Gold & Silver Daily
"JPMorgan et al put away the carving knives---and took out the axes"
 

¤ Yesterday In Gold & Silver

The gold price did nothing in Far East trading---and once the dollar index began to head south with a vengeance, it was obvious that JPMorgan et al were there to prevent the price from breaking out to the upside.  It managed to rally above unchanged going into the jobless claims number at 8:30 a.m. EDT, but the HFT boyz and their algorithms were there with their jackboots---and that as they say, was that.  The low tick came at the London p.m. gold fix---and from there it rallied quietly and unsteadily into the 5:15 p.m. close of electronic trading.

The high and low ticks were reported by the CME Group as $1,207.40 and $1,176.00 in the June contract.

Gold finished the Thursday session at $1,184.00 spot, down $20.60 from Wednesday's close---and well off its low.  Net volume was monstrous at 204,000 contracts.

Here's gold's 5-minute tick chart---and you can tell at a glance that all the volume that mattered occurred between 6:30 a.m. and 11:30 a.m. Denver time on this chart---add two hours for EDT.  The volume spike at the 1:30 p.m. EDT COMEX close intrigues me, as it stands out like the proverbial sore thumb that it is.  Don't forget to 'click to enlarge' feature.

The trading day in silver was identical, so I'll spare you a repeat of what I just said about gold.  But from its 10 a.m. EDT low, the silver price rallied smartly into the 1:30 p.m. COMEX close---and then chopped sideways for the remainder of the New York session.

The high and low ticks were recorded as $16.73 and $15.80 in the new front month, which is July.

Silver closed yesterday at $16.10 spot, down 44 cents---and well off its low tick.  Not surprisingly, net volume was pretty decent at 58,000 contract, which was about the same volume as Wednesday.

Platinum and palladium were hit by the HFT traders at the same time---and in the same way, as gold and silver.  Both finished well off their low ticks, too.  Platinum finished the day at $1,142 spot, down 11 bucks---and palladium closed yesterday at $776 spot, down only 4 dollars.  Here are the charts.

But platinum and palladium were a side show.  JPMorgan et al were after gold and silver in general, but silver in particular.

The dollar index closed late on Wednesday afternoon in New York at 95.21---and chopped quietly higher until its 95.40 high tick, which came a minute or so after 2 p.m. Hong Kong time on their Thursday afternoon.  It began to head lower from there, but really got its lights punched out starting at 8:20 a.m. in London trading.  The 94.40 low tick came just under an hour later at 9:15 a.m. BST.  It chopped higher from there, before catching a bit of a bid just before 8:30 a.m. EDT.  The New York high of around 95.37 came shortly after the equity markets opened in New York---and then it chopped lower---and was in real danger of taking out its London low shortly before 3 p.m. EDT.  But "gentle hands" appeared---and it crept higher into the close.  The index finished the Thursday session at 94.81---down an even 40 basis points on the day.

Needless to say, there was absolute no correlation between the dollar index and the precious metals on Thursday, as the powers-that-be had them in a headlock.

Here's the 6-month dollar index chart---and as you can tell, it's approaching oversold territory.  But as you can also tell from the chart, it can stay oversold for a long time---maybe for the same length of time or longer than it was overbought.  Time will tell.

The gold stocks opened down a bit over 3 percent---and then traded in a one percent or so price range, before rallying a hair into the close.  The HUI finished the Thursday session down 2.94 percent.

The silver equities followed an identical price path---and despite the fact that silver cut its Thursday loss in half by the close, the shares closed virtually on their lows of the day, as Nick Laird's Intraday Silver Sentiment Index got smacked for 3.85 percent.

The CME Daily Delivery Report for Day 2 of the May delivery month showed that zero gold and 302 silver contracts were posted for delivery within the COMEX-approved depositories on Monday.   The biggest short/issuer in silver was JPMorgan out of its client account with 177 contracts---and in very distant second place was R.J. O'Brien with 58 contracts out of its client account as well.  The biggest long/stopper was JPMorgan once again, with 85 contracts for its client account---and another 89 for its in-house [proprietary] trading account.  In second place was HSBC USA with 75 contracts for its in-house [proprietary] trading account as well. The link to yesterday's Issuers and Stoppers Report is here---and it's worth quick look.

The CME Preliminary Report for the Thursday trading session showed that gold open interest for May remained unchanged at 226 contracts---and silver's o.i. dropped by 1,667 contracts down to 1,704 contracts still open, minus the 302 mentioned above.

There were no reported changes in GLD yesterday---and as of 9:51 p.m. EDT yesterday evening, there were no reported change in SLV, either.

Since yesterday was Thursday, Joshua Gibbons, the Guru of the SLV Bar List, updated his website with the goings-on over at the iShares.com Internet site for the reporting week ending on Wednesday---and here is what he had to say...

"Analysis of the 29 April 2015 bar list, and comparison to the previous week's list: 4,302,220.0 troy ounces were added (all to JPM New York), no bars were removed or had serial number changes."

"The bars added were from: Solar Metals (3.0M oz), Asahi Pretec (0.1M oz), and Noranda (0.1M oz).  As of the time that the bar list was produced, it was overallocated 361.3 oz."

"A 2,963,810.8 oz withdrawal on Tuesday is not yet reflected, and should be on next week's list."

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

A Reuters story yesterday had this to say about U.S. gold eagle sales---"The U.S. Mint's sales of America Eagle gold coins in April fell 37 percent from March, while 2015 sales so far have dropped for the second straight year, government data showed on Thursday. The Mint said it sold 29,500 ounces of American Eagle gold coins in April, down from the 46,500 ounces in March but still well above the 18,500 ounces in February.  Sales for the first four months of the year have reached 175,500 ounces, down 3.6 percent from the first four months of 2014"

Of course there's not a word mentioned about the frantic pace of silver eagle sales---and why they continue to sell more dollars worth of them than gold eagles.  As of the end of April, the U.S. Mint had sold 14,922,500 of them, down from the 17,448,000 they sold in the same period in 2014.   The mint continues to produce silver eagles far in excess of U.S. yearly silver production.

Over at the COMEX-approved depositories on Wednesday, they reported receiving 32,116 troy ounces of gold, with virtually all of it going into HSBC USA.  Nothing was shipped out---and the link to that activity is here.

In silver, only 993 ounces were received---and 933,021 troy ounces were shipped out.  About 90 percent of the withdrawal came from Brink's Inc.  The link to that action is here.

There was also a decent amount of activity at the gold kilo depositories in Hong Kong---and it was all at Brink's, Inc. once again.  There were 1,668 kilobars received---and 8,918 kilobars shipped out.  The link to that activity in troy ounces is here.

I have the usual number of stories---and I hope you'll find a few that interest you.

 

¤ Critical Reads

The Last Time Initial Jobless Claims Were This Low Was The Peak of the Dot-Com Bubble

Initial jobless claims have been worse than expected for the last 2 weeks but remained below the magical 300k level, so it was only appropriate that this week all the great economic news of late - record plunge in U.S. macro disappointments and a dismal 0.2% GDP print - would be met with the lowest claims print in 15 years. At 262k (against a 290k expectation), initial claims has only been lower once - the week of April 14th 2000 - which just happened to mark the top of the Dot-Com bubble. While this is great news, we do note that a rolling average of Texas Jobless claims shows the improving trend has stalled.

This short Zero Hedge article, complete with three worthwhile charts, appeared on their website at 8:43 a.m. EDT on Thursday morning.  I thank Dan Lazicki for today's first story.

Read more...

Despite alarms about global warming, Obama blames cold winter for stalled economy

President Obama often raises the alarm about global warming, but his top economic adviser said Wednesday that an especially cold winter was to blame for slow growth in the U.S. in the first quarter.

“As measured by heating degree days, this quarter was the third coldest in twenty years,” said White House economic adviser Jason Furman. “Indeed, winter weather likely reduced both consumption and investment, contributing to this quarter’s below-trend output growth.”

The Bureau of Economic Analysis said first-quarter growth in gross domestic product contracted to an annual rate of 0.2 percent, far below projections and much slower than the previous three quarters.

Mr. Furman the first quarter “was only the fourth in 60 years on record with three or more snowstorms sufficiently severe to be rated by the National Climatic Data Center’s northeast snowfall impact scale.” He said the winter was “especially harsh” and may have lowered growth by a full percentage point.

It's always something other than the real reason, isn't it, dear reader?  This article appeared on the Washington Times website on Wednesday---and I found it in yesterday's edition of the King Report.

Read more...

Gold Dumped, Dollar Pumped as Algos Focus on Claims, Ignore Spending

Because what really matters is not spending or incomes for the average American (which both missed dismally), the market appears convinced that the 2nd lowest jobless claims print in history is what matters and the "rate hike is coming" trade is on. Bond yields are higher, dollar is jumping, and gold (and silver) and dumping...

Another short 3-chart Zero Hedge article from 09:03 a.m. yesterday---and it's also courtesy of Dan Lazicki.

Read more...

Guess Who Predicted the Failure of Q.E.

Janet Yellen -- FOMC minutes from December 2008

"As Japan found during its quantitative easing program, increasing the size of the monetary base above levels needed to provide ample liquidity to the banking system had no discernible economic effects aside from those associated with communicating the Bank of Japan’s commitment to the zero interest rate policy.

I think my views on this mirror those that you expressed in your opening comments, Mr. Chairman."

However, today we get more total hypocrisy from the newly found bond guru and hedge fund adviser via his blog...

Responding to The Wall Street Journal's questioning the efficacy of monetary policy (specifically ZIRP and QE), Bernanke scoffs:

This is another Zero Hedge article from 7:30 p.m. EDT on Thursday evening that's also courtesy of Dan Lazicki.

Read more...

When The Herd Turns -- Charles Hugh-Smith

When the leaders realize that further market gains are increasingly unlikely and fraught with risk, they will exit. The herd following them will also exit, as the selling of the leaders will eventually push markets down despite central bank purchases.

To the leaders who are selling, central banks are simply large-scale chumps, snapping up shares right when those buying stocks are about to stampede over the cliff. Central banks buying equities give sellers more opportunities to distribute to greater fools; they can't change the direction of the herd.

The ultimate hubris of central banks was their supreme belief in their own powers to direct the herd. As long as the herd was stampeding in one direction, the central banks could imagine that their shouted orders were directing the herd.

But once the herd turns, the futility of those orders will be revealed.

This very interesting commentary was posted on the Zero Hedge website yesterday as well---and the articles from Dan L. just keep on coming. This one is certainly worth reading.

Read more...

Goldman Sachs Jumps on the Bitcoin Bandwagon Investing $50 Million in Circle

The Wall Street investment bank Goldman Sachs on Wednesday became the first major financial institution to invest in bitcoin, after leading the latest funding round for digital currency company Circle Internet Financial, worth $50 million in investment for the start-up. 

Goldman Sachs is joined by China-based IDG Capital Partners in investing in the company, announced Jeremy Allaire, CEO and founder of the digital currency company on Wednesday:

"We could not be happier with our new strategic investors. They bring unique, powerful capabilities and capital that will help us continue building a new kind of global consumer finance company, one based on open platforms, open source software, and ubiquitous mobile devices."

This interesting news item put in an appearance on the sputniknews.com Internet site at 6:21 p.m. Moscow time on their Thursday afternoon, which was 11:21 a.m. EDT in New York.  It's the first contribution of the day from Roy Stephens.

Read more...

Canadian Partnership Shielded Identities of Donors to Clinton Foundation

Aides to former President Bill Clinton helped start a Canadian charity that effectively shielded the identities of donors who gave more than $33 million that went to his foundation, despite a pledge of transparency when Hillary Rodham Clinton became secretary of state.

The nonprofit, the Clinton Giustra Enterprise Partnership (Canada), operates in parallel to a Clinton Foundation project called the Clinton Giustra Enterprise Partnership, which is expressly covered by an agreement Mrs. Clinton signed to make all donors public while she led the State Department. However, the foundation maintains that the Canadian partnership is not bound by that agreement and that under Canadian law contributors’ names cannot be made public.

The foundation cited that restriction last weekend in explaining why it did not disclose $2.35 million in donations from the chairman of Uranium One, the subject of an article in The New York Times last week. The article examined how company executives and shareholders had sold a majority stake in the company — and with it a significant portion of American uranium reserves — to an arm of the Russian government in a deal that required the approval of the United States government.

Well, Frank Giustra's association with the Clinton's should tell you all you need to know about Mr. Giustra himself.  This interesting article appeared on The New York Times website on Wednesday---and it's the second offering in a row from Roy Stephens.

Read more...

Germany spied on France and E.U. commission: Report

German Chancellor Angela Merkel’s government has been embarrassed by reports that the country's intelligence service was spying on France and the European Commission for the US National security agency (NSA).

According to the Sueddeutsche Zeitung newspaper on Thursday (30 April), the BND, the German intelligence service, listened in on officials from the French presidency and foreign affairs ministry, as well as the E.U. Commission.

Phone tapping was done from the BND’s Bad Aibling spying station in Bavaria and information was transmitted to the NSA under an agreement signed in 2002, writes the Sueddeutsche Zeitung.

The newspaper does not specify when and for how long spying on France and the E.U. occurred.

This news item showed up on the euobserver.com Internet site at 9:23 a.m. Europe time yesterday morning---and I thank Roy Stephens for sending it along.

Read more...

Airbus to sue in U.S., German spying row

Aviation giant Airbus says it will file a criminal complaint over allegations that German intelligence helped the US carry out industrial espionage.

German media reports suggest the country's spy agency BND collected data on European firms at the behest of the US National Security Agency.

An Airbus statement quoted by AFP news agency said it was "alarmed" by the reports but did not want to speculate.

The company said it had asked for more information from the German government.

This story was posted on the bbc.com Internet site yesterday sometime---and it's also courtesy of Roy Stephens.

Read more...

Greece "Scrambles"To Make Full Monthly Pension Payments: "Still Missing Several Hundred Million Euros"

According to Bloomberg, the Greek government is €400 million short of the amount needed for payment of pensions and salaries this month, citing a Kathimerini report.

Surprisingly, this takes place even as Greece’s IKA, OGA pension funds have been informed by the government that amount needed for payment of pensions will be deposited today, while the Greece’s OAEE pension fund has said payment of pensions won’t be a problem.

In other words, someone is not telling the truth: either there is enough money or there isn't. And if the latter case is valid, then either the government or the pensions are now openly lying to the population.

This interesting article appeared on the Zero Hedge Internet site at 8:48 a.m. EDT yesterday morning---and I thank reader M.A. for sending it our way.

Read more...

World Bank: Ukraine needs deep reform

Deep reforms in sectors ranging from budget management to energy are needed to stimulate the Ukrainian economy, the World Bank Group said.

The Ukrainian government that took power in the wake of political upheaval in November 2013 said the ousted administration of President Viktor Yanukovych left the economy in shambles. In its latest assessment, the World Bank said it expects real gross domestic product in Ukraine will drop 7.5 percent this year, compared with a 6.8 percent drop in 2014.

"Exogenous shocks undermined the efforts of authorities to stabilize the economy and jump start growth in 2014," Qimiao Fan, World Bank country director, said in a statement. "Faster and deeper reforms are the best antidote to these exogenous shocks confronting Ukraine."

As long as the U.S. has its nose stuck in the Ukraine---and continues to prop up the current 'government', these so-called 'reforms' ain't going to happen.  This UPI story, filed from Kiev, was posted on their Internet site at 7:52 a.m. EDT on Thursday morning---and I thank Roy Stephens for sharing it with us.

Read more...

Visa and MasterCard resume operations in Crimea

Visa and MasterCard payment cards issued by Russian banks are working again in Crimea after transactions have been transferred to the new Russian National Payment Card System.

Cash withdrawals by Visa and MasterCard holders will be possible through ATMs belonging to the region’s largest bank the Russian National Commercial Bank (RNCB), TASS reported on Wednesday. Russian domestic transactions using Visa and MasterCard were transferred to processing through Russia’s newly created National Payment Card System (NPCS) on April 1. The system has been started to ensure the continued operation of Visa and MasterCard after the two companies refused to work with a number of Russian banks due to Western sanctions last year.

Visa and MasterCard suspended services to Crimean banks in December after US President Barack Obama authorized individual and sectoral sanctions against the peninsula. Later, PayPal, Google and Apple also cut off their products and services from Crimea. Russia’s Bank Rossiya, SMP Bank, InvestCapitalBank and Sobinbank also fell under Western sanctions.

Money talks!  This short news item put in an appearance on the Russia Today website at 10:11 a.m. Moscow time on their Thursday morning, which was 3:11 a.m. EDT in New York.  I thank reader M.A. for sharing it with us.

Read more...

Russia to limit apple imports from Serbia

Russian imports of apples from Serbia will be limited, said Russia’s food watchdog Rosselkhoznadzor, citing quality concerns. Moscow has suspected the sharp rise of supplies from Serbia could hide the re-export of banned apples from Poland.

"We have to introduce a prior notice procedure in respect of apple deliveries from Serbia. Products will not be authorized to cross the border without inspection," the head of Rosselkhoznadzor Sergei Dankvert said on Thursday, TASS reports. The tougher measures are related to a “large-scale falsification of Serbian quality certificates”. “We checked 33 Serbian apple certificates and only one of them was authentic,” Dankvert said. The limit on apple supplies will come into force on Friday.

Russia became concerned last month after a significant increase in apples coming from Serbia, and suspected the fruit could have been re-exported from Poland, which is currently under a food embargo.

This brief article was posted on the Russia Today website at 12:50 p.m. yesterday afternoon Moscow time---and the stories from Roy S. just keep on coming.

Read more...

Russia Central Bank Cuts Key Rate by 150 bps to 12.50% Citing Risk of "Considerable Economy Cooling"

The days when Russia scrambled to prevent the plunge in its currency in December of 2014, pushing its interest rate to an eye watering 17%, are now a distant memory: moments ago, the CBR announced that following the most recent cut from 15% to 14% on March 13, it once again cut rates by a greater than consensus 150 bps, to 12.50%. The majority of analysts, or 25 of 40, had expected a cut to only 13.00%.

The reason for the bigger than expected cut: "lower inflation risks and persistent risks of considerable economy cooling. Amid ruble appreciation and significant contraction in consumer demand in February-April 2015, monthly consumer price growth declines and annual inflation tends to stabilise."

The immediate reaction has seen the USD/RUB retrace some of its losses suffered earlier today.

This news story is another Zero Hedge offering.  This one appeared on their website at 6:43 a.m. yesterday morning---and it's the second contribution of the day from reader M.A.

Read more...

Russia Outplays the West

Regular readers of Russia Insider will know that since we began publication we have consistently made two claims:

The first is that in the Ukrainian conflict Russia holds all the cards.  

Ukraine’s economy is so interconnected with Russia’s that Ukraine cannot function economically without Russia, while the exceptionally tight links between Ukraine and Russia mean that any attempt to distance Ukraine from Russia is certain to fail.

Our second claim is that the West misunderstands and has gravely underestimated Russian society and Russia’s economy.  

We refused to buy the crisis talk so widely current at the end of last year. On the contrary we said the ruble was being oversold, that claims Russia would default or that its economy was in meltdown were nonsense, and that the devaluation of the ruble was ultimately good for Russia.

More and more people are gradually coming round to these views.  The latest article by Leonid Bershidsky for Bloomberg (“Putin Needs Neither War Nor Peace in Ukraine”, Bloomberg, 29th April 2015) is a case in point.

This russia-insider.com story falls into the absolute must read category for any serious student of the New Great Game.  It showed up there at around 2 p.m. Moscow time on their Thursday afternoon---and it's the third and final offering of the day from reader M.A.

Read more...

Saudi Arabia Is Burning Through Its Foreign Reserves at a Record Pace

Saudi Arabia is burning through foreign reserves at a record pace as the largesse of the new king and regional turmoil ratchet up pressure on public finances already hurt by the oil price slump.

The kingdom spent $36 billion of the central bank’s net foreign assets -- about 5 percent of the total -- in February and March, the biggest two-month drop on record, data released this week show. The fall was in part due to King Salman’s order to give government employees and pensioners a two-month bonus after he ascended to the throne of the world’s biggest oil exporter in January.

The early months of Salman’s rule also saw a sharpening of the country’s rivalry with Iran -- most strikingly over the Saudi-led air offensive in Yemen -- and mounting security threats at home, challenges that had already led to a surge in military spending in 2014. The 48 percent drop in oil prices last year has prompted the government to use reserves and borrow from domestic banks to maintain spending on wages and investments.

“This is going to be an exceptional year in terms of the drop in reserves,” Monica Malik, chief economist at Abu Dhabi Commercial Bank PSJC, said in an interview in Dubai on Thursday. “Even if oil stabilizes between $70 to $80 a barrel next year, there has to be some rationalization of spending objectives to limit a further deterioration in the fiscal position.”

This worthwhile article appeared on the Bloomberg Internet site at 6:41 a.m. Denver time Wednesday morning---and once again I thank Roy Stephens for sending it along.

Read more...

With Saudi Arabia Faltering in Yemen, Power in the Region Has Begun To Swing East

Saudi Arabia has announced the end to its campaign in Yemen, but nevertheless air attacks against Ansar Allah and former President Saleh-allied components of the Yemeni army still continue -- albeit on a lesser scale. A Saudi newspaper (without any trace of irony) has announced "mission accomplished." So what is afoot, here?

We do not know the full story, but already it is plain that a major diplomatic effort has induced Saudi Arabia to cut its immediate losses in Yemen. These immediate losses include the images of civilian bomb casualties widely broadcast in the region and the erosion of any residual support for former President Hadi in Yemen, the failure to put together the much-touted Sunni intervention force and the glaring evidence that while Saudi Arabia may have had an objective (restoration to power of the former President), it had no plan for accomplishing it.

As a consequence, Saudi Arabia has found itself isolated. While Iran, Oman and Russia have been busy working on a political initiative (while also seeking to restrain Ansar Allah on the ground), the U.S. has been quietly discouraging the Saudis from continuing the Saudi aerial campaign. The campaign has had little impact on the Ansar Allah-Saleh military effectiveness but has made life hell for most urban Yemenis, with estimates of 1,000+ dead and thousands more injured.

This article, filed from Beirut, showed up on the huffingtonpost.com Internet site very early Wednesday afternoon EDT---and is definitely worth reading if you have the interest.  I thank International Man senior editor Nick Giambruno for bringing it to my attention---and now to yours.

Read more...

Taliban Gains Pull U.S. Units Back Into Fight in Afghanistan

Months after President Obama formally declared that the United States’ long war against the Taliban was over in Afghanistan, the American military is regularly conducting airstrikes against low-level insurgent forces and sending Special Operations troops directly into harm’s way under the guise of “training and advising.”

In justifying the continued presence of the American forces in Afghanistan, administration officials have insisted that the troops’ role is relegated to counter-terrorism, defined as tracking down the remnants of Al Qaeda and other global terrorist groups, and training and advising the Afghan security forces who have assumed the bulk of the fight.

In public, officials have emphasized that the Taliban are not being targeted unless it is for “force protection” — where the insurgents were immediately threatening American forces.

But interviews with American and Western officials in Kabul and Washington offer a picture of a more aggressive range of military operations against the Taliban in recent months, as the insurgents have continued to make gains against struggling government forces.

This longish article, filed from Kabul, Afghanistan, was posted on The New York Times website on Wednesday sometime---and is another one of these news items that's definitely worth reading if you have the interest.  I thank Roy Stephens for sending it our way.

Read more...

CME Group suspends two gold traders for 60 days for spoofing

CME Group Inc. on Thursday barred two traders from its markets for allegedly colluding to enter orders repeatedly with no intention of trading, a strategy that has been fingered as a key contributor to the 2010 Wall Street flash crash.

Heet Khara and Nasim Salim, both traders of CME Group's gold and silver futures contracts on its Comex exchange in New York, are prohibited from trading for 60 days, according to a disciplinary notice released by the futures exchange giant.

Each trader, the notice said, "entered orders or layered multiple orders to encourage market participants to trade opposite his smaller orders resting on the opposite side of the book. ... After receiving a fill on his smaller orders," each trader "would then cancel the resting order or layered multiple orders that he had entered on the opposite side of the order book."

The CME's action is notable for its swiftness. The activity at issue began in February and last took place on Tuesday, CME Group said. Most CME disciplinary actions are carried out after years of investigations.

One has to wonder why the CME Group has any traders at all in any market.  But since they obviously do, you have to wonder what their real purpose is.  I'm sure there's more to this story than meets the eye.  This Reuters article, filed from San Francisco of all places, appeared on their website at 7:00 p.m. yesterday evening EDT---and I found it embedded in a GATA release.

Read more...

Central banks consider joining the LBMA -- So much for transparency

Central banks have expressed interest in joining the London Bullion Market Association, which pretty much runs the London gold market, according to a report by the LBMA's chief executive officer in the May edition of its newsletter, The Alchemist.

Summarizing developments with the association's membership committee, LBMA Chief Executive Ruth Crowell writes: "The committee continues to review a growing number of membership applications, which demonstrates the growing relevancy and diversity of the association. Two new mining companies have joined the ranks of the association. The LBMA welcomes other producers to join and have a voice in the London market. Another demonstration of the diverse reach of the association is the recent interest expressed by some central banks."

Just what we need.  This article, plus some associated links, is something that was posted on the gata.org Internet site yesterday---and it's definitely worth reading.

Read more...

Silver set for longest slump in 24 years – CPM Group

Silver prices on average will decline for a fourth straight year as supplies grow and investors continue moving their money away from commodities, according to CPM Group.

The metal averaged $16.93 an ounce since the end of December, compared with $19.09 in 2014, CPM said in its “Silver Yearbook 2015.” The price hasn’t declined for four straight years since 1991, according to data from CPM, which didn’t forecast an average price for 2015.

Investors soured on silver and other commodities last year, as production outstripped demand for many raw materials and the dollar rallied amid concern that the Federal Reserve will raise U.S. interest rates. Net investment demand in silver is forecast to drop to 102.9 million ounces this year, after declining 13 percent to 131.6 million ounces in 2014, CPM said in a statement. Mine output will climb 1.1%.

What a crock!  CPM Group, like GFMS and the World Gold Council, will do everything possible to keep the prices of the precious metals in check, including outright lying, which GFMS did on Wednesday---and CPM Group did on Thursday.  We all know why precious metal prices are in the dumpster---and it doesn't have anything to do with what these organizations espouse.  This Bloomberg article found a home over at the mineweb.com Internet site late yesterday morning London time.  Roy Stephens, who sent me this silver-related "story" said that "These guys should crawl back under their rock."  I agree.

Read more...

Yuan/Dollar unpegging to SDR to PBOC’s Gold: The relationships are becoming interesting -- Lawrence Williams

This brings us down to the question as to how important inclusion in the SDR is to China.  Is it sufficiently so for the Chinese to drop the dollar peg and probably allow the yuan to rise  accordingly (much as the Swiss Franc did against the Euro when it dropped its peg to the pan European unit)?  Remember the shock the Swiss decision had on the gold market, albeit a relatively short-lived one.  But the dropping of the Yuan peg to the US Dollar could have far greater ramifications in global financial markets.

This could be further exacerbated by a possible revisiting of the Chinese gold reserve figure.  there has been enormous speculation in the West that Chinese gold reserves are in fact far greater than the 1,054 tonnes it has reported to the IMF for the past six years and that it would further enhance the yuan’s standing if these were shown to be far greater than they appear to be officially now.  Even the more conservative estimates suggest China may announce that its gold reserves are in fact some 2,500 tonnes greater than the currently reported level would suggest, moving it up to second place in global gold holding rankings.  Others suggest the level could even be far higher.

Thus a twin announcement of the unpegging of the yuan to the dollar and a substantial uprating of Chinese gold reserves could give the gold price an enormous fillip – and one which those who appear to have been playing the futures market to keep the gold price under control could not counter – unless of course it is China itself which has been keeping the gold price subdued so it can continue to purchase the yellow metal at low prices!  These theories would seem to have no end!

This commentary by Lawrie appeared on his Internet site on Wednesday---and it too is worth reading.

Read more...

 

¤ The Funnies

What would spring be without cute-as-can-be goslings.  These two fuzz balls are less than a week old---but are already grazing in the grass.  This is a tiny brood for Canada geese---and I couldn't help but wonder what became of the rest.  That's mom in the second photo---and dad in the third.  He was chasing away every other goose away that got even close.  I kept my distance.  All these photos were taken from 8 to 10 meters away.

Avrupa and Antofagasta intersect copper-rich VMS in Pyrite Belt, Portugal

•             First Greenfields discovery of massive sulfide mineralization in 20 years in the Iberian Pyrite Belt

•             10.85 meters of massive and semi-massive/stockwork sulfide mineralization grading 1.81% Cu, 2.57% Pb, 4.38% Zn, 0.13% Sn, and 75.27 ppm Ag

•             Including 7.95 meters @ 2.21% Cu, 3.05% Pb, 4.82% Zn, 0.15% Sn, 89.8 ppm Ag

•             Followed by 2.90 meters @ 0.71% Cu, 1.27% Pb, 3.17% Zn, 0.092% Sn, 35.4 ppm Ag

•             Avrupa and Antofagasta sign an amended Joint Venture Agreement

Please visit our website to learn more about the company and current exploration program.

 

¤ The Wrap

Even though I am the fountain source of the JPM physical silver accumulation premise, I also recognize that doesn’t confer on me the divine light of prophecy in this matter. On the other hand, 30 years ago, when I first uncovered the COMEX silver scam and how the concentrated short position explained the ultra-depressed price, one of my very first thoughts was to imagine what the price of silver would be if the COMEX commercial crooks could ever assemble as large a long position as their concentrated short position. (Why not $1,000 an ounce I asked myself).

As it turns out, the concentrated short position of the 8 largest shorts (including JPMorgan) is just as large as it has always been - more than 320 million oz in the latest COT report, of which JPM holds maybe 75 million oz by my calculations (next week’s Bank Participation Report will help clarify this).   What’s different at this point, of course, is if JPMorgan holds the 350 million physical silver ounces I claim, that’s a completely different circumstance from what existed in the past. The other 7 big shorts might turn out to be in a world of hurt should silver prices explode forthwith, but not JPM. One thought I can’t shake is that historic price moves in anything generally entail big winners and losers, along with a certain amount of double crossing at the highest levels. That setup certainly exists in silver currently. - Silver analyst Ted Butler: 29 April 2015

Well, there was no salami slicing yesterday, as JPMorgan et al put away the carving knives---and took out the axes.  And with the thinnest cover story imaginable, jobless claims, they did the dirty in spectacular fashion, starting at 8:30 a.m. EDT.  No subtly here, as this was as in your face as you'll ever see.

In one fell swoop they undid all the Commitment of Traders damage that occurred on Monday and Tuesday---and put the numbers back pretty much where they were at the close of trading last Friday.  The HFT boyz spun their algorithms and as the key moving averages were hit---50 and 20-day---the brain dead technical funds in the Managed Money category sold longs---and went short.  It was all paper trading on the COMEX---and the fact that JPMorgan et al were all done to the downside by the London p.m. gold fix, makes it doubly damning.

And you have to wonder what the rush is that they're making no attempt to hide their tracks.

Here are the 6-month charts for all four precious metals courtesy of stockcharts.com---and it's a whole new ball game, as we're pretty much back to wildly bullish in silver---and more or less the same in gold.

And as I write this paragraph, the London open is less than five minutes away.  All four precious metals aren't doing much from a price perspective.  Two are up a hair---and two are down the same amount.  Gold volume is vanishingly small at 8,500 contracts---and silver's net volume is 1,860 contracts.  There's not a thing going on out there---and there isn't an HFT trader or algorithm in sight.  The dollar index barely moved in Far East trading on their Friday---and is currently up 3 basis points.

One casualty of yesterday's drive-by shooting is today's Commitment of Traders Report, as it's a certainty that the data in it is already yesterday's news.  I'll report on it tomorrow, but after Thursday's price action, it's basically irrelevant, unless it contains some sort of hidden surprise.

While on the subject of drive-by shootings, today is the fourth anniversary of JPMorgan et al's drive-by shooting on May 1, 2011 that started this 4-year price decline---and enabled JPMorgan to amass such a huge holding of physical silver.  That's why that CPM Group article about silver in the Critical Reads section above is such bulls hit---and anyone that knows anything about the silver market, including the miners, knows it is as well.  But they're all pretending that this 800-pound gorilla just doesn't exist.

And as I send today's offering into cyberspace at 5:15 a.m. EDT, I note that not much has changed since I reported on things a bit more than two hours ago.  With the exception of silver, which is up a whole 6 cents at the moment, the other three precious metals are a tad lower than they were earlier.

Gold volume is now up to 14,000 contracts net---and silver's net volume is now a hair over 3,800 contracts.  Still pretty light.

The dollar index rolled over---and at one point was down 25 basis points, but has cut the loss in half and is only down 14 at the moment.

The HFT boyz ended April on an ugly note---and I have no idea as to how the first day of trading in the new month will unfold, but it's a near certainty that any price/volume action that matters will occur during the COMEX trading session.

Is there more room to the downside?  Sure, I suppose, but it's not much if there is---and attention should now be turned in the direction of how the next rally will unfold, or be allowed to unfold.  The last one that started on Monday---and made it part way through Wednesday, got dealt with in the same old way, as JPMorgan et al appeared as sellers of last resort once again---and it remains to be seen if the next rally suffers the same fate.

So we wait some more.

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

I'm off to bed.

Ed Steer