There was a bit of gold price commotion on either side of the jobs numbers release, but the obligatory sell-off was met by aggressive buying, and it's hard to tell whether it was new longs being placed, or shorts being covered.
Whatever it was, the vertical spike in prices that started 10 minutes after the release of the jobs report, got capped less than a half hour later, and gold got sold back to around the Comex opening price by the London p.m. fix. After that, it traded in a five dollar price range either side of $1,230 spot.
The CME recorded the high and low ticks as $1,245.00 and $1,210.10 in the February contract. The high and low came within 30 minutes of each other and was obviously centered around the release of the jobs report.
Gold closed at $1,230.70 spot, which was up $5.60 from Thursday's close. Net volume was pretty chunky at 185,000 contracts.
It was the same price pattern in silver as well, as the charts for both metals look identical.
The CME recorded the high and low ticks at $19.785 and $19.165 in the March contract.
Silver finished the Friday trading session at $19.54 spot, up 10.5 cents on the day. Volume was pretty decent in silver as well, but not as over the top as the gold volume. Silver's net volume was 45,000 contracts.
Platinum's price activity was a mini version of the gold and silver charts. Only palladium was different, as it got sold off a bit around 7 a.m. in Zurich and then rallied sharply about 10 minutes after the jobs number was reported. That rally got aggressively capped shortly after 9 a.m. EST. From there, the palladium price got sold down for a small loss on the day. Here are the charts.
The dollar index closed on Thursday afternoon in New York at 80.26, and the didn't do much until about 10 minutes before the jobs numbers were release. At that point the index rallied sharply to its high of 80.56 right at 8:30 a.m. EST, before getting sold back to virtually unchanged by 9 a.m. The index didn't do much after that, and closed flat on the day.
The gold stocks gapped up a percent and a bit at the open, and then chopped sideways until the 1:30 p.m. Comex close. Then they sold down to flat on the day by shortly before 3 p.m., and that where the HUI finished, at 0.00% on the day. In my many years of writing, I'm sure that this was the first time I reported no change in the HUI.
The chart pattern for the silver stocks looked similar to the HUI chart, but despite the fact that silver also finished in the plus column on Friday, Nick Laird's Intraday Silver Sentiment Index closed down 0.64%.
The CME's Daily Delivery Report for Day 6 of the December delivery month was a little quieter, as only 92 gold and 32 silver contracts were posted for delivery within the Comex-approved depositories on Tuesday. In gold, the only short/issuer of note was Canada's Bank of Nova Scotia with 85 contracts, and it should come as no surprise that JPMorgan Chase took delivery of 90 contract in its in-house [proprietary] trading account.
In silver, there was no real stand-out as far as short/issuers were concerned, expect one of them was JPMorgan out of its client account. And guess who the big long/stopper was? There's no prize for the answer, as it was JPMorgan in its in-house account.
As Ted Butler mentioned on the phone yesterday, JPMorgan Chase has stood for delivery on over 95% of the gold and silver contracts in the first six days of the December delivery month. And Ted was just talking about their in-house [proprietary] trading account. If my memory serves me correctly, JPMorgan's own clients in these metals have been big losers so far this month, as JPMorgan has been been taking delivery of the lion's share of its own clients short positions as well, which they talked them into buying in the first place! You couldn't make this stuff up. Where the #%&$@ is the CFTC? Can't they read?
Anyway, the link to yesterday's Issuers and Stoppers Report is here.
Much to my surprise there was no change in GLD yesterday, and as of 10:20 p.m. EST yesterday evening, there were no reported changes in SLV, either.
There was a smallish report from the U.S. Mint again yesterday. They sold 125,500 silver eagles. Because the 2013 silver eagles are being severely rationed during the last month of the year, the silver/gold sales ratio using the mint's weekly sales, doesn't mean much, and I'm not posting it today for that reason.
Over at the Comex-approved depositories on Thursday, they reported receiving a tonne of gold; 32,143 troy ounces to be exact. Nothing was shipped out. Most of the gold received was at the HSBC USA depository, and the link to that activity is here.
It was somewhat more active in silver. Nothing was reported received, but 216,436 troy ounces were shipped out. Virtually all of the activity was at Brink's, Inc. and Scotia Mocatta. The link to that action is here.
Well, the Commitment of Traders Report in both silver and gold was pretty much as expected, as there were improvements in the Commercial net short position in both metals, with the biggest improvement coming in silver.
In silver, the Commercial net short position declined by a chunky 21.3 million ounces, and is now down to 60.8 million ounces, the smallest number I can remember it ever being. Ted Butler figures, based on the companion Bank Participation Report, that JPMorgan's short position in silver is back down to the 10,000 contract mark, or 50 million ounces. A simple division calculation shows that JPMorgan's short-side corner of the silver market represents 82% of the entire Commercial net short position. How's that for concentration?
Ted said that the managed money/technical funds are now net short silver for the first time in his memory, and he can remember quite a bit.
In gold, the Commercial net short position declined by 594,000 troy ounces, and is now down to 2.23 million ounces, which is practically no short position at all. Based on the latest Bank Participation Report, Ted pegs JPMorgan's long-side corner in the gold market at 7 million ounces.
The above COT comments are certainly the "Reader's Digest" version, and I know that Ted will have much more to say about this in his weekly review to paying subscribers later today. I'll steal what I can for Tuesday's column.
But if the Commitment of Traders numbers for the week ending on Tuesday, December 3 were pretty much as expected, the same can't be said for the companion Bank Participation Report. It was a stunning surprise, and one for the record books in my opinion.
As I mentioned in yesterday's column: "the monthly Bank Participation Report strips out the Comex futures positions of all the banks [both U.S. and foreign] and for that one Tuesday every month we get to see how dominant the U.S. banks really are in all four precious metals."
There were big declines by all banks in the short positions in all four precious metals in the December report. The exception was gold, where the 'Big 4' U.S. banks [read JPMorgan Chase] have been net long the Comex futures market for over six months.
In gold, 4 U.S. banks increased their net long position from 49,734 Comex futures contracts in November, to 57,408 Comex futures contracts in the December report. That's an increase of 7,674 Comex futures contracts, or 767,400 troy ounces.
The 4 U.S. banks, in total, are net long 5.74 million ounces of gold, and since Ted says that JPMorgan's long position is 7 million ounces, then by simple subtraction, the other 3 U.S. bullion banks holding Comex futures contracts must be net short 1.26 million ounces between them.
But it was the changes in the 18 non-U.S. banks that was the shocker. In November, these banks were short 39,480 Comex futures contracts in gold. In the December report, that had collapsed to 14,039 contracts, or 1.40 million ounces, a decline of 25,441 contracts in just one month! Amazing!
Canada's Bank of Nova Scotia probably owns a fair chunk of that 1.40 million ounces, but even if they don't, that 1.40 million ounces still held short, divided into 18 banks, is an immaterial amount compared to the 7 million ounce long position of JPMorgan Chase.
Here's Nick Laird's Bank Participation Report for gold with the latest data included. Charts 3, 4 and 5 are the critical ones. The 'click to enlarge' feature works wonders here.
As dramatic as the changes were in gold, they were just as incredible as the changes in silver.
In silver, 3 or less U.S. banks had a 21,760 Comex futures market net short position in the November BPR. In the December report, that had fallen all the way down to 13,639 contracts, or 68.2 million ounces. Don't forget that Ted Butler estimated JPM's short-side corner in silver at 50 million ounces, so the remaining 18.2 million ounces held short in the Comex futures market is held by the two remaining U.S. bullion banks, most probably HSBC USA and Citigroup. How's that for concentration.
And as startling as those number were, what happened with the non-U.S. banks was even more amazing.
In silver, 11 non-U.S. banks had a Comex net short position of 19,681 contracts in the November BPR, but in the December BPR, it had been cut by 40 percent, down to 11,997 contracts held short. I'm of the opinion that a huge chunk of that is held by Canada's Bank of Nova Scotia, but even if that turns out not to be the case at this point in time, the 11 non-U.S. banks, on average, are only short a hair over 1,000 Comex futures contracts apiece. That's not a lot compared to the positions held by the '3 or less' U.S. bullion banks in general, or the 10,000 contract short position of JPMorgan Chase in particular. Here's Nick Laird's chart which, like the gold chart, should be examined carefully.
The improvement is platinum and palladium weren't as impressive overall, but like gold and silver, the bullion banks all over the world are obviously covering short positions like there will be no tomorrow.
In platinum, 4 U.S. banks were net short 13,344 Comex futures contracts in the November BPR, and that number declined to 11,202 contracts in the December BPR. I'd bet serious coin that JPM holds the lion's share of the short position in this metal, just like they do in silver, and HSBC USA and Citi hold the rest.
In platinum, 14 non-U.S. banks had a net short position of 3,760 contracts in the November Bank Participation Report. That collapsed down to 1,765 contracts in the November BPR. Divide that number by 14 and you get a bit over 100 contracts apiece, which is immaterial.
JPMorgan Chase, HSBC USA and/or Citigroup don't control the platinum market, they are the platinum market.
In palladium, 3 or less U.S. bullion banks held 12,260 Comex contracts short in the November BPR. In the December report, that had dropped to 10,815 contracts held net short. Once again it was "all the usual suspects".
In palladium, 12 non-U.S. banks held 4,621 Comex contracts net short in the November report, and that dropped down to 3,317 Comex contracts in the December BPR. Twelve banks into 3,317 contracts is vapour, and immaterial compared to the Comex short position of the "3 or less" U.S. banks.
As always, this Bank Participation Report shows the total domination of the precious metal markets by JPMorgan Chase and a couple of other bullion banks as "also rans".
But the other thing that this particular BPR shows is that the bullion banks individually, and also as a group, are getting out of their Comex short positions in all four precious metals just as fast as they can. What do they know that we don't, at least not yet.
I don't have a whole lot of stories for you today, and I hope you find the time to read the ones you like.
And after the way equities responded to the Fed’s retreat from September tapering, I expect Fed officials will be more hesitant to pamper the markets next time around.
How will the global leveraged speculators game this? Play for further “how crazy do things get” speculative excess at the “core”? Push the melt-up dynamic in U.S equities for all it’s worth – squeezing the shorts and hedgers at each and every opportunity? Or does the unfolding “risk off” dynamic continue to expand, as was the case for much of this week? Are we in the early stages of a problematic de-leveraging throughout global fixed income, a predicament exacerbated by the ongoing Bubbles in “core” equities and corporate debt?
As the marginal source of buying and selling pressure in many global markets, the now $2.5 Trillion hedge fund industry will undoubtedly set the tone. If the hedge funds get through year-end, they will then have January to contend with. They surely would like to avoid having to de-risk into a June-like backdrop of heavy mutual fund and ETF outflows. The current backdrop would seem to imply the return of unstable markets for some weeks to come.
Doug's weekly missive over at the prudentbear.com Internet site is a must read for me every week. Here is his latest commentary from yesterday evening.
The nemesis of Wall Street’s high-frequency traders operates out of an apartment-sized office above the Bliss Salon -- manicure/pedicure $45 -- on Elm Street in the Chicago suburb of Winnetka.
Staring at four computer monitors, Eric Scott Hunsader, the founder of market-data provider Nanex LLC, looks for hints of illicit trading hidden in psychedelic images of triangles dancing with dots that represent quotes to buy and sell U.S. stocks broken down by the millisecond.
Charts of trading produced by Hunsader’s eight-person firm have captivated everyone from regulators to art gallery owners. One stunt involved a computerized piano piece mimicking quotes for an exchange-traded fund. He infuriates some traders, who say Nanex draws unwarranted conclusions and spreads conspiracy theories.
To Hunsader, the images created from market feeds are evidence of high-frequency trading firms exploiting market rules to turn a profit in a lawless environment. Though others in the industry see his reports and charts as propaganda, Nanex’s interpretations are helping to drive the public debate about the fundamental fairness of the modern stock market.
This longish but interesting Bloomberg essay was sent to me last Saturday by reader U.D...and it's the sort of piece that had to wait for a spot in a Saturday column. It was posted on their Internet site twelve days ago.
Billions of dollars annually are being used to fund operations conducted by the United States intelligence community, the likes of which allow the government to eavesdrop on emails, listen to world leaders’ phone calls and about everything in-between.
One thing that budget hasn’t bought, however, is subtlety. The US National Reconnaissance Office launched a top-secret surveillance satellite into space Thursday evening, and the official emblem for the spy agency’s latest mission is, well, certainly accurate, to say the least.
The latest spy satellite to be sent into orbit by the NRO can be recognized by its seal: a malevolent octopus with furrowed brows that also happens to be wrapping its tentacles around all corners of the Earth.
This Russian Today story, filed from Moscow early Friday evening, was sent to me by South African reader B.V...and even if you don't read it, you should at least look at the picture so you can see the mindset of the psychopaths running the NRO.
Italian communications have been targeted through the US’s Special Collection Service sites in Rome and Milan, according to Italy’s l’Espresso. The same service allegedly tapped into German Chancellor Angela Merkel’s cellphone.
The new leak, revealed by Glenn Greenwald with l’Espresso, alleges that the National Security Agency subjected Italy’s leadership to surveillance, although not specifying which people within the country’s “leadership” were monitored, via US diplomatic missions in Rome and Milan. The spying went on from 1988 to at least 2010.
The NSA conducted snooping in Italy via its Special Collection Service, which came under scrutiny after the snooping scandal involving Chancellor Angela Merkel. The report on Friday reveals the service kept whole two sites running in Italy: one in Milan, the country’s main economic hub, and one in Rome (staffed with agents). Of all European nations, only Italy and Germany had two SCS sites working simultaneously, according to the leak.
Here's another story from the Russia Today website. This one was posted late Friday afternoon Moscow time...and it's the first offering of the day from Roy Stephens.
Former US intelligence contractor Edward Snowden is set to make a pre-recorded video appearance at the European Parliament’s civil liberties committee around 18 December.
“The meeting will be live-streamed but the statement will be recorded answers of our questions, which will we send in advance,” said German Green MEP Jan Phillip Albrecht on Friday (6 December).
Albrecht noted that a live stream of Snowden himself would risk revealing his location.
The American is currently in Russia where he is said to be working at the country's version of Facebook, VKontakte.
This news item, filed from Brussels, showed up on the euobserver.com Internet site on Friday afternoon Europe time...and it's the second offering in a row from Roy Stephens.
Ukraine's President Viktor Yanukovych and his Russian counterpart Vladimir Putin have held surprise talks on a "strategic partnership treaty".
Mr Yanukovych flew from China to Sochi in southern Russia for the meeting. He also cancelled a visit to Malta.
Last month he shelved a partnership deal with the EU, triggering angry protests in Ukraine's capital Kiev.
This short article put in an appearance on the bbc.co.uk Internet site late Friday morning GMT...and it's another contribution from reader B.V.
Much has been said about the defeat the European Union suffered with Ukraine’s sudden refusal to sign a trade and association agreement. The contrary is true: The EU has had a lucky escape and so have the Ukrainian people.
Ukraine has a dysfunctional economy that faces imminent default. It cannot afford another destabilizing revolution. Rather than make a grand geostrategic choice between East and West, the country needs round-table talks similar to the ones that helped bring about a peaceful end to communism in Poland in 1989. These negotiations should resolve Ukraine’s political logjam and reach agreement on reforms to resuscitate the economy.
The to-do list for Ukraine has been known for a long time: a functioning democracy and a market economy with firm and transparent rules. Yet there has been no political will to take the steps required, because doing so would endanger the vested interests of too many of Ukraine’s political leaders and business leaders. Short of a miracle, Ukraine will continue muddling its way down.
This opinion piece by Finnish professor Pekka Sutela was posted on the Bloomberg website yesterday morning Denver time. I consider it a must read for all students of the New Great Game. It's the third offering of the day from Roy Stephens, for which I thank him.
When the United Nations Climate Change Conference wrapped up in Warsaw the weekend before last, it did, despite what most observers and disappointed NGO representatives believe, yield a result. It just wasn't officially announced: the termination of the at-least symbolic general agreement that urgent action must be taken to counter global warming. In other words, climate change has been definitively removed from the global policy agenda.
The intense concern over climate change triggered by Intergovernmental Panel on Climate Change reports in 2007 and widely popularized by Al Gore's movie, "An Inconvenient Truth" -- a concern that led even Angela Merkel to make an appearance in the Arctic as the "climate chancellor," decked out in a red all-weather jacket -- actually dissipated a while ago, but no one wanted to say so out loud.
This issue has finally gone away, at least for the moment. It was all b.s. right from the beginning, and I said so. In case you've forgotten, dear reader, I spent seven years in Canada's high arctic with Environment Canada about forty-odd years ago, and I still have good connections inside the service today. This is an issue with which I am intimately familiar, and it's nice to see it given the burial it has long deserved.
I'm not sure whether the whole article is worth reading or not, as I don't really agree with the rest of what the author has to say, but the two paragraphs I cut and paste above made this spiegel.de essay worth posting. This is another contribution from Roy Stephens for which I thank him.
On a dusty parade ground outside Tripoli, young recruits march and bark out slogans for the new Libyan army that Western powers hope can turn the tide on militias threatening to engulf the North African country in anarchy.
Their boots are new and their fatigues pressed, but Libya's army recruits will need more than drills to take on the hardened militiamen, Islamist fighters and political rivalries testing their OPEC nation's stability.
Two years after NATO missiles helped rebels drive out Muammar Gaddafi, Libya is under siege from former rebel fighters who now flex their military muscle to make demands on the state, seize oilfields and squabble over post-war spoils.
U.S.-sponsored regime changes are always messy affairs, and this one is proving no exception. This Reuters story, filed from Tripoli, was posted on their Internet site in the wee hours of Thursday morning EST...and it's a worthwhile read for all students of the New Great Game. It's also another offering from Roy Stephens.
NATO chief Anders Fogh Rasmussen has joined the US in urging Afghan President Hamid Karzai to sign a security agreement with Washington by year’s end. Karzai has so far been reluctant to sign the deal, which would grant US troops legal immunity.
Rasmussen said that ratifying the Afghan-US bilateral security agreement was an indispensable condition for NATO’s multinational International Security Assistance Force (ISAF) to continue its military mission in Afghanistan beyond 2014.
“Let me be very clear: It is a prerequisite for our presence in Afghanistan beyond 2014 that an appropriate legal framework is in place,” Rasmussen told reporters at a briefing at NATO headquarters in Brussels.
Without the deal “it will not be possible to deploy a train, advise, assist the mission to Afghanistan after 2014,” Rasmussen said. NATO previously announced plans to leave up to 12,000 soldiers in Afghanistan on a training mission after 2014.
This is another story from the Russia Today website. This one was posted there very early on Tuesday afternoon Moscow time, and had to wait for a spot in today's column. I thank reader B.V. for sending it our way.
Nearing the tail end of his Asian tour on Friday, Vice President Joe Biden set in stone the United States’ stance on a budding conflict there regarding ownership of airspace in the East China Sea.
Amid growing tensions in the region, Mr. Biden said during a stop in Seoul, South Korea this week that the US wholeheartedly rejects China’s self-declared right to control airspace above the Diaoyu islands — a small section of the sea off Taiwan’s northern coast which has recently attracted international tension due to a row that’s erupted between regional powers.
Speaking at Yonsei University on Friday, Biden said, according to Reuters, "I was absolutely clear on behalf of my president: We do not recognize the zone. It will have no effect on American operations. None. Zero.”
This news item was also posted on the Russia Today website late yesterday afternoon Moscow time...and it's the final offering of the day from reader B.V.
China is taking the highly unusual step of refusing to participate in a United Nations arbitration process over a territorial conflict with the Philippines, one of five countries challenging Beijing’s claims of ownership over the oil-rich South China Sea.
The legal dispute underscores the tough geopolitical approach China is adopting in the Pacific region. It has adopted an aggressive approach toward neighbours over a 2,000-mile stretch that also includes the East China Sea, over which it recently declared the air defence identification zone that has inflamed tensions with Japan and South Korea.
China sent its only aircraft carrier to the disputed waters off the coast of the Philippines for the first time last week, in a move Manila said raised tensions. China’s military said the carrier Liaoning will conduct drills in the area, accompanied by two destroyers and two frigates.
This story appeared on theguardian.com Internet site early yesterday evening GMT...and is the final offering of the day from Roy Stephens, for which I thank him.
1. Eric Sprott: "Terrifying Threat to the Financial System". 2. Tom Fitzpatrick: "2 Fantastic Charts Show Why Gold May Quickly Surge $200". 3. Bill Fleckenstein: "Global Meltdown and Why Bitcoin Will Go to Zero". 4. Egon von Greyerz: "The Frightening Problems Facing the U.S. and the World".
[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]
It wouldn't be a non-farm-payrolls (or for that matter any government report) without the ubiquitous "early" move in precious metals before the report is given to the general public. As Nanex shows, Gold's price moved in a 'correct' downward (taper-on) way on the "good" news that jobs are 'improving' 7 seconds before the report hit...
That's all there is to this short Zero Hedge piece from yesterday morning, but the charts are worth a look. I thank Manitoba reader Ulrike Marx for sharing it with us.
Sprott Money News interviewed Sprott Asset Management CEO Eric Sprott yesterday about the unfunded liabilities that sent Detroit into bankruptcy...and that means that the U.S. government is essentially insolvent, and then interviewed Chris Powell about the comparative advantages of bitcoin and gold. The audio clip is ten minutes long...and is posted on the soundcloud.com Internet site. I found this in a GATA release yesterday evening.
Turkey’s gold imports have surged to their highest on record so far this year after a hefty drop in bullion prices, with further progress signposted if restrictions on trade with Iran are formally eased.
Turkey imported 270.7 tonnes of gold in the first 11 months of the year, data from Borsa Istanbul showed, more than double 2012’s full-year imports of 120.8 tonnes.
The rise stemmed chiefly from this year’s sharp drop in gold prices, which have fallen 26 percent since December 2012 after 12 straight years of gains.
“Turkey, like most of the price-sensitive markets, saw this year’s lower price level as an opportunity to replenish stocks and release some of the pent-up demand that has been building as consumers have been priced out of the market,” Cameron Alexander, an analyst with Thomson Reuters GFMS, said.
This short story, co-filed from London and Ankara, was posted on thepeninsulaqatar.com Internet site very early yesterday morning in Qatar. My thanks go out to Ulrike Marx for digging up this story on such an obscure website. It's definitely worth your while.
Writing for Chris Martenson's Peak Prosperity Internet site, economist and former banker Alasdair Macleod has produced a masterful history of the geo-politics of gold over the last four decades, much of which involves the policy of price suppression adopted by Western central banks and implemented through the expansion of "paper gold" by their agents, the bullion banks.
Macleod deduces that since their smashing of the gold market in April, Western central banks have been supplying much metal surreptitiously to hold the price down. From import and official reserve data he calculates that the Western central banks have little metal left and that their control of the gold market is nearly at an end.
Macleod's commentary is pretty much a state paper for the gold community and is not to be missed. It is titled "There Is Too Little Gold in the West -- The History of Gold's Flight to the Developing World".
This is another news item I found in a GATA release yesterday...and it's definitely worth reading.
Today, anyone who talks about hyperinflation is treated like the shepherd boy who cried wolf. When the wolf actually does show up, though, belated warnings will do little to keep the flock safe.
The current Federal Reserve strategy is apparently to wait for significant price inflation to show up in the consumer price index before tapering. Yet history tells us that you treat inflation like a sunburn. You don’t wait for your skin to turn red to take action. You protect yourself before leaving home. Once inflation really picks up steam, it becomes almost impossible to control as the politics and economics of the situation combine to make the urge to print irresistible.
The hyperinflation of 1790s France illustrates one way in which inflationary monetary policy becomes unmanageable in an environment of economic stagnation and debt, and in the face of special interests who benefit from, and demand, easy money.
Even though it's not about precious metals directly, this short essay falls into the absolute must read category...and it was posted on the mises.org Internet site on Tuesday...and I thank Dr. David Richardson for today's last story.
Uranium Energy Corp. (NYSE MKT: UEC) is pleased to announce that the final authorization has been granted for production at its Goliad ISR Project in South Texas. As announced in previous press releases, the Company received all of the required authorizations from the Texas Commission on Environmental Quality, including an Aquifer Exemption which has now been granted concurrence from EPA Region 6.
“We are very pleased to have received this final authorization for initiating production at Goliad. Our geological and engineering teams have worked diligently toward achieving this major milestone and are to be truly commended. We are grateful to the EPA for its thorough reviews and for issuing this final concurrence. The Company’s near-term plan is to complete construction at the first production area at Goliad and to greatly increase the throughput of uranium at our centralized Hobson processing plant.” Please contact Investor Relations with questions or to request additional information, firstname.lastname@example.org.
Statism survives by looting. A free country survives by producing. -- Ayn Rand
Today's pop "blast from the past" was an international hit by a Canadian rock group called Loverboy back in 1980. It's one of those pounding rock beats with killer vocals that will be around for generations to come. I've posted this before, but it was years ago. The link to the official Sony Music video is here.
Today's classical "blast from the past" is from the baroque era, although the actual composition date/year of this 18th century oboe concerto by Georg Philipp Telemann [1681-1767] is not known with absolute certainty. After the violin and piano, the oboe is my most favourite orchestral instrument. I have a recording of this piece in my collection and it gets a fair amount of air time. This is his Concerto in E Minor for oboe, strings and basso continuo. It's a short work, and the link is here.
As I said in this space yesterday, nothing would surprise me regarding precious metal price activity around the release of the job numbers on Friday morning in New York. I'm sure that silver and gold prices would have closed higher if the rally hadn't been capped at 9 a.m. EST, and I was somewhat surprised by the heavy volume associated with yesterday's price action.
The data from Friday's price action, along with the volume data from Wednesday's short covering rally, won't be know for sure until next Friday's Commitment of Traders Report.
But it was the big changes in both the COT Report, and the companion Bank Participation Report that caught my eye. The numbers in the COT Report were pretty much as expected, and show that the stage is set for a monster rally in all four precious metals if and when JPMorgan is given the word to let 'er rip. All the internal readings within each category are at, or close to, multi-year extremes; and some of them are new records.
The Bank Participation Report was a two by four across the side of the head for me. Ted Butler pointed out that JPMorgan actually decreased their long position between the November BPR and the December BPR...and it's a good bet that the fact that JPMorgan had a well-advertised long-side corner on the gold market [courtesy of Ted] that made them stand back this time, and I'm sure that it was equally obvious to JPM as well. That gave the foreign banks a chance to cover short positions, and probably allowed the three other U.S. banks to follow suit. And almost the same can be said for what happened in silver during the prior month as well, but JPMorgan was covering short positions as well.
As I pointed out, it's the positions of the '3 or less' U.S. bullion banks in all four precious metals that really matter, as the Comex short positions held by the large number of foreign banks, when divided up more or less equally, are immaterial in the grand scheme of things. However, this may not entirely be the case for Canada's Scotiabank, as they held a decent sized short position in gold and a mega short position in silver, and I doubt very much that their in the same enviable position as the other foreign banks.
Except for JPMorgan's sore thumb long-side corner in the gold market, the '3 or less' U.S. bullion banks are the major short holders in all four precious metals. They are the market, with JPMorgan way out in front.
And with off-the-charts numbers in the current COT Report, its very doubtful whether JPMorgan et al can engineer prices lower from here. I won't stick my neck out and say that we're at the bottom, but there's not much blood left in these particular stones.
If there was ever a time for JPMorgan to stand aside, this would be it, as it's obvious that all the bullion banks are heading for the hills in all precious metals as fast as their bandy little legs will carry them.
If this event does occur, I can only envision two possible scenarios. First, a bank holiday, or a repricing on a weekend before the Sunday night open in Tokyo. Second, a natural market-clearing event where JPMorgan et al just put their hands in their pockets and let the markets do what is necessary with a market-clearing event for the ages. This would be wonderful, of course, but I can't shake the feeling that if this event is allowed to occur, it will be intertwined with something else that's going on at the same time, whether it be financial, economic, monetary or, perish the thought, military.
One thing is absolutely certain, and that is that things can't continue as they are now for much longer with China [and perhaps Russia] bleeding the world dry of every good delivery bar they can get their hands on, including their own production. Besides which, with the world's central banks in mortal fear of deflation, a little inflationary pressure would help. And as I've said on many occasions over the years, rapidly rising precious metal prices would be the trigger for that, as once they start to fly, all the commodities will rise as well, and that bakes inflation into the cake almost instantly.
And the action of the world's bullion banks over the last 30 days speaks volumes, at least to me, and as I said very recently, only the timing and circumstance are unknown, and are unknowable.
I'm done for the day, and the week.
See you on Tuesday.