Gold & Silver Daily

¤ Yesterday In Gold & Silver

Gold hit its Far East low at 10 a.m. Hong Kong time---and then rallied about fifteen bucks by shortly after 3 p.m. local time, which was just after 7 a.m. in London.  The usual suspects showed up at that point---and the low tick of the day came at 12:45 p.m. EDT in New York.  The price rallied a bit until a few minutes after the COMEX close---and then developed a slightly negative bias for the remainder of the electronic trading session.

The high and lows were reported as $1,165.70 and $1,147.50 in the April contract.

Gold closed yesterday at $1,152.70 spot, down $1.20 from Wednesday's close.  Gross volume was just under 199,000 contracts, but it netted out to only 120,000---as roll-overs out of the April contract start to predominate volume.  Almost a third of Thursday's volume occurred during the afternoon rally in Hong Kong.

Here's the 5-minute tick gold chart courtesy of Brad Robertson.  The early afternoon Far East rally is obvious, as was the selling pressure that followed.  The Thursday session began at 6:00 p.m. EDT, which shows as 16:00 MDT on this chart, as it's scaled for Denver time.  Add two hours for New York.  The 'click to enlarge' feature is a must.

Silver followed an identical price pattern as the gold price, complete with the rally in afternoon trading in Hong Kong---and also with the 12:45 p.m. New York low.  Like gold, silver rallied until a few minutes after the COMEX close---and then traded flat until electronic trading ended at 5:15 p.m. EDT.

The high and low were recorded by the CME Group as $15.685 and $15.385 in the May contract.

Silver was allowed to finish in the plus column at $15.555 spot, up a whole 9 cents on the day.  Net volume was rather unimpressive at 23,000 contracts.

Platinum and palladium had mini, but somewhat distorted, versions of the gold and silver price charts, with the highs and lows about the same time.  Platinum closed down a buck---and palladium finished up two dollars.  Here are the charts.

The dollar index closed late on Wednesday afternoon in New York at 99.68---and then traded flat until 9:00 a.m. on the button in the Hong Kong market.  From there it rallied to its 100.60 high tick, which came just minutes before noon over there.  Then it rolled over hard, but got saved by "gentle hands" the moment trading began in London at 8:00 a.m. GMT.  This reprieve lasted exactly one hour before it headed lower once again, with the 98.65 low tick coming at 8:30 a.m. in New York.  It 'rallied' almost 75 basis points going into the London p.m. gold fix ninety minutes later---and then chopped sideways into the close.  The index finished the Thursday session at 99.27---which was down 41 basis points on the day.

It should be obvious to all and sundry that if left to its own devices, the dollar index would have finished materially lower.  But as you already know, "gentle hands" are everywhere these days---except in commodities.

The gold stocks opened in the green, but headed into the red immediately, with their low coming at 12:45 p.m., which was gold's low tick.  They tried valiantly to rally as the trading day wore on from there, but just couldn't squeeze a positive close, as the HUI finished down 0.89 percent.

The silver equities did somewhat better, but as you can tell, they followed a very similar path to the gold equities---and why shouldn't they, as they were trading in lock stop with their respective precious metal prices, and they were trading in lock step with each other---almost to the tick.  Nick Laird's Intraday Silver Sentiment Index eked out a small gain of  0.56 percent.

The CME Daily Delivery Report showed that zero gold and 35 silver contracts were posted for delivery within the COMEX-approved depositories on Monday.   The largest short/issuer was JPMorgan out of its client account---and it should come as no surprise that they were also the biggest long/stopper in their in-house [proprietary] trading account, with 24 contracts.  This is at least the second time during the March delivery month that they've stuck it to their own clients for the benefit of the company. The link to yesterday's Issuers and Stoppers Report is here.

The CME Preliminary Report for the Thursday trading session showed that March open interest was unchanged from Wednesday at 130 contracts.  In silver, o.i. increased by 4 contracts---and March open interest is now at 844 contracts, minus the 35 posted for delivery on Monday.

There was a withdrawal from GLD yesterday, but it wasn't overly large, as an authorized participant took out 67,186 troy ounces.  And as of 9:18 p.m. EDT yesterday evening, there were no reported changes in SLV.

Joshua Gibbons, the "Guru of the SLV Bar List," updated his website with the weekly goings-on in SLV warehouse stocks that were posted on the Internet site as of the close of business on Wednesday---and here is what he had to say:  "Analysis of the 11 March 2015 bar list, and comparison to the previous week's list:  1,339,404.2 troy ounces were added (all to Brinks London), no bars were removed or had serial number changes."

"The bars added were from: Kazakhmys (0.4M oz), Uralelectromed (0.4M oz), Shui Kou Shan (0.2M oz), Krasnoyarsk (0.2M oz) and 6 others."

"As of the time that the bar list was produced, it was overallocated 101.3 ounces---and all daily changes are reflected on the bar list."

There was another tiny sales report from the U.S. Mint.  They sold another 2,500 gold eagles---and that was all.

There wasn't much in the way of gold activity at the COMEX-approved depositories on Wednesday.  Nothing was reported received---and 32,246.450 troy ounces were shipped out---which works out to 1,003 kilobars, a thousand of which came out of the vaults of Canada's Scotiabank.  The link to that activity is here.

There was no silver reported received---and only 260,495 troy ounces were shipped out.  The link to that action is here.

At the moment, I have a reasonable number of stories.  But I've discovered that the number slowly gets larger as the evening progresses.


¤ Critical Reads

Retail Sales Crumble, Suffer Worst Run Since Lehman

Earlier today we warned readers that based on actual credit card spending data, today's retail sales data would continue the worst trend since Lehman...

... and sure enough that's what happened: moments ago the Commerce department reported that in February, retail sales missed once again and missed big and across the board, the third big miss in a row, with the headline print coming at -0.6%, far below the 0.3% expected, and in line with the -0.8% drop last month. Putting the headline numbers in context: December -0.9%, January -0.8%, February -0.6%. Surely a great time for the Fed to hike.

Excluding the volatile autos and gas, sales dropped once again, sliding -0.2%, below the 0.3% expected - in fact below the lowest estimate - and worse even than last month's downward revised -0.1% decline. And with that the worst run in retail sales since Lehman is now in the record books.

This Zero Hedge article appeared on their website at 8:55 a.m. EDT yesterday morning---and today's first story is courtesy of reader M.A.


Q1 U.S. GDP Expectations Are Crashing

Despite the continuing commentary that all is well in America, economic growth expectations for Q1 just collapsed to a new cycle low. From just 4 months ago, growth expectations have been cut 20% to 2.4%... but that is still four times The Atlanta Fed's dismal 0.6% forecast...

The GDPNow model forecast for real GDP growth (seasonally adjusted annual rate) in the first quarter of 2015 was 0.6 percent on March 12, down from 1.2 percent on March 6. The Nowcast for first-quarter real consumption growth fell from 2.9 percent to 2.2 percent following this morning's retail sales release from the U.S. Census Bureau.

This brief Zero Hedge article from 2:19 p.m. EDT on Thursday afternoon represents the first offering of the day from Dan Lazicki.


U.S. Budget Deficit Totals $192.3 Billion in February

The federal government ran a slightly smaller deficit in February than a year ago but the imbalance through the first five months of the budget year is still running ahead of last year.

The Treasury Department reported Thursday that the deficit in February was $192.3 billion, down from a deficit of $193.5 billion a year ago. For the first five months of this budget year, the deficit totals $386.5 billion, up 2.7 percent from a deficit of $376.4 billion during the first five months of the 2014 budget year.

For the entire budget year, which ends Sept. 30, the Congressional Budget Office is forecasting a deficit of $486 billion, up 0.6 percent from the 2014 deficit of $483.4 billion. The 2014 deficit was the smallest annual imbalance in six years.

This AP article, filed from Washington, was posted on the Internet site at 5:38 p.m. EDT yesterday afternoon---and I thank West Virginia reader Elliot Simon for his first contribution to today's column.


The Richest Have Never Been Richer: U.S. Household Assets Rise To Record $97 Trillion (As The Poor Get Poorer)

In the quarter ended September 30, 2014, household net worth did something it hasn't done since 2011: it declined, as a result of the dip in the stock market which pushed financial assets lower by $200 billion. Well, since then ECB announced and then launched Q€, not to mention the expanded BoJ QE in November, and predictably financial assets rose.

Which means that in the fourth quarter, US household net worth jumped by $1.5 trillion to $82.9 trillion, driven by a rise in total assets to $97.1 trillion, even as the long awaited increase in "good debt", that of mortgage debt, remains elusive and Mortgage debt hasn't budged from $9.4 trillion in 8 quarters! This, even as the total US housing market is said to have kept rising, which can only mean one thing (a thing we have explained many times in the past): the bulk of home purchases in the U.S. take place "all cash" with zero incremental leverage (whether because the potential buyers don't want to incur the debt, or don't quality).

But the biggest jump in Q4 assets was once again in financial assets, driven by a $492 billion increase in Corporate Equities as well as $323 billion added from Pension Funds. And as usual, financial assets remained at precisely 70% of total assets (a curious ceiling which we will discuss shortly).

In short: almost $100 trillion in household assets, with the vast bulk of these belonging to America's "1%".

This is another Zero Hedge story from yesterday.  It appeared on their website at 2:35 p.m. EDT yesterday afternoon---and I thank Dan Lazicki once again.


April WTI Crude Futures Plunge to $46 Handle as Contango Soars

Front-month crude oil futures just plunged to new 6-week lows and a $46 handle. The April-May (J-K) spread has soared... no immediate catalyst for this move so we suspect it is Oil ETF and futures-roll-driven flow.

This tiny story, with two excellent charts, is also from the Zero Hedge website---and the offerings from Dan L. just keep on coming.


The U.S. Has Too Much Oil and Nowhere to Put It

Seven months ago the giant tanks in Cushing, Okla., the largest crude oil storage hub in North America, were three-quarters empty. After spending the last few years brimming with light, sweet crude unlocked by the shale drilling revolution, the tanks held just less than 18 million barrels by late July, down from a high of 52 million in early 2013. New pipelines to refineries along the Gulf Coast had drained Cushing of more than 30 million barrels in less than a year.

As quickly as it emptied out, Cushing has filled back up again. Since October, the amount of oil stored there has almost tripled, to more than 51 million barrels. As oil prices have crashed, from more than $100 a barrel last summer to below $50 now, big trading companies are storing their crude in hopes of selling it for higher prices down the road. With U.S. production continuing to expand, that’s led to the fastest increase in U.S. oil inventories on record. For most of this year, the U.S. has added almost 1 million barrels a day to its stash of crude supplies. As of March 11, nationwide stocks were at 449 million barrels, by far the most ever.

This very interesting story, which I think is worth reading, showed up on the Bloomberg Internet site at 3:00 a.m. MDT on Thursday morning---and I thank Elliot Simon for sending it our way.


Dollar Retreats From 12-Year High on Fed Rate Resolve Questions

After pushing the dollar to its strongest level in 12 years, the bulls are in retreat. At least for now.

A gauge of the dollar weakened for the first time in seven days as investors assess how the Federal Reserve may adjust the timing of an interest-rate increase when the central bank’s policy committee meets next week. The U.S. currency extended losses after a report showed retail sales unexpectedly dropped last month.

“The U.S. dollar has overshot,” Mark McCormick, a foreign-exchange strategist at Credit Agricole SA in New York, said by e-mail. The currency fell because of “weaker data, stretched positioning and rich valuation,” he said.

This Bloomberg article, filed from New York, showed up on their Internet site at 1:40 a.m. Denver time on their Thursday morning---and it's another contribution from Dan Lazicki.


Kaspersky claims to have found NSA's 'space station malware'

Kaspersky malware probers have uncovered a new 'operating system'-like platform that was developed and used by the National Security Agency (NSA) in its Equation spying arsenal.

The EquationDrug or Equestre platform is used to deploy 116 modules to target computers that can siphon data and spy on victims.

"It's important to note that EquationDrug is not just a trojan, but a full espionage platform, which includes a framework for conducting cyberespionage activities by deploying specific modules on the machines of selected victims," Kaspersky researchers say in a report.

"Other threat actors known to use such sophisticated platforms include Regin and Epic Turla.

This article showed up on Internet site at 8:28 a.m. GMT on Wednesday morning---and it's another contribution from reader M.A.


Hawai'i record cold spell could continue

Record-breaking cold weather could continue Tuesday night as cool north winds and dry conditions over Oahu and Kauai brought temperatures in the 50s overnight.

The low temperature of 58 degrees at the Honolulu Airport likely broke the previous record for the date of 59 degrees set in 1974. Lihue Airport's low of 57 degrees tied the record set in 1962. The numbers won't become official until they are verified later Tuesday afternoon.

Monday's low of 61 degrees tied a record set in 1981 at the Honolulu Airport.

Maureen Ballard, a meteorologist with the National Weather Service in Honolulu said temperatures could tie or set records again Tuesday night.

Amazing, to say the least.  Where's Al Gore when you need him? This very interesting news item appeared on the website at 1:22 p.m. Hawai'i Standard Time on Monday---and it's the second offering of the day from reader M.A.


Eastern, High Arctic regain sea ice during cold winter

While sea ice around the globe nears record lows, the frozen ocean water in the Eastern and High Arctic has regained coverage and thickness at near-normal levels, thanks to one of the coldest winters in decades.

Canadian researchers recently back from an expedition to the High Arctic, north of Labrador, said the sea ice has returned to a thickness of nearly 3.5 feet in most areas.

"The ice has been quite thick according to the local hunters," team leader Christian Haas, the Canada Research Chair in Arctic sea ice geophysics, told CBC News. "It's quite remarkable given that a few years ago, people broke through the ice because it was so thin."

The gain in coverage and thickness is likely the result of a very cold winter. Air temperatures in these parts of the Arctic during January and February were the lowest they've been on more than 22 years.

I spent seven years in this part of the world---and lake and sea ice thickness can be highly variable year to year.  I drilled enough holes in both kinds back in the late 1960s and early 1970s to know from personal experience.  This UPI news item, filed from Boulder, Colorado, showed up on their Internet site at 10:33 a.m. EDT on Wednesday morning---and I was saving it for the weekend, but thought it fit in rather nicely with the Hawai'ian weather story above.


Iceland announces dropping bid to join E.U.

Iceland has dropped its bid to join the European Union, the Foreign Ministry in Reykjavik says. The announcement follows pledges made by the country’s euro-skeptic government since winning the 2013 election.

Gunnar Bragi Sveinsson, the Icelandic foreign minister, said in a statement that he had informed Latvia, the current E.U. president, and the European Commission that his center-right government had decided to withdraw its application, which was submitted six years ago.

The E.U. and Iceland have discussed the country’s position on the status of its bid to join the European Union,” the statement reads. “The government does not intend to resume preparing for EU membership.”

This news story showed up on the Russia Today Internet site at 7:12 p.m. Moscow time on their Thursday evening---and I thank Roy Stephens for sliding it into my in-box just after midnight Denver time.


Global finance faces $9 trillion stress test as dollar soars -- Ambrose Evans-Pritchard

Sitting on the desks of central bank governors and regulators across the world is a scholarly report that spells out the vertiginous scale of global debt in U.S. dollars, and gently hints at the horrors in store as the U.S. Federal Reserve turns off the liquidity spigot.

This dry paper is the talk of the hedge fund village in Mayfair, and the stuff of nightmares for those in Singapore or Hong Kong already caught on the wrong side of the biggest currency margin call in financial history. "Everybody is reading it," said one ex-veteran from the New York Fed.

The report - "Global dollar credit: links to U.S. monetary policy and leverage" - was first published by the Bank for International Settlements in January, but its biting relevance is growing by the day.

It shows how the Fed's zero rates and quantitative easing flooded the emerging world with dollar liquidity in the boom years, overwhelming all defences.

This must read commentary by Ambrose was posted on the Internet site at 9:29 p.m. GMT on Wednesday evening---and I found it embedded in a GATA release.


Albert Edwards' "WOW!" Chart, or Why "Draghi Makes Greenspan Look Like a Rank Amateur"

Back in January, when European stocks were only starting their unprecedented QE ramp, we presented the "Driver Behind The European Stock Surge" in which we showed that ever since Mario Draghi's "whatever it takes" speech in July 2012, European equity prices were up 50% (even higher now) even as corporate earnings had actually declined by 7%.

It is a take on the chart above that has sent Albert Edwards over the edge once again, and in his latest letter he presents another way of visualizing the data above, with the help of what he dubs the "WOW!" chart.

Edwards begins with the standard, and well-deserved, rant against central bankers who now merely need - and create - ever greater bubbles in hopes of preserving a system, which can no longer function away from a "bubble" state.

We have long fulminated against strategists who are unwilling to predict sharp market moves. The violent down move in the euro over the last few weeks is a case in point. Mario Draghi and the ECB’s manipulation of asset prices makes Greenspan’s Fed look like a rank amateur. More shocking though than the plunge in the euro, and more shocking even that 25% of sovereign eurozone bonds now trade in negative territory, is what has happened to eurozone equity valuations. For, as we approach the sixth anniversary of the U.S. cyclical bull market (a post-war record), the PE expansion of eurozone equities is simply off the scale. History suggests this will end very badly indeed. Ask Alan!

This very worthwhile commentary put in an appearance on the Zero Hedge website at 1:24 p.m. EDT on Thursday afternoon---and it's courtesy of Dan Lazicki.


Commerzbank Paying $1.45B to Settle Cases on U.S. Sanctions

Germany's Commerzbank AG is paying $1.45 billion in agreements with U.S. and New York authorities for alleged violations of U.S. sanctions against countries including Iran and lapses in prevention of money laundering.

Commerzbank will avoid criminal prosecution by the U.S. Justice Department and the New York City district attorney's office under the agreements announced Thursday. In return, the bank admits responsibility for the violations and promised to establish strict internal controls.

The total $1.45 billion in fines is close to the landmark $1.9 billion settlement by HSBC, Europe's largest bank, of similar allegations in 2012.

Last year France's largest bank, BNP Paribas, agreed to pay nearly $9 billion and pleaded guilty to federal and New York state charges of processing transactions for clients in countries under U.S. sanctions.

This is another UPI story that was picked up by the Internet site.  This one was filed from Washington at 7:02 p.m. EDT last night---and it's courtesy of Elliot Simon once again.


Germans Furious After Varoufakis/Tsipras Admit "Greece Will Never Repay Its Debts"

The Greco-Germanic war of words continues... Having pissed off The Greeks with his "Troika" remarks, Germany's Schaeuble went on today to more ad hominum attacks by reportedly calling the Greek FinMin "foolishly naive." The Greek ambassador has 'officially' complained to "friend and ally" Germany about the personal insult. But The Greeks had the last laugh, as first Varoufakis and then Tsipras explained respectively that "Greece would never pay back its debts," and "Greece cannot pretend its debt burden is sustainable." The German response, via tabloid Bild, "there must be an end to this madness. Europe must not be made to look stupid."

As Bloomberg reports, Germany and Greece confirmed Thursday that the Greek ambassador in Berlin made an official protest late Tuesday to the German Foreign Ministry over comments made by Schaeuble.

Schaeuble and his Greek counterpart Yanis Varoufakis have traded barbs in recent weeks, with Schaeuble on Tuesday suggesting that Varoufakis needed to look more closely at an agreement that Greece signed in February: “He just has to read it. I’m willing to lend him my copy if need be.”

“It was a complaint after what he (Schaeuble) said about Mr. Varoufakis. As a minister of a country that is our friend and our ally, he cannot personally insult a colleague.”

Here's a Zero Hedge story built around a Bloomberg article.  It was posted on their website at 4:59 p.m. on Thursday afternoon EDT---and I thank Dan Lazicki for sharing it with us.


Moscow Wants to Try U.S. General Who Rallied to ‘Kill More Russians’

Russia’s Investigative Committee has launched a criminal case against Robert Scales, a retired U.S. major general and a Fox News military analyst, who said in a live broadcast that the only way for the U.S. to turn the tide in Ukraine is to start killing Russians.

The criminal case is launched under an article on “Public calls for unleashing an aggressive war through the mass media”, according to a statement on the official website of the committee.

The investigators believe that such statements “break not only the norms of the Russian legislation but Article 20 of the International Covenant on Civil and Political Rights of 1966, which prohibits any war propaganda and any instigation of discrimination, enmity or violence.”

This news item appeared on the Internet site at 6:03 p.m. Moscow time on their Thursday evening, which was 11:03 a.m. in Washington.  It's another article that's courtesy of reader M.A.


Rumors of Putin's Illness Run Rife in Russian Media

Speculation about Putin's health flared on Wednesday when news broke that the president had postponed a planned visit to his Kazakh counterpart Nursultan Nazarbayev in Astana.

Announcing the development, Kazakh presidential spokesman Dauren Abayev declined to provide a reason for the delay. But an unidentified Kazakh government source said that “it looks like he [Putin] has fallen ill,” Reuters reported.

The rumor mill quickly exploded, with media reports and Russian citizens alike comparing dates of Putin's recent meetings and deconstructing his schedule, highlighting the extent to which Russia's political system depends on a single man.

The Kremlin promptly denied the rumor.

This very important story appeared on the Internet site around 9 a.m. Moscow time on their Friday morning---and I thank Roy Stephens for sending it to me in the wee hours of this morning.


U.K. seeks to join China-backed Asian infrastructure bank

The U.K. is looking to join China's Asian Infrastructure Investment Bank, becoming the first "major western country" to apply for membership, Chancellor of the Exchequer George Osborne said.

"Joining the AIIB at the founding stage will create an unrivaled opportunity for the U.K. and Asia to invest and grow together," Osborne said in a statement Thursday. The U.K. will hold talks with the China-backed investment bank's founding members later this month, according to the Treasury.

The world's second-largest economy has promoted the creation of the $50 billion Asian regional bank, a potential rival to institutions such as the Asian Development Bank, to help finance construction in the region. The U.S. has stressed that the AIIB needs sound governance and might initially benefit from co-financing projects with established institutions.

I can't imagine that the U.K. wants to get involved out of the goodness of their hearts.  I'm somewhat suspicious of this, but what do I know?  This short Bloomberg article, filed from London, showed up on their Internet site at 11:03 a.m. MDT yesterday morning---and I found it on the website.


CHART: Beijing has finally turned around rare earth prices

China produces nearly 90% of the world's rare earths and its downstream industry consumes 70% of the 17 elements used in a variety of hi-tech industries including renewable energy, medical devices and defence.

Customs data show export volumes grew 27.3% in 2014 to 28,000 tonnes but the average export price of REE products plummeted to only 83,000 yuan ($13,000) per tonne. That's a decrease of 47.8% from the year before and the third year in a row of sharp declines.

Following a World Trade Organization ruling, China is abolishing its decade-old export quota system for rare earths and is due to lift export tariffs of 20%-plus in May.

This liberalization should translate into further price declines, but Beijing has found other ways to tighten its grip on the industry.

This article put in an appearance on the website yesterday sometime---and it's the final offering of the day from reader M.A.


SGE to start fixing gold price denominated in yuan

The Shanghai Gold Exchange will try to start offering the renminbi-denominated gold-fixing price this year, as an alternative to the dollar-denominated gold-fixing in London, a top bourse official said on Wednesday.

SGE head Xu Luode said that the bourse has been researching the pros and cons of the yuan-denominated gold-fixing price, and will strive to launch it by the end of this year as market conditions have laid "foundations" for the new price-fixing.

"The yuan-denominated price for gold will not compete with the current dollar-denominated price. Instead, it will be complementary, offer one more choice, and the yuan-denominated and US dollar-denominated systems can be cross-referenced," said Xu, adding that the yuan-denominated benchmark price will only make gold prices more reasonable. It will also reflect the existing supply and demand situation, as China accounts for about 40 percent of the global physical gold demand.

This is not new news, but it comes from the Chinese side of the equation---and for that reason, it's worth reading.  I thank Hong Kong reader "Graham C" for bringing it to our attention.


Koos Jansen: The Mechanics of the Chinese Gold Market

My previous three posts on the structure of the Chinese gold market I wrote a few years ago---and additional information has been published in little bits and pieces all over my blog. The time has come for another comprehensive and updated post on the basic mechanics of the Chinese gold market.

According to my analysis, the current structure of the Chinese market with the Shanghai Gold Exchange (SGE), launched in 2002, at its core has been designed by China’s central bank, the People’s Bank Of China (PBOC), (i) to manage the amount of gold added to Chinese (non-government) reserves, (ii) to grant all gold added to Chinese (non-government) reserves and traded in the Chinese wholesale market to be of the highest quality, (ii) to provide the Chinese people direct access to the wholesale market.

Sprouted from the centrally minded Chinese authorities, the SGE system was implemented to stimulate the citizenry to buy physical gold and to develop the Chinese gold market in order to support the internationalization of the renminbi.

This longish, but very interesting article, was posted on the Singapore internet site of yesterday---and it's definitely worth reading, although it's a bit involved.  I thank Koos for bringing it to my attention.


Demand for platinum jewellery picking up

India is emerging as an important market for platinum, with the use spreading in both jewellery and industrial use.

In an email interview with this newspaper, Trevor Raymond, director of research at the World Platinum Investment Council (WPIC), said, “India is becoming an increasingly important market for platinum jewellery, one of the two largest sections of platinum demand, comprising 38 per cent of total demand in 2014. Platinum jewellery demand in India rose by an estimated 35 koz (a koz is 1,000 ounces) to 175 koz (5.45 tonnes) during 2014 and we expect this growth trend to continue into 2015.”

Jewellery demand for platinum is largely for designing, Of late, though, platinum jewellery is becoming trendy. India’s platinum jewellery demand for 2015 is expected to go up 15 per cent to 200 koz. The platinum demand is said to be 12-15 tonnes.Platinum Guild India said, quoting DGCIS (Director General Commercial Intelligence and Statistics) data, that platinum imported in various forms towards jewellery in 2014 was 5.7 tonnes.

This platinum-related article appeared on the Internet site at 10:33 p.m. IST on their Thursday evening---and I thank Mumbai-based reader Danny Carroll for sending it our way.


Global platinum shortfall continues for third year running

According to the World Platinum Investment Council’s (WPIC) second ever Platinum Quarterly report, global platinum demand outstripped supply by 700,000 ounces in 2014. This was the third consecutive year-end deficit, which was exacerbated, this time around, by a five-month long platinum belt strike in South Africa, said WPIC CEO Paul Wilson.

“We also looked at a full year forecast for 2015 and, while all the fundamentals are strong, we expect another deficit (235,000 ounces),” said Wilson, adding that the shortage hadn’t been reflected by an inflation in the platinum price because producers had been able to draw on previously built inventories to satisfy some of the demand.

This is illustrated in the report, where above-ground platinum stocks are shown to have been substantially depleted, sitting at 2.76 million ounces and down by a third from 4.16 million ounces in 2012.

I'd love to know where these above-ground platinum stocks this gentleman is referring to are actually located.  He seems to know these reserves down to the ounce, but the big question remains---where are they?  Of course platinum prices, just like gold and silver prices, are going nowhere until JPMorgan et al are told to stand aside.  This interesting article was posted on the Internet site at 3:21 p.m. GMT on their Thursday afternoon---and it's the final offering of the day from Dan Lazicki, for which I thank him.


Very positive on gold but silver the big favourite – Middelkoop

While Middelkoop is very positive on gold for many of the same reasons as are gold bulls everywhere – 90% of world seeing zero interest rates, the largest bond bubble in history, massive global debt etc. – he does draw strongly on Chinese policy, and statements from various Chinese bankers and officials over the past few years to help make his case given China’s huge relevance to gold supply and demand. From these statements he gleans that China has a policy to build its reserves of gold, both directly through so-far under the radar purchases by the Central Bank (or perhaps by other government bodies under whose auspices it can store the gold without feeling it has to report it to the IMF) and also by persuading its citizens to buy the precious metals and thereby build up total Chinese gold volumes.

Talking to Mineweb after his presentation, Middelkoop predicted that China will likely make an announcement on an increase in its gold reserves some time this year at substantially more than the 1,054 tonnes it currently claims to hold – but even then no-one will really know if that is a true statement of  its central bank holdings or not. He sees China, Russia and some other like-thinking nations targeting a de-Americanised world and we are already seeing considerable evidence of this in the beginnings of the internationalisation of the yuan as a trading currency and also in the setting up of alternatives to the SWIFT global financial interbank trading network.

Middelkoop also says he likes drawing on statements from former central bankers like Alan Greenspan who, he says can now tell the truth! Greenspan has made some remarkably positive statements on gold in recent months including that ‘gold is a good place to put money these days given its value as a currency outside of the policies conducted by governments’, noted Middelkoop.

My friend---and huge GATA supporter---Willem Middelkoop.  The last time we spoke was the Vancouver Resource Investment Conference in January 2014.  I wish him well.  The commentary by Lawrie was posted on the Internet site at 2:29 p.m. GMT yesterday afternoon---and it's certainly worth reading.


Gold market sentiment matters no more than technical analysis does

Some gold market analysts are noting that sentiment in the sector has probably never been worse. They construe this as an indicator of a bottom in the metal's price and the price of gold mining shares. But in a market as manipulated as the gold market, sentiment has no more meaning than technical analysis does.

Really, who cares about what is being thought by ordinary investors, who may be able to deploy a few billion dollars in the gold market, when central banks have infinite money to deploy and acknowledge that they are trading the gold market nearly every day? And central banks are not trading just the metal itself but also futures, options, and derivatives, by which they can leverage their trading to infinity.

In the face of the infinite money deployed against them, the sentiment of gold market investors could be entirely positive or negative and it wouldn't mean anything. In the gold market right now the only sentiment that matters is that of the biggest traders, central banks.

These days no gold market analysis is worth anything unless it starts with questions like the following or is underlain by premises arising from these questions:  Are central banks active in the gold market or not?

This absolute must read commentary by Chris Powell, filed from Ho Chi Minh City, appeared on the Internet site at at 2:07 p.m. ICT [Indochina Time] on their Friday afternoon.


Very Rare Ancient Coins Rediscovered In University Library

If you have ever needed proof that gold and silver has always been a store of value then you should take a class at the University of Buffalo (UB).

On Wednesday, the university announced what they have dubbed “the discovery of the century” as a collection of 55 ancient Greek and Roman coins were unearthed from its library archives.

The rediscovery was made by Philip Kiernan, an assistant professor at UB.  In an interview with Kitco News, Kiernan said the collection hasn’t been touched for decades. When he was first researching the existence of the coins, Kiernan said that he wasn’t expecting see an extensive collection maybe “one or two coins and some replicas.”

“I was so struck by the collection… we had coins from the most important Greek city states. The kind of coins you see in the text books,” he said. “They were never lost but they appear to have been forgotten about.”

This interesting story appeared on the Internet site at 10:54 a.m. EST on Thursday---and today's last gold-related story is courtesy of Elliot Simon.



¤ The Funnies

Here are the last five shots from in and around Jerome.  As you can tell, I was quite taken by the place---and would have spent lots more time there if I'd been able. Except for some of the upscale art shops, the place looks at least a hundred years old in every respect---and even more incredible in the fact that it's built on the side of a hill at altitude.  Don't forget the 'click to enlarge' for these photos.

Uranium Energy Corp. (NYSE MKT: UEC) is pleased to announce that the final authorization has been granted for production at its Goliad ISR Project in South Texas.  As announced in previous press releases, the Company received all of the required authorizations from the Texas Commission on Environmental Quality, including an Aquifer Exemption which has now been granted concurrence from EPA Region 6.

Amir Adnani, President and CEO, stated, “We are very pleased to have received this final authorization for initiating production at Goliad. Our geological and engineering teams have worked diligently toward achieving this major milestone and are to be truly commended. We are grateful to the EPA for its thorough reviews and for issuing this final concurrence. The Company’s near-term plan is to complete construction at the first production area at Goliad and to greatly increase the throughput of uranium at our centralized Hobson processing plant.” Please contact Investor Relations with questions or to request additional information,


¤ The Wrap

When I first uncovered the COMEX silver manipulation, three decades ago, after first petitioning the regulators (the CFTC and the COMEX, I approached the silver miners with my allegations of manipulation since they (and their shareholders) were the obvious victims. While some individuals were supportive, the only company that took a deeper look and engaged me financially was Sunshine Mining, which, unfortunately went bankrupt (not due to silver, but an ill-timed options bet on oil). Aside from Sunshine way back when, why have the silver miners ignored the growing allegations about price manipulation?

I can’t read peoples’ minds and the best I have been able to understand why senior mine management has been so hostile to even engaging in an open debate on an issue that so many have increasingly come to fully accept is based on a few things. One, there is a natural aversion to believing anything bad about someone that you depend upon financially. The banks who have manipulated the price of silver and gold on the COMEX also provide financing and other important services to the miners. Therefore, there is a natural reluctance to accepting outside advice that runs counter to insider influences. Who are you going to side with, someone who controls your financing or some outsider (like me) with no financial connection?

Another factor, related to this, is that most mining CEO’s are, like corporate heads in any industry, take-charge type-A personalities. The head of any enterprise is typically not a shrinking violet and usually possesses some degree of ego. I don’t mean this necessarily as a negative, but typical CEO’s don’t like to be told what to do and certainly don’t like admitting they may have been wrong about anything (I confess to holding similar traits). The upshot is this – because so many mining CEO’s had dismissed allegations of manipulation early on (at the urging of the banks or their agents), they are very reluctant to do so now because that risks the admission of being wrong previously. No matter that the companies and their shareholders are suffering due to the manipulation, apparently ego and not having to admit one might have been wrong is more important. Something is preventing the silver and gold mining company management from addressing the issue of price manipulation and that’s my best guess. - Silver analyst Ted Butler:  11 March 2015

It's hard not to come to the conclusion that the forces that were at work in the gold market on Wednesday were the same forces that were in play yesterday, as the price pattern starting about an hour before the London open was virtually the same for all four precious metals on both days.

Maybe I'm looking for black bears in dark rooms that aren't there, but I don't think so---and you're entirely free to form your own opinion regarding the price action of the last couple of days.

Here are the 6-month charts for all four precious metals once again---and not much has changed since I posted them here on Wednesday, although the RSI for silver has turned up a bit.

I was happy to see that the precious metal equities didn't come under much selling pressure---and more or less followed their respective precious metals around like shadows yesterday.

And as I write this paragraph, the London open is about thirty minutes away.  The gold price rallied about seven bucks in morning trading in Hong Kong on their Friday---and has basically chopped sideways from there.  Ditto for silver.  Platinum and palladium are up more than a few dollars as well.

Net gold volume is sitting right at the 21,000 contract mark---and silver's net volume is a hair under 3,000 contracts.   Virtually all of it is in the current front months for both metals. The dollar index has been rallying rather unsteadily since its 8:30 a.m. EDT low tick on Thursday morning---and is currently up 18 basis points at the moment.

Today we get a very significant Commitment of Traders Report---and hopefully all the damage up to and including Tuesday's cut-off will be in it.  And as I mentioned earlier this week, I'll be on the lookout for anything that doesn't seem right, considering the unexpected, though positive surprise we got in last week's report.  But it's too bad that Wednesday's price action won't be in it, because it appeared that "da boyz" set the low ticks for this move down in both gold and silver on that day.

I noted that there were new lows in both platinum and palladium yesterday, but they weren't material.

And as I fire this out the door at 5:10 a.m. EDT, I note that there's still nothing much going on in all four precious metals, as prices continue to chop sideways.  Volumes are up, of course, but not by a much.  Gold's net volume is just under 25,000 contracts---and silver's net volume is up to 3,900 contracts.  It's very quiet.

The dollar index ran into a bit of a setback around 2:30 p.m. Hong Kong time---and is only up 9 basis points at the moment.  It will be interesting to see how the dollar index trades for the rest of the Friday session, as it sure had help yesterday---and I'll be watching to see if it gets some more of that today.

Today is Friday---and Friday the 13th as well.  I'm not the suspicious type---other than "black bears in dark rooms"---and I'm not sure what to expect during COMEX trading today.

That's all I have for today.  Enjoy your weekend, or what's left it---and I'll see you here tomorrow.

Ed Steer