After not doing much of anything from a price perspective in Far East and early London trading on their Tuesday, gold and silver both rallied sharply sharply starting just before 11 a.m. in London. Within minutes, gold was up 13 dollars, but that was pretty much it for the day. The price dipped a bit during COMEX trading, but then rallied until 11:45 a.m. EDT, before trading sideways for the remainder of the Tuesday session.
The low and high ticks were reported by the CME Group as $1,179.70 and $1,196.30 in the June contract.
Gold finished the trading session in New York yesterday at $1,193.00 spot, up $9.50 from Monday's close. Net volume was light at only 107,000 contracts.
Here's the 5-minute gold tick chart---and you can see that virtually all of the big volume came at the 11 a.m. BST price spike in London, which is 4 a.m. Denver time on this chart---and by 9:45 a.m. MST, most of the price/volume action was done for the day. Midnight EDT is the vertical dark gray line. Add two hours for EDT---and use the 'click to enlarge' feature.
Silver had the same price action as gold on Wednesday, almost to the tick, so nothing more has to be said, except that silver's secondary rally took silver to its high tick of the day, which was 11:45 a.m. in New York, the same as gold.
The low and high ticks in the metal were reported as $16.12 and $16.595 in the July contract.
Silver closed on Tuesday at $16.48 spot, up 20.5 cents on the day. Net volume was 33,500 contracts.
Platinum's price action was the same as gold and silver's price action. The palladium price action was but a shadow the the platinum price activity. Platinum finished the Wednesday session at $1,131 spot, up 7 bucks on the day. Palladium closed at $783---up four dollars.
The dollar index closed late on Monday afternoon in New York at 95.04---and then rallied to its 95.15 high in mid-morning trading in Hong Kong on their Tuesday. From there it began to roll over---and really began to head south with a vengeance starting at the 8:00 a.m. BST London open. The 94.25 low tick came minutes after 11 a.m. in London. From there it chopped unsteadily higher, finishing the Tuesday session at 94.56---down 48 basis points on the day.
And as I said in The Wrap section of Tuesday's column---all the while the dollar index was falling, JPMorgan et al had the precious metals in a vice grip. But the moment that the dollar index turned at 11 a.m. BST, they relaxed their death grip on the precious metals---and it's my guess they all popped in price when they did for that reason.
Here's the 3-day U.S. Dollar index chart showing all of Tuesday's action.
Here's the 6-month USD index chart---and as you can tell, we've had a fairly serious decline in the index since mid-March. Although both crude oil and copper have been allowed to rally substantially during that period, that certainly hasn't been the case for the precious metals---and I'll have more about that in today's edition of The Wrap.
The gold stocks opened in the black---and rallied to their highs of the day about the same time as the gold price peaked out just before noon EDT. After that, they didn't do a lot---and the HUI closed up 1.44 percent.
The silver equities traded on the weaker side---and after a slide into negative territory shortly after the open, they rallied to their highs by around 1:15 p.m. EDT. They chopped a bit lower from there into the close, as Nick Laird's Intraday Silver Sentiment Index closed up only 0.55 percent.
The CME Daily Delivery Report showed that 1 gold and 5 silver contracts were posted for delivery within the COMEX-approved depositories on Thursday. JPMorgan stopped 3 of the silver contracts.
The CME Preliminary Report for the Tuesday trading session showed that gold open interest for May dropped by one contract to 148 still left. Silver's o.i. in May declined by 163 contracts, leaving 411 still open.
There were no changes in GLD yesterday---and as of 9:10 p.m. EDT yesterday evening, there were no reported changes in SLV, either.
There was no sales report from the U.S. Mint.
There was a decent amount of gold received at the COMEX-approved depositories on Monday, as 80,802 troy ounces were taken in---and only 6 kilobars were shipped out. The big 'in' activity was at Canada's Scotiabank and HSBC USA. The link to that action is here.
It was the second big 'in' day in a row for silver, as 1,489,490 troy ounces were reported received---but only 76,176 troy ounces were shipped out. The link to that activity is here---and it's worth a quick look. JPMorgan took in another 600,000 troy ounces.
There was no in/out activity at all over at the gold kilobar depositories in Hong Kong on their Monday.
From feast to famine. I had a lot of stories in my Tuesday column, but I'm happy to report that I have very few today. I'll leave the final edit up to you once again.
A flood of tax payments pushed government receipts to an all-time high in April and left the country with the largest monthly budget surplus in seven years.
In its monthly budget report, the Treasury Department said Tuesday that the April surplus totaled $156.7 billion, up from a surplus of $106.9 billion a year earlier. It was the largest surplus since April 2008.
Government receipts totaled $471.8 billion, the largest monthly total on record.
Receipts for the first seven months of the budget came to $1.89 trillion, the biggest seven-month total ever. Tax receipts have climbed thanks to an improving economy, which has boosted individual and corporate tax payments.
One month of surplus doesn't mean much when the U.S. is running a permanent yearly budget deficit, but it does make for a good headline. This AP article, filed from Washington, was posted on the abcnews.go.com Internet site at 2:27 p.m. EDT Tuesday afternoon---and I thank West Virginia reader Elliot Simon for today's first story.
Both in February and in March, in the aftermath of the total collapse in energy-related jobs in Texas, we had a simple, if recurring, question for the Bureau of Labor "Statistics": Did the BLS Forget to Count Thousands of Energy Job Losses---and did the BLS Again Forget to Count the Tens of Thousands of Energy Job Losses?
The answer was Yes and Yes.
However, we are delighted that in the latest monthly JOLTs report, the BLS has finally noticed the bloodbath for highly-paid energy jobs which, as we showed just last week courtesy of Challenger Gray data, is unprecedented and compares to the devastation in the aftermath of the Lehman collapse.
This short chart-filled commentary was posted on the zerohedge.com Internet site at 10:50 a.m. EDT yesterday morning---and it's worth the trip. I thank reader M.A. for sending it our way.
More than seven years after the financial crisis, Congress is still fretting that some mega-banks might be "too big to fail." On Monday, members of the House Financial Services Committee subpoenaed three federal agencies over lingering questions as to whether regulators went easy on banks deemed to be too large to prosecute.
Citing "extraordinary stonewalling" from the agencies in question, committee Chairman Jeb Hensarling, R-Texas, called for the Department of Justice, New York Federal Reserve Bank and Treasury Department to answer long-standing inquiries over the government's approach to bank prosecutions and other post-crisis decision-making.
At the center of the lawmakers' concerns is the DOJ's settlement with U.K. bank HSBC concerning allegations that the lender failed to prevent its branches from laundering money for Mexican drug cartels and providing financing for state-designated terrorist regimes.
During questioning in 2013 about the DoJ's settlement with HSBC -- which ended up paying $1.9 billion and signing a deferred prosecution agreement -- then-Attorney General Eric Holder told the Senate that some banks might indeed be too big to jail.
This ugly HSBC story just won't die---and rightly so, as HSBC is a criminal organization. This news item showed up on the ibtimes.com Internet site early Monday afternoon EDT---and I thank South African reader B.V. for sharing it with us.
A vibrant, multi-hued painting from Pablo Picasso set a world record for artwork at auction, selling for $179.4 million on Monday, and a sculpture by Alberto Giacometti set a record for most expensive sculpture, at $141.3 million.
Picasso's "Women of Algiers (Version O)" and Giacometti's life-size "Pointing Man" were among dozens of masterpieces from the 20th century Christie's offered in a curated sale titled "Looking Forward to the Past."
Christie's global president, Jussi Pylkkanen, who was the auctioneer, said the two pieces are outstanding works of art.
"I've never worked with two such beautiful objects," he said.
You couldn't make this stuff up. It's insanity. This Associated Press article appeared on their website very late Monday evening---and it's the second offering of the day from reader M.A.
Senate Democrats on Tuesday blocked consideration of giving President Obama power to accelerate a broad trade accord with Asia, a rebuke that the president helped bring on himself.
After more than six years battling Republicans on everything from his signature health care legislation to simply keeping the government open, Mr. Obama is at odds with his own party as he seeks a legislative capstone to his presidency.
But Tuesday’s setback also highlighted a problem that has vexed Mr. Obama for most of his tenure in office: his difficulties with Congress. This time he is criticizing Democrats whose votes he now needs.
The president “has made this more personal than he needed to,” said Senator Sherrod Brown, Democrat of Ohio, after the 52-45 vote.
This very interesting story put in an appearance on The New York Times website on Tuesday---and it's the first offering of the day from Roy Stephens.
The White House scrambled on Monday to counter perceptions that the Saudi king's absence from a summit later this week could undermine U.S. efforts to assure Gulf states it remains committed to their security against Iran.
King Salman's abrupt decision to skip the U.S.-hosted regional talks shows how Gulf rulers, displeased by what they see as U.S. indifference to Iranian meddling in the Arab world, may hesitate to bless any final nuclear deal that President Barack Obama reaches with Tehran.
Some analysts and diplomats in the Middle East and Washington interpreted Salman's decision to stay away from the meeting at the Camp David presidential retreat as a diplomatic snub, despite denials from U.S. and Saudi officials.
Riyadh announced the monarch's no-show on Sunday, only two days after the White House had said he would attend the summit of Gulf Cooperation Council (GCC) states - some of which have long doubted Obama's commitment to confronting Iranian backing of Shi'ite Muslim militias across the region.
Elliot Simon sent us this story---and in his covering e-mail said that it "sounded like damage control" to him---and that's precisely what it is, dear reader. This Reuters story, co-filed from Washington and Riyadh, put in an appearance on that website at 9 p.m. EDT on Monday evening.
The defining events of our time are the collapse of the Soviet Union, 9/11, jobs off-shoring, and financial deregulation. In these events we find the basis of our foreign policy problems and our economic problems.
The United States has always had a good opinion of itself, but with the Soviet collapse self-satisfaction reached new heights. We became the exceptional people, the indispensable people, the country chosen by history to exercise hegemony over the world. This neoconservative doctrine releases the U.S. government from constraints of international law and allows Washington to use coercion against sovereign states in order to remake the world in its own image.
To protect Washington’s unique Uni-power status that resulted from the Soviet collapse, Paul Wolfowitz in 1992 penned what is known as the Wolfowitz Doctrine. This doctrine is the basis for Washington’s foreign policy. The doctrine states:
“Our first objective is to prevent the re-emergence of a new rival, either on the territory of the former Soviet Union or elsewhere, that poses a threat on the order of that posed formerly by the Soviet Union. This is a dominant consideration underlying the new regional defense strategy and requires that we endeavor to prevent any hostile power from dominating a region whose resources would, under consolidated control, be sufficient to generate global power.”
In March of this year the Council on Foreign Relations extended this doctrine to China.
This is the keynote speech that Paul delivered to the Annual Conference of the Financial West Group in New Orleans last Thursday---and it certainly falls into the absolute must read category. I had this commentary on Monday, but it would have got lost in Tuesday's column, so I saved it for today. Brad Robertson was the first person through the door with it.
British P.M. David Cameron has suffered a major blow to one of his biggest election policies in just the first week of his new government, after Germany rejected the idea of making E.U. treaty changes before a British referendum on E.U. membership.
Chancellor and newly appointed First Secretary of State George Osborne, who has been tasked with leading negotiations to try and reform Britain's relationship with the bloc, represented Britain at a meeting of Eurozone finance ministers in Brussels, where a number of issues, including Greece's ongoing debt problems were discussed.
And while Osborne didn't officially bring up the matter of Britain renegotiating the terms of its membership agreement with the E.U., he used the meeting to privately discuss Britain's push to change its agreement with the bloc.
Despite Osborne holding talks with German finance minister Wolfgang Schaeuble, the Germans poured cold water on British hopes of making changes to the E.U. treaty before a British referendum on E.U. membership, to be held before the end of 2017.
This news item was posted on the sputniknews.com Internet site at 7:47 p.m. Moscow time on their Tuesday evening, which was 12:47 p.m. EDT in New York. It's another story that's courtesy of Roy Stephens.
Debt traders suffered another turbulent day of trading on Tuesday, as a global rout in government bonds extended, which some analysts warned might merely be a sign of worse to come.
The prices of government bonds fell across the developed world, including a major German bond sell-off labelled as "large and vicious" by Goldman Sachs analysts.
The yields on 10-year German government notes - which move in the opposite direction to their price - rose by more than 20pc, settling 11pc higher as the day drew to a close.
US Treasuries also rocked back and forth as yields on the bonds climbed by as much as 3.7pc before falling back down to earth, retracing their movements and sliding 2pc below where they began.
This news item put in an appearance on the telegraph.co.uk Internet site at 5:07 p.m. BST yesterday afternoon, which was 12:07 p.m. in New York. It's certainly worth reading.
If there is one thing more faith-in-central-planning-destroying than a drop in equity prices, it is a collapse in bond prices. Last week, when Bunds (and Treasuries) collapsed (with 10Y Bund yields spiking up to 75bps), there was a sudden appearance of a deep-pocketed buyer of last resort that rescued bond yields lower (and squeezed stock prices higher).
Today, after overnight carnage, Bunds (and Treasuries) are once again mysteriously aggressively bid into the U.S. open...
However, it doesn't seem to be having the same effect this time...
This short Zero Hedge article, with a must see chart, showed up on their website at 9:41 a.m. EDT yesterday morning---and it's another contribution from reader M.A.
Germany's BND intelligence agency sends mammoth amounts of phone and text data to the U.S. National Security Agency (NSA) each month, Die Zeit Online reported, highlighting the scale of spying cooperation which has unleashed a political row here.
Critics have accused Chancellor Angela Merkel's staff of giving the nod to the BND to help the NSA spy on European firms and officials. They also say officials lied about the prospects of a U.S.-German "no-spy deal" before the 2013 election.
Polls show the scandal is starting to hurt popular Merkel whose office is responsible for the oversight of intelligence.
Citing confidential documents, Die Zeit Online reported on Tuesday that of about 220 million pieces of meta data gathered per day, some 1.3 billion pieces per month go to the NSA.
This Reuters article put in an appearance on the South African website sharenet.co.za Wednesday at 3:07 p.m. South African Standard Time [SAST] yesterday afternoon, which was 9:07 a.m. in Washington.
The fate of Ukraine’s agricultural sector is on shaky ground. Last year, the Oakland Institute reported that over 1.6 million hectares (ha) of land in Ukraine are now under the control of foreign-based corporations. Further research has allowed for the identification of additional foreign investments. Some estimates now bring the total of Ukrainian farmland controlled by foreign companies to over 2.2 million ha; however, research has also identified important grey areas around land tenure in the country, and who actually controls land in Ukraine today is difficult to ascertain.
The companies and shareholders behind foreign land acquisitions in Ukraine span many different parts of the world. The Danish “Trigon Agri,” for example, holds over 52,000 ha. Trigon was established in 2006 using start-up capital from Finnish “high net worth individuals.” The company is traded in Stockholm (NASDAQ), and its largest shareholders include: JPM Chase (UK, 9.5 percent); Swedbank (Sweden, 9.4 percent); UB Securities (Finland, 7.9 percent); Euroclear Bank (Belgium, 6.6 percent); and JP Morgan Clearing Corp (USA, 6.2 percent).
The United Farmers Holding Company, which is owned by a group of Saudi Arabian investors, controls some 33,000 ha of Ukrainian farmland through Continental Farmers Group PLC.
AgroGeneration, which holds 120,000 ha of Ukrainian farmland, is incorporated in France, with over 62 percent of its shares managed by SigmaBleyzer, a Texas-based investment company.
This interesting article, originally posted on the oaklandinstitute.org Internet site last Friday, appeared on the russia-insider.com website yesterday afternoon Moscow time. It's another offering from reader B.V.
U.S. Secretary of State John Kerry, who is on his first visit to Russia since May 2013, met with Russian President Vladimir Putin and Foreign Minister Sergei Lavrov behind closed doors on Tuesday.
Lavrov said during the talks that Moscow was ready for constructive cooperation with Washington both in bilateral relations and on the global arena, "where our countries bear the utmost responsibility for global security and stability."
"But this cooperation is possible only on a fair and equal basis, without attempts to dictate or apply pressure [on Russia]," Lavrov stressed.
"Attempts to apply sanctions pressure on us is a path to a deadlock. Russia will not be forced to forsake its national interests or its principal position on vital issues," Lavrov added.
This story, filed from Moscow, appeared on the sputniknews.com Internet site at 8:24 p.m. Moscow time on their Tuesday evening. Once again I thank Roy Stephens for sending it our way.
Sir Max Hastings obviously has a chip on his shoulder. Vladimir Putin must have really upset him in a previous life. Writing for the Daily Mail, the renowned British journalist and self-proclaimed Conservative has outed himself as a bigot and neocon. His article on the Victory Day parade is a masterpiece of black propaganda that only an expert such as Josef Goebbels himself could be proud of. The depressing thing is, he has a large readership, with 709 people already sharing this disgraceful content online at time of writing.
Previously calling Putin a “lying brute who has to be shackled”, Hastings has, along with the rest of the Western media, done his darndest to turn Moscow’s Victory Day celebrations from something glorious into something sinister. Let’s analyse the twisted way he attempted this by examining his key points.
This rebuttal to a Russia-bashing article showed up on the russia-insider.com Internet site yesterday sometime---and it's the final contribution of the day from reader M.A.Read more...
After taking a beating last year due to Western sanctions, Russian markets are looking attractive again, says Jim Rickards, chief global strategist at West Shore Funds.
This 5:16 minute CNBC Asia video clip, with host Bernie Lo, appeared on their website on Monday evening EDT---and I thank reader Harold Jacobsen for bringing it to our attention. While I was watching the clip, I noticed that the photo that CNBC was using was the one I took of Jim when we were speaking at the Casey Conference in San Antonio last September.
Nomura Holdings Inc. and Royal Bank of Scotland Group Plc may face $500 million in damages for what a judge called an “enormous” deception in the sale of defective mortgage-backed securities, a ruling that may spur other banks to settle similar claims tied to the 2008 financial crisis.
Nomura and RBS were excoriated in a 361-page opinion by U.S. District Judge Denise Cote in Manhattan, whose ruling followed the first trial of claims that banks sold flawed securities to government-owned mortgage companies. After a three-week trial, Cote said they misled Fannie Mae and Freddie Mac and set a damages formula that may result in the government winning about half its original claim of $1 billion.
“The offering documents did not correctly describe the mortgage loans,” Cote, who heard the case without a jury, wrote Monday. “The magnitude of falsity, conservatively measured, is enormous.”
This Bloomberg article put in an appearance on their website at 10:30 a.m. Denver time on Monday morning---and I thank Elliot Simon for finding it for us.
Nowadays many countries’ social and political structure relies on debt-driven consumption and increasing levels of entitlements.
The current state of affairs echoes Archaeologist Arthur Demarest’s observation about the Mayan civilization: “Society had evolved too many elites, all demanding exotic baubles…all needed quetzal feathers, jade, obsidian, fine chert, and animal furs. Nobility is expensive, non-productive and parasitic, siphoning away too much of society’s energy to satisfy its frivolous cravings.”
Policy makers refused to acknowledge that available fiscal and monetary policy tools cannot address the underlying problems. They repeatedly use complex jargon, obscure mathematics and tired ideologies to disguise their failures and limitations. Perhaps, as the writer G. K. Chesterton suggested: “It isn’t that they can’t see the solution. It is that they can’t see the problem.”
Ultimately, the policies being used to manage the debt crisis punish frugality and thrift, and reward borrowing, profligacy, excess, and waste---the prudent have been sacrificed on the altar of the wanton.
This opinion piece appeared on the marketwatch.com Internet site back on April 27---and it's worth reading. I thank Dan Lazicki for pointing it out.
Roy Sebag and Josh Crumb started their business with one simple guiding principle.
"We wanted to be able to go into Tim Horton's and buy a coffee with gold, with our credit card or debit card," Sebag said in an interview. "It went from being a hobby of how to do that to this whole company."
Investors will start to get a better look at their vision on Wednesday, as shares of BitGold Inc. begin trading on the TSX Venture Exchange. It is the culmination of several years of hard work by the founders, and is being backed by George Soros, Sprott Inc., and other big-name financiers. The company has a valuation of more than $30 million.
BitGold is the first serious financial services platform ever built around gold. The online service allows users to buy gold, store gold, and pay for goods and services around the world using gold as the currency. The service has been active for less than a week but has already signed up thousands of users.
This interesting gold-related news item showed up on Canada's Financial Post website yesterday---and I found it embedded in a GATA release.
More sneers seem to come toward GATA tonight from Bob Moriarty over at 321Gold. His new commentary begins this way:
"The gold 'perma-bulls' have cost their followers a lot of money over the past 15 years. We all know who they are. Gold is supposed to go up every single day or it's 'proof' of a conspiracy of the evil bullion banks that manipulate gold at every turn. ... Gold, silver, and resource stocks are markets like all others."
-- "We all know who they are"? Really? Then why not identify them so they may know that they have been accused and have a fair chance at rebuttal? Why, if not cowardice, hide behind insinuation?
-- "Gold is supposed to go up every single day or it's 'proof' of a conspiracy of the evil bullion banks that manipulate gold at every turn" is not GATA's position.
Instead, GATA's position is that central banks are in the gold market surreptitiously every day, often acting through intermediaries like bullion banks, for the traditional purposes of central bank policy -- to control and defeat a dangerously competitive currency that, if ever traded freely, would make deadly trouble for government currencies, government bonds, and interest rates generally -- and that this intervention distorts and ultimately defeats all markets and even democracy itself. Yes, if central banks were not constantly intervening against gold, the monetary metal's price would be a lot higher. But no one contends that in a free market gold would "go up every single day."
I see that Bob, unlike a fine red wine, is definitely not improving with age. This commentary by Chris Powell showed up on the gata.org Internet site late yesterday evening EDT---and it's worth reading.
The Chinese government seems to be very keen on developing the New Silk Road Economic Belt as fast as possible; an initiative, said to be designed by President Xi Jinping himself, that will increase economic cooperation in the wide Eurasian region. At a stunning speed China and Russia take the lead in strengthening ties in the area. For the wind down of the US dollar hegemony the Silk Road economic project is an important tool. As part of this project two clubs are rapidly developing as we speak, the Asian Infrastructure Investment Bank (AIIB) and the Eurasian Economic Union (EEU). Additionally, China is incorporating gold into the Silk Road project.
The AIIB is an international financial institution proposed by China in 2013 to finance infrastructure projects in Asia. The Chinese government has been frustrated with the slow pace of reforms in established institutions like the IMF and World Bank, which are dominated by the US. China’s rapid economic growth in recent years has made them pursuing a greater input in these institutions, but the U.S. has neglected to honor these requests appropriately, forcing China to launch its own institutions.
Despite the U.S. has been pressuring its allies from signing up as AIIB prospective founding members only Japan obeyed, signaling a demise of US power and failing US foreign policy. In a milestone event many western countries have submitted for membership in March and April 2015, amongst others the UK, Switzerland, Sweden, Spain, Portugal, Norway, the Netherlands, Italy, Germany, France, Finland, Denmark, Australia and Israel. The AIIB articles of agreement are expected to be completed by the end of 2015.
China is now playing multiple games at the same time by developing the AIIB and concurrently pressuring the IMF to reform. One of China’s goals is for the renminbi to be included into the IMF’s basket of currencies the Special Drawing Right (SDR). On April 30, 2015, the IMF’s Director Of The Communications Department, Gerry Rice, stated in a press briefing about the SDR review “Yes, the work has begun”. The first IMF board meeting on the SDR review originally scheduled in May 2015, has been “deferred, because the work is underway.”
This commentary by Koos was posted on the Singapore website bullionstar.com yesterday---and I thank him for sending it our way. It's certainly worth reading.
China’s State Administration of Foreign Exchange has announced that the nation is to bring its Current Account reporting in line with International Monetary Fund standards. This will mean that all its reserve assets, including its gold reserve, which is widely believed to be far greater than the 1,054.6 tonnes currently reported to the IMF, will fall under one accounting headline. China, in the past, has reported its reserve assets as a separate item, somewhat parallel to its reporting of its trade account and financial accounts, according to an article in the South China Morning Post.
Bringing its accounts into line with an IMF standard is seen as part of China’s desire to have the yuan included in a revised Special Drawing Right calculation, as the IMF is currently entering internal discussions with its members on a possible restructuring of the SDR – the results of which are due to be announced later this year, and come into force at the beginning of 2016. This again is seen as part of a possible move en route to the yuan being regarded as a global reserve currency.
This brief commentary by Lawrie showed up on his website yesterday sometime---and it's a must read.
There can’t be anyone out there who examines and researches the silver markets like Ted Butler, and some will consider his findings and assumptions, particularly with respect to his theorising on JPMorgan’s undue impact on the silver market, a little over the top. However, he has been delving deeply into the market’s inner workings and pricings for as long as I can remember – at least 30 years – and his views should certainly not be discarded out of hand.
There’s little doubt that the world’s financial giants like JPMorgan have the financial clout to manipulate almost any market to their own ends and its reported and assumed silver holdings – whether on its own account or just on behalf of clients – should at least raise eyebrows. Such is capitalism today where the haves – and few, if any, have more than JP Morgan – seem to be able to ride roughshod over market regulators at the ultimate expense of the have-nots (the vast majority of the populace).
Ted Butler is adamant in his research suggesting that indeed JPMorgan has been manipulating the global silver market to its own ends for financial gain. In his latest newsletter for his clients he comments that, “Being highly capitalised and with the co-operation from the federal government, JPMorgan was able to turn silver (and gold) prices sharply lower into year-end 2008 and made well over one billion dollars as a result of falling metals prices and was able to greatly reduce the short positions it inherited from Bear Stearns. Not content to exit the short side of COMEX silver and gold, JPMorgan then repeated the process of selling short great additional quantities of COMEX short contracts on metals price rallies over the next couple of years and buying back those short positions when prices fell lower. All told, JPMorgan continued to extract great profits from the short side of COMEX silver and gold, to the tune of many hundreds of millions of dollars and even billions of dollars on a cumulative basis.” Playing the markets in this manner is what the big banks seem to be able to do whatever the regulators may wish.
This commentary by Lawrie about Ted Butler's latest commentary appeared on the mineweb.com Internet site yesterday afternoon BST---and it's worth your time.
Here are the last two photos I'm posting from my Sunday outing. The first is a male red-winged blackbird on full display---and the second is ring-billed gull just moments after in landed on the water.
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The Company’s primary focus is on production planning for its high-grade Lamaque South project. The Lamaque South property is divided into three clusters, the North, South and West cluster. The primary targets are the high-grade Parallel Zone in the North Cluster and the Triangle Zone in the South Cluster. The acquired Sigma Mill, located 1 kilometer from the Parallel Zone and 3 kilometers from the Triangle Zone, is a fully-permitted, 2,200 ton per day mill and tailings facility. The Sigma-Lamaque Mill and Mining Complex include the historic Sigma and Lamaque Mines which operated for 75 and 52 years respectively and produced more than 9 million ounces of gold in total. Please visit our website for more information.
I still feel that one shouldn’t interpret the flat trading range of either the relative price of silver to gold, or the absolute price of each metal, as an indication that we are anywhere near a free market equilibrium price, particularly for silver.
Current prices are solely and exclusively explained by activities on the COMEX, as will future prices be so explained. That’s the reason, although I live and breathe thinking about silver that I spend less time on silver’s actual supply/demand fundamentals.
For the time being, the actual metal fundamentals don’t matter a whit; price is a function of what happens on the COMEX, particularly when it comes to JPMorgan. - Silver analyst Ted Butler: 09 May 2015
It was more than obvious that "da boyz" were at battle stations in Far East and early London trading on their Tuesday when the dollar index did its 90+ basis point face plant---as the precious metals had their prices frozen in place for the entire length of time that the dollar index was heading south. And as I said further up, they only released their grip when the dollar index began to head higher around 11 a.m. in London trading.
So despite the very bullish internal structure of the Commitment of Traders Report, JPMorgan et al were not about to let the precious metals out to play yesterday---and when they finally did, they weren't allowed to get far. Gold broke above---and closed above its 50-day moving average, but not by a material amount.
Here are the 6-month charts for all four precious metals, plus the dollar index and WTIC.
Even though the dollar index is down about 600 basis points from its mid-March high tick---and with the bond market getting killed recently, it's certainly not being allowed to show up in precious metal prices, as gold is only up about 50 bucks from its mid-March low. During the same time period crude oil is up 50 percent.
As I write this paragraph, the London open is about 20 minutes away---and gold and silver prices have done almost nothing from a price perspective during the Far East trading session on their Wednesday. But all four precious metals are up a hair from their respective closes in New York yesterday.
Net volume in gold is pretty light at just over 10,000 contracts, with a decent amount of roll-over activity---and silver's net volume is around 4,500 contracts, which is quite a bit, considering the quiet price action. The dollar index is chopping quietly lower---and is currently down 19 basis points.
Yesterday at the close of COMEX trading was the cut-off for this Friday's Commitment of Traders Report. Just eye-balling the five trading days that will be in that report, it looks like it will be a neutral report in both gold and silver. My guess for last week's COT Report wasn't even close, so I'll reserve the right to be wrong once again.
And as I fire today's column out the door to Stowe, Vermont at 5:15 a.m. EDT, I note that with the exception of silver, which is up about 15 cents at the moment, the other three precious metals are trading back at unchanged after being up a few dollars just before the London open.
Net gold volume is around 21,000 contracts, which isn't overly heavy, but it's not exactly light either. Silver's net volume is now over 10,000 contracts, so it's obvious that even this tiny rally is being contained with whatever selling is necessary by the HFT boyz and their algorithms. The dollar index isn't doing much---and is currently down 13 basis points.
I'm sure that the rest of the Wednesday trading session will prove to be just as interesting as Tuesday's---and nothing will surprise me when I check the charts later this morning.
I'm off to bed---and I'll see you here tomorrow.