Wednesday, January 30, 2013

Harvey Organ 's Report - January 30 , 2013..... news , data and views focusing on gold and silver .....

By the way, the outfit that holds an enormous short position in silver on the Comex is JP Morgan. And I wonder is JPM working secretly for the Fed?” (Since 2003, when Max & Stacy first recommended Silver: silver has gained 1,012%)

By the way, the outfit that holds an enormous short position in silver on the Comex is JP Morgan. And I wonder is JPM working secretly for the Fed?”



USA posts negative .1% GDP shocking investors around the globe/Banca Monte dei Paschi reveals another derivative mess/Implicates Draghi/

Good evening Ladies and Gentlemen:

Gold closed up today to the tune of $20.00 to finish the comex session at $1680.20.  Silver had a good day rising by 99 cents and closing at $32.15.  Gold was trading around $1667.00  when the bankers showed up whacking gold down to $1662. when the world was greeted with news that the first preliminary 4th quarter GDP came in at a negative .1%.  Not only that but the good folks revealed a negative deflator.  This deflator is suppose to deduct inflation from the eventual GDP number.  Today it helped the figures, otherwise we would have had a negative .6% GDP. (rarely do you see a negative deflator)

The street did not like what it saw.  The stock market, on the opening bell, fell and finished the day down 44 points. All of the major European bourses ended in the glue.  The volume on gold contracts skyrocketed.  Immediately gold and silver reversed course and ended the day up 1% which is generally the level where the banking cartel will allow gold to rise.  It never allows gold to rise for two consecutive days.  To further signal their intentions, the banking cartel whacked the gold and silver equity shares in the afternoon.  It looks like we had a one day postponement for our raid on our precious metals. So be careful tomorrow and Friday.

Silver eagles continue to shine with sales this month at 7.4 million oz.In other news, Italy got another bombshell today when a 4th derivative was uncovered at Banca Monte dei
Paschi di Siena.  However this time it was revealed that the Central Bank of Italy was well informed on these derivatives underwritten by the bank way back in 2010.  Who was the head of the Central Bank of Italy at this time?  None other than Mario Draghi.  The prosecutors have opened up a case against the Central bank of Italy and Mario Draghi.

The Euro continues to rise against the dollar causing trouble for big exporters like Germany.
It also causes huge problems for Spain and Italy as their exports will plummet to nothing.  Not only that, but this will also damage the target 2 imbalances with Germany.

On this side of the pond, the 2 and 10 year interest rates are starting to rise and investors are taking note.
The USA 10 year rate finished above 2% in quite some time. Also the German 10 year bond is close behind in yield.

We will discuss these and other stories but first let us head over to the comex and assess trading today............

The total comex gold open interest fell by a huge 8,206 contracts as somehow our gold longs are not as committed as silver longs  The OI rests tonight at 430,712 down from Tuesday's level of 438,918.  The January contract month is now off the board.  First day notice for the big February month is tomorrow afternoon.  (by mistake I said Friday, but it is tomorrow).  Today the OI for February reads an astonishingly high 36,174 down from Tuesday's level of 82,128.However I am sure that some of these will roll, some will sell off and others will homage to Blythe Masters. The drop in OI in the February contract month was 45,954.  The next non active gold delivery month is March and here the OI rose by 94 contracts from 993 up to 1087.  The estimated volume today was good at 200,134. The confirmed volume yesterday was very good at 282,030.

The total silver comex OI continues to play havoc to our bankers. Today the OI fell by only 471 contracts from 148,997 down to 148,526.  The non active February contract month saw it's OI fall by 35 contracts from 108 down to 73.
The active March contract saw it's OI fall by 1279 contracts. from 77,954 down to 76,675.  The estimated volume today came in at a very large 50,862.  The confirmed volume yesterday was somewhat weaker at 35,466.

It seems that investors piled into the metals at soon as Bernanke announced that he may add more stimulus to the economy.
Late tonight, I will get first day delivery notes and if I have time, I will put it in my comments section.

*  *  * 

Jan 30.2013    The  January contract month

Withdrawals from Dealers Inventory in oz
Withdrawals from Customer Inventory in oz
Deposits to the Dealer Inventory in oz
Deposits to the Customer Inventory, in oz
4,050.9 (HSBC)
No of oz served (contracts) today
 6    (600)
No of oz to be served (notices)
off the board
Total monthly oz gold served (contracts) so far this month
1063  (106,300 oz) 
Total accumulative withdrawal of gold from the Dealers inventory this month
Total accumulative withdrawal of gold from the Customer inventory this month

317,417.61 oz
We had another  totally uneventful day at the gold vaults.
The dealer had no deposits and no    withdrawals.


January 30.2013:   The January silver contract month

Final for January

Withdrawals from Dealers Inventorynil
Withdrawals from Customer Inventory  188,545.694 oz (Brinks,Delaware,)
Deposits to the Dealer Inventory nil
Deposits to the Customer Inventory   1,114,350.38 oz (HSBC, Delaware)
No of oz served (contracts)6  (30,000)
No of oz to be served (notices)month complete
Total monthly oz silver served (contracts)724  (3,620,000 oz)
Total accumulative withdrawal of silver from the Dealers inventory this month2,592,665.3
Total accumulative withdrawal of silver from the Customer inventory this month9,495,898.9

Today, we  had fair activity  inside the silver vaults.

 we had no dealer deposit and no dealer withdrawal.

*  *  * 

selected news items......

Gold & Silver Jump on Weak US Data, Big Swiss Banks Raise Gold Account Fees

By: Adrian Ash, BullionVault

-- Posted Wednesday, 30 January 2013 | Share this article | Source:

London Gold Market Report

GOLD and silver jumped to 4-session highs above $1674 and $31.65 per ounce respectively Wednesday lunchtime in London, gaining as new data showed the US economy unexpectedly shrinking in late 2012.

US stock-market indices held flat near 5-year highs, while the EuroStoxx 50 was unchanged near 18-month highs despite news that Spain's GDP shrank by 0.7% in the last 3 months of 2012.

Greek newspaper Kathimerini meantime said 30 activists from the communist PAME union briefly stormed the Athens' office of employment minister Yiannis Vroutsis.

The Euro currency this morning rose to its best level in 14 months at $1.3560.

The gold price in Euros today hits its lowest level since May 2012 at €1228 per ounce.

"Bernanke will not be giving a press conference" after today's US Federal Reserve announcement, notes Wednesday's commodity report from Standard Bank. "So there will be plenty of reading between-the-lines of the official statement.

"[But] we feel it is important to note that the Fed's balance sheet is only one piece in a puzzle of growing liquidity and negative real interest rates.

"Strategically we remain bullish on gold over the long term. The cost of holding gold relative to cash remains negligible."

Gold account fees at Swiss banking giants Credit Suisse and UBS are being raised however in a bid to shrink their balance-sheets, says a report in today'sFinancial Times.

"Like their global peers, UBS and Credit Suisse are under regulatory pressure to reduce capital-intensive activities ahead of the introduction of Basel III global banking rules," says the FT.

So the two banks are hiking costs for unallocated accounts – where the customer pays full price to buy gold, but is then owed the metal, bearing credit risk if the bank fails rather than becoming an outright owner as with allocated gold.

Unallocated gold enables the bank to lease out the metal, earning an income from the client's gold. But analysis of 
London Bullion Market Association data shows that the net return on 12-month gold leasing has fallen from averaging 1.63% in the decade to Jan. 2003 to averaging less than 0.40% in the 10 years since.

Moreover, "When [gold] is on balance sheet it does create costs" in the form of capital requirements by regulators, an anonymous source tells the FT.

Gold demand in Asia meantime eased off Wednesday, according to Reuters, as Chinese wholesalers prepared for next month's Lunar New Year celebrations, and Indian wholesalers cut prices in a bid to clear stockpiles.

"Those who have built up a large inventory before [this month's new import-duty] tax hike are selling at a discount right now," the newswire quotes a bank trader in Mumbai, citing discounts to local prices of 0.5% – some $6 per ounce.

The Chinese New Year falls in 2013 on 10th February.

Adrian Ash

Adrian Ash is head of research at BullionVault, the secure, low-cost gold and silver market for private investors online, where you can buy gold and silver in Zurich, Switzerland for just 0.5% commission.

(c) BullionVault 2013


Silver Eagle Sales Surge To All-Time Record In January

Tyler Durden's picture

massive 7.4 million Silver Eagles were purchased from the U.S. Mint in January, considerably higher than the previous record from early 2011. After halting Silver coin production/sales for over a week, the Mint re-opened yesterday and demand once again surged. Having almost doubled from the first week in January, there remains two more days before the book is closed on January's sales. At 140,000 ounces, the Mint has also sold the most ounces of gold in January in almost three years, suggesting the rising 'currency wars' are stoking people's ongoing rotation from paper-to-physical assets as their 'wealth' slowing loses its value.


(courtesy Ed Steer breaks out the sales for us in oz)

Germany's gold at NY Fed may be impaired, Centennial's analysts agree

7:42p ET Tuesday, January 29, 2013
Dear Friend of GATA and Gold:
Repatriation of Germany's gold from the Federal Reserve Bank of New York may be so limited and slow because the gold is tied up by leases that will require years of unwinding, three market analysts at Centennial Precious Metals in Denver agree in a panel discussion broadcast today. The analysts -- Peter Grant, Jonathan Kosares, and George Cooper -- also discuss the U.S. Mint's erratic production of silver eagle coins. The discussion is a half hour long and can be viewed at Centennial's Internet site,, here:

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.


Turkey has been the major link for Iran to obtain gold.  The gold bars obtained would be used to pay for gas.
Now this route is cut off...

(courtesy Reuters)

Dubai gold dealers shun Turkish bars on fears of Iran link

Trade in Turkish gold bars to Iran via Dubai is drying up as buyers refuse to buy the bullion to avoid the risks associated with Turkey’s gold-for-gas trade with Iran.
Author: Humeyra Pamuk
Posted: Wednesday , 30 Jan 2013
DUBAI (Reuters) 

Trade in Turkish gold bars to Iran via Dubai is drying up as a growing number of banks and dealers refuse to buy the bullion to avoid the risks associated with Turkey’s gold-for-gas trade with Iran.
U.S. officials say they are concerned the trade between the two countries provides a financial lifeline to the Iran, which is largely frozen out of the global banking system by Western sanctions.The U.S. State Department said in December that diplomats were in talks with Ankara over the flow of gold to Iran after the Senate approved expanded sanctions on trade with Iran's energy and shipping sectors, which would also restrict trade in precious metals.
That increasing U.S. pressure has already started to create troublesome repercussions for exporters of Turkish gold.
Many dealers in Dubai’s crowded and boisterous gold souk now refuse to take gold bars produced in Turkey. Some ask for a deep discount, saying their clients such as banks and other traders had suspended dealing with Turkish bullion over the past couple of months.
The media spotlight on the gold-for-gas exchange has already helped push Turkey’s gold exports to the UAE to $621 million in November from nearly $2 billion in August, according to the latest official trade data.
Turkey, Iran's biggest natural gas customer, has been paying the Islamic Republic for oil and gas imports with Turkish liras, because Western sanctions prevent it from paying in dollars or euros. Iranians then buy gold in Turkey, and couriers carry the gold worth millions of dollars in their hand luggage to Dubai, where it can be sold for foreign currency or shipped to Iran.
A Turkey-based industry source said the fact that Iranians are buying Turkish gold and shipping it via Dubai has worried international banks and traders and prompted them to suspend trading in Turkish gold bars.
"This is not something declared. It has been going on very quietly for the past month. Some international banks have taken the lead in this and they are simply staying away from any gold bullion that is coming out of Turkey," he added.
A London-based spokesman for Standard Bank, which is active in Dubai’s gold market, said it was not trading any Turkish-branded gold currently and had not regularly traded in Turkish bullion in the past.
He said, however, that the bank continued to trade gold bars registered by the London Bullion Market Association (LBMA), whose Good Delivery List sets the quality standard for physical gold refining.Gold bars produced in Turkey’s two refineries - Nadir Metal and Istanbul Gold Refinery - are both registered in LBMA's Good Delivery list.
"In general we see a decline in the pace of demand from Dubai. After the latest U.S. sanctions, Turkish gold suppliers might have become more cautious too. The market is not as hectic as it was three months ago," an Istanbul-based gold trader said.
Sources based in Dubai and Turkey said representatives from Turkey’s jewellery makers visited Dubai Multi Commodities Center (DMCC), a government-run commodities platform, in December as part of efforts to disperse the clouds over the reputation of Turkish gold.
The DMCC is a commodities platform that provides the infrastructure for the parties to trade and does not control who trades with whom.
"This is not a Dubai-particular issue. It has started here due to the flows of Turkish gold, but this has now become a global issue around Turkish gold," said a source with knowledge of the discussions between DMCC and Turkish officials.
The direct and indirect shipments of gold to Iran do not breach existing Western sanctions imposed over its disputed nuclear programme, but they help Tehran manage its finances.
In Dubai, majority government-owned bank Emirates NBD, an active player in the local bullion market, said in a note to clients in November, "Emirates NBD will, as a pure measure of precaution, stop buying and selling all gold bars from Turkish refineries, even though they might be an accredited refinery by the London Good Delivery or by the Dubai Good Delivery List."
A source in the Dubai office of major bullion dealer ScotiaMocatta, a division of Bank of Nova Scotia, said it was currently not dealing with Turkish gold bars.
Turkey’s gold bullion exports to the United Arab Emirates jumped in August as Turkish exporters re-routed gold destined for Iran to Dubai, following increasing pressure from the United States.
Turkish ministers have acknowledged the "gold-for-gas" trade but say it is carried out entirely by the private sector and is not subject to U.S. sanctions.
"We do not feel legally bound by any unilateral sanctions by any country, except if they are endorsed by the U.N. Security Council under Chapter 7," a Turkish government official said."We have a huge (natural gas) consumption requirement from within Turkey ... On the gold issue ... If they (Iranians) go to the market, we cannot prevent them. If they buy gold here and send it somewhere else, that is up to them ... It is not government or government agencies selling gold."
In Dubai, the government has also increased pressure on traders, forcing them to be cautious about taking Turkish gold, several industry sources said.
"We also know that the local government have their eyes on this. They have the news and they are collecting information; they are also doing a back-door investigation," said a Dubai-based gold industry source, who requested anonymity due to the sensitive nature of the issue.
"If they get to the conclusion that something is really going wrong, maybe they will investigate a few companies. But it will all be done secretly, so if that's proven they will not harm the reputation of the companies," he added.