Gold & Silver Daily
 

¤ Yesterday In Gold & Silver

The gold price did little of anything during the Far East trading session on their Friday---and it got sold down about five bucks the moment that London opened.  From there it chopped rather unsteadily higher, with the high tick coming minutes before the London close, which was about 10:55 a.m. EST.  From there it got sold down into the 1:30 p.m. COMEX close---and did little after that.

The CME Group reported the high and low ticks as $1,219.20 and $1,204.10 in the April contract.

Gold finished the Friday session in New York at $1,213.70 spot, up $4.50 from Thursday's close.  Net volume was nothing special at 105,000 contracts.

It was more or less the same price chart in silver, although there was no rally at all after the short price spike at 9:15 a.m. EST in New York yesterday.  Once that was over, the metal chopped sideways into the close.

The high and low ticks, which were barely worth looking up, were reported as $16.70 and $16.425 in the May contract.

After its low tick an hour after the Zurich open, the platinum price rallied until noon in New York, before getting sold down a few dollars into the close.  The metal finished the day at $1,185.00 spot, up 13 bucks on the day.

The palladium chart was sort of a mini version of the platinum price chart---and it closed at $815 spot, up 8 dollars from Thursday's close.

The dollar index closed late on Thursday afternoon at 95.27---and it chopped quietly lower until its 94.86 low, which came a minute or so after 8:00 a.m. in New York.  From there it chopped higher until noon---and it didn't do much after that, closing at 95.26---which was basically unchanged from Thursday's close.

The gold stocks gapped up a bit at the open---and then proceeded to follow the gold price like a shadow for the remainder of the Friday session, as the HUI closed up 1.45 percent.

It was more or less the same chart pattern for the silver equities, except their highs came just before 11:00 a.m. EST---and then they traded lower until almost the end of COMEX trading, before rallying into the 4:00 p.m close of the New York equity markets.  Nick Laird's Intraday Silver Sentiment Index closed up 1.31 percent.

The CME Daily Delivery Report for Day 2 of the March delivery month showed that zero gold and 141 silver contracts were posted for delivery within the COMEX-approved depositories on Tuesday.  There were a lot of issuers and stoppers---and the one that stood out was JPMorgan, which issued 42 contracts out of its client account---and then stopped 77 contracts in its in-house [proprietary] trading account.  Trading against its clients best interests again methinks.  The link to yesterday's Issuers and Stoppers Report is here.

The CME Preliminary Report for the Friday trading session showed that gold open interest in March increased by 29 contracts---and now stands at 202 contracts.  In silver, the March open interest fell by 1,588 contracts down to 1,554 contracts remaining---and the big drop was the First Day Notice deliveries posted in yesterday's column.  You can also subtract the 141 contracts posted for delivery on Tuesday.

There were no reported changes in GLD yesterday---and as of 7:18 p.m. EST yesterday, there were no reported changes in SLV, either.

The U.S. Mint had a tiny sales report yesterday.  They sold 59,000 silver eagles---and that was all.

Setting aside the possibility that the mint might add some sales to February's total on Monday, for the month the mint reported selling 18,500 troy ounces of gold eagles---12,000 one-ounce 24K gold buffaloes---and 3,022,000 silver eagles.  Based on these sales, the silver/gold sales ratio works out to 99 to 1.  Gold sales continue to be worse than awful, as retail demand has all but dried up---and Ted Butler's "big buyer" still appears to be active in the silver eagles market.

It was another quiet day in gold over at the COMEX-approved depositories on Thursday, as only 700 troy ounces were received---and 482.250 troy ounces [15 kilobars] were shipped out.

It was another zero movement day in silver, although 1,296,519 troy ounces were shifted from the Eligible to Registered category over at the CNT Depository---which means nothing in the grand scheme of things.

The Commitment of Traders Report for positions held at the close of COMEX trading on Tuesday was more or less what Ted and I were expecting.

In silver, the Commercial net short position declined by 5,574 contracts, which works out to 27.9 million troy ounces.  The Commercial net short position is now down to 210.7 million troy ounces, which is still way up in nose bleed territory.

The Big 4 traders reduced their net short position by around 2,400 contracts, but the '5 through 8' traders only reduced their short position by about 300 contracts.  The small traders, Ted Butler's raptors, added about 2,900 contract to their long position.   Ted pegs JPMorgan's short-side corner in the silver market at around 18,500 contracts.

On the other side of this were the hapless and brain-dead technical traders in the Managed Money category, as they sold 3,920 long contracts, but they also decreased their short position by 503 contracts as well, which Ted was happy to see.  The reason being that despite the ongoing engineered price decline during the reporting week, the Managed Money may have been pitching longs, but they weren't adding to their short positions, which is a good sign that they may not be suckered into going mega short the silver market if JPMorgan tries to force them to go there.

In gold, the Commercial net short position declined by 8,057 contracts, or 805,700 troy ounces of the stuff.  The Commercial net short position now sits at 13.57 million troy ounces, which is still way too high to suit me.

The Big 4 traders reduced their short position by 2,200 contracts---and the '5 through 8' traders did the same.  The smaller traders/raptors added 3,500 contracts to their long position.

In the Managed Money category of the Disaggregated COT Report, these technical funds sold 4,000 long contracts and also added 2,205 contracts to their short positions.

Ted mentioned that the technical funds in the Managed Money category are close to the point where they've sold all their accumulated long positions in both silver and gold---and unless "da boyz" can force these same traders further onto the short side, we may be at---or close to---a temporary bottom.  If that turns out to be the case, then a rally of some size may be in our future.

So we wait.

I want to spend a minute talking about what I call the "unblinking longs" in all four precious metals.  These are non-technical fund traders in the Managed Money category of the Disaggregated COT Report.   They do not respond to the usual buy/sell signals that drives the brain-dead technical funds in this same category.  They remain long through thick and thin---and the highs and the lows.  They hold very large long positions.

In palladium, it's north of 15,000 contracts, platinum it's something over 25,000 contracts, in silver it's a bit over 40,000 contract---which is an eye-watering number, by the way---and in gold it's a bit north of 110,000 contracts.  These are not small numbers---and I've always asked myself who they might be---and what their reason for being there is.

I don't know if this situation is good or bad, but they're always there.  I expect that at some point in the future, we'll find out.

Before getting into the stories, here' Nick's "Days of World Production to Cover Short Positions" chart showing the short positions of the 4 and 8 largest traders in all physically traded commodities on the COMEX.  Nothing much has changed since I last posted this chart, except that the 'Big 8' in silver are down to 148 days [from 156 days] of world silver production to cover all their short positions.  The other three precious metals aren't much better---and everybody seems to think that this state of affairs is perfectly OK.

I have a lot of stories for a Saturday/weekend column---and a few of them I've been saving for today's missive for length and content reasons, and some for both reasons.  Four or five of them fall into the absolute must read category---and I hope you can find the time in what's left of your weekend to give them the attention they so richly deserve.

 

¤ Critical Reads

Q4 GDP Revised Down to 2.2% From 5.0%: Full Breakdown

There was much hope that when Q3 GDP soared to 5%, primarily on the back of Obamacare spending recalendarization and a massive consumption/personal saving data revision, that the US economy would finally enter lift-off mode. Those hopes were reduced by about 60% when moments ago the BEA announced that Q4 GDP was revised from the original 2.64% print to only 2.18%, which while better than expected, was the lowest economic growth rate since the "polar vortex."

The main reason for the revision: a substantial drop in growth contribution from private inventories, which instead of adding 0.82% to the bottom GDP line, only contributed 0.12% in Q4 following the first revision. To be sure, this was perfectly expected, and is exactly what we said would happen last month after the first inventory number.

This short commentary, with a couple of excellent charts, appeared on the Zero Hedge website at 8:46 a.m. EST on Friday morning---and I thank Dan Lazicki for today's first story.

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Chicago PMI Crashes Most Since Lehman to Lowest Since July 2009

January's brief 'hope' bounce following 3 months of weakness is long forgotten as February's Chicago PMI crashes to 45.9 (missing expectations of 57.5) - its lowest since July 2009.

This is the biggest MoM drop since Lehman in Oct 2008. New Orders suffered the largest monthly decline on record.

Seems like it is time to blame the weather... PMI says it is "difficult to gauge magnitude of weather and port strike" but blames it nonetheless.

This is the second story in a row from the Zero Hedge website.  This one showed up there at 9:48 a.m. EST yesterday---and it's also the second in a row from reader Dan Lazicki.

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"Monetary Policy is Bankrupt" Dr. Lacy Hunt Warns "Bonds, Not Stocks, Are a Good Economic Indicator"

I think the S&P is disconnected from the fundamentals in the US economy. Growth last year was a quarter slower than it was in 2013. We’re on the cusp of either zero inflation or deflation. Corporate profits using the Bureau of Economic Analysis numbers, compiled using data from the Internal Revenue Service, showed year over declines in all the first three quarters of last year (4Q is not yet available). In the third quarter, the after-tax profits adjusted for inventory gains/losses and over/under depreciation were 7% below a year ago.

The standard of living declined again in 2014. And a lot of the growth we had in 2014 really was a massive building of inventories, which is often the case when stock prices are high and top line is decelerating.

The economy enters 2015 in very weak shape. None of the big ticket sectors are doing well. Capital spending is declining, being paced by extreme weakness in oil & gas drilling, which has really been the driving force in manufacturing over the last four years. The best you can say about the housing sector is that it is flat. Not a very important sector.

Vehicle sales are below the best levels of last year and the trade sector is deteriorating. It is very difficult to move the US economy forward by selling things over the counter and through the shopping cart. The US economy is very fragile. And the fragility is highlighted by the fact that firms simply do not have pricing power.

This rather longish interview with Lacy appeared on the Zero Hedge website at 6:15 p.m. EST Friday evening---and it's also courtesy of Dan Lazicki, for which I thank him. It's worth reading if you have the time.

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How Much Will You Pay to Park Cash as Central Banks Go Negative?

Central banks are stooping to new lows to conquer weak inflation.

The monetary guardians of the euro area, Switzerland, Sweden and Denmark are now imposing negative interest rates on bank deposits or on funding operations that feed through to the real economy. Analysts at Commonwealth Bank of Australia reckon almost a quarter of worldwide central-bank reserves now carry a negative yield.

By confounding the onetime idea that they had to stop cutting borrowing costs at zero, monetary-policy makers are seeking to spur spending over saving. They also expect their currencies to weaken as capital inflows are discouraged.

The risk is that negative rates backfire and result in even less demand. That could happen if people begin stuffing their cash under mattresses, or if rates below zero eat into the profit margins of banks or distort financial markets.

This very interesting Bloomberg article, filed from London, appeared on their Internet site at 3:27 a.m. Denver time yesterday morning---and I thank West Virginia reader Elliot Simon for sending it our way.  There was another Bloomberg story about this by Mohamed A. El-Erian early Friday morning as well---and it's headlined "10 Things to Know About Negative Bond Yields".  I thank Dan Lazicki for this one as well.

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Doug Noland: Periphery Fragility List

The Chinese Credit Bubble has been historic, dwarfing the fateful Japanese Bubble from the eighties. Arguably, China’ Bubble today even exceeds its mirror image U.S. Bubble. I have also referred to the Chinese renminbi link to the dollar as the King of All Currency Pegs. The bullish consensus scoffs at notions of Chinese fragility. With an international reserve position of $3.8 TN (and shrinking), the belief is that China has more than sufficient “money” to stimulate the economy, recapitalize the banking system and support the renminbi. Yet with anecdotes suggesting mounting outflows and heightened nervousness, a destabilizing dislocation in renminbi trading becomes a real possibility.

How long will the PBOC be willing to use the nation’s reserves to allow speculators, fraudsters and Chinese elite to cash out of China at top dollar? Chinese officials confront great challenges that will require difficult decisions. So far, bullish sentiment remains impervious to the major uncertainties enveloping China’s economy, financial system and policy making. The perception that Chinese officials have everything well under control could soon be challenged.

Meanwhile, signs of Bubble excess become increasingly conspicuous in the U.S. – Silicon Valley, Manhattan, upper-end real estate around the country, subprime auto loans, jumbo mortgages, record corporate debt issuance, etc. Record stock and bond prices – record prices for anything that provides a yield. Record hedge fund assets, in the face of ongoing performance issues. Record ETF assets. Resurgent derivative markets.

The list goes on and on.  Doug's weekly commentary appeared on his creditbubblebulletin.ca website yesterday evening---and I thank reader U.D. for sending it my way.

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Here’s how the clash between the NSA Director and a senior Yahoo executive went down

In an unusual public exchange, the director of the National Security Agency and a senior Yahoo executive clashed over cyber-spying Monday, illustrating the growing chasm between Washington and Silicon Valley over whether intelligence officials should have broad access to the products being developed by the nation's top technology firms.

For a normally staid Washington cyber-security conference, this one hosted by New America, the tense back-and-forth had the packed audience of executives, senior policy makers, bureaucrats and journalists buzzing.

Speaking at the signature event of the conference, NSA Director Adm. Mike Rogers called for a "legal framework" that would enable law enforcement and anti-terrorism officials to tap into encrypted data flowing between ordinary consumers -- echoing a stance laid out by other administration officials, including FBI Director James Comey and Attorney General Eric J. Holder. But technology executives as well as many cybersecurity experts argue there is no way to build in such "back doors" without fundamentally undermining the security that protects online communications around the world. In response to recent revelations about government snooping, firms such as Apple and Google have designed their latest mobile software to make it impossible for the companies to turn over data from smartphones and tablet computers to police -- even when authorities have a search warrant.

This extremely interesting article showed up on The Washington Post website on Monday---and I thank reader P.F. for sharing it with us.

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Foreign governments gave millions to foundation while Clinton was at State Department

The Clinton Foundation accepted millions of dollars from seven foreign governments during Hillary Rodham Clinton’s tenure as secretary of state, including one donation that violated its ethics agreement with the Obama administration, foundation officials disclosed Wednesday.

Most of the contributions were possible because of exceptions written into the foundation’s 2008 agreement, which included limits on foreign-government donations.

The agreement, reached before Clinton’s nomination amid concerns that countries could use foundation donations to gain favor with a Clinton-led State Department, allowed governments that had previously donated money to continue making contributions at similar levels.

The new disclosures, provided in response to questions from The Washington Post, make clear that the 2008 agreement did not prohibit foreign countries with interests before the U.S. government from giving money to the charity closely linked to the secretary of state.

This is the second story in a row from The Washington Post---and this one is courtesy of Norman Willis.  It was posted on their Internet site on Wednesday sometime.

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Deeper Ties to Corporate Cash for Doubtful Climate Researcher

For years, politicians wanting to block legislation on climate change have bolstered their arguments by pointing to the work of a handful of scientists who claim that greenhouse gases pose little risk to humanity.

One of the names they invoke most often is Wei-Hock Soon, known as Willie, a scientist at the Harvard-Smithsonian Center for Astrophysics who claims that variations in the sun’s energy can largely explain recent global warming. He has often appeared on conservative news programs, testified before Congress and in state capitals, and starred at conferences of people who deny the risks of global warming.

But newly released documents show the extent to which Dr. Soon’s work has been tied to funding he received from corporate interests.

He has accepted more than $1.2 million in money from the fossil-fuel industry over the last decade while failing to disclose that conflict of interest in most of his scientific papers. At least 11 papers he has published since 2008 omitted such a disclosure, and in at least eight of those cases, he appears to have violated ethical guidelines of the journals that published his work.

No surprises here.  Another so-called climate change "expert" caught with his hand in the proverbial cookie jar.  This long essay appeared on The New York Times website last Saturday---and for obvious reasons had to wait for today's column.  It's the second offering of the day from reader P.F.

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The Neoconservative Threat to World Order — Paul Craig Roberts

This week I was invited to address an important conference of the Russian Academy of Sciences in Moscow. Scholars from Russia and from around the world, Russian government officials, and the Russian people seek an answer as to why Washington destroyed during the past year the friendly relations between America and Russia that President Reagan and President Gorbachev succeeded in establishing. All of Russia is distressed that Washington alone has destroyed the trust between the two major nuclear powers that had been created during the Reagan-Gorbachev era, trust that had removed the threat of nuclear Armageddon. Russians at every level are astonished at the virulent propaganda and lies constantly issuing from Washington and the Western media. Washington’s gratuitous demonization of the Russian president, Vladimir Putin, has rallied the Russian people behind him. Putin has the highest approval rating ever achieved by any leader in my lifetime.

Washington’s reckless and irresponsible destruction of the trust achieved by Reagan and Gorbachev has resurrected the possibility of nuclear war from the grave in which Reagan and Gorbachev buried it. Again, as during the Cold War the specter of nuclear Armageddon stalks the earth.

Why did Washington revive the threat of world annihilation? Why is this threat to all of humanity supported by the majority of the US Congress, by the entirety of the presstitute media, and by academics and think-tank inhabitants in the US, such as Motyl and Weiss, about whom I wrote recently?

This commentary by Paul is one of today's stories that falls into the absolute must read category.  It appeared on this website on Thursday---and had to wait for a spot in today's column.  By the way, did I mention that this an absolute must read---because it certainly is.  Do it now!  I thank Roy Stephens for sending it to me.

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The Real American Exceptionalism: From Torture to Drone Assassination, How Washington Gave Itself a Global Get-Out-of-Jail-Free Card

"The sovereign is he who decides on the exception,” said conservative thinker Carl Schmitt in 1922, meaning that a nation’s leader can defy the law to serve the greater good. Though Schmitt’s service as Nazi Germany’s chief jurist and his unwavering support for Hitler from the night of the long knives to Kristallnacht and beyond damaged his reputation for decades, today his ideas have achieved unimagined influence. They have, in fact, shaped the neo-conservative view of presidential power that has become broadly bipartisan since 9/11. Indeed, Schmitt has influenced American politics directly through his intellectual protégé Leo Strauss who, as an émigré professor at the University of Chicago, trained Bush administration architects of the Iraq war Paul Wolfowitz and Abram Shulsky.

All that should be impressive enough for a discredited, long dead authoritarian thinker. But Schmitt’s dictum also became a philosophical foundation for the exercise of American global power in the quarter century that followed the end of the Cold War. Washington, more than any other power, created the modern international community of laws and treaties, yet it now reserves the right to defy those same laws with impunity. A sovereign ruler should, said Schmitt, discard laws in times of national emergency. So the United States, as the planet’s last superpower or, in Schmitt’s terms, its global sovereign, has in these years repeatedly ignored international law, following instead its own unwritten rules of the road for the exercise of world power.

This longish essay by Alfred W. McCoy is your second absolute must read story in a row.  It was posted on the tomdispatch.com Internet site via the Asia Times on Tuesday---and for length and content reasons, had to wait for today's column.  It is, like the Paul Craig Roberts commentary that preceded it, a very disturbing read.  But no matter how ugly, it is the truth.  Not surprisingly, it's courtesy of Roy Stephens once again.

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Leonard Nimoy, world famous as Mr. Spock on 'Star Trek' TV series and films, dies at 83

In 1975, Leonard Nimoy published an autobiography with the defiant title, "I Am Not Spock" — an attempt to show the world he had many more facets than the pointy-eared character that had come to define him.

Yet two decades later, after proving that with a career that became a rich blend of roles beyond "Star Trek" along with directing, writing and photography, he bowed to fate with "I Am Spock," a revisionist sequel.

Nimoy had come to appreciate Mr. Spock's enduring legacy and the inspiration the man of logic provided the actor and his fans alike.

"He's a part of me," he wrote in his second memoir. "Not a day passes that I don't hear that cool, rational voice commenting on some irrational aspect of the human condition."

I remember watching Star Trek on TV in Toronto back in the summer of 1967---and I've been a 'trekkie' ever since.  It makes me sad [and old] to post this story.  This AP article, filed from Los Angeles, appeared on the canada.com Internet site yesterday---and I thank reader M.A. for bringing it to my attention---and now to yours.

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Foreign Real Estate Is the New Swiss Bank Account

Financial privacy is essentially dead.

I think it’s only prudent to assume that sooner or later all the details of your financial life will come to rest in a government computer—if they haven’t done so already—and to plan accordingly.

We live in a world where pretty much every penny you earn, save, and spend is stored in a permanent record somewhere and can be retrieved for scrutiny one day if needed.

It’s not a comfortable or happy thing. But no matter how unpleasant it is, I believe it’s a reality we have to face.

This most excellent commentary was written by International Man's senior editor, Nick Giambruno---and it's worth your while, especially if you're an American citizen.

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How Real Is the European Deflation Threat?

Oppenheimer Funds’ Alessio de Longis and Principal Global Investors CEO Jim McCaughan discuss the impact of the threat of deflation on banking and the economy. They speak on “Bloomberg Surveillance.”

This 5:58 minute Bloomberg video clip was posted on their website at 5:05 a.m. MST on Friday---and it's another offering from Dan Lazicki.

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Alasdair Macleod: The euro may be riskier than you think

GoldMoney research director Alasdair Macleod writes that Greece and the European Union are both in terribly weak positions relative to the other and that this may bear more heavily than expected on the euro, which has no long history and thus less credibility than other currencies.

Macleod's commentary is headlined "The Euro May Be Riskier Than You Think" and it was posted on the goldmoney.com Internet site on Friday.  I found it embedded in a GATA release.

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You will get nothing unless you honour our deal, Germany warns Greece

Germany is expected to approve the new eurozone bail-out deal for Greece in a parliamentary vote on Friday but has warned that Athens will receive nothing unless it honours its commitments under the deal.

Wolfgang Schaeuble, the German finance minister, said he was “stunned” after his Greek counterpart, Yanis Varoufakis, spoke again of a debt restructuring on Greek radio, and the Athens government indicated it would block plans to privatise strategic assets.

“If the Greeks violate the agreements, then they have become obsolete," a visibly angry Mr Schaeuble said at a meeting to persuade German MPs to support the deal in today’s vote. The meeting in Berlin came after Germany’s biggest-selling newspaper launched a campaign against the Greece deal, printing “NEIN!” across an entire inside page, and encouraging readers to take selfies holding the page up and send them in for publication.

“No more billions for greedy Greeks,” the newspaper added, in only slightly smaller print. The page was printed in the blue and white of the Greek flag, instead of Bild’s more usual red and white.

This story appeared on the telegraph.co.uk Internet site at 9:29 p.m. GMT on Thursday evening---and it's courtesy of Roy Stephens.

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Greek PM says 'forget about third bailout'

Greece won’t be seeking a third international bailout after the four-month extension of its current program expires, Greek Prime Minister Alexis Tsipras said.

In a televised speech to his government, Tsipras also said the country has requested a reduction of its debt, despite European creditors demanding that Greece pay it in full.

"Some have bet on a third bailout, on the possibility of a third bailout in June. I'm very sorry but once again we will disappoint them," the PM declared, adding that “the Greek people put an end to bailouts with their vote."

Well, dear reader, it sounds like he's put a stake in the ground on this issue, so we'll see how things progress over the next four months, if it gets that far.  This news item appeared on the Russia Today website at 9:28 p.m. Moscow time on their Friday evening---and it's courtesy of Roy Stephens.

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Ukraine pays Gazprom $15 million for 24 hours worth of gas

Ukraine’s Naftogaz has paid Gazprom $15 million for gas delivery. At current levels, the prepayment covers one day's gas consumption and will be spent by Tuesday, Gazprom spokesperson Sergey Kupriyanov said.

“Today at 9:20am MSK Gazprom received a payment from Ukraine’s Naftogaz in the amount of $15 million. At the current level of supply this sum will be enough roughly for one day,” he said.

"If Naftogaz paid for another 24 hours, it means the resources would last through Monday till Tuesday," he said.

The relatively small prepayment suggests Kiev is buying time before trilateral talks in Brussels on march 2nd. Russian energy minister Alexander Novak had warned Kiev’s failure to pre-pay would mean a cut-off.

This news item showed up on the Russia Today website at 7:10 a.m. Moscow time on their Friday morning---and once again it's another contribution from Roy Stephens.

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Dubai’s deal with Kiev includes no weapons supplies – UAE Foreign Ministry

The United Arab Emirates is not selling military equipment to Ukraine, despite earlier statements by Kiev officials, the UAE Foreign Ministry said.

“An agreement on cooperation in defense technologies the UAE and Ukraine signed recently does not stipulate any contracts for deliveries of weaponry to the Ukrainian side,” said Faraj Faris al-Mazrouei, adviser to UAE Foreign Minister Abdullah bin Zayed Al Nahyan.

The deal was only one element in a future system of cooperation between the two countries in the field of defense technologies, RIA Novosti reported al-Mazrouei as saying, citing the Emarat Al-Yawm news portal.

The UAE and Ukraine signed a memorandum of understanding on military-technical cooperation during the IDEX-2015 defense exhibition in Abu Dhabi earlier this week.

This Russia Today story appeared on their website at 7:28 p.m. Moscow time on their Friday evening---and it's also courtesy of Roy Stephens.

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Boris Nemtsov, Russian opposition leader, shot dead in Moscow

Boris Nemtsov, a Russian opposition leader and sharp critic of President Vladimir Putin, was gunned down Saturday near the Kremlin, officials said. Nemtsov was killed just a day before a protest planned against Putin's rule.

The death of Nemtsov, a 55-year-old former deputy prime minister, ignited a fury among opposition figures who assailed the Kremlin for creating an atmosphere of intolerance of any dissent. Putin quickly offered his condolences and called the murder a provocation.

Putin ordered Russia's law enforcement chiefs to oversee the probe. "Putin noted that this cruel murder has all the makings of a contract hit and is extremely provocative," presidential spokesman Dmitry Peskov said in remarks carried by Russian news agencies.

Nemtsov assailed the government's inefficiency, rampant corruption and the Kremlin's Ukraine policy, which has strained relations between Russia and the West to a degree unseen since Cold War times.

This news story was posted on the cbc.ca Internet site at 5:14 p.m. EST yesterday afternoon---and I thank reader David Caron for bringing it to our attention.  There was a story about this on the Russia Today website as well---and it's headlined "Opposition politician Boris Nemtsov killed in the center of Moscow".  I thank Juli Placek for that one.

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Nemtsov was no threat to Russian government - presidential spokesperson

Boris Nemtsov did not pose a threat to the Russian government, according to presidential press secretary Dmitry Peskov. The murder of the Russian opposition figure has been called a "provocation" by a number of politicians and public figures.

“With all due respect to the memory of Boris Nemtsov, in political terms he did not pose any threat to the current Russian leadership or Vladimir Putin. If we compare popularity levels, Putin’s and the government’s ratings and so on, in general Boris Nemtsov was just a little bit more than an average citizen,” Peskov said on Saturday.

Russian President Vladimir Putin has condemned the assassination and expressed his condolences to the family, Peskov added. “Putin has stressed that this brutal murder has all [the] signs of a contract murder and is extremely provocative.”

Irina Khakamada, an opposition figure who was Nemtsov's ally in the SPS party (Union of Right Forces), called the murder a "provocation" aimed at destabilizing Russia.

This is Russia Today news item appeared on their Internet site at 3:18 a.m. Moscow time on their Saturday morning, which was 7:18 p.m. in Washington on their Friday evening.  I thank Roy Stephens once again---and it's definitely worth reading.

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Breaking news: FALSE FLAG IN MOSCOW!

There is no doubt in my mind at all that either this is a fantastically unlikely but always possible case of really bad luck for Putin---and Nemtsov was shot by some nutcase or mugged, or this was a absolutely prototypical western false flag: you take a spent politician who has no credibility left with anyone with an IQ over 70, and you turn him into an instant "martyr for freedom, democracy, human right and civilization".

By the way if, as I believe, this is a false flag, I expect it to be a stunning success in the West and a total flop in Russia: by now, Russians already can smell that kind of setup a mile away and after MH-17 everybody was expecting a false flag.  So, if anything, it will only increase the hostility of Russians towards the West and rally them around Putin.  In the Empire, however, this will be huge, better than Politkovskaya or Litvinenko combined.  A "Nemtsov" prize will be created, a Nemtov statue will be place somewhere (in Warsaw?), the U.S. Congress will pass a "Nemtsov law" and the usual combo package of "democratic hagiography" will be whipped-up.

What worries me most is that the Russian security services did not see this one coming and let it happen.  This is a major failure for the FSB which will now have a lot at stake to find out who did it.  I expect them to find a fall-guy, a patsy, who will have no provable contacts with any western services and who, ideally, might even have some contacts with the Russian services (like Andrei Lugovoi).

As for the "liberal" or "democratic" "non-system" - it will probably re-brand the upcoming protests as a "tribute to Nemtsov" thereby getting more people into the streets.

There are folks in Langley tonight who got a promotion.

This very interesting commentary/speculation was posted on the vineyardsaker.com Internet site on Friday evening sometime---and it is, once again, courtesy of Roy Stephens.

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No, Obama, Russia's Economy Isn't 'in Tatters'

Bashing the Russian economy has lately become a popular pastime. In his state of the nation address last month, U.S. President Barack Obama said it was "in tatters." And yesterday, Anders Aslund of the Peterson Institute for International Economics published an article predicting a 10 percent drop in gross domestic product this year -- more or less in line with the apocalyptic predictions that prevailed when the oil price reached its nadir late last year and the ruble was in free fall.

Aslund's forecast focuses on Russia's shrinking currency reserves, some of which have been earmarked for supporting government spending in difficult times. At $364.6 billion, they are down 26 percent from a year ago and $21.6 billion from the beginning of this year. Aslund expects $166 billion to be spent on infrastructure investments and bailing out companies, and another $100 billion to exit via capital flight and other currency outflows. As a result, given foreign debts of almost $600 billion, "Russia's reserve situation is approaching a critical limit," he says.

What this argument ignores is that Russia's foreign debts are declining along with its reserves -- that's what happens when the money is used to pay down state companies' obligations. Last year, for example, the combined foreign liabilities of the Russian government and companies dropped by $129.4 billion, compared with a $124.3 billion decline in foreign reserves. Beyond that, a large portion of Russian companies' remaining foreign debt is really part of a tax-evasion scheme: By lending themselves money from abroad, the companies transfer profits to lower-tax jurisdictions. Such loans can easily be extended if sanctions prevent the Russian side from paying.

This opinion piece put in an appearance on the bloombergview.com Internet site at 2:51 p.m. EST on Thursday afternoon---and I thank South African reader B.V. for digging it up for us.

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China Just Sided With Russia Over the Ukraine Conflict

When it comes to the Ukraine proxy war, which started in earnest just about one year ago with the violent coup that overthrew then president Yanukovich and replaced him with a local pro-U.S. oligarch, there has been no ambiguity who the key actors were: on the left, we had the west, personified by the US, the European Union, and NATO in general; while on the right we had Russia. In fact, if there was any confusion, it was about the role of that other "elephant in the room" - China.

To be sure, a question few asked throughout the Ukraine civil war is just whose side is China leaning toward. After all the precarious balance of power between NATO and Russia had resulted in a stalemate in which neither side has an obvious advantage (even as the Ukraine economy died, and its currency hyperinflated, waiting for a clear winner), and the explicit or implicit support of China to either camp would make all the difference in the world, not to mention the world's most formidable axis.

We finally got the answer.

Xinhua reported that late on Thursday Qu Xing, China's ambassador to Belgium, was quoted as blaming competition between Russia and the West for the Ukraine crisis, urging Western powers to "abandon the zero-sum mentality" with Russia.  Cited by Reuters, Xing said that Western powers should take into consideration Russia's legitimate security concerns over Ukraine.

Reuters' assessment of Xing speech: "an unusually frank and open display of support for Moscow's position in the crisis."

This is another Zero Hedge news story---and it showed up on their website at 2:25 p.m. EST on Friday afternoon---and once again I thank Dan Lazicki for sharing it with us.

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Collapse of Russia will prove major test for U.S. – Stratfor

American think-tank Stratfor has issued a new 'Decade Forecast,' which says the E.U. will decay, China will end up in "a communist dictatorship," and Russia will disintegrate...though it hasn't done so yet, despite such predictions taking place in the past.

“It is unlikely that the Russian Federation will survive in its current form,” the forecast’s chapter dedicated to Russia begins. The research maintains that Moscow’s “failure to transform energy revenues into self-sustaining economy” will eventually lead to a “repeat of the Soviet Union's experience in the 1980s and Russia's in the 1990s,” with the process accompanied by a demographic decline that is set to “really hit” Russia.

However, the forecaster's founder and CEO, George Friedman, recently said that Russia has the ability to emerge from U.S.-led sanctions and the recent drop in the ruble due to falling oil prices. "Russians' strength is that they can endure things that would break other nations," Friedman said, suggesting that the country "has military and political power that could begin to impinge on Europe."

This article, which certainly falls into the absolute must read category, was posted on the Russia Today website on Tuesday evening Moscow time---and for content reasons, had to wait for today's column.  I thank Norman Willis for bringing it to my attention---and now to yours.

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The rise of fascism is again the issue -- John Pilger

The recent 70th anniversary of the liberation of Auschwitz was a reminder of the great crime of fascism, whose Nazi iconography is embedded in our consciousness.

Fascism is preserved as history, as flickering footage of goose-stepping blackshirts, their criminality terrible and clear. Yet in the same liberal societies whose war-making elites urge us never to forget, the accelerating danger of a modern kind of fascism is suppressed; for it is their fascism.

"To initiate a war of aggression…," said the Nuremberg Tribunal judges in 1946, "is not only an international crime, it is the supreme international crime, differing only from other war crimes in that it contains within itself the accumulated evil of the whole."

Had the Nazis not invaded Europe, Auschwitz and the Holocaust would not have happened. Had the United States and its satellites not initiated their war of aggression in Iraq in 2003, almost a million people would be alive today; and Islamic State, or ISIS, would not have us in thrall to its savagery. They are the progeny of modern fascism, weaned by the bombs, bloodbaths and lies that are the surreal theatre known as news.

Like the fascism of the 1930s and 1940s, big lies are delivered with the precision of a metronome: thanks to an omnipresent, repetitive media and its virulent censorship by omission. 

This is your fourth and last absolute must read of the day.  It, too, is on the longish side.  It appeared on the Asia Times website on Thursday---and once again I thank Roy Stephens for bringing it to our attention.

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Moscow confirms India considering free trade zone with Eurasian Economic Union

India has proposed creating a free trade zone with the Eurasian Economic Union of Russia, Kazakhstan, Belarus and Armenia, said Alexey Pushkov, head of the International Committee of Russian State Duma.

"The question was raised by India, which is now considering a free trade agreement with the Eurasian Economic Union. This is a new level in our relationship. The possibility is being discussed," he told reporters Friday during an official visit to New Delhi.

On Thursday TASS reported that India will start negotiating a comprehensive free trade agreement with the Customs Union of Russia, Belarus and Kazakhstan within the next six months.

The Eurasian Economic Union of Armenia, Belarus, Kazakhstan and Russia started functioning in January 2015.

This news item showed up on the Russia Today Internet sit at 2:38 p.m. Moscow time on their Friday---and it's the final offering of the day from Roy Stephens, and I thank him on your behalf.

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Sprott Money Weekly Wrap Up

Listen to Eric Sprott share his views on new U.S. economic data, the chaos in the foreign exchange market, the scam in precious metals on the COMEX, the options expiry, and possibility of changes to India’s gold import taxes.

This 8:17 minute audio interview conducted by sprottmoney.com's Geoff Rutherford, appeared on their website yesterday.

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Gold Prices Need To Move Higher, Reserves Aren’t Being Replaced

Kitco News speaks with Bear Creek Mining chairman Catherine McLeod-Seltzer to see how she sees the industry set up for 2015. “A lot of write-offs were taken in the industry,” she says. “But I think people are ready for a fresh start. They see reasons why metals prices have bottomed and may start to move up,” she adds.

According to McLeod-Seltzer, the industry is just in a cycle and she thinks it has bottomed. “The price has been within a range quite stable, so I think that’s part of the bottoming process. And I do know that we consume 90 million ounces a year of our reserves as an industry, and we’re not replacing them,” she says, adding that prices need to move higher in order to support the struggling mining companies.

It's obvious that its not only the male members of the precious metal mining industry that are clueless.  Prices will rise when they're allowed to rise---and not a moment sooner.  This 5:06 minute video interview was posted on the kitco.com Internet site yesterday---and it's courtesy of Dan Lazicki.

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Switzerland accounts for 60% of India’s gold imports

As much as three-fifths of India's total gold imports last year came from Switzerland, reflecting a significant jump in just a couple of years.

India imported 471.9 tonnes of gold from Switzerland in 2014, according to precious metals consultancy GFMS Thomson Reuters that quoted a country-by-country breakdown of gold imports and exports released by the Alpine country for the first time since 1980. This represents 61% of India's total gold imports of 769 tonnes last year as per World World Gold Council data.

Industry sources say that the quantum of gold imports from Switzerland has increased to around 60% in 2013 and 2014 from an average 45%-50% in the decade through 2012.

This very interesting gold-related news item from India, which was filed from Mumbai, appeared on the indiatimes.com Internet site at 7:02 p.m. IST on their Thursday evening---and I found it on the Sharps Pixley website in the wee hours of this morning.

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China plans yuan-denominated gold fix this year, sources tell Reuters

China plans to launch a yuan-denominated gold fix this year to be set through trading on an exchange, sources familiar with the matter said, as the world's second-biggest bullion consumer seeks to gain more say over the pricing of the precious metal.

The Chinese benchmark would be derived from a new 1-kilogram contract to be launched on the state-run Shanghai Gold Exchange, a senior source directly involved in the process told Reuters.

China, also the top producer of gold, feels that its market weight should entitle it to be a price-setter for bullion and it is asserting itself at a time when the established benchmark, the century-old London fix, is under scrutiny because of alleged price-manipulation.

This Reuters article, filed from Singapore, put in an appearance on their Internet site at 3:07 a.m. EST on Friday morning---and I found this gold-related story on the gata.org Internet site.

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Hong Kong January gold exports to China confirm strong demand

The latest figures for net gold exports from Hong Kong into China confirm the latter nation’s strong demand in the run up to the Chinese New Year holiday. The figure for January was 76 tonnes, up from 71 tonnes in December, but it should be realised that this Hong Kong figure relates specifically to Chinese gold imports – not total demand – and then only to a diminishing proportion of the Asian dragon’s total gold imports.

If one views known export levels from the U.S. and Switzerland, where official statistics differentiate between gold going to Hong Kong and to mainland China direct, then the percentage moving in via Hong Kong is perhaps only 60% of total Chinese gold imports – still significant, but well below earlier years when Hong Kong will have accounted for perhaps 90% or more of total Chinese gold imports and was thus used as a proxy by Western analysts for the total figure – a pattern which continues today in much mainstream media coverage of Chinese gold import figures.

Last year China relaxed import controls to allow far more direct shipments via other ports of entry – notably Shanghai and Beijing which has reduced the amounts routed through Hong Kong.

I reported on the Chinese gold imports through Hong Kong the other day, but just gave the number---and didn't elaborate on it.  Lawrie has done the heavy lifting for me/us---and it was posted on the mineweb.com Internet site at 2:45 p.m. GMT yesterday.  It's certainly worth reading.

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Apple buying a third of world’s gold to meet demand for iWatch

Technology giant Apple may soon buy up one third of the world’s gold in order to meet the demands of its highly anticipated Apple Watch, according to reports.

Interest in the high-end model, featuring 18-karat gold casing, is picking up and the firm is already taking the necessary steps to have enough of them in stock. According to WSJ.com, Apple plans to start producing more than one million units per month in the second quarter of the year, anticipating high demand from Asian markets, mainly China.

Josh Centers, from TidBits, estimates that each gold watch will contain 2 troy ounces (62.2 grams) of gold. So, based on the estimated sales figure, he concludes that Apple will need 746 tons of gold a year, or about 30% of the world’s annual production.

I'm sure the watch will do well initially, but its novelty value won't last forever.  Of course if it is successful, they may get a phone call from the powers-that-be saying that this is not the best idea in the world. This tiny story appeared on the mining.com Internet site on Thursday sometime---and I thank James Ackers for sharing it with us.

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¤ The Funnies

Here are five more photos of the Grand Canyon as Day 2 came to a close---and the weather improved as we headed back in the direction of Flagstaff via Desert View Drive, which is State Highway 64.  But first is another shot of a mule deer from the small herd that I posted yesterday.  The "God beams" streaming in from the left in photo #3 have a scientific name.  They're called crepuscular rays.  Photo 4 and 5 are exterior and interior shots of the Desert View watchtower which is located at the 7,438 ft/2,267 meter level---and is one of the highest points on the South Rim.  Don't forget the 'click to enlarge' feature.

First Majestic is a mining company focused on silver production in México and is aggressively pursuing the development of its existing mineral property assets. The Company presently owns and operates five producing silver mines; the La Parrilla Silver Mine, the San Martin Silver Mine, the La Encantada Silver Mine, the La Guitarra Silver Mine, and the Del Toro Silver Mine. Production from these five mines is anticipated to be between 11.8 to 13.2 million ounces of pure silver or 15.3 to 17.1 million ounces of silver equivalents in 2015.

 

¤ The Wrap

It seems highly plausible that of the many thousands of individual and corporate entities capable of investing less than $2 billion in physical silver, that one or two might emerge in time. Even more amazing is that there really isn’t room for more than one or two big buyers.  It would seem impossible for, say, ten such buyers to purchase, for a combined $20 billion, one billion ounces of silver bullion because that’s all that exists in the world and little of that is available for sale at current prices.

This is what makes silver so special – the dollar to physical ounce conversion. Please consider what the $20 billion that would buy up the entire one billion ounces of silver bullion (1,000 oz bars) in the world would buy in gold. At current prices, $20 billion would buy less than 17 million ounces of gold, an amount that would no doubt influence the price of gold immensely, but at the same time only represents less than 1% of all the gold bullion in the world (3 billion oz of gold bullion, not the 5.5 billion oz of all forms of gold). Again, this is a simple financial equation - what would have more price impact, the purchase of 100% of what exists in the world or the purchase of less than 1% of what exists in the world?

For those potential big buyers which decided to look more closely as a result of answering the question as to why so much physical silver could be bought with so little money, the answer is also simple and easily documented. The answer is because 8 or less crooked traders on the COMEX are short the equivalent of 325 million oz, or more than 40% of annual world production and a third of all the silver bullion that exists. No other commodity has such an extremely concentrated short position and if this short position didn’t exist, the price of silver would be much higher. And at current depressed silver prices, who in their right mind could legitimately hold such a large short position? If any number of potential big buyers make it to this point with an open mind, it would be easy to verify what I claim, since the data are published weekly by the CFTC. -- Silver analyst Ted Butler: 25 February 2015

Today's first pop 'blast from the past' dates back to 1968---and a British rock group called The Zombies.  They didn't have all that many hits, but the ones they had were great---and one of them is linked here.  While I'm at it, here's another one.

Today's classical 'blast from the past' was something I ran across when I was looking for English madrigals.  This selection is the famous Miserere by Gregorio Allegri that he composed sometime in the 1630s---and I've posted this before.  You can read the incredible story surrounding it by clicking hereThe Tallis Scholars do the honours.

In April 1994, they sang this work in the newly-restored Sistine Chapel in the Vatican, and performed it in February 1994 in the Basilica di Santa Maria Maggiore in Rome to commemorate Palestrina's 400th anniversary---and the latter performance is the one posted here.  I consider it to be the definite recording of this work.  It's beyond sublime---and the link is here.

It was another day where not too much should be read into the price action. I was happy to see prices up on the day, rather than the big down day that I feared might materialize.  Once again there wasn't a lot of volume.

Here are the 6-month charts for all four precious metals.

Well, the U.S. is not stopping or even slowing down much when it comes to the pressure they're putting on Russia vis-à-vis the Ukraine.  Push is really becoming shove now---and I'm sure that "the dogs of war" will be howling in the Western press in the days ahead about the event in Moscow yesterday.

Even China has put their marker down on the Russia/Ukraine embroglio---and the reason is obvious, because they know that if Russia falls, they're next on the USA's list.

Sooner or later one would think that this war will show up in the gold price---notwithstanding any improvement in demand from Apple's new iWatch.

I've always thought that the day would come when, in pure self defence, Russia and/or China might be forced to play the gold card whether they wanted to or not.

If this, in fact, does happen, then the U.S. will be able to point a finger at Russia and/or China and say that it was all their fault.  How materially higher precious metal prices would affect the Western bullion and investment banks that currently hold massive COMEX short positions in all four of these metals, is something that remains to be seen.  At the same time one has to consider where the metal will come from to meet the demands of all the precious metal ETFs on Planet Earth if/when this event does occur.  Questions with no answers at the moment.

And notwithstanding anything I just said, I'm still amazed how the powers-that-be can keep this dog and pony show going across all markets.  For those of us who have been around the block a few times, the current economic, financial and monetary situation is beyond absurd---and there's no way that any part of it will be ever be brought under control successfully.  The whole scenario will blow up, or melt down---and you'll excuse me for thinking that may be the grand plan, as no attempt is being made in any quarter to put the brakes on any of this.

It will all end terribly---and in a heap.  But as to what will emerge from the rubble after that, I haven't a clue.

So we wait.

That's it for the day---and the week.

I'll see you here on Tuesday.

Ed Steer