) at a significant saving of $1,749 per year.  But more importantly, Casey Research has got some good opportunities across all sectors---and what better way to keep track of them, then to sign up for a service that includes them all?

You can find out all you need to know by clicking here---and it costs nothing to have a look.

Enjoy what's left of your weekend---and I'll see you here on Tuesday.

]]>
Sat, 13 Sep 2014 08:09:00 +0000
<![CDATA[China Holds “Gold Congress”—Positioning Itself as Global Gold Hub]]> http://www.caseyresearch.com/gsd/edition/china-holds-gold-congress-positioning-itself-as-global-gold-hub/ http://www.caseyresearch.com/gsd/edition/china-holds-gold-congress-positioning-itself-as-global-gold-hub/#When:06:14:00Z "The price management scheme may blow up before Tuesday"

¤ Yesterday In Gold & Silver

It was a pretty quiet trading day in gold up until the 10:30 a.m. BST London morning gold fix---and after that the HFT boyz swung into action. Once that was over with around the noon BST silver fix, the gold price rallied until precisely 9 a.m. EDT when 'da boyz' went to work once again---and gold's low tick around 10:25 a.m. EDT was another slice off the salami, along with another new low for this move down.  After that, the gold price chopped quietly higher until precisely 4 p.m. EDT when it got sold down a few bucks into the 5:15 p.m. electronic close.

The highs and lows were recorded by the CME Group as $1,251.00 and $1,235.30 in the December contract.

Gold finished the Thursday session at $1,240.20 spot, down $8.80 from Wednesday's close.  Net volume was very impressive at around 149,000 contracts.

Here's the New York Spot Gold [Bid] chart on its own, so you can see the Comex action in more detail.

After the obligatory down-tick at the 6 p.m. open on Wednesday evening, silver traded more or less flat until noon Hong Kong time on their Thursday.  Then down it went as well.  There was a secondary low at the noon London silver fix, with the final low coming at either 12:15 or 12:30 p.m. EDT if you check the NY Spot Silver [Bid] chart a bit further down.  The silver price didn't do much after that, although it did rally a few pennies starting just before 3 p.m. EDT.

The high and low ticks were posted as $18.895 and $18.57 in the December contract.

Silver closed yesterday at $18.67 spot, down 27 cents from Wednesday's close---and another low for this move down.  Net volume was very hefty at 52,500 contracts.

Here's the New York Spot Silver [Bid] chart

Platinum and palladium continue to get pounded by the HFT boyz as well, with the sharp spike down in palladium around 12:30 p.m. EDT being particularly egregious sign of that.   Platinum got closed down 11 dollars---and palladium another 22 bucks.  Platinum is now monstrously oversold---and it won't be long before palladium is in oversold territory as well.  Here are the charts.

The dollar index closed late on Wednesday afternoon at 84.20---and spent all of Thursday chopping around in a very tight range either side of that number.  The index closed up 7 basis points at 84.27.

It should be obvious that the actions inside the currency markets had no influence on the precious metal prices.  They are, as always, controlled by JPMorgan et al in the futures market on the Comex.

The gold stocks gapped down a percent at the open---and then chopped sideways until the gold price began to rally shortly after 2 p.m. in electronic trading in New York.  The stock popped into positive territory and closed up 0.81%.  No doubt some bottom fishing going on.

The silver shares got sold down by 2 percent at their lows during mid-day trading in New York yesterday but, like the gold equities, came roaring back when silver rallied in electronic trading---and they, too, managed to finish in positive territory, as Nick Laird's Intraday Silver Sentiment Index closed up 0.45%.  More bottom fishing, I presume.

The CME Daily Delivery Report showed that 1 gold and 141 silver contracts were posted for delivery within the Comex-approved depositories on Monday.  The big short/issuer was ABN Amro with 124 contracts---and there were about a dozen long/stoppers once again.  The link to yesterday's Issuers and Stoppers Report is here.

The CME Preliminary Report for the Thursday trading session showed that we're down to only 21 gold contracts open in the September delivery month, but that can change at any moment if someone shows up out of the blue demanding physical metal.  And there are still 745 silver contracts open in September, down only 8 contracts from Wednesday.

There was a small withdrawal from GLD yesterday, as an authorized participant took out 10,015 troy ounces, which was probably a fee payment of some type.  And as of 9:20 p.m. EDT yesterday evening, there were no reported changes in SLV.  However, when I checked the iShares.com Internet site at 3:40 a.m. EDT this morning, I was amazed to see that another 1,486,686 troy ounces had been added.

Since its low of 317.7 million troy ounces on June 26, 2014---there has been, net of withdrawals, 18.42 million ounces of silver added to SLV.  During that time period, silver has risen from about $19.70 the ounce, up to about $21.70 the ounce on July 10.  Now silver is down to $18.71 the ounce as of Thursday's close.

I mentioned my surprise yesterday that not all of this silver was being used to pay down the short position in SLV---and I couldn't figure out why that was the case.  After discussing this with Ted yesterday, he concluded that despite the net price decline in silver over that period, there were still buyers of the metal via SLV---depositing the metal and taking shares in exchange---which certainly isn't how you and I would do it.

It would be my guess that whoever is "doing it" has a more intimate knowledge about the future direction of silver prices than we do at the moment.

Joshua Gibbons, the "Guru of the SLV Bar List," updated his website with the goings-on inside SLV for the week ending at the close of trading on Wednesday---and here's what he had to say.  "Analysis of the 10 September 2014 bar list, and comparison to the previous week's list:  238,916.3 troy ounces were removed (all from Brinks London), 1,438,586.7 troy ounces were added (all to Brinks London). No bars had a serial number change."

"The bars removed were from: Aurubis AG (0.1M oz), Degussa, Australian Gold Refineries, and Handy Harman (all bars were in there many years).  The bars added were from: Solar Applied Materials (1.0M oz), Jiangxi Copper (0.4M oz), Kazakhmys and Tonling Nonferrours Metals."

"As of the time that the bar list was produced, it was overallocated 245.7 oz.  All daily changes are reflected on the bar list."  The link to Joshua's website is here.

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

There wasn't much movement in gold at the Comex-approved depositories on Wednesday, as only 16,075 troy ounces were reported received---and nothing was shipped out.  The receipt was at Canada's Scotiabank.  The link to that activity is here.

Of course, it was another big day for silver, as 624, 561 troy ounces were received---and 708,162 troy ounces shipped out.  Scotiabank, CNT and Brink's, Inc. were involved.  The link to that action is here.

I have a decent number of stories today---and I'll leave the final edit up to you.

¤ Critical Reads

9/11 After 13 years --- Paul Craig Roberts

The tragedy of September 11, 2001, goes far beyond the deaths of those who died in the towers and the deaths of firefighters and first responders who succumbed to illnesses caused by inhalation of toxic dust. For thirteen years a new generation of Americans has been born into the 9/11 myth that has been used to create the American warfare/police state.

According to the official story, on September 11, 2001, the vaunted National Security State of the World’s Only Superpower was defeated by a few young Saudi Arabians armed only with box cutters. The American National Security State proved to be totally helpless and was dealt the greatest humiliation ever inflicted on any country claiming to be a power.

Osama bin Laden, a CIA asset dying of renal failure, was blamed despite his explicit denial. For the next ten years Osama bin Laden was the bogyman that provided the excuse for Washington to kill countless numbers of Muslims. Then suddenly on May 2, 2011, Obama claimed that U.S. Navy SEALs had killed bin Laden in Pakistan. Eyewitnesses on the scene contradicted the White House’s story. Osama bin Laden became the only human in history to survive renal failure for ten years. There was no dialysis machine in what was said to be bin Laden’s hideaway. The numerous obituaries of bin Laden’s death in December 2001 went down the memory hole. And the SEAL team died a few weeks later in a mysterious helicopter crash in Afghanistan. The thousands of sailors on the aircraft carrier from which bin Laden was said to have been dumped into the Indian Ocean wrote home that no such burial took place.

No surprises here for me.  Questions that nobody in the U.S. government will answer.  This commentary by Paul Craig Roberts appeared on this website on Wednesday---and I thank Roy Stephens for sending it to me yesterday.  It's a must read for sure.

NYC Watches WTC Building #7 Come Down Again This 9/11/14

Times Square in New York City is now the site of the largest 9/11 TRUTH video presentation since 2001. It will host a 45-foot Building #7 video-billboard created by the Architects and Engineers for 9/11.

The billboard has been installed at the corner of 42nd Street and 8th Avenue in Times Square, Manhattan. This 9/11 TRUTH video-billboard has been quite strategically located within very close proximity to the New York Times Building.  In fact many Times employees will be able to view the video as they walk by it on their way to and from work.

What is particularly significant is that The New York Times has persisted in ignoring the facts surrounding the 9/11 event. The Grey Lady and national newspaper of record, as it is universally known, has all but refused to cover with any credibility the greatest terrorist attack in U.S. history; one that occurred in its own backyard!

The video shown below will repeat the following statements and the 15-second spot will air every two minutes for four straight weeks.

5:20 PM on 9/11, WTC7 came down in a classic controlled demolition. The government says fire brought it down, but anyone who watches the video can see otherwise.

This must read/watch article was posted on the stateofthenation2012.com Internet site yesterday---and it's the second offering in row from Roy Stephens.

Deutsche Bank: The Bubble Must Go on to Sustain the "Current Global Financial System"

When all is said and done, it all basically boils down to this: from Deutsche Bank's Jim Reid.

"The bubble probably needs to continue in order to sustain the current global financial system and the necessary future deleveraging. However with yields moving ever lower in many parts of the world in recent times, partly due to weak growth, and with debt levels still moving higher, the chances are that most government bondholders are unlikely to achieve a positive real return over the medium to long-term from this starting point. Inflation or even the risk of sovereign restructuring will likely prevent this."

So there you have it: either the bubble goes on, or the "current global financial system" gets it.

What is left unsaid is that it is only the "1%" who benefits from the bubble. The wealth and income of everyone else gets progressively less, as even the Fed has been forced to admit, until there is nothing left. And should the bubble burst? Why the central banks will just reflate yet another bubble, which translated in lay man's terms means steal even more from the global middle class and give to the world's richest.

This short piece appeared on the Zero Hedge website at 4:22 p.m. EDT on Wednesday---and I found it in yesterday's edition of the King Report.

American credit-card debt hits a post-recession high

U.S. consumers may be relying too heavily on their plastic.

Americans added $28.2 billion to their credit cards in the second quarter of 2014, the largest amount in the last six years and nearly 200% more than in the second quarter of 2009, when the economy emerged from the depths of the Great Recession, according to new research from personal finance website CardHub.com. After paying off $32.5 billion owed during the first quarter of 2014, consumers ran up roughly 86% more debt during the following quarter.

The average household’s credit-card balance now stands at $6,802, up slightly from $6,628 in the first quarter, but still down from $8,431 at the end of 2008. By the end of the year, this figure is expected to exceed $7,000, reaching levels not seen since the end of 2010. U.S. consumers will be roughly $1,300 away from the credit card debt “tipping point,” where minimum payments become unsustainable and delinquencies skyrocket, the report says.

This news item appeared on the marketwatch.com Internet site at 3:32 p.m. EDT yesterday---and it's courtesy of Roy Stephens.

Foreclosure Activity Rises for Second Straight Month in August: RealtyTrac

U.S. foreclosure activity jumped in August for the second consecutive month as banks started the process on more properties and scheduled more housing auctions, industry firm RealtyTrac said on Thursday.

Overall, 116,913 properties were at some stage of the foreclosure process, which includes foreclosure notices, scheduled auctions and bank repossessions, the group said.

That pushed overall activity up 7 percent from July, it said. From a year ago, foreclosure activity was down 9 percent.

Lenders started the foreclosure process on about 55,000 properties in August, up 12 percent from July, but unchanged from a year ago. It was the second consecutive month in which foreclosure starts were up month-over-month.

This article appeared on the moneynews.com Internet site at 10:23 a.m. EDT on Thursday---and I thank West Virginia reader Elliot Simon for sharing it with us.

Marc Faber: McDonald’s tells us why the market will collapse

Marc Faber has long predicted that a collapse in U.S. stocks is coming. On Thursday he reiterated that call, saying there is fresh evidence that a bear market is ahead—courtesy of the Golden Arches.

On Tuesday, McDonald's reported that global same-store sales in August fell 3.7 percent in August, well short of expectations. The worst drop occurred in the Asia-Pacific region on the back of a Chinese meat safety scandal, but even U.S. sales slid 2.8 percent.

For Faber, those results are a perfect example of the damage being done by central banks—and the harbinger of more bad news to come.

This 11-minute CNBC interview with Mark appeared on their website yesterday sometime---and it starts at the 1:10 minute mark.  I thank reader Ken Hurt for finding it for us.

How important is the financial sector to Scotland's economy?

Scotland has a long, rich history in the financial sector. Royal Bank of Scotland has been based there for nearly 300 years, while money manager Standard Life has had its headquarters in Scotland for 189 years.

But several Scottish-based financial institutions have now said they will relocate to England if Scottish voters back the break-up of the UK in next week's referendum on independence.

Uncertainty over the currency an independent Scotland would use, who would be the lender of last resort for Scottish banks and who would regulate them have led to concerns of "capital flight" - where deposits are moved out of the country.

Scottish First Minister Alex Salmond denied uncertainty in the markets was caused by the Scottish government's stance on a shared currency, and instead blamed "the unreasonable posture of the UK government who have refused to discuss this at any stage throughout the last two years".

This article showed up on the bbc.com Internet site at 11:24 a.m. BST on Thursday---and I thank Washington state reader S.A. for sending it our way.

Only Germany is holding together as separatists threaten to rip Europe apart

Europe is disintegrating. Two large and ancient kingdoms are near the point of rupture as Spain follows Britain into constitutional crisis, joined like Siamese twins.

The post-Hapsburg order further east is suddenly prey to a corrosive notion that settled borders are up for grabs. "Problems frozen for decades are warming up again," said Giles Merritt, from Friends of Europe in Brussels.

The best we can hope for - should tribalism prevail - is German political hegemony in Europe. The German people so far remain a bastion of rationalism, holding together as others tear themselves apart. The French are too paralysed by economic depression and the collapse of the Hollande presidency to play any serious role.

The far worse outcome is that even Germany succumbs to centrifugal forces, leaving Europe bereft of coherent leadership, a parochial patchwork, wallowing in victimhood and decline, defenceless against a revanchist Russia that plays by different rules.

Ambrose Evans-Pritchard has the 'Chicken Little'/fear mongering alarm bells ringing before there's anything for them to ring about.  But the British establishment has their knickers in a twist over Scotland at the moment---and AE-P is only doing the bidding of his masters.  If you decide to read this, do so with a big grain of salt.  It was posted on the telegraph.co.uk Internet site at 9:10 p.m. BST on their Wednesday evening---and its another contribution from Roy Stephens.

Most of France Wants Early Resignation of President Hollande: Poll

Over 60 percent of French voters want President Francois Hollande to leave office before his term runs out in in 2017, according to a new poll conducted by Ifop for Le Figaro Magazine, the media outlet reported Thursday.

"According to Ifop, 62 percent of Frenchmen would like to see Francois Hollande leave the Elysee Palace [the official residence of the President of the French Republic] before the end of his mandate. This would be preferable to the dissolution of the National Assembly [the lower house of the Parliament] of France or the replacement of the country's prime-minister," Le Figaro said.

Earlier in September, Hollande announced that he will not step down before the end of his term.

This brief news item was posted on the RIA Novosti website at 3:16 p.m. Moscow time on their Thursday afternoon---and it's the first offering of the day from South African reader B.V.

Half of Europeans against U.S. Interference in European Policies: Survey

Half of Europeans are against US interference in their international policies, the 13th Transatlantic Trends survey by The German Marshall Fund reveals.

"Fifty percent of Europeans said they would prefer to see their country take a more independent approach from the United States, up 8 percentage points from last year," reads the statement published on the fund's website on Wednesday.

The survey, which also showed that the majority of Americans (53%) disapprove of President Barack Obama's international policies, had the most notable response registered in Germany, where 57 percent of the population expressed a strong preference for such an approach in security and diplomatic affairs that would as independent from the United States as possible.

This is another RIA Novosti story from yesterday---and it's the second offering in a row from reader B.V.

German Business Calls Russia Key Partner Despite Sanctions

Despite the sanctions, Russia is still key partner for German businesses, Michael Harms, Chairman of the German-Russian Chamber of Commerce in Moscow, said Thursday.

"Unfortunately, the paradigm of our cooperation has changed significantly. At the beginning of the year I was working on the framework of a new Germany- Russia Partnership for Modernization, and today we have to speak about the impact of sanctions. Nevertheless, I would like to emphasize that from the perspective of the German business, Russia remains its strategic economic partner," Harms noted at the news conference presenting the results of the poll on the impact of sanctions.

According to the survey conducted by the German-Russian Chamber of Commerce revealed Tuesday, most German companies operating in Russia believe that economic sanctions against Moscow are not proving effective. Almost 80 percent of the polled enterprises believe that economic sanctions are counterproductive and not conducive for political objectives. One third of the respondents agree that sanctions still need to be introduced. Two thirds, on the contrary, think that the sanctions are not necessary. The respondents said the sanctions will lead to further deterioration of the economic environment. Some 71 percent of enterprises expect economic slowdown by the end of the year.

This RIA Novosti article put in an appearance on their Internet site at 2:36 p.m Moscow time on their Thursday afternoon---and it's the third contribution in a row from reader B.V.

Despite economic fears, the E.U. sanctions Russia again

The European Union on Thursday slapped more sanctions on Russia for helping separatists destabilize Ukraine, limiting Russia’s access to its financial market, hitting the country’s vital oil industry, curbing high-tech exports and targeting more officials with travel bans and asset freezes.

Many E.U. members had been loath to increase the sanctions against Russia for fear of jeopardizing their close trade relationships with Moscow. But a compromise struck in a video conference call with top EU leaders broke a deadlock that had paralyzed the 28-nation bloc from taking tougher action over the past ten days.

Under the compromise hashed out by leaders including Britain’s Prime Minister David Cameron, Germany’s Angela Merkel and France’s Francois Hollande, the sanctions could be reversed within weeks if the cease-fire in eastern Ukraine holds.

This AP story showed up on the washingtonpost.com Internet site at 1:51 p.m. EDT on Thursday afternoon---and it's the second offering of the day from Elliot Simon.  The BBC also had a story about this yesterday---and it was headlined "Ukraine crisis: New E.U. sanctions hit Russia on Friday".  It's courtesy of reader James Skinner.

U.S. to sanction Sberbank, tighten limits on other Russian banks, sources tell Reuters

The United States will take new steps on Friday to limit the access of major Russian banks, including Sberbank, to U.S. debt and equity markets to punish Russia for its intervention in Ukraine, sources familiar with the matter said.

The sanctions are timed to coincide with fresh European Union economic penalties, with both sets aimed at the Russian energy, financial and defense sectors.

They are the latest sanctions imposed by the United States and the E.U. following Russia's annexation of Crimea in March and what the West sees as an effort since to further destabilize Ukraine by backing pro-Russian separatists with troops and arms.

This Reuters article, filed from Washington, put in an appearance on their website at 4:29 p.m. EDT on Thursday---and I found it on the gata.org Internet site.

Finance, energy and defense sectors: E.U. and U.S. set to impose new Russia sanctions

Barack Obama says he is joining the E.U. initiative to impose a new round of sanctions on Russia. Both Washington and Brussels say the sanctions will target finance, energy and defense sectors – yet can be revoked if the situation in Ukraine improves.

The U.S. is to provide details of their sanctions on Friday.

“We will deepen and broaden sanctions in Russia’s financial, energy, and defense sectors. These measures will increase Russia’s political isolation as well as the economic costs to Russia, especially in areas of importance to President [Vladimir] Putin and those close to him,” U.S. President Barack Obama said in a statement on Thursday.

The U.S. says that Russia has sent heavily armed forces to Ukraine. Obama added that the U.S. may withdraw sanctions if Russia fulfills obligations under the Minsk agreement.

This news item showed up on the Russia Today website at 1:19 p.m. Moscow time on their Thursday afternoon, which was 5:19 a.m. EDT.  It's another contribution to today's column from Roy Stephens.

Moscow Views New E.U. Sanctions as Illegitimate: Kremlin

Moscow regrets E.U. decision to impose new sanctions against Russia over Ukraine and views them as illegitimate, the Kremlin spokesman said Thursday.

“We regret the decision by E.U. countries to introduce a new round of sanctions [against Russia],” Dmitry Peskov told reporters in the capital of Tajikistan.

“We have said on numerous occasions that we do not understand and reject the idea of sanctions imposed earlier, while considering them as illegitimate,” Peskov said.

The spokesman added that the new sanctions did not make sense in view of efforts made recently by Russia to stop the bloodshed and to assist in a peaceful resolution of the crisis in eastern Ukraine.

Well, dear reader, if you haven't figured out by now that the U.S. and NATO don't want to resolve this issue peacefully, then you should give up reading these types of stories.  This one appeared on the RIA Novosti website at 10:33 p.m. Moscow time yesterday evening.  I thank Roy Stephens for sending it.

Russia’s New Package of Retaliatory Measures to Western Sanctions Ready: Kremlin

Moscow has prepared a new package of retaliatory measures to Western sanctions, that include restrictions on imports of cars and textile products, but hopes that common sense will prevail, a senior Kremlin official told RIA Novosti Thursday.

"There is a whole range of non-agricultural products that make our, first of all European, partners dependent on us," he said. "For example, imports of cars, primarily second-hand cars, as well as certain types of textile products that we are quite capable of producing on our own. Not all of them, but certain kinds," presidential aide Andrei Belousov told RIA Novosti on the sidelines of the Samara economic forum.

Moscow has already imposed a year-long ban on the import of meat, seafood, fruit and vegetables, as well as milk products from the European Union, the United States, Canada, Australia and Norway as a response to Western sanctions.

This story appeared on the RIA Novosti Internet site at 4:33 p.m. Moscow time on their Thursday afternoon---and my thanks go out to reader B.V. once again.

The Attack on ISIS Expands to Syria: New York Times Editorial Board

By the time President Obama announced the authorization of airstrikes in Syria Wednesday night, he clearly felt that he had little choice militarily or politically. For three years he resisted American military involvement in Syria, where the Assad government and rebel forces are engaged in a bloody civil war.

But with the rise of the Islamic State in Iraq and Syria — the vicious Sunni extremist group also known as ISIS and ISIL, which has seized territory in Iraq and Syria and beheaded two Americans — Mr. Obama explained that he had to expand the fight into a perilous new horizon. “ISIL poses a threat to the people of Iraq and Syria, and the broader Middle East — including American citizens, personnel and facilities,” he said. “If left unchecked, these terrorists could pose a growing threat beyond that region, including to the United States. While we have not yet detected specific plotting against our homeland, ISIL leaders have threatened America and our allies.”

In broadening the operation beyond airstrikes in Iraq, Mr. Obama says the aim now is to retake ISIS-controlled territory in Iraq and to degrade and ultimately destroy it wherever it operates, including in its strongholds in Syria. But even if discrete military goals are achieved in the short term, the expansion of the American role in that regional conflict carries substantial and unpredictable risks that Americans may not be willing to bear.

That’s why this open-ended operation, which Mr. Obama says will take time, demands congressional approval, despite his claim of authority to expand the campaign in Iraq and take the fight to Syria under the Iraq war resolution and the War Powers Resolution.

This editorial appeared on The New York Times website late in the evening on Wednesday---and it's courtesy of Roy Stephens.  It's worth reading.

Struggling to Gauge ISIS Threat, Even as U.S. Prepares to Act

The violent ambitions of the Islamic State in Iraq and Syria have been condemned across the world: in Europe and the Middle East, by Sunni nations and Shiite ones, and by sworn enemies like Israel and Iran. Pope Francis joined the call for ISIS to be stopped.

But as President Obama prepares to send the United States on what could be a years-long military campaign against the militant group, American intelligence agencies have concluded that it poses no immediate threat to the United States. Some officials and terrorism experts believe that the actual danger posed by ISIS has been distorted in hours of television punditry and alarmist statements by politicians, and that there has been little substantive public debate about the unintended consequences of expanding American military action in the Middle East.

Daniel Benjamin, who served as the State Department’s top counter-terrorism adviser during Mr. Obama’s first term, said the public discussion about the ISIS threat has been a “farce,” with “members of the cabinet and top military officers all over the place describing the threat in lurid terms that are not justified.”

“It’s hard to imagine a better indication of the ability of elected officials and TV talking heads to spin the public into a panic, with claims that the nation is honeycombed with sleeper cells, that operatives are streaming across the border into Texas or that the group will soon be spraying Ebola virus on mass transit systems — all on the basis of no corroborated information,” said Mr. Benjamin, who is now a scholar at Dartmouth College.

This news item, filed from Washington, was also from The New York Times website on Wednesday---and it's worth reading as well.

Russia warns U.S. against strikes on Islamic State in Syria

Russia has warned that U.S. air strikes against militants in Syria would be a "gross violation" of international law.

A Russian foreign ministry spokesman said any such action, without the backing of the UN, would be "an act of aggression".

It comes as U.S. Secretary of State John Kerry meets Arab leaders in Saudi Arabia to try to build a coalition against Islamic State (IS) militants.

President Obama has threatened action against IS in Syria as well as Iraq.

Good points, of course, but the U.S. government and military are now beyond any law---domestic or foreign.  This article appeared on the bbc.com Internet site at 11:36 EDT on Thursday---and it's courtesy of reader B.V.

Turkey Refuses to Take Part in U.S.-led Attacks in Iraq, Syria: Reports

Turkey will not allow a U.S.-led coalition to launch attacks in Iraq and Syria from its air bases and will not take part in combat operations against militant groups, a government official told Agence France Presse Thursday.

"Turkey will not be involved in any armed operation but will entirely concentrate on humanitarian operations," the official said on condition of anonymity.

The announcement comes as U.S. Secretary of State John Kerry is holding talks in Saudi Arabia in an attempt to encourage Middle Eastern countries to create an international coalition to fight terrorism, particularly the Islamic State (IS) group.

This is another story from the RIA Novosti website that was posted there late yesterday afternoon Moscow time---and it's also courtesy of reader B.V.

Iran Doubts Emerging Coalition Members Ready to Fight IS Militants

Tehran expressed doubts that the members of an emerging international coalition truly intend to fight radical Islamists in Syria and Iraq, Islamic Republic News Agency (IRNA) reported Thursday, citing Iranian Foreign Ministry spokeswoman Marzieh Afkham.

“There are serious ambiguities in the real intention of an emerging so-called international coalition against the terrorist group of Daesh (also known as ISIS),” Afkham was quoted as saying by the agency.

She added that certain coalition members provided financial and technical support to the terrorists in Iraq and Syria. At the same time, other members proved unable to carry the responsibility put on them by the international community when it came to Iraq and Syria.

Once again reader B.V. has sent us a story from the RIA Novosti website that was posted there at 5:53 p.m. Moscow time on their Thursday afternoon.  There was also a story about all this in The Guardian yesterday evening BST as well.  It's headlined "Assad, Moscow and Tehran condemn Obama's plan for air strikes against ISIS"---and it's courtesy of Roy Stephens---and it's final contribution of the day, for which I thank him.

China, Russia reported to build huge seaport in North Asia

China and Russia are to build one of the largest ports in northeast Asia on Russia's Sea of Japan coast, Chinese media reports. It is the latest step by Beijing and Moscow to bring their economies closer, and diversify from Western influence.

The new seaport will be located in Russia’s Far East, just 18 kilometers away from the Chinese border and will be capable to handle up to 60 million tons of cargo a year, China's state-run People's Daily Online reported.

The deal between the two countries was signed at May's Conference on Interaction and Confidence Building Measures in Asia (CICA) in Shanghai, the report said.

This Russia Today article showed up on their website at 10:53 a.m. Moscow time on their Thursday morning---and it's the final offering of the day from South African reader B.V.

Three King World News Blogs

1. Art Cashin: Remembering the Horror, Atrocity, and Heroes of 9/11  2. Keith Barron: "Swiss Gold Initiative---and the PPT Losing Control of the Gold Market"  3. Egon von Greyerz: "This Terrifying Black Swan to Collapse Global Financial System"

[Please direct any questions or comments about what is said in these interviews by either Eric King or his guests to them, and not to me. Thank you. - Ed]

India's Love Affair with Gold May Be Over as Prices Slide

Kiran Laxman Salunkhe used to buy jewellery during religious festivals, but sliding gold prices have led the young Indian farmer to break with his family's traditional investment.

This year Salunkhe has deposited his hard-earned savings at the bank for the first time in a decade and bought farmland.

"I bought jewellery when gold price was 32,000 rupees (per 10 grams) last year. Now jewellers won't pay me more than 27,000 rupees if I want to sell. Why should I invest in gold," said Salunkhe, who farms 15 acres of sugar cane in Vangal, a village 250 km (160 miles) south of Mumbai.

"Nowadays it is risky to keep jewellery. Burglaries are rising," he said. "With a fixed deposit there is no risk."

This longish Reuters story, filed from Vangal, India, certainly has a strong anti-gold slant---and it was posted on their website at 8:17 p.m. EDT on Thursday evening---and I found it embedded in a GATA release.  I doubt very much that this story is representative of the entire nation, but it's worth skimming nonetheless.

China Holds “Gold Congress” - Positioning Itself as Global Gold Hub, “In China, Gold is Money”

The China Gold Congress is currently in full flight in Beijing. The three day Congress is China’s biggest gold industry event of the year, drawing in participants from across the Chinese and international gold sectors including central banks, mining companies, bullion banks and refiners.

The event, co-sponsored by the World Gold Council (WGC) and the China Gold Association, showcases China’s gold industry and acts as a focus point for what is now the world’s largest gold market in terms of demand and product innovation.

Discussions and forums during the event cover everything from reserve asset management for the official or central banking sector, through to investment products and mining supply. One of the key themes this year is the internationalisation of the gold market.

China’s gold market accounts for one third of global demand, and according to the WGC, is expected to grow another 20% cumulatively from now until the end of 2017.

This excellent commentary by Mark O'Byrne showed up on the goldcore.com Internet site yesterday---and in my opinion is a must read.  I borrowed the headline from the Zero Hedge piece on this.

CME to launch Asia gold contract as race for pricing power heats up

CME Group Inc said it will launch a physically deliverable gold futures contract in Hong Kong later this year, joining a race in Asia to provide a viable price benchmark in the biggest gold-consuming region.

The planned launch of CME's 1 kg gold contract comes as China and Singapore are also preparing to launch physical bullion contracts with an eye on gaining pricing power of the metal at a time when the global benchmark is under scrutiny.

The moves underscore rising pressure from Asia, home to the top two gold consumers - China and India - to have pricing references that better reflect the region's market dynamics, and the growing disenchantment with prices set in the West.

The century-old London fix, the global benchmark for spot gold that is determined by a group of four banks over a teleconference, is being investigated by European and U.S. regulators under suspicion that it may have been manipulated.

If the CME Group is involved, you just know its going to be crooked.  This Reuters article, filed from Beijing, appeared on their Internet site at 10:32 a.m. IST on their Friday morning---and it's a gold-related news story I found on the Sharps Pixley website in the wee hours of this morning.

China gold group, WGC ink co-operative agreement

The World Gold Council (WGC), the London headquartered market development organisation for the gold industry, and the China Gold Association have signed a ‘Comprehensive Strategic Cooperation Agreement’, at the official launch of the China Gold Congress & Expo 2014 in Beijing.

The aim of the agreement is stated to be to enhance the global understanding of the gold market and supply chain and China’s role within it through the exchange of research, data insights and developing innovations for gold in investment, technology and jewellery.

One hopes that this may give WGC researchers perhaps a better understanding of the Chinese gold supply and demand situation than seems to be the case at present where known import figures, stated gold demand figures and published data out of the Shanghai Gold Exchange seem to suggest a wide disparity in apparent demand in particular. However given the China Gold Association’s ties with the Chinese government, as will have any Chinese trade organisation, which may have an agenda to only let Western organisations, like the WGC, know what it wants them to know, then the co-operation agreement might not actually provide a great deal of new information on these disparities, although any such regular contact should be helpful.

It is also highly unlikely to throw any new light on whether the Chinese Central Bank is surreptitiously increasing its gold reserves without reporting them to the IMF - as many Western analysts believe - or not. We will almost certainly have to wait until the Chinese government deems it politic to announce any reserve upgrade, if any, before we know for sure.

This commentary by Lawrie appeared on the mineweb.com Internet site on Thursday sometime---and it's definitely worth reading.

Gold engagement ring from 17th Century discovered lying in field by pensioner

A gold engagement ring from the 17th Century has been unearthed by a pensioner with a metal detector - more than 300 years after it was lost. 

Tom Ross, 69, was sweeping his metal detector over a ploughed farmer's field near Newtownabbey in County Antrim, Northern Ireland, when he stumbled across the item.

The rare 'posy' ring, which dates back to the late 1600s and is 85 per cent gold, bears the Old English inscription 'I noght on gift bot gifer', or 'Look not on the gift, but the giver'. Also known as a 'betrothal' ring, it pre-dates the custom of proposing with an engagement ring, but essentially served the same purpose.

Men and women exchanged the items from the 1500s onwards to symbolise their future commitment to each other.

This interesting news item put in an appearance on the dailymail.co.uk Internet site on Wednesday---and I found it on the gata.org Internet site yesterday.

¤ The Funnies

Here are another couple of pictures I took on Sunday.  The red-necked grebe parents, along with their three siblings, kept their distance for the longest time, but it pays to sit quietly---and I got these two photos for my 'efforts,' or lack thereof.  The first in bright sunshine really close up---and the other when it was cloudy again.  In the second shot, the adult has just passed a small fish over to junior, so it's obvious that they're not too proud to take a handout, even though they're quite capable of catching their own by this stage.  The third photo is baby pygmy hippo that a reader was kind enough to share.

¤ The Wrap

Let me overuse my salami-slicing analogy. The slicing must cease once all the salami is cut; otherwise a hand gets sliced. That’s how I view the price slicing in silver and gold, with the only difference being once the technical funds are maximum short, the slicing must stop or a hand will get sliced. The collusive commercials are slicing the technical funds (collectively) and once the commercials succeed in drawing in the maximum number of technical fund shorts, any further lower prices will benefit the technical funds and hurt the commercials who just bought heavily. Since I’m convinced that the collusive commercials are leading the technical funds by the nose into and out from positions (and not the other way around), the price will stop going down and start going up when it is in the best interest of the commercials. Prices will only continue to fall if the commercials can buy more. Otherwise, the commercials will slice their own hands.

What it comes down to in picking a bottom for me is calculating the point of maximum technical fund short sales. Based upon previous record extremes in technical fund short sales and the extent of current salami price slicing, it appears to me that we are close enough to expect the bottom may be here. Otherwise, I wouldn’t have topped off and bought calls. That’s not a guarantee that my expectations will prove to be accurate, but I hope I have been clear in suggesting why I think the price decline is over or nearly over. - Silver analyst Ted Butler: 10 September 2014

[I took Ted's advice and bought some more physical silver yesterday. - Ed]

Well, JPMorgan et al, along with their associated HFT buddies---and their algorithms---took decent slices out of the four precious metal salamis again yesterday, with palladium getting the living snot kicked out of it once again, as it had been hanging around overbought territory since the beginning of February, but no more.

As you can tell from all four 6-month precious metal charts below, we're getting near the end of the engineered price declines in all four metals, as there's a limit to how low 'da boyz' can, or will, take these prices---and if you've already forgotten why that's the case, please reread Ted Butler's quote just above.

Based on yesterday's price action, I will make the assumption that we're at new record low short positions for the Managed Money crowd in silver.  Of course I'm guessing here, as the last three trading days price/volume action won't show up until next Friday's Commitment of Traders Report---and there's the possibility that the price management scheme may blow up before Tuesday's cut-off, as this sell-off appears to have some sort of urgency attached to it.

Maybe the powers-that-be know something we don't, but as I said in yesterday's column, the increasingly bizarre goings-on inside the precious metal futures market---especially in silver---appear to be heading for some sort of dénouement.  And not to be forgotten in all of this is the wild in/out physical movement of silver at the Comex-approved depositories for the last three and half years---and the amount of silver pouring into SLV as the silver price continues to get engineered lower.

And as I write this paragraph, the London open is 30 minutes away.  The HFT boyz and their algorithms have done their jobs once again, as all four precious metals declined to new lows for this move down, as the technical funds sold longs and bought more short positions, with JPMorgan et al doing the opposite in all of them.

The current low ticks came just before 1 p.m. Hong Kong time and, with the exception of palladium, all are in rally mode at the moment.  I'm just speculating here, but using the past as prologue, these rallies won't make it past the London open.  Net gold volume is a hair over 20,000 contracts---and 9,000 contracts in silver, which is pretty heavy for this time of day.  And not that it matters, but the dollar index is currently up a handful of basis points.

Today, at 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, September 9.  Both Ted and I are expecting great things from this report, but we'd both give a day's pay to see what the COT Report would look like if it had been issued as of 1 p.m. Hong Kong time on their Friday, which are the current low ticks for these moves down.

And as I send this out the door at 5:15 a.m. EDT, I note that, as expected, the smallish rallies in all four precious metals ended at the London open---and all four are still down on the day from Thursday's close in New York.  There's a problem over at the CME Group's website, as my attempts to get the updated volume figures got nowhere, as a message on the page read "A Technical error has occurred. Please try again in a few minutes."  I gave it more than half an hour---and nothing had changed.  I would expect that volumes are considerably higher in both gold and silver, if the previous numbers I reported at 2:30 a.m. EDT are any guide.  The dollar index is up a couple of basis points.

Are we done to the downside yet?  I still don't know, but as I said in The Wrap in Thursday's column, it wouldn't surprise me in the slightest if 'da boyz' give us one more quick spike to the downside---and with today being Friday, I might still get my 'wish'.  Their efforts yesterday were certainly a decent start to that process.

So we wait once again.

Friday's Comex trading session in New York will be another day where nothing will surprise me when I look at the charts later this morning, as I'm ready for any eventuality.

Enjoy your weekend, or what's left of it if you live west of the International Date Line---and I'll see you here tomorrow.

]]>
Fri, 12 Sep 2014 06:14:00 +0000
<![CDATA[Dimitri Speck: Platinum’s Price is Suppressed Like Gold and Silver]]> http://www.caseyresearch.com/gsd/edition/dimitri-speck-platinums-price-is-suppressed-like-gold-and-silver/ http://www.caseyresearch.com/gsd/edition/dimitri-speck-platinums-price-is-suppressed-like-gold-and-silver/#When:06:09:00Z "It was just another salami slicing day on the Comex"

¤ Yesterday In Gold & Silver

The gold price didn't do much of anything for most of the Far East trading session on their Wednesday, but the selling pressure appeared shortly before the 8 a.m. BST open in London and, not surprisingly the HFT boyz printed a new low tick for this move down, with the low coming at 12:30 p.m. in New York.  From that low, the gold price gained back half a dozen dollars by 3:35 p.m. EDT---and then sold off a hair into the 5:15 p.m. electronic close.

The high and low ticks were recorded by the CME Group as $1,258.50 and $1,244.50 in the December contract.

Gold finished the Wednesday session at $1,249.00 spot, down another $6.80 on the day.  Net volume was pretty decent at 130,000 contracts.

Here's Brad Robertson's 5-minute gold daily price/volume chart.  The 'click to enlarge' feature works wonders---and don't forget to add 2 hours to get EDT.

Silver, as always, opened on a down tick at 6 p.m. on Tuesday evening in New---and stayed down for the remainder of the trading session.  But the decline quickened shortly after London opened, with the low of the day like gold, coming at 12:30 p.m. in New York.  It rallied a few pennies until shortly after 2 p.m. EDT---and then traded flat for the remainder of the day.  Silver did not set a new low price tick yesterday.

The high and low ticks are barely worth looking up, but they were recorded as $19.125 and $18.90 in the December contract.

Silver closed on Wednesday at $18.94 spot, down 11.5 cents from Tuesday.  Net volume was 30,500 contracts.

And, not surprisingly, both platinum and palladium were under slight price pressure yesterday as well---and both finished at new lows for this engineered price decline.  Both were closed down 6 bucks.  Here are the charts.

The dollar index closed late on Tuesday afternoon in New York at 84.17.  From there it chopped quietly higher, hitting its 84.42 high tick minutes before 12:30 p.m. EDT in New York on Wednesday, which just happened to be when the low was hit in all four precious metals.  From there it slid down to---and closed at---84.20, up only 3 basis points from Tuesday.

The gold stocks gapped down over a percent at the open yesterday morning, hitting their lows at 12:30 p.m., which was the low for the metal itself.  The stock barely recovered from there---and the HUI closed down another 1.96%.

The silver equities opened down as well, but rallied into positive territory briefly just minutes before 10 a.m. in New York.  From there it was all pretty much down hill into the low tick which came very shortly after 1 p.m. EDT.  Then the shares rallied just under a percent from there---and Nick Laird's Intraday Silver Sentiment Index closed down 'only' 0.63%.

The CME Daily Delivery Report showed that 87 gold and 34 silver contracts were posted for delivery within the Comex-approved depositories  on Friday.  Morgan Stanley issued all 87 gold contracts and Canada's Scotiabank stopped 81 of them.  The link to yesterday's Issuers and Stoppers Report is here.

The CME Preliminary Report for the Wednesday trading session showed that 84 gold contracts were added to the September total---and there are now 108 gold contracts still open in the September delivery month.  In silver, the number of contracts still open in September dropped by 214 contracts---and the revised total outstanding is down to 753 contracts.  The deliveries mentioned in the previous paragraph have to be subtracted from these numbers to show the true picture of what's left to deliver in September at this point in time.

I was expecting another decline in GLD yesterday---and got a big surprise, as 96,177 troy ounces were deposited by an authorized participant.  I suppose it's logical to assume that it was deposited to cover an existing short position, but if that was the case, it's certainly the only time that I can remember it happening, especially considering the fact that the gold price has been declining almost nonstop for the past 30 days.

And as of 9:42 p.m. yesterday evening, there were no reported changes in SLV.

Yesterday evening, the good folks over at the shortsqueeze.com Internet site updated their short positions for both GLD and SLV as of the end of August.  It showed that the short position in SLV declined by 9.57 percent, from 15.81 million shares/troy ounces, down to 14.30 million shares/troy ounces---an improvement of 1.51 million shares/ounces.

With about 5.8 million ounces of silver deposited during the reporting period---from mid August to the end of August---I was expecting much more of a decline that this.  This is the second consecutive disappointing decline in the SLV short position.  For the entire month of August, about 9.6 million ounces of silver were deposited in SLV---but the last two reports from the folks over at shortsqueeze.com shows that less than 3 million shares/ounces of the short position have been covered---and all this silver wasn't deposited because prices were rising.  It was quite the opposite, as  the silver price was down all through August.

The question that springs from 'all of the above' is that if the 9.6 million ounces that was deposited in SLV in August wasn't being used to cover an existing short position---and John Q. Public were net sellers of SLV shares during the August time period---why was all that silver being deposited, and by whom?

There wasn't much change in GLD, as the short position declined by only 0.64 percent---from 1.35 million troy ounces, down to 1.34 million troy ounces.

The good folks over at Switzerland's Zürcher Kantonalbank updated their website with the changes in both their gold and silver ETFs for the week ending September 5.  Both ETFs showed declines, as their gold ETF shed another 12,881 troy ounces---and their silver ETF dropped by 66,134 troy ounces.

There was a tiny sales report from the U.S. Mint yesterday.  They sold 1,500 troy ounces of gold eagles---and 500 one-ounce 24K gold buffaloes.

It was another very busy day for gold over at the Comex-approved depositories on Tuesday---and virtually all of the in/out activity was at Canada's Scotiabank.  In total, 96,461 troy ounces were reported received---and 64,318 troy ounces were shipped out the door.  The link to that activity is here.

And I was bowled over by the silver activity on Tuesday, as 2,153,409 troy ounces were reported received---and 922,562 troy ounces were reported shipped out.  Five of the six silver depositories saw action, with a large chunk of the activity centered around the CNT Depository.  The link to that action is here---and it's definitely worth checking out.

I don't have a lot of stories again today and, like yesterday, that suits me just fine.

¤ Critical Reads

U.S. stocks rise on Apple; rate hike views boost dollar

U.S. stocks rose on Wednesday, helped by a rebound in Apple shares, while expectations for a stronger economy and thus higher interest rates from the Federal Reserve boosted the dollar to a six-year high against the yen.

Yields on U.S. Treasuries continued their advance higher, with investors increasingly seeing momentum in the world's strongest economy prompting central bank action soon.

Worries over a vote for Scottish independence, scheduled for Sept. 18, spooked investors in Europe, where shares closed flat.

"There are so many factors that are supporting the dollar at the moment, mainly its better performance in the U.S., which will likely bring a more hawkish tone from the Fed," said Sireen Harajli, a foreign exchange strategist at Mizuho Corporate Bank in New York.

This Reuters article, filed from New York, appeared on their Internet site at 5:10 p.m. EDT yesterday afternoon.  That's very strange considering the fact that Orlando, Florida reader Dennis Mong sent me this link at 5:34 a.m. EDT yesterday morning---and at that time the headline read "Shares fall, yields rise as Fed, Scotland dominate".  And some readers wonder why I doubt the veracity of the U.S. media.

New York Golf Courses Rejected Obama Holiday Weekend Visit

President Barack Obama was rejected by several New York golf courses over Labor Day weekend, according to NBC News.

A number of sources told the network that top golf courses in the Westchester area turned down requests by the president's team for Obama to tee off on Saturday, Aug. 30. The clubs include Trump National Golf Club, the Winged Foot, and Willow Ridge.

Club managers, who were approached just a day or two before the requested visit, allegedly did not want to inconvenience their members by shutting down the club to accommodate the president.

This cute story showed up on the newsmax.com Internet site at 8:14 a.m. EDT on Wednesday---and I thank reader Brad Robertson for sharing it with us.

Coming soon: 3D printable solar panels capable of powering…anything

Printable solar panels are going to be available to us very soon and could power “entire skyscrapers,” Australian researchers say. The very near future will see personal electronic charging transformed, but the potential is growing quickly.

A team of 50 scientists in various fields worked for years to develop paper-thin, printable solar panels as part of the Victorian Organic Solar Cell Consortium. They hope to see commercial market production for use in low-power applications in the very near future.

The key benefit of such technology is in transforming the way personal electronics are charged. "iPad covers, laptop bags, skins of iPhone [will no longer be] just for casing electronics, but to collect some energy as well and power those electronics," Fiona Scholes, a senior research scientist at Australia’s national science agency CSIRO, told ABC News.

What’s more, the energy source can be transported to the world’s remote and developing regions in a cheap and easy way.

Since I don't have all that many stories for you today, I thought I'd slide this off-topic Russia Today article into the mix, rather than saving it for Saturday---and it's the first offering of the day from Roy Stephens.

British P.M. begs Scots not to break up 'family of nations'

British Prime Minister David Cameron on Wednesday begged Scots not to rip apart the United Kingdom's "family of nations", flying to Scotland to man the barricades against a surge in support for independence eight days before a referendum.

Cameron appealed to Scots to use their heads and their hearts when they voted on Sept. 18. He reminded them of their shared history and bonds with England, Wales and Northern Ireland - twice evoking World War Two and the fight against Hitler.

He also warned that an independent Scotland could not keep the pound currency, jobs would head south, and the country's security be weakened.

Cameron's visit was a sign of the panic that has gripped the British ruling elite over the possible disintegration of the 307-year-old union since two polls in the past showed the campaign for independence, led by Alex Salmond's Scottish National Party, gaining support to run neck-and-neck with the "No" campaign, which until a few weeks ago was looking comfortably ahead.

This Reuters article, filed from Edinburgh, Scotland, appeared on their website at 6:50 p.m. EDT on Wednesday afternoon, at least according to the dateline.  Dennis Mong sent me this story at 5:32 a.m. EDT yesterday morning, so it's obviously been through some changes in the interim.  It's prior headline read "U.K. ... Please Scotland ... Please do not divide the U.K."

France says will not meet E.U. deficit rules until 2017

Crisis-wracked France on Wednesday said it would not be able to get its public deficit under the EU maximum of three percent until 2017, pushing the target back by two years.

Finance Minister Michel Sapin said France's deficit would be 4.4 percent of output in 2014, dropping only slightly to 4.3 percent in 2015. He added the target of getting below the three-percent ceiling would not happen until 2017, instead of 2015 as previously forecast.

France will never get back into compliance.  They, like almost all European countries, are in an economic slump that they can never get out of---along with a national debt that they can never pay off.  Bankruptcy is the only answer.  This short 2-paragraph story is all there is to this AFP offering that appeared on the france24.com Internet site at 9:51 a.m. Europe time yesterday---and I thank South African reader B.V. for sending it our way.

Santander weighs as European shares fall for fourth session

Europe's leading shares fell for a fourth straight session on Wednesday, with Spain's top lender Santander the biggest drag after the death of its chairman prompted worries over a successor.

Sentiment on the broader market was sapped by the prospect of tighter U.S. monetary conditions, which - along with the wars in Ukraine and the Middle East - has unnerved investors.

EU states will discuss on Wednesday whether to implement new sanctions against Russia over its role in the Ukraine crisis.

This Reuters piece, filed from London, showed up on their website at 4:23 a.m. EDT on Wednesday morning---and it's another contribution from Dennis Mong.

V for Victoria: Catalans Want Independence Too

There are two questions that could secure a prominent place in the history books for Oriol Junqueras. The first is: "Do you want Catalonia to be its own state?" The second: "Do you want that state to be independent?" Junqueras, a 45-year-old historian from the Autonomous University of Barcelona, is the man behind the referendum that could result in independence for Catalonia.

The president of the Republican Left of Catalonia (ERC), Junqueras is convinced that a majority of his compatriots in the region in Spain's northeast would like to live in an independent state. Since the European Parliament elections in May, the ERC is Catalonia's strongest political party, partly the result of Junqueras' unflagging support for independence.

Junqueras' popularity is such that he was also elected mayor of his hometown, Sant Vicenç dels Horts, three years ago. "Even though 80 percent of village residents speak Spanish instead of Catalan, they elected a separatist," he says. Now, he is hoping to win over all of Catalonia to his cause.

This article put in an appearance on the German website spiegel.de late Wednesday morning Europe time---and my thanks go out to  Roy Stephens for finding it for us.  The story has had a headline change, as it used to read "Catalonia Seeks Independence Referendum Despite Madrid Rejection".

Unidentified Fragments Found in Bodies of MH17 Crew: Dutch Safety Board

Unidentified fragments have been found in the bodies of Malaysia Airlines flight MH17 pilots, their origin is currently being established, a Dutch Safety Board (DSB) spokeswoman told RIA Novosti Wednesday.

“Some fragments are found in the bodies of flight crew, pilots. We have to investigate them to see if they are fragments of the plane. If they are not, it might be fragments of the objects, coming from outside. We’re not sure yet what these pieces are fragments of. Experts are working with bodies,” DSB spokeswoman Sara Vernooij said.

On Tuesday, the DSB released a preliminary report on the MH17 crash. According to the report, the flight broke up in the air probably as the result of structural damage caused by “a large number of high-energy objects” that penetrated the aircraft from outside.

This RIA Novosti news item appeared on their website at 1:49 p.m. Moscow time on their Wednesday afternoon---and it's another offering from reader B.V.

Azov fighters are Ukraine's greatest weapon and may be its greatest threat

"I have nothing against Russian nationalists, or a great Russia," said Dmitry, as we sped through the dark Mariupol night in a pickup truck, a machine gunner positioned in the back. "But Putin's not even a Russian. Putin's a Jew."

Dmitry – which he said is not his real name – is a native of east Ukraine and a member of the Azov battalion, a volunteer grouping that has been doing much of the front line fighting in Ukraine's war with pro-Russia separatists. The Azov, one of many volunteer brigades to fight alongside the Ukrainian army in the east of the country, has developed a reputation for fearlessness in battle.

But there is an increasing worry that while the Azov and other volunteer battalions might be Ukraine's most potent and reliable force on the battlefield against the separatists, they also pose the most serious threat to the Ukrainian government, and perhaps even the state, when the conflict in the east is over. The Azov causes particular concern due to the far right, even neo-Nazi, leanings of many of its members.

This longish essay, which is definitely worth reading, showed up on theguardian.com Internet site at 1:36 BST on Wednesday afternoon---and my thanks go out to Roy Stephens for bringing it to our attention.

Ukraine’s President signs law allowing sanctions against Russia

Ukrainian President Petro Poroshenko has signed a law allowing future sanctions against Russia, which could include a ban on the transit of Russian gas, and sanctions against Russian banks, according to the website of the upper parliament.

The President’s signature means that Ukraine now can legally enact special economic restrictions against Russia should it choose to, according to the document posted on the website Wednesday.

On August 14, the Ukrainian Parliament approved the first reading of the bill that allows Ukraine to impose sanctions on Russia. They will apply to 172 individuals and 65 companies that have supported the reunification of Crimea with Russia, and those that “violate the territorial integrity of Ukraine” according to Ukrainian Prime Minister Arseny Yatsenyuk.

The prime minister has said the sanctions against Russia may include a ban on the transit of Russian natural gas across its territory.

Talk about shooting yourself in the head.  You couldn't make this stuff up.  This Russia Today story was posted on their website at 9:49 a.m. Moscow time on their Wednesday morning.  This story is courtesy of Roy Stephens as well.

Russia stokes tensions with the west by cutting gas exports to Poland

A decision by Russia to cut gas exports to Poland without warning has rekindled fears about Europe's reliance on Siberian gas at a time of increasing tension between Moscow and the west.

The Polish state energy group, PGNiG, said it was trying to find out why volumes had been slashed by up to 24% when it had been exporting gas itself to Ukraine to make up for Russian shortfalls there.

Its counterpart in Kiev, Ukrtransgaz, accused Kremlin-controlled Gazprom of penalising Poland and undermining onward gas supplies to Kiev.

"Today Russia started limiting gas supplies to Poland in order to disrupt the reverse (flows) from Poland that we receive ... Poland stopped reverse supplies to Ukraine in the range of 4m cubic metres," said Ihor Prokopiv, chief executive of Ukrtransgaz, according to the Russian news agency, RIA.

This is another article from The Guardian courtesy of Roy Stephens---and it appeared there at 6:32 p.m. BST Wednesday evening.

U.S., E.U. to ban Exxon, BP and Shell from oil exploration in Russia – report

The E.U. and the U.S. are going to ban energy giants like Exxon Mobil, BP and Shell from searching for crude oil in Russia's Arctic, deep seas and shale formations, three American officials anonymously told Bloomberg.

These sanctions would reportedly not interfere with current oil drilling and production from conventional land-based wells and those along the shallow edges of inland seas, some of which have been pumping crude for decades, according to the officials interviewed by Bloomberg News.

The ban reportedly targets crude reserves that wouldn’t supply oil to the international energy market for at least 5 years.

All of the officials asked to not be named. The E.U. has failed to agree on whether to impose its new round of sanctions on Russia. The announcement of the final decision has been held off as the ambassadors from the 28 E.U. members convene to continue discussions on Thursday.

This article appeared on the Russia Today website at 8:28 p.m. Moscow time on their Wednesday evening---and was edited at 6:57 a.m. Moscow time this morning.  I thank reader B.V. for sliding it into my in-box just before I hit the send button on today's column.

Putin: Russia will not get involved in arms race

Russia is not going to get involved in a new arms race, President Vladimir Putin said as he ordered his government to work out “balanced and realistic” defense strategy for 2016 through 2025.

“Someone really wants to unleash a new arms race,” Russia’s president said at a meeting with senior defense industry officials. “We, of course, are not going to be involved in this race.”

Putin tasked the defense industry to work out a new military doctrine by December. His comments came a week after Russia said Sept. 2 it would review the doctrine, in response to NATO announcing its intentions to expand in Eastern Europe amid Ukrainian crisis.

This Russia Today news item appeared on their Internet site at 12:33 p.m. Moscow time yesterday afternoon---and it's the final contribution of the day from Roy Stephens.

Russia and China agree to settle more trade in their own currencies

Russia and China pledged on Tuesday to settle more bilateral trade in ruble and yuan and to enhance cooperation between banks, First Deputy Prime Minister Igor Shuvalov said, as Moscow seeks to cushion the effects of Western economic sanctions.

Shuvalov told reporters in Beijing that he had agreed on an economic cooperation pact with Chinese Vice Premier Zhang Gaoli that included boosting use of the ruble and yuan for trade transactions.

The pact also lets Russian banks set up accounts with Chinese banks, and makes provisions for Russian companies to seek loans from Chinese firms.

This Reuters piece, filed from Beijing, was posted on their website at 6:22 a.m. EDT on Tuesday morning---and I found it embedded in a GATA release yesterday.

Bank of Japan Buys Government Debt at Negative Yield

Tuesday marked another milestone in the topsy-turvy world of monetary easing in Japan: The Bank of Japan bought short-term Japanese government debt at a negative yield for the first time, according to market participants.

The BoJ scooped up some of the three-month No. 477 Treasury bill, which has traded at a negative yield for the past two trading days amid strong demand, the market participants said.

Normally, people who buy debt expect to get their money back plus some interest. Negative yield means the buyer gets back less than he or she puts in.

Why would the Bank of Japan buy under such conditions?  Traders said the bank wanted to show the market that it would meet its asset purchase goals–literally at whatever the cost.

Reader Brad Robertson sent around this Wall Street Journal piece, filed from Tokyo I presume, that was posted on their website at 10:32 p.m. JST on their Tuesday evening---and it's worth reading.

Three King World News Blogs

1. Rick Rule: "Takedowns in Gold, Silver and Oil to End Badly For Bears"  2. Jeffrey Saut: "Quote of the Week---and a Chart That Will Shock KWN Readers"  3. Stephen Leeb: "Putin Has Won in Ukraine---and What China and Germany Are Up To"

[Please direct any questions or comments about what is said in these interviews by either Eric King or his guests to them, and not to me. Thank you. - Ed]

Weak hands have been shaken out of gold, Butler and Skoyles contend

Fund manager and author John Butler and Jan Skoyles, CEO of The Real Asset Co., interviewed in London the other day by financial journalist Lars Schall, concurred that the weak hands have been shaken out of gold and that most gold investors are holding for the long term, expecting market fundamentals to prevail.

The interview is 6:05 minutes long and was posted at Matterhorn Asset Management's Internet site, goldswitzerland.com.  I thank Chris Powell for wordsmithing the above paragraph of introduction.

Dimitri Speck: Platinum's price is suppressed like gold's and silver's

Analysis by market analyst and GATA consultant Dimitri Speck shows that the platinum market is manipulated just as the gold and silver markets are, largely through futures contract sales keyed to the morning and afternoon platinum price fixings.

Speck writes: "There have long been hints that systematic manipulation of gold and silver prices via the futures markets is taking place -- also during the fixing. Due to the many similarities, it seems likely that the futures market also plays a decisive role with respect to manipulation of the platinum fixing.

"The one-sided direction of the fixing manipulations over many years is conspicuous. Conventional manipulations can be excluded as a possible reason. These could, for instance, have the goal of creating profits for option writers or other holders of securities tied to a benchmark. However, in such manipulations, one would expect that prices would be manipulated to the upside just as often as to the downside. This is, however, not the case with platinum, and neither is it the case with gold and silver.

"Thus, the manipulation of the platinum fixing, similar to that in gold and silver, amounts to systematic price suppression."

No surprises here.  All one has to do is take a cursory glance at the latest Bank Participation Report for platinum to see that.  That goes for palladium as well.  Speck's analysis is headlined "Platinum Fixing Under the Microscope" and was posted on thehedgefundjournal.com Internet site back on Sunday, August 31.  I thank Chris Powell for writing 'all of the above'---but the first person through the door with this story was South African B.V.  It falls into the must read category.

¤ The Funnies

These two photos are from Sunday as well.  I was concentrating on photographing juvenile red-necked grebes, the photo of which will grace tomorrow's column, when this fellow popped up out of nowhere.  The red colour in the water is the reflection from the red siding on a building on the other side of the pond.

¤ The Wrap

I had remarked that I saw the light at the end of the tunnel (no, not of an oncoming train) in terms of the price decline over the past two months, due to my perception that technical fund short selling was drawing to an end in COMEX silver and gold. I concluded that, as a result, I would be topping off long term positions (SLV) and purchasing call options, although I did expect a continuation of the new price lows for a short while as the commercials lured more technical fund shorts into their lair. Since we got the new lows as I hoped, I topped off and bought the calls.

Since the silver and gold price salami was sliced to the downside during virtually every day of the reporting week ending on Tuesday (and continuing on Wednesday), there should be significant further increases in the managed money gross short positions in silver and gold (and perhaps in copper, given Tuesday’s big chunk to the downside). I would think the changes in Friday’s COT Report will parallel the last report in significance. This will, undoubtedly, put us closer to the ultimate extreme in technical fund short selling. I would define a bottom in price for silver and gold as the point of maximum technical fund short selling. - Silver analyst Ted Butler: 10 September 2014

Well, it was just another salami slicing day on the Comex on Wednesday, as three of the four precious metals got taken to new lows for this move down.  They weren't large dollar amounts in any of them, but it was still more technical fund/Managed Money long selling/short buying---as JPMorgan et al happily covered short positions and went long themselves.

Here are the 6-month charts for both gold and silver updated with yesterday's price/volume data.  As I've already mentioned, gold hit a new low, but silver didn't.

As I write this paragraph, the London open is about 25 minutes away.  All four precious metals are currently trading below their respective closes in New York on Wednesday---and the HFT boyz have both silver and platinum at new lows for this move down.  Net volume in gold is just under 12,000 contracts---and silver's net volume is 2,700 contracts.  The dollar index is up 10 basis points.

I, along with Ted, continue to be amazed at the amount of silver being moved around in both the Comex-approved depositories---and deposited in SLV.  Topping that off was the surprise deposit in GLD, a phenomenon that I don't recall ever seeing, especially during an engineered price decline.  Physical gold, at least that much, is readily at hand---and I'm still wondering why it was deposited, and by whom.  This frantic state of affairs can't continue forever---and I'm still expecting a dénouement of some sort in the not-to-distant future.

And as I prepare to hit the 'send' button on today's effort at 4:50 a.m. EDT, I note that the HFT boyz have knocked silver down to another new low since I wrote the previous paragraph before the London open.  Gold rallied a tad, but got sold down the moment it broke above Wednesday's closing price in New York.  Palladium is trading as flat as the proverbial pancake---and platinum continues to bounce off its new low tick.  Gold's net volume is just over 20,000 contracts---and silver's net volume just broke through 7,000 contracts.  These volumes are on the lighter side of 'normal'---whatever that means these days.  The dollar index is now flat on the day, after being down about 5 basis points at 9:30 a.m. BST in London.

I'd guess that we're in the final throes of this engineered price decline in all four precious metals---particularly silver.  Could we still get lower price from here?  Sure, a final slam down wouldn't surprise me in the slightest.  The only thing I'm not overly happy about is the fact that Wednesday's and Thursday's trading data won't be in tomorrow's Commitment of Traders Report, but it's a safe bet that we're now back to the record COT Report we had on June 3---and it's now time to look ahead as to how the upcoming rally will be allowed to unfold.

It could be an interesting Comex trading session today---and I look forward to powering up my computer later this morning to see what JPMorgan et al have been up to.

That's all I have for today---and I'll see you here tomorrow.

]]>
Thu, 11 Sep 2014 06:09:00 +0000
<![CDATA[Lawrence Williams: Goldcorp CEO Expounds on Peak Gold and $900 Gold Price]]> http://www.caseyresearch.com/gsd/edition/lawrence-williams-goldcorp-ceo-expounds-on-peak-gold-and-900-gold-price/ http://www.caseyresearch.com/gsd/edition/lawrence-williams-goldcorp-ceo-expounds-on-peak-gold-and-900-gold-price/#When:06:16:00Z "There are limits to how low these prices can be driven"

¤ Yesterday In Gold & Silver

It was a very quiet day on Tuesday with not much happening during Far East and London trading session.  That all changed starting at 11:40 a.m. EDT when the HFT boyz showed up with their algorithms---and it appeared that a new low for this move down was set at, or very close to, the 1:30 p.m. Comex close.  From there it rallied a few bucks before rallying anew starting around 3:15 p.m.  A thoughtful non-for-profit seller put a pin in that rally balloon a few minutes after 4 p.m.---and  the price didn't do much after that.

The high and low ticks were reported by the CME Group as $1,258.90 and $1,248.10 in the December contract.

Gold finished the Tuesday trading session in New York at $1,255.80 spot, up 30 cents from Monday's close.  Net volume was around 113,000 contracts.

Here's the New York Spot Gold [Bid] chart on its own so you can see the finer details of the Comex and electronic markets in New York yesterday.

Brad Robertson sent us the 5-minute gold tick chart---and you can see the associated volume that went with the price action.  Remember to add 2 hours for EDT.

After the obligatory down tick at the open on Monday night in New York, the silver price made quite a few attempts to break above its Monday closing price in New York, but didn't quite make it.  Once Comex trading began however, there was some price pressure---and 'da boyz' printed a new silver low as well for this move down shortly after 12 o'clock noon in New York.  After that, it traded almost the same as gold, including the nifty rally that began at 3:15 p.m. EDT---which also got cut off a the knees minutes after 4 p.m. by a willing seller.

The low and high ticks were reported as $18.89 and $19.155 in the December contract.

Silver finished the Monday trading session at $19.055 spot, up 3.5 cents from Monday.  Net volume was 30,500 contracts.

And here's the New York Spot Silver [Bid] chart.

Platinum and palladium weren't spared by the HFT algorithm yesterday, either.  Platinum, which is now hugely oversold, was closed down 12 bucks, but well off its low tick.

Palladium really got it in the neck yesterday starting at the London p.m. gold fix---and by 12:15 p.m. EDT, most of the damage had been done---and 'da boyz' closed it down by 24 bucks.  It was a dollar or so lower than that on the day as well.

The dollar index closed late on Monday afternoon in New York at 80.30.  From there it chopped to its 84.56 high, which occurred at precisely 9:00 a.m. BST in London on their Tuesday morning.  Then it drifted unsteadily lower, closing at 84.17, which was down 13 basis points on the day---and 39 points off its high tick.

The gold stocks rallied slightly into positive territory at the open---and then slowly began to sink back into the red, hitting their lows just before the 3:15 p.m. EDT rally began in both gold and silver.  They popped back into positive territory in no time---and the HUI closed up 1.48%.

The silver equities followed a similar path, except their time in positive territory didn't last long---and they got sold down much harder than the gold shares.  They were down by almost 3 percent at their 3:15 p.m. EDT low---and the subsequent rally in Nick Laird's Intraday Silver Sentiment Index cut the loss to only 0.86%.

The CME Daily Delivery Report showed that zero gold and 227 silver contracts were posted for delivery within the Comex-approved depositories on Thursday.  In silver, the two largest short/issuers were ABN Amro and R.J. O'Brien with 138 and 77 contracts respectively.  There were 11 different long/stoppers. The link to yesterday's Issuers and Stoppers Report is here---and it's certainly worth a quick look.

The CME Preliminary Report for the Tuesday trading session shows that there are still 24 gold contracts left open in the September delivery month, which is unchanged from Monday's report.  But the number of silver contracts left open in September rose by 90 yesterday, so there are now 977 contracts left to deliver in September---from which you can subtract the 227 contracts mentioned in the prior paragraph.

There were no reported changes in GLD yesterday---and as of 9:40 p.m. EDT yesterday evening, there were no reported changes in SLV, either.  But when I was editing today's efforts at 3:55 a.m. EDT, I was shocked to see that there was another addition to SLV.  This time it was 1,438,770 troy ounces.  Was this deposited to cover an existing JPMorgan short position?  Since the beginning of the month, 3.12 million ounces of silver have been added to SLV---and 9.7 million troy ounces were added in August---and since August 1, silver prices have been engineered lower to the tune of almost two bucks.  During the same time period, GLD has shed about 320,000 troy ounces.

We should get the new short positions for both GLD and SLV this evening sometime---and that will be up until the end of August.  The 3.12 million ounces added so far this month, won't show up in shortsqueeze.com's numbers until almost the end of September.

There was another sales report from the U.S. Mint.  The sold 1,000 troy ounces of gold eagles---500 one-ounce 24K gold buffaloes---200,000 silver eagles---and 100 platinum eagles.

Once again there was big movement at the Comex-approved depositories on Monday.  In gold, nothing was reported received, but 56,748 troy ounces were shipped out, with most of it coming out of Scotiabank's vault.  The link to that activity is here.

In silver, there was 601,494 troy ounces received---and 1,222,262 troy ounces shipped out the door.  All the activity was at the CNT Depository---and Brink's, Inc.  The link to that action is here.

Happily, I don't have all that many stories for you today---and that suits me just fine.  You as well, I would assume.

¤ Critical Reads

James Rickards: Fed Tapering Signals Trouble for Economy, Stock Market

The Federal Reserve is in the midst of winding down its third round of quantitative easing (QE3), and economist and financial author James Rickards says that doesn't bode well for the economy and financial markets.

After the Fed's prior two quantitative easing operations, both the economy and the stock market suffered, he notes. Rickards is the author of "The Death of Money: The Coming Collapse of the International Monetary System."

"It's happening again, but in slow motion, because the QE3 taper was gradual and from a higher level," he tells CNBC. "When this third taper is done in November, the weakness will become apparent."

This short piece appeared on the moneynews.com Internet site at 8:15 a.m. EDT on Tuesday morning---and I thank West Virginia reader Elliot Simon for today's first story.

Big Banks Headed Straight for Another Bailout

The 2010 Dodd-Frank Act, which included the orderly liquidation living wills requirement, was meant to prevent future rescues of systemically important financial institutions. But the idea that current regulations are capable of solving the too-big-to-fail problem was challenged by the recent regulatory rejection of 11 banks' living wills. Some argue that living wills are a work-in-progress that will improve over time. However, the truth is that living wills are a myth meant to calm the populace. It is impossible to neatly unwind a failed SIFI, since the failure of such a large institution will necessarily cause unacceptable collateral damage.

The most likely course of action is that regulators will maintain the status quo and change nothing of substance, relying on cosmetic fixes to give voters a false sense of security. Some free market enthusiasts might argue that the status quo isn't so bad, so long as customers and not regulators decide how big banks should be. But the SIFI market is anything but free. The big bank model failed in late 2008; in a free market, these banks would have ceased to exist. They survived because they are the creations of the government, not the free market. Exempt from market discipline, they represent crony capitalism at its worst.

This brief essay, which is certainly worth reading, showed up on the americanbanker.com Internet site at noon on Monday---and it's something I found in yesterday's edition of the King Report.

Ron Paul---Nixon’s Revenge: The Imperial Presidency Lives On

Forty years ago many Americans celebrated the demise of the imperial presidency with the resignation of Richard Nixon. Today it is clear they celebrated too soon. Nixon’s view of presidential powers, summed up in his infamous statement that, “when the president does it that means it is not illegal,” is embraced by the majority of the political class. In fact, the last two presidents have abused their power in ways that would have made Nixon blush.

For example, Nixon’s abuse of the Internal Revenue Service to persecute his political opponents was the subject of one of the articles of impeachment passed by the US House of Representatives. As bad as Nixon’s abuse of the IRS was, he was hardly the first president to use the IRS this way, and the present administration seems to be continuing this tradition. The targeting of Tea Party groups has received the most attention, but it is not the only instance of the IRS harassing President Barack Obama’s political opponents. For example, the IRS has demanded that one of my organizations, Campaign for Liberty, hand over information regarding its major donors.

Nixon’s abuse of federal power to spy on his “enemies” was abhorrent, but Nixon’s abuses of civil liberties pale in comparison to those of his successors. Today literally anyone in the world can be spied on, indefinitely detained, or placed on a presidential “kill list” based on nothing more than a presidential order. For all his faults, Nixon never tried to claim the power to unilaterally order anyone in the world detained or killed.

This short essay by Ron Paul appeared on David Stockman's website on Monday---and I thank Roy Stephens for sending it.

U.S. Refuses to Declassify Information About Foreign Involvement in 9/11 Attacks

The Obama administration refuses to declassify the information about the involvement of certain foreign governments in the terrorist attacks of September 11, 2001, despite the calls and efforts of the Congress members, congressman Stephen Lynch told RIA Novosti on Tuesday.

"We've had dialog. And the families have had dialog. But it hasn't been productive up until now," Lynch said.

H. Res. 428 is a resolution introduced to make public 28 pages of the Joint Inquiry into Intelligence Activities Before and After the Terrorist Attacks of September 2001. The pages, initially classified by President George W. Bush, have remained classified under President Barack Obama. The resolution states that declassification of the pages is necessary to provide the American public with the full truth surrounding the tragic events of September 11, 2001, particularly relating to the involvement of foreign governments.

This news item showed up on the RIA Novosti website at 3:15 a.m. Moscow time on their Wednesday morning---and I thank South African reader B.V. for sliding it into my in-box just before I hit the send button on today's column.

Doug Casey: “There Is a Rogue Elephant in Your House”

One time when I was in Burma (now Myanmar), I spent a couple of days riding around the forest by elephant back. Elephants are a fine thing to have in the forest but, believe it or not, you have one living in your house with you. And you should do something about it now, before your house is wrecked and you and your family get stomped in the process.

Any amount of financial success won’t mean much if you get stepped on by the elephant in the room. The damage you routinely suffer from the elephant—not to mention the lingering threat that he’ll go completely berserk someday—dwarfs the importance of the best investment decision you’ll ever make. So, I’m going to invite your attention to a problem of overriding importance: How can you protect yourself and your wealth from the elephant?

The elephant in the room is, of course, the government.

This excellent commentary by Doug showed up on the Casey Research website on Monday---and it's well worth reading.

British P.M. to head to Scotland as independence campaign gathers steam

British Prime Minister David Cameron implored Scots on Tuesday not to vote for independence in next week's referendum after an opinion poll showed a surge in support for a break from the United Kingdom.

Cameron pledged to do all he could to keep the United Kingdom together and said he would head north to Scotland on Wednesday to join the fray.

"In the end, it is for the Scottish people to decide, but I want them to know that the rest of the United Kingdom - and I speak as prime minister - want them to stay."

Cameron's move made clear that the break–up of the United Kingdom - previously thought to be a pipe dream - was now a distinct possibility. His spokesman said Scotland's blue and white flag would be flown over Cameron's London residence in Downing Street until the vote next week.

This Reuters article, co-filed from Edinburgh and London, appeared on their website at 1:05 p.m. EDT yesterday afternoon---and I thank Orlando, Florida reader Dennis Mong for sending it our way.

Get your money out of Britain: Global banks warn investors 'Yes' vote would be 'cataclysmic' for U.K. economy

International investors have been warned to pull their cash out of Britain to protect themselves against the 'cataclysmic' impact of Scottish independence.

Japan's biggest bank, Nomura, warned sterling could plunge by 15 per cent in the event of a ‘Yes’ vote – amid warnings over a ‘run on UK assets’ threatening savings and pensions of ordinary families.

It came as it emerged David Cameron has pleaded with business chiefs to publicly warn against Scottish independence.

The Prime Minister asked company bosses at a Downing Street drinks event last night to 'highlight the dangers of a Scottish exit in any way we can'. 

This news item appeared on the dailymail.co.uk Internet site at 8:48 a.m. BST on their Tuesday morning---and it thank South African reader B.V. for sharing it with us.

Malaysia Airlines flight MH17 - 5 stories

1. Malaysia: Dutch report suggests MH-17 shot down from ground: Reuters  2. MH17: Malaysia Airlines plane 'split into pieces during flight': The Telegraph  3. MH17 broke up in mid-air due to external damage - Dutch preliminary report: Russia Today  4. ‘Report on MH-17 crash acceptable but not conclusive’: Russia Today 'Op Edge'  5. Preliminary Report---Crash of flight MH17 [PDF - 17 pages]: Dutch Safety Board

[The above stories are courtesy of James Skinner and Roy Stephens]

Lavrov Hopes Ceasefire in Ukraine to Be Consolidated in Next Few Days

Moscow hopes that within the next few days the ceasefire in Ukraine will be consolidated, Russian Foreign Minister Sergei Lavrov said Tuesday.

“In speaking of the assessments of how the ceasefire is being observed, we naturally rely on the opinions of the OSCE observers. They aren’t panicking. They do acknowledge that there are some isolated incidents from both sides. However, one senior observer said in an interview that unfortunately this is the usual case at the beginning period of a setting up a ceasefire and bringing the agreement of a ceasefire to life. So, we hope that in the next few days this regime will be consolidated,” Lavrov said during a joint press conference with Malian Foreign Minister Tieman Coulibaly.

Representatives from Ukraine, Russia and the Organization for Security and Cooperation in Europe (OSCE) agreed to a ceasefire between Kiev and Ukrainian independence supporters during the September meeting of the Contact Group in Minsk.

This article appeared on the RIA Novosti website at 1:57 p.m. Moscow time on their Tuesday afternoon---and it's another contribution from Roy Stephens.

The Ukraine Crisis Remains Unresolved — Paul Craig Roberts

Some Western commentators interpret the cease fire in Ukraine obtained by President Putin as a victory for Russia. The reasoning is that the cease fire leaves Ukraine with disputed borders, which rules out Ukraine’s membership in NATO.

But will the cease fire hold? The right-wing Kiev militias, whose members often wear Nazi insignias, are not under Kiev’s complete control. These militias can easily violate the cease fire, and there are already reports of violations. Moreover the billionaire oligarch that Washington has installed in Kiev as president of Ukraine will violate the ceasefire on Washington’s orders, unless, of course, Putin has put the fear of God in him.

To a military strategist the Russian response to the trouble that Washington has caused Russia in Ukraine, longer a part of Russia than the U.S. has existed, is a mystery. Russia lost Ukraine because of its weakness when the Soviet Union collapsed, and Washington forced Russia to permit an independent Ukraine, which served Washington’s purpose of breaking up the Russian Federation.

The western Ukrainians, who fought for Hitler during World War II, maintained an impressive lobby organization in Washington and secured their independent country, but they did not control Ukraine because much of the country consists of former Russian territories made part of Ukraine by Soviet leaders in the 20th century.

This Paul Craig Roberts commentary falls into the absolute must read category, especially for all serious students of the New Great Game---and it's a Roy Stephens offering as well.

Russian MP urges ‘nationalization’ of Google over security fears

A ruling party lawmaker has said he will press for Google to register a subsidiary in Russia and comply with all Russian laws after uncovering the software giant’s alleged cooperation with foreign security services.

We hold that in due time we must see the nationalization of Google, meaning that Google’s operations concerning Russia must fall under Russian jurisdiction and competence,” MP Yevgeny Fyodorov of the parliamentary majority caucus United Russia told a press conference on Tuesday. This will mean national control over the legal entity and all the company communications, the lawmaker explained.

Fyodorov wants Google to register a subsidiary in Russia by the beginning of 2015.

The MP said the Russian Federation would now face a long period of foreign aggression and that it must prepare all its defenses, including those in mass media and information. He added that the authorities must gradually transfer the control of all sensitive internet resources in the country to Russian specialists’ control. This would assure that Russian laws are observed in full and also give a boost to the hi-tech sector of the economy, Fyodorov said.

This article appeared on the Russia Today Internet site at 1:34 p.m. Moscow time on their Tuesday afternoon---and it's courtesy of Roy Stephens.

The Mother of All Blowback: Eric Margolis

President Barack Obama is being lambasted by US Republicans for admitting that “we don’t have a strategy yet” for dealing with the rise of the militant group, ISIS, or Islamic State, as it’s now known.

Given that the US had made an unbelievable mess of its Mideast policies, the president is right to pause and think, something his shoot –from- the- lip Republican critics rarely do. They are demanding the US attack both Iraq and Syria without asking “what then oh brave Washington warriors?” These are the Republicans who ardently supported George Bush’s catastrophic invasion and destruction of Iraq.

The problem is that too many cooks in Washington are spoiling its Mideast soup. In his magnificent new book, “The Sleepwalkers,” Prof. Christopher Clark of Cambridge describes how World War I was in part ignited by small numbers of anti-German officials in France, Russia, Serbia and Britain who often undermined their own government’s moderate policies.

The same process occurred under President George W. Bush when cabals of neocon officials in the Pentagon, State Department, CIA and media drove the US into a calamitous war whose negative effects are still being felt.

This short essay is your second absolute must read of the day---and it was posted on Eric's website on August 30. I thank reader B.V. for bringing it to our attention.

Lavrov: West may use ISIS as pretext to bomb Syrian government forces

If the West bombs Islamic State militants in Syria without consulting Damascus, the anti-ISIS alliance may use the occasion to launch airstrikes against President Bashar Assad’s forces, Russian Foreign Minister Sergey Lavrov said.

There are reasons to suspect that air strikes on Syrian territory may target not only areas controlled by Islamic State militants, but the government troops may also be attacked on the quiet to weaken the positions of Bashar Assad’s army,” Lavrov said Tuesday.

Such a development would lead to a huge escalation of conflict in the Middle East and North Africa, Lavrov told reporters in Moscow after a meeting with the foreign minister of Mali.

This story appeared on the Russia Today website at 4:10 p.m. Moscow time on their Tuesday afternoon---8:10 a.m. EDT---and it's the final offering of the day from Roy Stephens, for which I thank him.

Three King World News Blogs

1. Art Cashin: "There is a Huge Problem in Europe---and a Shock in Key Markets"  2. John Embry: "Vladimir Putin, the U.S. Dollar, Gold---and a Warning"  3. James Turk: "Despite Recent Weakness in Gold, Revaluation Spike is Coming"

[Please direct any questions or comments about what is said in these interviews by either Eric King or his guests to them, and not to me. Thank you. - Ed]

Brian Domitrovic: Transacting in gold can shaft the IRS

In 2011, the state of Utah passed a law banning taxes on the use of gold and silver coins as currency and permitting residents to remit state taxes in these coins. Big deal, you might say. That’s already in the Constitution: “No state shall…make anything but gold and silver coin a tender in payment of debts.”

Oklahoma has done something similar, confirming that transactions taking place in gold and silver are free from state taxes on the exchange medium. Currently, in federal law, if you buy things with gold, for example, you have to declare as taxable the gain on any market appreciation of the gold you used to make the purchase.

Actually, it’s not real federal law. It’s just a piece 0f “administrative law,” that poor relation of real law, which an agency, the Internal Revenue Service, came up with outside of the Congressional and the judicial processes. If you look at real law, statutes signed by the president and Supreme Court decisions from over the centuries, it has been affirmed time and again that the feds must consider gold and silver coins and their own paper notes as dollars as denominated, one and the same.

This opinion piece appeared on the forbes.com website on Monday---and I found this on the gata.org Internet site.

Koos Jansen: German gold repatriation accelerating

Bloomberg News would have the world believe that Germany's Bundesbank has stopped repatriating gold from the Federal Reserve Bank of New York, but gold researcher and GATA consultant Koos Jansen says that the repatriation is likely accelerating, though of course with such a slow start almost anything might qualify as acceleration.

Jansen's commentary is headlined "German Gold Repatriation Accelerating" and it was posted at the bullionstar.com Internet site on Sunday.  I thank Chris Powell for wordsmithing the above paragraph of introduction.

Lawrence Williams: Goldcorp CEO expounds on Peak gold and $900 gold price

Goldcorp CEO, Chuck Jeannes, has been on the interview trail recently and has come up with some interesting, although not altogether surprising, views on gold and the gold price. Indeed if one analyses them from the Goldcorp perspective they are wholly logical given what is one of the most successful of the world’s mega gold miners’ current financial and operating situations.

Followers of the gold sector will be aware that not only has the pace of gold exploration dipped dramatically, as majors have cut back and juniors are cash strapped, but the discovery of new major gold deposits has diminished to close on zero, while big new projects under development are pretty well coming to an end, as the majors cut back on capital programmes, and finance for multi billion dollar mega projects is tough, if not impossible, to raise in the current financial climate. ‘Peak gold’ has been discussed in the gold-oriented media from time to time, but it probably has needed the comment from a heavy hitter like Jeannes to get it the prominence it perhaps deserves.

Yes, Peak Gold is indeed close. In fact the only thing preventing it having happened already is, ironically, the lower gold price, which has forced big miners to mine higher ore grades and thus raise production (thereby lowering unit costs) but at the expense of mine lives. But their scope for doing this diminishes the whole time. We may yet thus see a small increase in global gold production this year as a result and as the remaining projects, already in the pipeline, come on stream. But the industry’s scope for maintaining this is diminishing by the minute and Jeannes is almost certainly correct in his prediction that global gold output is about to turn downwards, and may well remain on a downwards path for many years to come.

I would hazard a guess, dear reader, that unless we see some radically higher gold prices soon, the "many years" to which Lawrie refers to in his last sentence, could wind up being a decade or more.  Not only don't the ore bodies exist to be mined, but the deposits being found now are much smaller, as the low-hanging fruit was picked long ago.  The other casualty of high prices will be production from existing mines, as it will plunge, because the owner/operators will jettison high-grading the moment it happens.  I found this story on the mineweb.com Internet site yesterday.

¤ The Funnies

Here's another two photos I took on Sunday.  It's our old friend, the double-crested cormorant.  It's the same bird sitting in the same spot that I presented in this column about a month ago---and that I photographed in early summer as well, so I would think that it's a non-breeding adult.  Since I already had all the photos of this fellow I could ever want, I thought it would fun to see how close I could get.  The first photo is from about 8 meters at bird-eye level, which is point blank range for a 400mm telephoto lens for an object this size, so I didn't have to crop it much.  Here he/she is, standing on one leg, pretending to sleep, but with at least one eye wide open.  The second photo was taken from a bit further away and from a slightly elevated position on some stairs as I left.  I spent half an hour at that spot---and it didn't move an inch.









¤ The Wrap

Let me take another shot at trying to highlight why this COMEX physical turnover, unique to silver among all commodities, has captured my attention. There are six COMEX-approved silver warehouses---four in the vicinity of New York City and two not that far away in Delaware and Massachusetts. There is not a lot of silver mining or smelting occurring in this narrow area of the Northeastern US, although this is clearly a hub for distribution and transportation. This year some 900,000 oz of silver on average have moved into or out from these six warehouses on a daily basis.

Converting world annual silver mine production to the same five day work week as COMEX inventories are reported (800 million oz divided by 250 days), the daily world mine production of silver comes to 3.2 million oz each business day. The daily average movement of silver into and out from the COMEX silver warehouses at 900,000 oz is equal to 28% of total world daily mine production, even though the world mines and refines silver in areas far from the narrow area where the COMEX silver warehouses are located. - Silver analyst Ted Butler: 06 September 2014

[And as an aside to what Ted say above, it's a very good bet that just about every good delivery bar that's been received or shipped out of these six Comex-approved depositories during the last three years or so, has some pretty awesome 'frequent flyer' points attached to them. - Ed]

I don't have much to add to my prior comments about any of the four precious metals, as JPMorgan et al took all four of them to new lows yesterday in these ongoing engineered price declines.

Here are the 6-month charts for all four metals.

Are we done to the downside?  Beats the hell out of me.  JPMorgan et al along with their HFT buddies can do anything they want.  But there are limits to how low these prices can be driven---and as Ted Butler said in his Saturday column---and again on the phone yesterday---if we're not there already, we aren't far off.  I'm sure he'll have more to say about this to his paying subscribers in his mid-week commentary later today.

And as I write this paragraph, the London open is less than 15 minutes away---and prices did absolute nothing in Far East trading on their Wednesday.  Of course silver had it's obligatory down spike at the 6 p.m. open in New York on Tuesday evening---and it's still down as of this writing.  Net gold volume is around 15,000 contracts---and silver' net volume is 4,500 contracts.  The dollar index is basically unchanged.

As I said in The Wrap yesterday, I was kind of hoping that JPMorgan et al would get this over with on Tuesday, as I would like all the data in Friday's Commitment of Traders Report, as yesterday at the close of Comex trading was the cut-off for that report.  And whether it was the bottom or not, there's an excellent chance that all of it should be reported in a timely manner.

And as I send this off to Stowe, Vermont at 5:20 a.m. EDT, I note that all four precious metals are being guided lower---and are below yesterday's closing prices in New York---and palladium is once again at a new low for this move down.  It wouldn't surprise me in the slightest if 'da boyz' had the other three precious metals at new lows before the trading day is done in New York today.  Gold's net volume is now 25,000 contracts---and silver's volume is up to 6,500 contracts net.  The dollar index is still up a tiny amount.

Based on what I see here, nothing will surprise me from a price perspective when I check out the Kitco charts after I fire up my computer later this morning.

And before heading out the door, I'd like to point out that the Casey OnePass has been opened for a very brief period of time.  You have until this Friday to sign up to save $1,749 on the full subscription package.

As you know, with the Casey OnePass, you get ALL of Casey’s newsletters (no CIA or CEC alert services) at a significant saving of $1,749 per year.  But more importantly, we’ve got some good opportunities across all sectors---and what better way to keep track of them, then to sign up for a service that includes them all?

You can find out all you need to know by clicking here---and it costs nothing to have a look.

I'm off to bed.  See you here tomorrow.

]]>
Wed, 10 Sep 2014 06:16:00 +0000
<![CDATA[CME Group Admits Its Exchanges Have Been Allowing Manipulative Trading Practices]]> http://www.caseyresearch.com/gsd/edition/cme-group-admits-its-exchanges-have-been-allowing-manipulative-trading-prac/ http://www.caseyresearch.com/gsd/edition/cme-group-admits-its-exchanges-have-been-allowing-manipulative-trading-prac/#When:06:19:00Z "We are very close to a major bottom once again"

¤ Yesterday In Gold & Silver

The gold price didn't do much in the early going in the Far East on their Monday, with the the high of the day, such as it was, coming around 1:30 p.m. Hong Kong time.  At that point the HFT boyz showed up with their algorithms---and by 9:25 a.m. EDT, the gold price was down three or four bucks from its Friday close.  Then 'da boyz' really got serious, with the low tick of the day coming shortly after 1 p.m. in New York.  By 2 p.m. the gold price had recovered a few bucks, but then traded sideways on almost no volume into the 5:15 p.m. close of electronic trading.

The high and low ticks were reported by the CME Group as $1,272.60 and $1,252.10 in the December contract---an intraday move of twenty bucks.

Gold closed in New York yesterday at$1,255.50 spot, down $12.90 on the day.  Net volume wasn't overly heavy at 96,000 contracts.

Here's the New York Spot Gold [Bid] chart so you can see the Comex action in greater detail.

Once again reader Brad Robertson was kind enough to send out the daily 10-minute tick chart for gold.  Of course all the big volume was around the engineered price decline that began about 9:15 a.m. EDT---and don't forget, this chart shows Mountain Daylight Time, so you have to add 2 hours to get the time in New York.

It was virtually the same price pattern in silver, so I shall spare you the details, as the Kitco chart below tells all.

The high and low tick in silver in the December contract were recorded as $19.345 and $18.93---which was an intraday move of a bit more than 2 percent.

Silver finished the Monday session in New York at $19.02 spot, down 17 cents from it's Friday close.  Net volume was 28,000 contracts, which was pretty light.

The New York Spot [Bid] chart looks the same as the above Spot [Bid] chart for gold, so I shan't bother posting it.

Both platinum and palladium rallied in the early going in Far East trading as well, but were both closed down on the day---platinum by 7 bucks and palladium by 4 dollars.  Here are the charts.

The dollar index closed in New York late on Friday afternoon at 83.76---and by 11 a.m. EDT on Monday morning, it was up another 17 basis points.  From there it ran away to its 84.31 high of the day, which came right at the 1:30 p.m. close of Comex trading---and from that point, it basically traded sideways into the close, finishing the day at 80.30, which was up another 54 basis points.

Most of the loses in the precious metals were in long before the big run-up in the dollar index---and you can check that out on the Kitco precious metal charts posted above.  I would guess that the biggest portion of the dollar rally involved more short covering.

Here's the 6-month U.S. dollar index chart---and as you can see, it's at nosebleed levels.

Needless to say, the gold shares got clubbed again---and the HUI finished down another 2.91%---just off its low tick of the day.

The silver equities got hit by about the same amount, as Nick Laird's Intraday Silver Sentiment Index closed down 3.02%.

The CME Daily Delivery Report showed that no gold or silver contracts were posted for delivery within the Comex-approved depositories on Wednesday.  That was a surprise.

The CME Preliminary Report for the Monday trading session showed that 24 gold and 887 silver contracts are still open in the September delivery month.

There were no reported changes in GLD yesterday---and as of 5:48 p.m. yesterday afternoon, there were no reported changes in SLV, either.

The U.S. Mint had another sales report.  They sold 1,500 troy ounces of gold eagles---and 240,000 silver eagles.

It was another big day in gold movement over at the Comex-approved depositories on Friday, as 43,603 troy ounces were reported received---and 92,210 troy ounces were shipped out.  The big receipt was at Scotiabank---and the big shipment was out of JPMorgan's vault.  The link to that activity is here.

Of course there was even bigger movement in silver, as 831,310 troy ounces were received---and 600,941 ounces were shipped out the door.  The 'in' activity was at the CNT Depository---and the 'out' activity was at Brink's, Inc.  The link to all that action is here.

My Tuesday column normally comes with a lot of stories---and today's offering is no exception.  I hope you have time for the ones that interest you the most.

¤ Critical Reads

Broken Transmission: Bank Credit As Percentage of Monetary Base Hits All-time Low

It is no secret that money velocity keeps falling. And has continued to fall despite the extraordinary increase in the monetary base of the U.S.

If we look at bank credit at all commercial banks divided by the St. Louis Adjusted Monetary Base, we see a distinct “stall” as The Fed increased the monetary base in 2008. In other words, after 2008. there is substantial money in the banking system that is NOT being loaned. Now we sit at a new historical low of bank credit as a percentage of monetary base.

The answer to this puzzle is declining/stagnant income growth which can be seen in this chart of declining/stagnant average hourly wage earnings growth since 2007.

This short commentary, with some excellent FRED charts, was posted on the confoundedinterest.com website---and my thanks go out to reader U.D. for passing it around on Sunday.

Why Illinois Is Bankrupt: 6,000 Teachers Get Pensions Of $100,000+

From 2013 to 2014, the number of teachers receiving six-figure pensions in Illinois increased by 24 percent. Today, 6,000 retired Illinois teachers are collecting at least 100,000 in annual pension money.

Yet, as Kelly Riddell reports for the Washington Times, if the Illinois Teachers Retirement Service (TRS) were forced to pay out the pensions it owes today, it would only be able to pay retirees 40 cents for every dollar. Indeed, the state’s pension fund is in trouble:

  • According to a report from the spending watchdog group Open the Books, over 100,000 Illinois teachers had already broken even on their pension payments after just 20 months of retirement.
  • Illinois taxpayers can pay up to $2 million per teacher per retirement.
  • The TRS pension fund is underfunded by $54 billion, according to the Illinois Policy Institute.
  • By 2029, the fund could be entirely broke.

This very interesting commentary appeared on David Stockman's website on Saturday---and I thank Orlando, Florida reader Dennis Mong for sending it our way.

Your Money Matters: Retirement Reboot author Dennis Miller

This 4:39 minute video clip is an interview with Casey Research's own Dennis Miller---of "Miller's Money Forever" fame.  The interview was performed by WGN TV in Chicago---and it was posted on their Internet site at 11:10 a.m. CDT on Monday.  It's worth watching if you fall in that age category.

Consumer Credit in U.S. Jumps as Auto Lending Strengthens

Consumer borrowing in the U.S. surged again in May as Americans took out more loans to purchase cars.

The $19.6 billion increase in credit followed a revised $26.1 billion gain in April, Federal Reserve figures showed today in Washington. Non-revolving lending, which includes auto and school loans, advanced by the most in a year.

Stronger employment and stock-market gains this year are giving consumers the confidence to take on more debt. The figures coincide with robust auto sales and greater demand for furniture and appliances tied to the real-estate recovery, indicating the economy is rebounding from a first-quarter slump.

"Another day older---and deeper in debt"---as the song goes.  This Bloomberg article appeared on their website at 1:38 p.m. Denver time yesterday---and it's the first offering of the day from West Virginia reader Elliot Simon.

Harvard's Ken Rogoff: The Exaggerated Death of Inflation

Is the era of high inflation gone forever? In a world of slow growth, high debt, and tremendous distributional pressures, whether inflation is dead or merely dormant is an important question. Yes, massive institutional improvements concerning central banks have created formidable barriers to high inflation. But a significant part of a central bank's credibility ultimately derives from the broader macroeconomic environment in which it operates.

In the first half of the 1990s, annual inflation averaged 40% in Africa, 230% in Latin America, and 360% in the transition economies of eastern Europe. And, in the early 1980s, advanced-economy inflation averaged nearly 10%. Today, high inflation seems so remote that many analysts treat it as little more than a theoretical curiosity.

They are wrong to do so. No matter how much central banks may wish to present the level of inflation as a mere technocratic decision, it is ultimately a social choice. And some of the very pressures that helped to contain inflation for the past two decades have been retreating.

This commentary by Ken Rogoff appeared on the guardian.com Internet site back on September 2---and it's the second offering in a row from Elliot Simon.  It's worth reading.

The Scottish Independence Referendum - 7 stories

1. New Poll Shows Supporters of Scottish Independence Take Lead for First Time: RIA Novosti  2. Supporters of Scottish independence take narrow poll lead for first time: Reuters  3. U.K. scrambles to promise more powers if Scots reject independence: Reuters  4. Scottish independence: Vote 'will go to the wire'BBC  5. Sterling tumbles after poll shows 51pc support Scottish exitThe Telegraph  6. Britain faces storm as giant global investors awaken to break-up dangers: The Telegraph  7. Investors, be warned: Scottish independence would be highly contagious: The Telegraph

[The above stories are courtesy of Dennis Mong and Roy Stephens---and the last three stories are definitely worth reading, as they are the most current - Ed]

French far-right 'at gates of power' - P.M. Manuel Valls

He said his Socialist government had to act and speak "differently" to counter the threat from FN.

His comments came after opinion polls suggested that FN leader Marine Le Pen could beat incumbent Francois Hollande in the 2017 presidential election.

Meanwhile, a far-right rally held in Calais, in the north, demanded that the port city be "saved" from migrants.

This news item appeared on the bbc.com Internet site on Sunday BST sometime---and I thank South African reader B.V. for sharing it with us.

German trade surplus hits record in July

The outlook for the German economy, Europe's biggest, brightened on Monday when data showed the country's trade surplus hit a new record in July on the back of booming exports.

After allowance for seasonal blips, Germany exported goods worth a total of €98.2 billion ($127 billion) in July, 4.7 percent more than in June, the federal statistics office Destatis said in a statement.

Imports, on the other hand, shrank by 1.8 percent to €76.1 billion.

That meant the seasonally adjusted trade surplus -- the balance between imports and exports -- increased to €22.2 billion in July from €16.4 billion in June.

This AFP article appeared on the france24.com Internet site at 10:05 a.m. Europe time on their Monday morning---and it's the second offering in a row from reader B.V.

Switzerland ‘unlikely to extradite Snowden’, if he appears for NSA testimony

Switzerland will most likely guarantee safety to National Security Agency whistleblower Edward Snowden, if he comes to testify against the NSA’s spying activities, Swiss media said.

In the document, titled “What rules are to be followed if Edward Snowden is brought to Switzerland and then the United States makes an extradition request,” Switzerland’s Attorney General stated that Snowden could be guaranteed safety if he arrives in the country to testify, Sonntags Zeitung reported.

In the document, the authority said that Switzerland does not extradite a U.S. citizen, if the individual’s “actions constitute a political offense, or if the request has been politically motivated,” Swiss ATS News agency reported.

"Mostly likely" doesn't sound like a guarantee to me.  This story appeared on the Russia Today website at 3:49 a.m. Moscow time on their Monday morning---and that makes it three in a row from reader B.V.

Minsk protocol: Ukraine to be decentralized, special status for Lugansk, Donetsk

The OSCE has revealed the 12-point road map behind the September 5 truce signed in Minsk. It says that Ukraine must adopt a new law, allowing for a special status for Lugansk and Donetsk regions, and hold early elections there.

The document, titled ‘Protocol on the results of consultations of the Trilateral Contact Group’ and signed in Minsk on September 5, outlines what needs to be done for the ceasefire to stay in place.

“To decentralize power, including through the adoption by Ukraine of law 'on provisional procedure for local government in parts of Donetsk and Lugansk regions (law on special status),'” states one of the provisions in the document.

This article appeared on the Russia Today website at 4:46 a.m. Moscow time on their Sunday morning---and my thanks go out to Roy Stephens for this story.

Ukraine ceasefire at risk amid shelling in Mariupol, Donetsk

Shelling erupted in eastern Ukraine’s strategic port of Mariupol and the city of Donetsk overnight, threatening a fragile ceasefire agreed Friday between the Ukrainian government and pro-Russian separatists.

The ceasefire – brokered in Minsk by envoys from Ukraine, the separatist leadership, Russia and Europe’s OSCE security watchdog – is part of a broader peace plan intended to end a five-month-long conflict that has killed nearly 3,000 people.

The renewed shelling broke out hours after Russia’s President Vladimir Putin and his Ukrainian counterpart Petro Poroshenko had agreed in a telephone call that the truce was holding and had discussed ways of allowing in shipments of humanitarian aid.

Both sides blamed the other on Sunday for the ceasefire violations.

This france24/Reuters article appeared on the france24.com Internet site on Sunday sometime---and it's another contribution from Roy Stephens.

U.S. Politician: Kiev Unable to Bring Right-Wing Militias Under Complete Control

The ceasefire in Eastern Ukraine is unlikely to be a permanent solution to the crisis as Kiev fails to bring ultra-right groups under its complete control, former Assistant Secretary of the Treasury Paul Craig Roberts told RIA Novosti on Monday.

"Will the ceasefire hold? The right-wing Kiev militias, whose members often wear Nazi insignias, are not under Kiev's complete control," Roberts stressed, adding that these militias can easily violate the ceasefire, and there are already reports of violations.

Commenting on the overall situation in Ukraine, Roberts claimed that the Ukrainian crisis is one of Washington's tools to disrupt the economic and political relationships between Europe and Russia.

"By using Ukraine to demonize Russia, Washington has pushed the European Union into imposing sanctions on Russia that disrupt the trade relationships and create distrust," Roberts explained.

This commentary/interview put in an appearance on the RIA Novosti website at 9:21 a.m. Moscow time on their Monday morning---and I thank reader B.V. for sending it.

Why the Ukraine Crisis Is the West’s Fault: Foreign Affairs

According to the prevailing wisdom in the West, the Ukraine crisis can be blamed almost entirely on Russian aggression. Russian President Vladimir Putin, the argument goes, annexed Crimea out of a long-standing desire to resuscitate the Soviet empire, and he may eventually go after the rest of Ukraine, as well as other countries in eastern Europe. In this view, the ouster of Ukrainian President Viktor Yanukovych in February 2014 merely provided a pretext for Putin’s decision to order Russian forces to seize part of Ukraine.

But this account is wrong: the United States and its European allies share most of the responsibility for the crisis. The taproot of the trouble is NATO enlargement, the central element of a larger strategy to move Ukraine out of Russia’s orbit and integrate it into the West. At the same time, the E.U.’s expansion eastward and the West’s backing of the pro-democracy movement in Ukraine -- beginning with the Orange Revolution in 2004 -- were critical elements, too. Since the mid-1990s, Russian leaders have adamantly opposed NATO enlargement, and in recent years, they have made it clear that they would not stand by while their strategically important neighbor turned into a Western bastion. For Putin, the illegal overthrow of Ukraine’s democratically elected and pro-Russian president -- which he rightly labeled a “coup” -- was the final straw. He responded by taking Crimea, a peninsula he feared would host a NATO naval base, and working to destabilize Ukraine until it abandoned its efforts to join the West. 

Putin’s push back should have come as no surprise. After all, the West had been moving into Russia’s backyard and threatening its core strategic interests, a point Putin made emphatically and repeatedly. Elites in the United States and Europe have been blindsided by events only because they subscribe to a flawed view of international politics. They tend to believe that the logic of realism holds little relevance in the twenty-first century and that Europe can be kept whole and free on the basis of such liberal principles as the rule of law, economic interdependence, and democracy.

This absolute must read commentary showed up in the Council on Foreign Relations magazine "Foreign Affairs"---and I thank reader U.D. for passing it around late Monday morning MDT.

Europe Goes "All In": Will Sanction Rosneft, Gazprom Neft and Transneft

Until this moment, the main reason why everyone mostly dismissed Europe's sanctions against Russia is that despite all its pompous rhetoric, Europe consistently refused to hit Russia where it would hurt: its energy titans Gazprom, Rosneft And Transfneft. The reason is simple: by imposing sanctions on these core energy exporters, Europe would directly threaten the stability of its own energy imports (Russia accounts for up to 30% of German gas imports), and as winter approaches with every passing day, playing with the energy status quo would seem like economic suicide. This all appears to have changed last Friday, when as the FT reports from a leaked copy, Europe's latest sanctions round will boldly go where Europe has never dared to go before, and impose sanctions on the big three: Rosneft, Gazprom Neft and Transneft.

This is what is known in game theory terms as a major defection round.

It also means that suddenly the stakes for Russia, and thus Europe, just got all too real, as Putin will now have no choice but to really ramp up the retaliatory escalation, which following the food ban can only mean one thing: a staggered reduction in gas flow to Europe.

This must read Zero Hedge commentary appeared on their website just before midnight on Sunday evening EDT---and I thank reader 'David in California' for pointing it out.

E.U. Slows New Russia Sanctions as it Gauges Ukraine Truce

European Union governments abruptly put on hold for at least a “few days” new sanctions against Russia, allowing more time to assess the viability of a cease-fire in Ukraine without risking further trade retaliation by the Kremlin.

The E.U.’s second package of economic penalties against Russia was delayed late yesterday in Brussels by the bloc’s 28 governments, which approved the measures in principle while stopping short of giving the green light for their publication in the Official Journal and entry into force.

The planned provisions -- originally due to be published today -- include barring some Russian state-owned defense and energy companies from raising capital in the E.U., according to a European official who spoke on the usual condition of anonymity.

I passed this story past the Casey Research crowd---and this is what Bud Conrad had to say about it:

"My view is that this crisis and the sanctions that the U.S. is pushing the Europeans to implement will hurt Europe much more than the US, and that Europe business and farmers are getting very upset. This is the U.S. pushing to contain Russia by bringing troops under the name of a Rapid Response Force of 4,000 troops supported with $1B of U.S. money to be run out of Poland and with troops stationed in the Baltics of Estonia, Latvia and Lithuania. The name is response, but the action is pretty aggressive."

"I think this is a crisis that could weaken NATO rather than strengthen it. Germany's 3,000 business that deal with Russia want nothing to do with more sanctions. The U.S. track record encouraging NATO to take aggressive action action against Libya has caused a failed state. It is not clear that Germany likes to have and pay for having tens of thousands of U.S. troops on their soil, and while Merkel hasn't been too out spoken in objecting, she probably doesn't like her cell phone and country to be spied on. If Germany pulled out of some of these measures, she would become a target, but could bring the institutions down like NATO and even the Euro. I think the stakes are very high."

Bud would be pretty close to the mark with those comments.  This Bloomberg article appeared on their Internet site at 5:12 p.m. MDT yesterday evening.

Russia may close airspace in response to new Western sectoral sanctions — Medvedev

The Russian government does not rule out that Russia could close its airspace in response to new Western sectoral sanctions, Prime Minister Dmitry Medvedev said.

Western nations “should be asked whether there will be new sanctions, but if there are sanctions connected with energy or further restrictions for our financial sector, we will have to respond asymmetrically,” Medvedev said in an interview with the Vedomosti business daily. “For example, with restrictions in the transport sphere.”

“We proceed from the fact that we have friendly relations with our partners, so the sky above Russia is open for flights; but if we are restricted, we will have to respond,” he said. “If Western carriers fly out beyond our airspace, it may lead to bankruptcy of many airlines that are teetering on the brink of survival.”

Medvedev, however, said it would be a bad option. “We would just like our partners to realize that,” he said. The premier regretted that the West already announced a few rounds of sanctions against Moscow. “I hoped our partners would be smarter,” he said.

This article appeared on the ITAR-TASS website at 8:51 a.m. Moscow time on their Monday morning---and it's another offering from reader B.V.

Defense minister of Malaysia to visit Moscow to negotiate investigation into MH17 crash

Defense Minister of Malaysia Hishammuddin Hussein is arriving in Moscow on September 10 to negotiate problems of an investigation into a crash of the Malaysian passenger plane on the territory of the Donetsk region on July 17, the News Straits Times newspaper in Monday's issue.

After talks in Moscow the Malaysian defense minister will go to Amsterdam where he will also discuss a process of an investigation into the crash of the Malaysian Boeing-777.

On Monday morning the Malaysian defense minister is arriving in Kiev to make sure that the access to the crash site of the Malaysian plane is safe, the newspaper said.

This very interesting must read news story, filed from Singapore, showed up on the ITAR-TASS Internet site on Monday at 11:25 Moscow Time [UTC+4]---and once again I thank reader B.V. for this contribution to today's column.

OMGodzilla! Japanese Macro Data Revisions Even More Disastrous Than Expected

If the U.S. equity market's reaction to the worst jobs data of 2014 is anything to go on; Japanese stocks should be a double overnight given the catastrophe that just printed. While the initial prints for the post-tax-hike period were bad enough (record worst levels in most cases), the revisions are even worse.

Drum roll please: 1) Trade balance miss, worst in 4 months; 2) GDP -7.1% miss, revised down, worst since Q1 2009; 3) Business Spending/Capex -5.1% miss, revised down, worst since Q2 2009; and 4) Consumer Spending -5.3% miss, revised down, worst on record.

But apart from that, as the Japanese leaders noted last week, "the recovery is heading in the right direction."

Why am I not surprised---and you shouldn't be surprised either, dear reader.  This story showed up on the Zero Hedge website at 8:09 p.m. on Sunday evening EDT---and it's the third and final offering from reader 'David in California'.

China will overtake America to become world's biggest economy within a decade

China will overtake America to become the world's biggest economy in just 10 years, according to a report.  The U.S. has been the world's economic leader for more than a century, but now, a huge rise in consumer spending in China is expected to see it passed in 2024.

Chinese consumer spending is predicted to triple over the next decade, according to an IHS report - increasing from $3.5 trillion to $10.5 trillion.  This would boost their GDP to $28.3trillion, surpassing the USA's expected $27.4trillion - using today's prices.

U.S. GDP is currently still significantly higher than China's - $17.4 trillion compared with $10 trillion.

But with experts predicting China's consumer spending to grow at an average rate of 7.7 per cent per year, things look set to change.

This interesting article showed up on the dailymail.co.uk Internet site at 9:47 a.m. BST on Sunday---and it's the final contribution of the day from reader B.V., for which I thank him.

De-Dollarization Continues: China-Argentina Agree Currency Swap, Will Trade in Yuan

Argentina, which defaulted on its debt in July, will receive the first tranche of a multi-billion dollar currency swap operation with China's central bank before the end of this year, the South American country's La Nación newspaper reported on Sunday.

The swap will allow Argentina to bolster its foreign reserves or pay for Chinese imports with the yuan currency at a time weak export revenues and an ailing currency have put the Latin American nation's foreign reserves under intense pressure.

La Nación said Argentina would receive yuan worth $1 billion by the end of 2014, the first payment of a loan worth a total $11 billion signed by Argentina's President Cristina Fernandez and her Chinese counterpart in July.

This Reuters story bears a Zero Hedge headline.  The story, filed from Buenos Aires, showed up on their website at 3:13 p.m. EDT on Sunday afternoon---and it's another offering from reader 'David in California'.  The ZH spin on this piece is linked here.

Venezuelan Default Suggested by Harvard Economist

As Venezuela racks up billions of dollars of arrears with importers that are fueling the worst shortages on record, one of the nation’s top economists is questioning the government’s decision to keep servicing its foreign bonds.

A “massive default on the country’s import chain” is part of what has allowed the nation to keep paying its foreign bonds, Ricardo Hausmann, a former Venezuelan planning minister who is now director of the Center for International Development at Harvard University in Cambridge, Massachusetts, said by phone from Boston. “I find the moral choice odd. Normally governments declare that they have an inability to pay way before this point.”

While Hausmann declined to say if he’s specifically recommending a default, he said he found “no moral grounds” for the government and state-owned oil company Petroleos de Venezuela SA to make $5.3 billion of bond payments due in October. With foreign reserves at an 11-year low and arrears to importers growing, Venezuelans are struggling to find everything from basic medicines to toilet paper. And prices are surging on the goods that they can buy, saddling the country with the world’s highest inflation rate.

This Bloomberg news item, filed from Santiago, Chile, showed up on their website at 1:13 p.m. MDT on Monday---and I thank reader U.D. for finding it for us.

Seven King World News Blogs/Audio Interviews

1. James Turk: "The Greatest LBMA Injustice---and a Chart of the Year"  2. Richard Russell: "U.S. Treasury Should Buy Gold in the Open Market"  3. Michael Pento: "Global Earthquakes---and a Horrifying Catastrophe"  4. Keith Barron: "A Cataclysmic Great Unwind and Global Meltdown is Coming"  5. Robert Fitzwilson: "People's Savings May Now Be Destroyed Virtually Overnight"   6. The first audio interview is with Michael Pento---and the second audio interview is with Art Cashin

[Please direct any questions or comments about what is said in these interviews by either Eric King or his guests to them, and not to me. Thank you. - Ed]

Koos Jansen: Another week of strong gold demand in China, and silver gets scarcer

Chinese gold demand remained strong for the most recent week reported by the Shanghai Gold Exchange, gold researcher and GATA consultant Koos Jansen reports. He adds that silver inventories on the Shanghai Futures Exchange have dropped to a record low.

His analysis is posted at the BullionStar.com Internet site based out of Singapore---and I found this news item buried in a GATA release on Sunday.

Gold plunge to $900 wouldn't bother Goldcorp; it would buy poorer miners

The chief executive of Goldcorp Inc. is not fretting over lower gold prices this year and says he would view any price declines as an opportunity to buy assets.

In an interview with the Financial Post on Friday, Charles Jeannes, president and CEO of Goldcorp, spoke about the company's growth prospects in the next year.

Gold prices have steadily pulled back since 2011, when they reached a record intraday price of US$1,909 an ounce. Prices for the precious metal closed Friday at US$1,268.81 an ounce.

"We're a low cost producer and we've done most of the investing we need to to secure our future," Mr. Jeannes said. "Building these new mines over the last four years, even if we see gold go down to US$900 -- which I don't think we will -- we'd look for opportunities. Things come for sale at that price."

[Note to Charles: Everything is already on sale, so what are you waiting for???]  This story appeared on Canada's Financial Post website on Saturday---and it's another article I found embedded in a GATA release.

Goldcorp CEO sees 'peak gold' this year or next

Miners have reached "peak gold," in which production of the precious metal has hit its high as easy-to-mine gold deposits become harder to find, said Chuck Jeannes, chief executive of Goldcorp, the world's largest gold miner by market capitalization.

Mr. Jeannes said in an interview that a falloff in supply will support the gold price but make mining it even harder and lead to further consolidation in the industry. ...

"Whether it is this year or next year, I don't think we will ever see the gold production reach these levels again," he said. "There are just not that many new mines being found and developed."

This isn't news, of course, as others have stated this many times over the last few years.  He just stole someone else's work without accreditation, which is a disease in the precious metal industry that has no known cure.  This story was posted on The Wall Street Journal's website at 11:04 a.m. EDT on Monday morning---and unless you have a subscription, the above three paragraphs are all you're going to be able to read.  This is another gold-related news item I found over at the gata.org Internet site yesterday.

Peru's gold output will likely fall 20 percent this year - official

Peru's gold output will likely drop by 20 percent this year and keep falling through 2016 as aging mines churn out less of the precious metal and a government crackdown curbs informal production, a ministry official said on Friday.

Gold output, however, will continue to decline until 2017, when several small mines will support a rebound, Shinno said.

He declined to forecast how much gold production would slide in coming years, or what output would look like in 2017.

"These are very strong production drops," Shinno said from his offices in Lima.

One has to wonder how much Peru's silver production will be impacted by all this.  Any amount would be significant, as they are one of the top two silver producing countries on Planet Earth.  This Reuters article, filed from Lima, appeared on their Internet site at 7:49 p.m. on Friday evening EDT---and I thank reader U.D. for passing it around yesterday.

Sprott Money Weekly Wrap Up

Both Eric Sprott and John Embry were obviously out of town on Friday so, in desperation, I got a call from the host, Jeff Rutherford, asking if I would step into the breech---so I said "yes".  The audio interview runs for 6:32 minutes---and was was posted on the sprottmoney.com Internet site on Monday.

2014 American Platinum Eagle Bullion Coin Sales to Conclude October 1

The United States Mint has informed its network of authorized purchasers that the last day to place orders for 2014-dated American Platinum Eagle bullion coins will be October 1, 2014. The Mint plans to begin accepting orders for 2015-dated platinum bullion coins in early January.

The United States Mint relaunched the American Platinum Eagle one ounce bullion coins this year, with the coins available for authorized purchasers to order from March 10, 2014. The opening day orders reached 8,500 ounces, with orders totaling 10,000 by the end of the month. The pace of sales subsequently slowed, with total sales for the year to date now at 13,700 ounces based on information from the Mint’s website.

While 13,700 ounces may seem like a low figure compared to the sales totals achieved for the more popular gold and silver bullion coins, there have been numerous years when sales for the one ounce Platinum Eagles have been lower. The mintage level for the one ounce Platinum Eagle bullion coins have been less than 10,000 pieces in five separate years.

This article put in an appearance on the coinupdate.com Internet site on Monday sometime---and I thank Elliot Simon for his final contribution to today's column.

Would Scotland take its gold or just a paper claim against Bank of England?

An independent Scotland could lay claim to a part of the United Kingdom's 310-tonne gold reserves if votes go in favour of the "Yes" campaign this month, with ownership of Britain's bullion hoard up for negotiation along with other assets.

"The distribution of the U.K.'s assets in the event of Scottish independence would be subject to negotiation between an independent Scottish Government and the continuing U.K. government," a spokesman for the United Kingdom Treasury said on Monday.

The United Kingdom, whose reserves are worth £7.84 billion ($12.6 billion) at today's prices, is currently the world's 18th largest official sector gold holder.

This Reuters article, filed from London, was posted on their website at 7:29 a.m. EDT on Monday morning---and I found it embedded in a GATA release yesterday.  The real headline of this news item reads: "Ownership of U.K. gold up for negotiation if Scotland votes "Yes""---and it's definitely worth reading.

CME Group admits its exchanges have been allowing manipulative trading practices

Zero Hedge reports tonight that CME Group, operator of futures exchanges, including the Comex in New York, that give discounts to central banks and governments for surreptitious trading whose purpose can be only to manipulate markets, has told the U.S. Commodity Futures Trading Commission that effective September 15 it will ban "spoof trades," "quote stuffing," and "disorderly execution of transactions during the closing period" -- which is to say, as Zero Hedge notes, that this sort of market manipulation has been going on a long time.

This sounds too good to be true.  So good, in fact, that there has to be a catch.  We'll find out soon enough, I would think.  I'll be interested in what Ted Butler thinks of this when I speak to him later today.  This Zero Hedge piece is something I found over at the gata.org Internet site yesterday evening---and I thank Chris Powell for wordsmithing all of the above.  It's a big read, but a must read---at least until your eyes start to glaze over.

¤ The Funnies

I took this photo of Canada geese on Sunday.  The weather was about to take a turn for the worse---and it rained off and on---and it was very cloudy when I took it.  They were quite a distance away, but even that didn't help the depth-of-field issues with this shot, as the birds in the foreground and background are not in sharp focus.  But on a photo this size, it's really hard to tell, but I sure can when I'm looking at it full screen.

¤ The Wrap

After many weeks of having been resigned to expect and prepare for price declines, Friday's COT Report strongly suggests the end of the price decline is in sight. While the recent series of new price lows (slicing the salami) could continue for a while longer, I can no longer say that, based upon market structure, the probabilities point to lower prices. Instead, further technical fund selling potential, while not eliminated completely, looks limited, particularly in silver. - Silver analyst Ted Butler: 06 September 2014

It was another slice out of the gold and silver salamis once again on Monday---and this time by some decent amounts.  Here are the 6-month gold and silver charts---and the news lows for this move down in both metals are striking.

And as I write this paragraph, the London open is 10 minutes away.  None of the four precious metals is doing much from a price perspective and, with the exception of gold, all are down a bit from Monday's close in New York.  I also note that the HFT boyz have carved another new low for silver for this move down.

Net gold volume is a bit over 15,000 contracts---and silver's net volume is 3,400 contracts.  The dollar index, which was up about 18 basis points at around 11:20 a.m. Hong Kong time, is now up only 5 basis points.

The only good thing about Monday's price adjustments by the HFT boyz in all four precious metals, is that all the data will be in Friday's Commitment of Traders Report.  The same can be said for today's price/volume action.  With new lows set in both gold and silver, we are very close to a major bottom once again---and close to being back to where we were in late May, very early June, before the last rally began.

The question that can be rightfully asked at this point, is what will happen when the technical funds start covering their short positions and going long when the next rally begins and the major moving averages are broken to the upside?  Will we blast off from here if JPMorgan et al stand aside and let 'er rip---or will we have a repeat of the anemic rally we experienced off the last low that began in very early June?

Ted Butler put it this way in his Saturday weekly report to his paying subscribers: "The only explanation for the anemic rally was that the commercials sold with such reckless abandon that they succeeded in capping silver prices despite the enormous technical fund buying. Therefore, it is not unreasonable to assume that might occur again; as it has been happening with increased regularity over the past year or so."

So, once again, we wait.

And as I hit the send button on today's column at 4:55 a.m. EDT, I see that not much has happened between now and ten minutes before the London open.  Gold is now down on the day, just like the other three precious metals.  Gold volume is up to 25,000 contracts, which is about 'normal' for this time of day, except for the fact that the price action doesn't warrant this volume.  Silver's net volume is now around 5,400 contracts, which isn't overly heavy.  The dollar index is up 15 basis points.

Although we are certainly very close to a bottom, it wouldn't surprise me in the slightest if 'da boyz' took another slice off the gold and silver salamis.  Twenty bucks in gold, along with two bits or so in silver, would be the maximum.

And if they are going to make that move, I'd like it to be today, as most of the price action, if it occurs early enough, will be in Friday's COT Report.

That's more than enough for today---and I'll see you here tomorrow.

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