Gold & Silver Daily
"The PPT was at battle stations for a goodly chunk of the Wednesday trading session"
 

¤ Yesterday In Gold & Silver

The gold price had a negative bias all through Far East trading on their Wednesday---and that lasted until at, or just after, the London a.m. gold fix.  From there it began to rally a little, but every tiny breakout was hammered flat immediately---and it basically traded flat once COMEX trading began.  Then, starting a few minutes before the FOMC 'news', some thoughtful soul hit the gold price for about eight bucks---and after it recovered a bit, the price traded sideways into the close of electronic trading.

The low and high ticks are barely worth looking up---and they were recorded as $1,200.70 and $1,213.50 in the June contract.

Gold closed in New York yesterday at $1,204.60 spot, down $7.20 from Tuesday's close.  Net volume was pretty decent at 135,000 contracts, so "da boyz" had to resort to some heavy firepower to keep the gold price in check in the face of a rout in the dollar index.

Here's the 5-minute gold chart courtesy of Brad Robertson.  Midnight EDT is the dark gray line---and virtually all the volume that mattered came between 6:30 a.m. and 1:30 p.m. on this chart, which is Denver time---so add two hours for New York.  Don't forget the 'click to enlarge' feature.

It was more or less the same chart pattern in silver, although the absolute low tick in that precious metal occurred at the noon London silver fix.

The low and high in silver were reported by the CME Group as $16.385 and $16.685 in the May contract.

Silver finished the Wednesday session at $16.54 spot, down 6.5 cents on the day.  Net volume was very chunky at 58,500 contracts.

The platinum price action followed gold and silver like a shadow---and that white metal finished the Wednesday session at $1,153 spot, down 3 bucks on the day.

Palladium had an up/down price move during Far East and early Zurich trading---and then began to rally mid morning Zurich time.  The price peaked out at the COMEX close---and it sold down a few bucks from there, closing at $780 spot, up 6 dollars on the day.

The dollar index closed late on Tuesday afternoon in New York at 96.11---and by 8:00 a.m. EDT on Wednesday morning, it was down to 96.00.  Then it really began to head south with a vengeance, with the 94.72 low coming shortly after 12 o'clock in New York.  It had a bit of a jump up at the FOMC meeting 'news'---and then traded more or less ruler flat for the remainder of the Wednesday session.  The index closed at 95.21---down 90 basis points on the day.

Of course the precious metals certainly weren't allowed to reflect that decline, as JPMorgan et al sat on gold, silver and platinum from 8 a.m. EDT until around 2:30 p.m.

Here's the 1-year dollar index chart once again, updated with Wednesday's data.

The gold shares opened about unchanged---and rallied into positive territory within twenty minutes of the open---and crawled higher from there.  Then about ten minutes before the Fed 'news' a not-for-profit seller hit the shares for a bit over 2 percent.  It was probably the same not-for-profit sellers that hit gold, silver and platinum a few minutes in advance of the 'news' as well.  But despite the obvious intervention, they soon recovered into positive territory---and the HUI managed to close up 1.00 percent.

The silver equities followed a very similar path, but the recovery into positive territory after the 1:55 p.m. EDT smash, met with what certainly looked like more not-for-profit selling.  Nick Laird's Intraday Silver Sentiment Index closed down 0.72 percent.

The CME Daily Delivery Report for First Day Notice for delivery into the May contract in silver showed that zero gold and 1,481 silver contracts were posted for delivery on Friday.  The three biggest short/issuers were Barclays [a surprise] with 848 contracts out of its in-house [proprietary] trading account, Canada's Scotiabank with 521 contracts---and in distant third spot was Jefferies with 108 contracts out of its client account.  The three largest long/stoppers were JPMorgan with 550 contracts for its client account, plus another 344 contracts for its in-house [proprietary] trading account.  Then came HSBC USA with 328 contracts---and the rest don't matter.  The link to yesterday's Issuers and Stoppers report is linked here---and it's worth a minute of your time.

The CME Preliminary Report for the Wednesday trading session showed that April open interest in gold is zero---and May open interest in gold is currently at 226 contracts.  In silver, April o.i. is zero as well, of course---and May o.i. fell by 5,703 contracts, leaving 3,378 contracts still open.  But 1,481 contracts were reported issued in the previous paragraph---and I expect the May open interest to have shrivelled to almost nothing by the time Friday's Preliminary Report is issued.

There were no reported changes in GLD---and as of 9:59 p.m. EDT yesterday evening, there were no reported changes in SLV, either.

The folks over at Switzerland's Zürcher Kantonalbank updated their inventories for their gold and silver ETFs as of the close of business on Friday, April 24---and this is what they had to report.  There was a smallish 1,866 troy ounces of gold added---and an equally smallish 15,973 troy ounces added to their silver ETF.

There was no sales report from the U.S. Mint.

Over at the COMEX-approved depositories on Tuesday, they reported receiving 11,252 troy ounces of gold, all of it at Brink's, Inc.---and 2 kilobars were shipped out.  The link to that activity is here.

It was pretty quiet in silver, as nothing was reported received---and only 48,300 troy ounces were shipped out the door.  The link to that activity is here.

There was more big in/out activity in the gold kilobar warehouses in Hong Kong on their Tuesday, as 5,585 kilobars were reported received---and 5,166 kilobars were shipped out.  The link to that action in troy ounces is here.

I've managed to keep today's number of stories at a reasonable level but, as usual, I'll leave the final edit up to you.

 

¤ Critical Reads

U.S. Economy Grinds to a Halt, Again: Q1 GDP Tumbles Below Expectations, Rises Paltry 0.2%

And so the Atlanta Fed, whose "shocking" Q1 GDP prediction Zero Hedge first laid out nearly 2 months ago, with its Q1 GDP 0.1% forecast was spot on. Moments ago the BEA reported that Q1 GDP was far worse than almost everyone had expected, and tumbled from a 2.2% annualized growth rate at the end of 2014 to just 0.2%, in a rerun of last year when it too "snowed" in the winter.  This was well below the Wall Street consensus of a print above 1.0%.

In other words, in the quarter in which the S&P rose to unseen highs, the economy ground to a near halt.

Only this time it wasn't the snow, as the main reason for the plunge in economic growth was not only personal consumption which was cut by more than 50% from last quarter, tumbling to just 1.31%, but fixed investment, i.e., CapEx, which subtracting 0.40% from the bottom line GDP number, was the lowest print since 2009!

This Zero Hedge piece from 8:42 a.m. EDT yesterday morning is definitely worth your while---and today's first story is courtesy of Dan Lazicki.

Read more...

The Mysterious U.S.-Session Bond-Seller is Back

After taking two days off last week, the mysterious but persistent U.S. Treasury bond seller is back. Like clockwork as the U.S. market awakes, no matter what the trend overnight, Treasuries are offered in size and yields snap higher...

Around 8 a.m. EDT each day, bonds become magically offered...

This tiny Zero Hedge article, complete with a must see graph, showed up on their Internet site at 9:19 a.m. EDT on Wednesday morning---and it's another story from Dan L.

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The Great Unwind Begins: U.S. Dollar Plunges to 2-Month Lows

Just when you thought it was safe to pile all your money (at maximum leverage) into USD-denominated assets, the greenback plunges... The last 4 days have seen the 2nd biggest drop in 6 years. This has very significant consequences for a world that has become entirely consensus-based across at least 5 major themes... This poses a problem for talking-heads: if USD strength as indicative of US economic strength... what does a plunging USD imply?

This tiny article, with an excellent chart, appeared on the Zero Hedge website at 11:17 a.m. EDT---and it's the third story in a row from Dan Lazicki.

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Fed's downgrade of economic outlook signals longer rate hike wait

The Federal Reserve downgraded its view of the U.S. labor market and economy on Wednesday in a policy statement that suggested the central bank may have to wait until at least the third quarter to begin raising interest rates.

The Fed's statement put in place a meeting-by-meeting approach on the timing of its first rate hike since June 2006, making such a decision solely dependent on incoming economic data.

The data, however, have been getting worse. Just hours before the Fed's statement, the U.S. government reported that first-quarter gross domestic product came in much weaker than expected.

The central bank acknowledged that growth had slowed in the winter months, a dimmer assessment of the economy than its view in March. And while it said the poor performance was in part due to transitory factors, it pointed to soft patches across the economy, in a sign it may have to hold off hiking rates until at least September.

This Reuters article, filed from Washington, showed up on their Internet site at 5:40 p.m. EDT Wednesday afternoon---and it's courtesy of Orlando, Florida reader Dennis Mong.

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Biggest Inventory Build in History Prevents Total Collapse of the U.S. Economy

While we already observed that in Q1, US GDP rose by an appalling 0.2%, far, far below the consensus Wall Street estimate (in case you missed it, here again is the one thing every Wall Street economist desperately needs) and precisely in line with the Atlanta Fed forecast which we brought attention to in early March, confirming yet again that US stocks no longer reflect any fundamentals but merely Fed and global liquidity injections, there is something far more disturbing under the surface of today's GDP report.

Inventories.

Specifically, the $121.9 billion increase in private, mostly non-farm, inventories in the first quarter.

If U.S. inventories, already at record high levels, and with the inventory to sales rising to great financial crisis levels, had not grown by $121.9 billion and merely remained flat, U.S. Q1 GDP would not be 0.2%, but would be -2.6%.

This is another Zero Hedge story.  This one appeared on their Internet site at 12:55 p.m. EDT yesterday---and it's another contribution from Dan Lazicki.  It's worth a peek.

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Jim Grant: Fed statement awfully familiar

Jim Grant, Grant's Int. Rate Observer, discusses today's Fed statement and when they may begin to raise interest rates.

This 4:15 minute CNBC video clip appeared on their website at around 5:30 p.m. EDT yesterday afternoon---and it's worth watching.  It's another offering from Dan Lazicki.  Dan also sent along two more CNBC video clips about the Fed meeting.  They involve Marc Faber, stocks and the economy---and they're linked here and here.  The first one runs for 3:25 minutes---and the second for 2:49 minutes.

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Today investors weren't wearing bathing suits: Bill Gross

Bill Gross, Janus Global Unconstrained Bond Fund, predicts when he thinks the Fed will raise rates, and also shares his view on Ben Bernanke being named a senior advisor at Pimco.

This 6:49 minute CNBC video clip was appeared on the their website mid-afternoon on Wednesday EDT---and it's also courtesy of Dan Lazicki.

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Ignore the 'whiff of panic' as U.S. economy stalls

The economy contracted in the first quarter once inventories are stripped out. 'It is hard to put lipstick on that pig,' said UniCredit.

The U.S. economy has suddenly stalled. A blizzard of shockingly weak figures raise the awful possibility that America's six-year growth cycle since the Great Recession has already rolled over, with unsettling implications for the world.

Worse yet, this apparent exhaustion is taking hold even before the Federal Reserve has begun to raise interest rates or to drain any of its $3.7 trillion of quantitative easing and balance-sheet expansion.

Former U.S. Treasury Secretary Larry Summers warned in Davos earlier this year that the Fed typically needs to cut rates by three or four percentage points to combat each cyclical downturn. It is currently at zero. "Are we anywhere near the point when we have 3pc or 4pc running room to cut rates? This is why I am worried," he said.

"Nobody over the last 50 years, not the IMF, not the U.S. Treasury, has predicted any of the recessions a year in advance, never," he said.

They dare not predict a recession or a depression, or its curtains for the equity markets, the bond markets---and the U.S. dollar.  Ambrose Evans-Pritchard tries to put some lipstick on this particular pig anyway, but it rings hollow.  This commentary put in an appearance on The Telegraph's website at 9:17 p.m. BST yesterday evening, which was 4:17 p.m. EDT in New York.  I thank Roy Stephens for sliding it into my in-box just after midnight Denver time.

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The Dwindling U.S. Economy — Paul Craig Roberts

The announcement today (April 29) of a barely positive GDP first quarter 2015 growth rate of 0.2 percent (two-tenths of one percent) is an intentional exaggeration.

Today’s GDP report is the “advance estimate.” There will be two revisions, with the first occurring in one month on May 29.

Although the “consensus estimate,” which is Wall Street’s estimate, declined dramatically over the past month, the consensus estimate was for 1.0 percent.

The BEA’s advance estimate bears the burden of impact on financial markets even though it is the least reliable estimate. Subsequent revisions receive much less attention. Because of its market impact, the advance estimate is fudged by the Bureau of Economic Affairs (BEA) in order not to upset financial markets keyed to the consensus forecast.

This commentary by Paul was posted on his website on Wednesday afternoon sometime---and I thank reader M.A. for sharing it with us.

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The War on Cash: Transparently Totalitarian

While the forces pushing for centralization of power have been prevailing for decades, they haven’t won a total victory yet. Technologies that empower the individual and that tend toward decentralization—including the Internet, encryption, 3D printing, and cryptocurrencies—offer a powerful ray of hope, reasons to be optimistic about the future.

So the tug of war between the collectivists and the rest of us continues.

One thing that would tip the scales heavily in favor of the collectivists would be victory in the War on Cash. Their goal is to eliminate the use of hand-to-hand currency, so that governments can document, control, and tax everything.

It’s exactly like what Ron Paul said: “The cashless society is the IRS’s dream: total knowledge of, and control over, the finances of every single American.”

This commentary by senior editor Nick Giambruno appeared on the internationalman.com Internet site yesterday.

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G20: fossil fuel fears could hammer global financial system

Top energy watchdog says two thirds of all assets booked by coal, oil and gas companies may be worthless under the 'two degree' climate deal.

The G20 powers have launched a joint probe into global financial risks posed by fossil fuel companies investing in costly ventures that clash with international climate goals and may never be viable.

World leaders are increasingly concerned that a $6 trillion wave of investment into the nexus of oil, gas, and coal since 2007 is based on false assumptions, leaving companies with an overhang of debt and "stranded assets" that cannot easily be burned under CO2 emission limits.

The G20 has asked the Financial Stability Board in Basel to convene a public-private inquiry into the fall-out faced by the financial sector as climate rules become much stricter. All member countries have agreed to co-operate or carry out internal probes, including the United States, China, India, Russia, Australia, and Saudi Arabia.

Diplomatic sources have told The Telegraph that the investigation is being pushed by France and is modelled on a review launched by the Bank of England last year.

Say what?  It must be a slow news day over at The Telegraph, but when you're one of the fair-haired boys for the powers-that-be, I suppose you write what you're told.  This Ambrose Evans-Pritchard commentary is worth reading, only because it's so preposterous.  I thank Roy Stephens for his second contribution of the day.  It was posted on the telegraph.co.uk Internet site at 7:12 a.m. BST yesterday morning, which was 2:12 a.m. EDT.

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Negative interest rates put world on course for biggest mass default in history

Here’s an astonishing statistic; more than 30pc of all government debt in the eurozone – around €2 trillion of securities in total – is trading on a negative interest rate.

With the advent of European Central Bank quantitative easing, what began four months ago when 10-year Swiss yields turned negative for the first time has snowballed into a veritable avalanche of negative rates across European government bond markets. In the hunt for apparently “safe assets”, investors have thrown caution to the wind, and collectively determined to pay governments for the privilege of lending to them.

On a country by country basis, the statistics are even more startling. According to investment bank Jefferies, some 70pc of all German bunds now trade on a negative yield. In France, it's 50pc, and even in Spain, which was widely thought insolvent only a few years ago, it's 17pc.

Not only has this never happened before on such a scale, but it marks a scarcely believable turnaround on the situation at the height of the eurozone crisis just a little while back, when some European bond markets traded on yields that reflected the very real possibility of default. Yet far from being a welcome sign of returning economic confidence, this almost surreal state of affairs actually signals the very reverse. How did we get here, and what does it mean for the future? Whichever way you come at it, the answer to this second question is not good, not good at all.

This longish commentary from Jeremy Warner showed up on the telegraph.co.uk Internet site at 6:14 p.m. BST on Tuesday evening in London---and it's worth reading.  I plucked it from yesterday's edition of the King Report.

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To Commerzbank: German Bunds Are "Flash Crashing"

As first Bill Gross and then Jeff Gundlach suggest shorting German bonds, so it appears the message has sunk in that at 4.9bps 10 days ago, 10Y Bund yields were the short of a lifetime. Since then they have soared, with a dramatic doubling today from 14bps to over 29bps - the highest yield in 7 weeks. As Commerzbank warns, "a cascade of small events is creating a large splash in a structurally ever-thinner market," which has led to a plunge "similar to U.S. Treasury flash crash of Oct. 15."

Yields are crashing higher...Doubled in a day!

This is another story from the Zero Hedge Internet site that's courtesy of Dan Lazicki---and it was posted on their website at 11:36 a.m. EDT on Wednesday.  The charts are worth a look.

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Greek Banks Get More Funds as ECB Weighs Collateral Discount

The European Central Bank raised the amount of emergency liquidity available to Greek banks, while signaling that access to such funds may become more difficult if bailout talks remain deadlocked.

The Governing Council lifted the cap on Emergency Liquidity Assistance by 1.4 billion euros ($1.5 billion) to 76.9 billion euros on Wednesday, people familiar with the decision said. That follows an increase of about 1.5 billion euros last week. An ECB spokesman declined to comment.

With no speedy deal between Greece and its creditors in sight, the ECB is studying measures to rein in ELA funding to limit risks. Staff have proposed increasing the discounts imposed on the securities banks post as collateral when borrowing, and the Governing Council may discuss the issue at its May 6 meeting.

This Bloomberg article appeared on their Internet site at 2:24 A.M. Denver time on their Wednesday morning---and I thank West Virginia reader Elliot Simon for sending it our way.

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Kremlin Confirms Putin-Merkel Talks in Moscow on May 1

Russian President Vladimir Putin will hold talks with German Chancellor Angela Merkel in Moscow on May 10, Kremlin spokesman Dmitry Peskov confirmed Wednesday.

The German government made an announcement of the meeting between the two leaders earlier in the day.

"It's true, we are expecting the German chancellor in Moscow on May 10. Merkel and Putin will hold talks in the Kremlin in 'narrow' and 'expanded' formats," Peskov told reporters.

The leaders are also expected to hold a joint press conference on the result of the talks, Peskov added.

This story, which really isn't new 'news' appeared on the sputnik.com Internet site at 8:26 p.m. Moscow time on their Wednesday evening, which was 1:26 p.m. EDT in Washington.  It's courtesy of Roy Stephens.

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Putin Accuses 'Quasi-Partners' of Counting on Russia Collapse

President Vladimir Putin accused some of Russia’s “quasi-partners” on Monday of counting on the country’s collapse by cutting its banks off from the global financial system at a time when oil prices had plunged.

“After the fall in oil prices from $100 a barrel to 50, 160 billion out of 500 did not come into the economy,” he said, apparently counting in dollars.Speaking in Russia’s second city of St Petersburg, Putin said they had been proved wrong and the economy had easily weathered the crisis, deepened by Western sanctions imposed to punish Moscow over its policies in Ukraine.

“It’s a big figure. And at the same time our quasi-partners limited access of our banks to refinance on the European markets.”

Putin did not make clear what he included in his calculations. Russia has lost income because of a fall in export revenues in dollar terms, a sharp decline in foreign investment and capital flight.

This Reuters article was picked up by the russia-insider.com Internet site around 8 p.m. Moscow time Wednesday evening---and it's another offering from Roy Stephens.

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Saudi royal reshuffle likely to ensure kingdom’s U.S. loyalty for decades

In a move that is likely to solidify ties with the US for decades to come, King Salman of Saudi Arabia has undertaken a major reshuffle, appointing Mohammed bin Nayef as his new successor and his son Mohammed bin Salman as second in line to the throne.

The decision by King Salman, who succeeded his late brother King Abdullah, who died on January 23, replaces his half-brother Prince Muqrin with Mohammed bin Nayef as crown prince and heir to the Saudi throne.

Mohammed bin Salman, who is 34 years-old, is King Salman’s son. In his position as defense minister, the new deputy crown prince has been overseeing the Saudi-led coalition’s bombing campaign against anti-government Houthi forces in Yemen.

Both princes are part of a generation of grandsons of Saudi Arabia’s founder, the late King Abdulaziz al-Saud, whose sons have passed power from brother to brother since his death in 1953.

The majority of the family’s Allegiance Council approved both appointments. The selections are seen as a shift away from the princes who had been favored by King Salman’s predecessor, King Abdullah.

This longish but very interesting commentary appeared on the Russia Today website at 12:45 p.m. Moscow time on their Wednesday afternoon---and once more my thanks goes out to Roy Stephens for finding it for us.

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Putin: Czar of Natural Gas, Crude Oil, Uranium and GOLD

Well-known Moscow journalist Dmitry Kalinichenko expressed it well:  “Very few people understand what Putin is doing at the moment. And almost no one understands what he will do in the future.  No matter how strange it may seem, but right now, Putin is selling Russian oil and gas only for physical gold.

Nonetheless, the above comments provide valuable insights into what President Putin’s plan is most likely to be…and how it will eventually and materially benefit the Russian economy.

Russia more than tripled its gold hoard since 2005 and holds the most since at least 1993, IMF data show. The country is boosting Central Bank reserves to diversify foreign reserves with a view to resolving issues related to ruble liquidity, central bank Governor Elvira Nabiullina said in February.

Additionally, Kazakhstan’s gold hoard jumped 33 percent in the past 12 months, data compiled by Bloomberg show.  Kazakhstan is an ally of Russia…and is a former member of the Soviet Union (U.S.S.R).

This begs the mind-boggling question:  What is shrewd Putin’s covert objective…and what does he stealthy have up his sleeve?

This commentary by Vronsky, the proprietor over at gold-eagle.com, was posted on his website on Tuesday sometime.  Most of what's in here about gold you've already seen in my column under different guises, but it is worth reading if you have the interest.  It's the second contribution of the day from Elliot Simon.

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Marc Faber talks about protection strategies---gold, and gold stocks

Marc Faber, the editor of the Gloom, Boom & Doom Report, tells CNBC's Dominic Chu why he still likes gold.

This 2:44 minute CNBC video clip appeared on their Internet site around 5:30 p.m. EDT yesterday afternoon---and I thank Dan Lazicki for his final contribution to today's column.  It's worth your while.

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India brushes off concerns over gold import spike - for now

Weak oil and commodity prices are offsetting concerns at India's central bank over the impact of a spike in gold imports on the broader economy, officials say, even as the industry forecasts another three months of strong buying.

A more sustained increase in bullion imports after June, however, could cause concern, a policymaker said.

"(While) we have the comfort from low oil prices, there is a large cushion and we don't need to be very concerned about the gold imports numbers," said one senior official involved in policy decisions, who declined to be named.

Concern would kick in if imports stay at or over 100 tonnes a month after June, he said.

This very interesting gold-related Reuters story was filed from Mumbai and posted on their Internet site at 2:14 p.m. IST yesterday afternoon---and it's worth reading.  I found it embedded in a GATA release.

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GFMS Q1 update confirms China as world No. 1 gold consumer

If one is happy to take GFMS figures as providing a consistent ranking on global gold demand figures (although some would dispute them) we should be able to rest the argument as to which country – China or India – was the world’s No. 1 gold consumer last year and, as we have said all along, China comes out on top. Unfortunately, not that it matters that much in the scheme of things, the world’s mainstream media keeps on insisting that India retook first place from China last year, and this is all down to the preliminary figures published by the World Gold Council (WGC) back in February in its first Gold Demand Trends report of the year (based on figures then also supplied by GFMS). It will be interesting to see if the WGC publishes a correction in its next Gold Demand Trends report due out in a couple of weeks’ time, and even if it does whether the mainstream media will even take notice but just continue to rely on the earlier figure. The February estimate seems to be set in stone by them.

As we have no doubt pointed out beforehand, Chinese consumption would have been streets ahead of that for India again last year if what is described as ‘bank activity’ was included – and also if Hong Kong’s consumption was lumped together with that of the Chinese mainland – after all Hong Kong is officially an integral part of China, although classed separately in trade figures as a Special Economic Region. GFMS does note that Chinese imports of gold, and deliveries from the Shanghai Gold Exchange (SGE) considerably exceeded the quoted consumption figure owing to growth in gold leasing, increased holdings by commercial banks to back paper products (a legal requirement) and perhaps some double counting of gold due to round-tripping to Hong Kong.

Lawrie is absolutely right to be skeptical of anything that comes out of GFMS, or their ilk---and I'm glad to see him point this out right up front.  This commentary was posted on the mineweb.com Internet site at 10:34 a.m. BST yesterday morning---and it too, is worth reading.

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¤ The Funnies

Here are three more photos from my Sunday outing.  The first is of two Canada geese sitting on the edge of the walking path around this stormwater pond---and no matter who walked by, they never even stood up, so they obviously know they're safe there.  I had to stand back about 15 meters---and climb a small hill to get far enough away so that the depth-of-field covered both birds.  A shallow depth of field at close range [regardless of the 'f' stop] is the curse of a big telephoto lens at times.



The two small diving ducks below are lesser scaups.  The first one is the female---and the second is the male beating his wings after preening.  They 'stand up' in the water as they do it, which looks really odd.  It took a shutter speed of 1/8,000 of a second to stop the action.









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

 

¤ The Wrap

A quick mention on the continued counterintuitive deposits/withdrawals in the big silver ETF, SLV. There was another unexpected deposit on Monday of 1.4 million oz and the reason it was unexpected was because silver prices were so weak into Friday. Then there was a near 3 million oz withdrawal reported on Tuesday following Monday’s high volume surge in price.

The way it is supposed to work is that withdrawals of metal should occur on price weakness, which imply net investor selling---and deposits should occur on high volume up days, which imply net investor buying. The only logical explanation is that the deposit was made to extinguish part of the short position in SLV---and Tuesday's withdrawal was a conversion of shares to metal to hide ownership. A kewpie doll to anyone guessing which entity is behind this. - Silver analyst Ted Butler: 29 April 2015

The "whiff of panic" that Ambrose Evans-Pritchard spoke of in the headline to one of the stories in the Critical Read section above was the primary reason that JPMorgan et al had the precious metals in lock-down yesterday.   Whether it was the dollar, the Dow, or the bond markets both at home and abroad---whatever COMEX paper it took, it appeared that they went short against all comers.   It was another one of those days that if the markets had been left to their own devices, the entire financial system would have gone down the drain.  The PPT was at battle stations for a goodly chunk of the Wednesday trading session.

So it's the same old, same old---at least for the moment.

Here are the 6-month charts for all four precious metals---and the price capping is beyond obvious.

And as I type this paragraph, the London open is ten minutes away---and all four precious metals are trading slightly below their closing prices in New York yesterday.  Gold volume is around 13,600 contracts---and all of it, with the exception of about 100 contracts, is in the current front month, so it's all of the HFT variety.  Silver's net volume is around 3,700 contracts---and virtually all of that is in the new front month as well.

This is about where we were yesterday at this time, but once thing started to unravel in New York, volumes exploded---and that may happen again today.  The dollar index is flat.  It's almost like yesterday's near-death experience never happened, as the conflagration from one day is not allowed to contaminate the following day's trading, although Japan and Hong Kong got hit pretty hard on their Thursday morning---and Europe is down smartly as well at the moment.

I think Charles Hugh-Smith put it best in a "must read" article of his that was posted on the Zero Hedge website yesterday---when he said this:

I explain the danger of continually 'saving" the markets from any market clearing event in The Yellowstone Analogy and The Crisis of Neoliberal Capitalism (May 18, 2009).

When a forest is never allowed to burn away the accumulation of dead branches and underbrush with a limited fire, the forest eventually catches fire anyway. The deadwood (of bad debt, excessive credit and leverage and phantom collateral) is now piled so high, the entire forest burns down to ashes.

This is the eventual cost of never allowing any clearing of financial deadwood because everyone is now so dependent on financial markets that the slightest swoon will bring down the entire system. This vulnerability only increases with every "save" and every new bubble.

All the "saves" have done is guarantee the financial system will burn down in a conflagration ignited by a seemingly trivial spark somewhere in the vast global system of phantom collateral.

Amen to that, dear reader!

And as I send today's column off into cyberspace at 5:15 a.m. EDT, I see that the dollar index has taken another big header starting around 8:15 a.m. BST in early London trading.  From unchanged fifteen minutes before the London open, it is now down 59 basis points---but off its low tick by a bit.

All four precious metals are struggling to remain at unchanged on the day, although silver is up a whole 7 cents---and it's obvious from the blow-outs in gold and silver volumes in their current front months, that the JPMorgan et al's HFT boyz and their algorithms are hard at it once again.  Gold's net volume is now north of 29,000 contracts---and silver's net volume is 8,100 contracts.

I also note that stock in Europe are back in the plus column as well.  All is as it should be once again, please move along, as there's nothing to see here, folks.

As for how the last trading day of April will go, I have no clue.  But it's obvious that the powers-that-be are pedal-to-the-metal to keep the biggest financial mania in Planet Earth's history from meeting its inevitable end.

See you tomorrow.

Ed Steer