http://harveyorgan.blogspot.com/2013/07/total-comex-gold-falls-again-to-6885.html
Gold exploded up $42.60 to $1336.40 (comex closing time ). Silver was also up by $1.05 to $20. 50 (comex closing time)
In the access market at 5:00 pm, gold and silver finished trading at the following prices :
gold: $1335.90
At the Comex, the open interest in silver rose by 788 contracts to 132,732.
Tonight, the Comex registered or dealer inventory of gold remains below the 1 million oz mark at 950,441.152 oz or 29.56 tonnes. This is dangerously low especially when we are coming up to the August delivery month.
Remember in June we had almost 31 tonnes of gold stand for delivery. The total of all gold at the comex (dealer and customer) lowers again tonight breaking deeper below the 7 million oz barrier resting at 6.885 million oz or 214.17 tonnes.
JPMorgan's customer inventory remains constant tonight at only 46,069.447 oz or 1.43 tonnes. It's dealer inventory rests at 390,092.326 oz (12.13 tonnes) but it still must settle upon contracts issued in the May and June delivery month which far exceeds its inventory. (see last Wednesday's Bill Kaye interview with Lars Schall on the lack of deliveries at the comex per outstanding issues).
The total of the 3 major gold bullion dealers( Scotia , HSBC and JPMorgan) in its Comex gold dealer account registers only 24.92 tonnes of gold. The total of all of the dealers remains tonight to 29.56 tonnes!! Brinks continues to record a low of only 4.18 tonnes in its dealer account.
The GLD reported another loss in inventory tonight of 1.20 tonnes of gold with an inventory reading of 931.26 tonnes of gold. We had neither a gain nor a loss in silver inventory at the SLV.
The total gold comex open interest rose by 5193 contracts from 439,539 up to 444,732 with gold rising in price by $8.70 on Friday. We are now into the non active July contract and here the OI rests at 82 down 2 contracts . We had 0 delivery notices filed on Friday so in essence we lost 2 contracts or 200 oz of gold that will not stand for the July delivery month. The next active delivery month for gold is August and here the OI fell by 4730 contracts from 135,265 down to 130,535 as we are less than 1 1/2 weeks away from first day notice for the August contract month. The estimated volume today was good at 232,366 contracts. The confirmed volume Friday was fair at 180,568.
The total silver Comex OI rose by 788 contracts with silver rising in price on Friday by 7 cents. The total of all comex silver OI stands at 132,732 contracts. We are now into the big delivery month of July and here the OI fell by 177 contracts down to 271. We had 163 notices filed on Friday so in essence we lost 14 contracts or 70,000 oz of silver standing in the July contract month. The next big delivery month is September and here the OI rose by 769 contracts up to 78,894. The estimated volume today was good coming in at only 51,290 contracts. The confirmed volume on Friday was poor at 23,315.
The total dealer comex gold remains dramatically below 1 million oz at 950,441.152 oz or 29.56 tonnes of gold.The total of all comex gold, dealer and customer falls again tonight to 6.885 million oz or 214.17 tonnes.
Now for JPMorgan's dealer side and what their inventory should be:
On June 11.2013 we reported that 4935 contracts have been issued by JPMorgan's house account(dealer account) since first day notice and not yet subtracted out of inventory.
Tuesday, July 2: 24 contracts (notices) were issued by JPMorgan's dealer or house account.
Wednesday: July 3: 20 contracts were issued by JPMorgan's dealer or house account.
Friday: July 5: 10 contracts were issued byJPMorgan's dealer our house account.
Tuesday; July 15.2013: 16 notices issued by JPMorgan dealer side.
Monday: July 22.2013: 6 notices issued by JPMorgan dealer side
You will also recall 7 weeks ago I reported that JPMorgan had 470,322.102 oz in it's dealer account. From that day until now, 80,229.777 oz was either withdrawn or adjusted out dealer , leaving the dealer side at 390,092,33 oz where it sits tonight.
On the dealer side here are the last 30 trading sessions as to notices issued from JPMorgan's dealer side:
Friday: zero
Monday: 1
Another disturbing piece of news is the low dealer gold inventory for our 3 major bullion banks(Scotia, HSBC and JPMorgan). These 3 dealer gold lowers to 24.92 tonnes tonight
i) Scotia: 190,375.136 oz or 6.206 tonnes
ii) HSBC: 221,093.814 oz or 6.87 tonnes
iii) JPMorgan: 390,092.326 oz or 12.13 tonnes
total: 24.92 tonnes
Brinks dealer account which did have the lions share of the dealer gold remains tonight at 134,524.79 oz or 4.18 tonnes (in the beginning of July they had over 13 tonnes and today only 4.18 tonnes!!)
Today we had 6 notices served upon our longs for 600 oz of gold. In order to calculate what I believe will stand for delivery in July, I take the total number of notices served (109) x 100 oz per contract to give us 10,900 oz served + I take the OI remaining for July (82) and subtract out today's notices (6) which leaves us with 76 notices still left to be served upon our longs or 7,600 oz
Thus we have the following gold ounces standing for metal:
109 contracts served x 100 oz = 10,900 oz, + 76 contracts left to be served upon x 100 oz = 7,600 oz to give us 18,500 oz or 0.5754 tonnes of gold. We lost 200 gold ounces standing for July.
Ladies and Gentlemen: we have a three-fold problem:
i) the total dealer inventory of gold remains at a very dangerously low level of only 29.56 tonnes and none of the 9.5 tonnes delivery notices from May and the major part of the 30.70 tonnes from June issued by JPM on its dealer side has yet to leave.
ii) a) JPMorgan's customer inventory remains at an unbelievably low 46,069.447 oz. (1.43 tonnes of gold)
If you are a customer of JPMorgan and have your gold in its vault, I think it is best to remove it before we have another fiasco like MFGlobal.
ii b) JPMorgan's dealer account rests tonight at 390,092.326 oz. However all of this gold has been spoken for plus an additional 112,307.68 oz of deficient gold.
iii) the 3 major bullion banks have collectively only 24.92 tonnes of gold left in their dealer account.
Monday, July 22, 2013
Total comex gold falls again to 6.885 million oz/Spain starts to borrow funds from its pension fund to pay out/ Gold and silver explode
Good evening Ladies and Gentlemen:
Gold exploded up $42.60 to $1336.40 (comex closing time ). Silver was also up by $1.05 to $20. 50 (comex closing time)
In the access market at 5:00 pm, gold and silver finished trading at the following prices :
gold: $1335.90
silver: $20.55
It seems that our specs are in deep trouble with the commercials net long. We will have in the next few weeks a plethora of buyers and a scarcity of suppliers of paper gold.
It seems that our specs are in deep trouble with the commercials net long. We will have in the next few weeks a plethora of buyers and a scarcity of suppliers of paper gold.
At the Comex, the open interest in silver rose by 788 contracts to 132,732.
The open interest on the entire gold comex contracts rose by 5193 contracts to 439,539 with gold's rise in price on Friday.
Tonight, the Comex registered or dealer inventory of gold remains below the 1 million oz mark at 950,441.152 oz or 29.56 tonnes. This is dangerously low especially when we are coming up to the August delivery month.
Remember in June we had almost 31 tonnes of gold stand for delivery. The total of all gold at the comex (dealer and customer) lowers again tonight breaking deeper below the 7 million oz barrier resting at 6.885 million oz or 214.17 tonnes.
JPMorgan's customer inventory remains constant tonight at only 46,069.447 oz or 1.43 tonnes. It's dealer inventory rests at 390,092.326 oz (12.13 tonnes) but it still must settle upon contracts issued in the May and June delivery month which far exceeds its inventory. (see last Wednesday's Bill Kaye interview with Lars Schall on the lack of deliveries at the comex per outstanding issues).
The total of the 3 major gold bullion dealers( Scotia , HSBC and JPMorgan) in its Comex gold dealer account registers only 24.92 tonnes of gold. The total of all of the dealers remains tonight to 29.56 tonnes!! Brinks continues to record a low of only 4.18 tonnes in its dealer account.
The GLD reported another loss in inventory tonight of 1.20 tonnes of gold with an inventory reading of 931.26 tonnes of gold. We had neither a gain nor a loss in silver inventory at the SLV.
Today, we had the 11th consecutive day for negative GOFO rates with the 3 months rate at -05%.
Today, we have 2 huge commentaries from Bill Holter. The first commentary on a bank gold run we are witnessing right now. The second commentary prepares us for what we should expect and how we should act.
On the physical side of things, Kingworld news and Eric King discusses gold
with John Embry and the topic is Ben Bernanke and his understanding of gold.
We have a great discussion on gold with Alasdair Macleod on how the gold derivatives have mispriced gold. The government of India is again attacking gold as their current account deficits rise as citizens use all possible means to obtain gold.
On the paper side of things, we have commentaries from Michael Snyder and F.F. Wiley on Detroit's bankruptcy filing.
Simon Black discusses problems resurfacing in Iceland as its government has now increased its sovereign debt 500% from 2008 to today. They too are prone for a major hit on their debt.
John Rubino of DollarCollapse discusses the Detroit bankruptcy together with chaos in Portugal and Spain to illustrate that "bombs" have ignited one floor below.
And finally, Ambrose Evans Pritchard discusses the latest data form Europe where everybody's debt to GDP rises. He believes that the poorer nations should form a debtors cartel.
On the physical side of things, Kingworld news and Eric King discusses gold
with John Embry and the topic is Ben Bernanke and his understanding of gold.
We have a great discussion on gold with Alasdair Macleod on how the gold derivatives have mispriced gold. The government of India is again attacking gold as their current account deficits rise as citizens use all possible means to obtain gold.
On the paper side of things, we have commentaries from Michael Snyder and F.F. Wiley on Detroit's bankruptcy filing.
Simon Black discusses problems resurfacing in Iceland as its government has now increased its sovereign debt 500% from 2008 to today. They too are prone for a major hit on their debt.
John Rubino of DollarCollapse discusses the Detroit bankruptcy together with chaos in Portugal and Spain to illustrate that "bombs" have ignited one floor below.
And finally, Ambrose Evans Pritchard discusses the latest data form Europe where everybody's debt to GDP rises. He believes that the poorer nations should form a debtors cartel.
We will go over these and many other stories today, but first......
Let us now head over to the comex and assess trading over there today.
Here are the details:
The total gold comex open interest rose by 5193 contracts from 439,539 up to 444,732 with gold rising in price by $8.70 on Friday. We are now into the non active July contract and here the OI rests at 82 down 2 contracts . We had 0 delivery notices filed on Friday so in essence we lost 2 contracts or 200 oz of gold that will not stand for the July delivery month. The next active delivery month for gold is August and here the OI fell by 4730 contracts from 135,265 down to 130,535 as we are less than 1 1/2 weeks away from first day notice for the August contract month. The estimated volume today was good at 232,366 contracts. The confirmed volume Friday was fair at 180,568.
The total silver Comex OI rose by 788 contracts with silver rising in price on Friday by 7 cents. The total of all comex silver OI stands at 132,732 contracts. We are now into the big delivery month of July and here the OI fell by 177 contracts down to 271. We had 163 notices filed on Friday so in essence we lost 14 contracts or 70,000 oz of silver standing in the July contract month. The next big delivery month is September and here the OI rose by 769 contracts up to 78,894. The estimated volume today was good coming in at only 51,290 contracts. The confirmed volume on Friday was poor at 23,315.
Comex gold/May contract month:
July 22/2013
the July contract month
the July contract month
Ounces
| |
Withdrawals from Dealers Inventory in oz
|
nil
|
Withdrawals from Customer Inventory in oz
|
103,484.367 (HSBC)
|
Deposits to the Dealer Inventory in oz
|
nil
|
Deposits to the Customer Inventory, in oz
| nil |
No of oz served (contracts) today
|
6 ( 600 oz)
|
No of oz to be served (notices)
|
76 (7600 oz)
|
Total monthly oz gold served (contracts) so far this month
|
109 (10,900 oz)
|
Total accumulative withdrawal of gold from the Dealers inventory this month
|
339,257.96 oz
|
Total accumulative withdrawal of gold from the Customer inventory this month
| 583,999.18 oz |
We had fair activity at the gold vaults
The dealer had 0 deposits and 0 dealer withdrawal
We had 0 customer deposits today :
total customer deposits: nil oz
we had 1 huge customer withdrawals
i) Out of HSBC customer account: 103,484.367 oz
Total Customer withdrawals: 103,484.367 oz
I wonder what on earth is scaring our owners of gold at the Comex.
Today we had 0 adjustments
Thus tonight we have the following JPMorgan gold inventory
JPM dealer inventory: 390,092.326 oz 12.13 tonnes
JPM customer inventory: 46,069.447 oz or 1.43 tonnes
Today, 6 notices were issued from JPMorgan dealer account and 0 from their client or customer account.
As I indicated to you on Friday night, JPMorgan probably settled upon all customer issuance leaving only the dealer side still outstanding.
total customer deposits: nil oz
we had 1 huge customer withdrawals
i) Out of HSBC customer account: 103,484.367 oz
Total Customer withdrawals: 103,484.367 oz
I wonder what on earth is scaring our owners of gold at the Comex.
Today we had 0 adjustments
Thus tonight we have the following JPMorgan gold inventory
JPM dealer inventory: 390,092.326 oz 12.13 tonnes
JPM customer inventory: 46,069.447 oz or 1.43 tonnes
Today, 6 notices were issued from JPMorgan dealer account and 0 from their client or customer account.
As I indicated to you on Friday night, JPMorgan probably settled upon all customer issuance leaving only the dealer side still outstanding.
The total dealer comex gold remains dramatically below 1 million oz at 950,441.152 oz or 29.56 tonnes of gold.The total of all comex gold, dealer and customer falls again tonight to 6.885 million oz or 214.17 tonnes.
Now for JPMorgan's dealer side and what their inventory should be:
On June 11.2013 we reported that 4935 contracts have been issued by JPMorgan's house account(dealer account) since first day notice and not yet subtracted out of inventory.
Tuesday, July 2: 24 contracts (notices) were issued by JPMorgan's dealer or house account.
Wednesday: July 3: 20 contracts were issued by JPMorgan's dealer or house account.
Friday: July 5: 10 contracts were issued byJPMorgan's dealer our house account.
Tuesday; July 15.2013: 16 notices issued by JPMorgan dealer side.
Monday: July 22.2013: 6 notices issued by JPMorgan dealer side
You will also recall 7 weeks ago I reported that JPMorgan had 470,322.102 oz in it's dealer account. From that day until now, 80,229.777 oz was either withdrawn or adjusted out dealer , leaving the dealer side at 390,092,33 oz where it sits tonight.
On the dealer side here are the last 30 trading sessions as to notices issued from JPMorgan's dealer side:
Friday: zero
Monday: 1
Tuesday: 0
Wednesday : 0
Wednesday : 0
Thursday: 0
Friday: 0
Monday: 0 .
Tuesday: 0
Wednesday: 0
Thursday: 0
Friday: 0
Monday:0
Tuesday: 0
Wednesday: 0
Thursday:0
Friday: 0
Monday: 0
Tuesday: 24
Wednesday: 20
Thursday/Friday: 10
Monday: 0
Tuesday: 0
Wednesday:0
Thursday: 0
Friday: 0
Friday: 0
Monday: 0 .
Tuesday: 0
Wednesday: 0
Thursday: 0
Friday: 0
Monday:0
Tuesday: 0
Wednesday: 0
Thursday:0
Friday: 0
Monday: 0
Tuesday: 24
Wednesday: 20
Thursday/Friday: 10
Monday: 0
Tuesday: 0
Wednesday:0
Thursday: 0
Friday: 0
Monday: 0
Tuesday: 24
Wednesday:0
Thursday
Friday :0
Monday: 6
we will now account for the new data tonight:
Thus, 5030 notices have been issued by JPMorgan (dealer side) for the month of June until today for 503,000 oz and these ounces have yet to settle from JPMorgan's dealer side.
JPMorgan's dealer vault registers tonight 390,092.326 oz.
Somehow we have a huge negative balance as i) the gold has not left JPMorgan's dealer account and has yet to settle
and
ii) it is now deficient by 102,307.68 oz (390,092.326 inventory - 503,000 oz issued = -112,907.68 oz)
In other words, the entire 390,092.326 oz must be first transferred out of Morgan's dealer category ( in the same format as in the customer category) leaving it with zero, plus the 112,907.68 of additional deficient gold
JPMorgan has not had any deposits in gold in quite some time. As a matter of fact, zero ounces has entered on the dealer side from the beginning of 2013.
How will JPMorgan satisfy this shortfall??
Tuesday: 24
Wednesday:0
Thursday
Friday :0
Monday: 6
we will now account for the new data tonight:
Thus, 5030 notices have been issued by JPMorgan (dealer side) for the month of June until today for 503,000 oz and these ounces have yet to settle from JPMorgan's dealer side.
JPMorgan's dealer vault registers tonight 390,092.326 oz.
Somehow we have a huge negative balance as i) the gold has not left JPMorgan's dealer account and has yet to settle
and
ii) it is now deficient by 102,307.68 oz (390,092.326 inventory - 503,000 oz issued = -112,907.68 oz)
In other words, the entire 390,092.326 oz must be first transferred out of Morgan's dealer category ( in the same format as in the customer category) leaving it with zero, plus the 112,907.68 of additional deficient gold
JPMorgan has not had any deposits in gold in quite some time. As a matter of fact, zero ounces has entered on the dealer side from the beginning of 2013.
How will JPMorgan satisfy this shortfall??
Another disturbing piece of news is the low dealer gold inventory for our 3 major bullion banks(Scotia, HSBC and JPMorgan). These 3 dealer gold lowers to 24.92 tonnes tonight
i) Scotia: 190,375.136 oz or 6.206 tonnes
ii) HSBC: 221,093.814 oz or 6.87 tonnes
iii) JPMorgan: 390,092.326 oz or 12.13 tonnes
total: 24.92 tonnes
Brinks dealer account which did have the lions share of the dealer gold remains tonight at 134,524.79 oz or 4.18 tonnes (in the beginning of July they had over 13 tonnes and today only 4.18 tonnes!!)
Today we had 6 notices served upon our longs for 600 oz of gold. In order to calculate what I believe will stand for delivery in July, I take the total number of notices served (109) x 100 oz per contract to give us 10,900 oz served + I take the OI remaining for July (82) and subtract out today's notices (6) which leaves us with 76 notices still left to be served upon our longs or 7,600 oz
Thus we have the following gold ounces standing for metal:
109 contracts served x 100 oz = 10,900 oz, + 76 contracts left to be served upon x 100 oz = 7,600 oz to give us 18,500 oz or 0.5754 tonnes of gold. We lost 200 gold ounces standing for July.
Ladies and Gentlemen: we have a three-fold problem:
i) the total dealer inventory of gold remains at a very dangerously low level of only 29.56 tonnes and none of the 9.5 tonnes delivery notices from May and the major part of the 30.70 tonnes from June issued by JPM on its dealer side has yet to leave.
ii) a) JPMorgan's customer inventory remains at an unbelievably low 46,069.447 oz. (1.43 tonnes of gold)
If you are a customer of JPMorgan and have your gold in its vault, I think it is best to remove it before we have another fiasco like MFGlobal.
ii b) JPMorgan's dealer account rests tonight at 390,092.326 oz. However all of this gold has been spoken for plus an additional 112,307.68 oz of deficient gold.
iii) the 3 major bullion banks have collectively only 24.92 tonnes of gold left in their dealer account.
Silver:
July 22/2013: July silver contract month:
July contract month
July contract month
| Silver |
Ounces
|
| Withdrawals from Dealers Inventory | 599,622.775 (Scotia) |
| Withdrawals from Customer Inventory | 1,615,655.380 oz (Brinks, CNT,) |
| Deposits to the Dealer Inventory | nil |
| Deposits to the Customer Inventory | 599,622.775 (JPM) |
| No of oz served (contracts) | 15 (75,000 oz) |
| No of oz to be served (notices) | 256 (1,280,000 oz) |
| Total monthly oz silver served (contracts) | 3171 (15,855,000) |
| Total accumulative withdrawal of silver from the Dealers inventory this month | 1,346,324.2 |
| Total accumulative withdrawal of silver from the Customer inventory this month | 4,049,364.1 oz |
Today, we had good activity inside the silver vaults.
we had 0 dealer deposits and 1 dealer withdrawal.
i) Out of Scotia: 599,622.775 oz (and this landed in JPMorgan customer account)
We had 1 customer deposit:
i) Into JPMorgan: 599,622.775 oz
total customer deposit: 599,622.775 oz
we had 2 customer withdrawals:
We had 1 customer deposit:
i) Into JPMorgan: 599,622.775 oz
total customer deposit: 599,622.775 oz
we had 2 customer withdrawals:
i) Out of CNT: 423,399.38 oz
ii) Out of Brinks; 1,192,256.000 oz (another of those exact round numbers)
total customer withdrawal : 1,615,655.380 oz
ii) Out of Brinks; 1,192,256.000 oz (another of those exact round numbers)
total customer withdrawal : 1,615,655.380 oz
we had 2 adjustments today
i) Out of HSBC: 5,102.35 oz was adjusted out of the customer and into the dealer account of hSBC
ii) Out of Scotia; 35,984.47 oz was adjusted out of the dealer and back into the customer account.
i) Out of HSBC: 5,102.35 oz was adjusted out of the customer and into the dealer account of hSBC
ii) Out of Scotia; 35,984.47 oz was adjusted out of the dealer and back into the customer account.
Thus we have the following:
Registered silver at : 48.065 million oz
total of all silver: 164.622 million oz.
Now let us check on gold inventories at the GLD first:
July 22.2013: we had another bleed of 1.2 tonnes
July 22.2013: we had another bleed of 1.2 tonnes
Tonnes931.26
Ounces29,940,986.77
Value US$39.7196 billion
Gold Breaks Above $1300 As Shorts Cover Most In 4 Months
Submitted by Tyler Durden on 07/21/2013 19:43 -0400
Almost 11% of short gold positions covered in the last week according to CFTC Commitment of Traders' data. That is thelargest weekly drop in net shorts for four months and the combined futures-and-options net long position jumped 13,287 contracts or an impressive 48% (the most since Nov 08). Following the ubiquitous "sell-while-Bernanke-is-speaking" dump last Wednesday gold has risen almost 4% touching $1320 this evening as Asia opens. So with Asian physical demand remaining high and COMEX vault's running dry (and JPMorgan's on fire), we wonder - now that Taper is off (according to equity market pundits) if this is the start of the long-awaited short-covering rally back to reality for the precious metal.
Big short-covering in gold last week...
and gold is breaking back above $1300...
The Gold bank run is on....
(courtesy Bill Holter/Miles Franklin)
"I really don't understand Gold"
Friday Friday marked the end of two straight weeks where the GOFO rates were negative. Over the weekend, Reuters finally put an article out explaining this http://www.reuters.com/
What is happening is that investors are pushing back against the "fractional reserve" paper Gold market. Put simply, they are valuing Gold in hand, now, at a higher price than a futures price locked in by a contract. Whether it is because investors are skeptical that they won't receive their Gold (for good reason) because it's not there or they don't trust the counter party it doesn't matter, "trust is breaking down".
We also got word late Friday that JP Morgan had a withdrawal from their customer inventory of 90,000 ounces, this was a 66% drop and has left the inventory at a laughable 46,000 ounces. Was this to settle contracts that were due in May and June? Probably, but we are now staring August directly in the face with potential settlements greater than the inventories of JP Morgan, Scotia, HSBC and Brinks combined. The potential for an historic short squeeze in the Gold market has never been greater, I think we will soon find out who "really" has it and who doesn't.
I do want to pick on our chairman of the Federal Reserve just a little more because he reached a new high in disinformation and a new low in stupidity in front of the Senate Thursday. He said and I quote "Nobody understands gold prices, and I don't really pretend to understand them either". Really? Nobody? But wait, why would you even answer any questions or even speak about Gold? It, according to you "is not money" and Lord knows since you are "the chairman" who would know the definition of "money" better than you?
Regardless (irregardless is not a word) of what Ben Bernocchio says or wants people to think, we are (and have been for more than 3 months) witnessing a bank run. This "bank run" is not on any one single bank, it is on the system itself. Inventories being drawn down, custodians refusing to deliver and even sovereigns making claim to their Gold shows that a choice has been made. The negative curve (backwardation) is proof positive that investors are voting with their feet and saying "I want my Gold, real Gold, and I want it now...I will not accept any substitutes".
As we have said all along, the paper markets have written receipts for more than 100 ounces for every one real ounce that is available to deliver. How do you suppose this is going to work out? I guess the best way to explain this is by asking a question or two. What do you suppose will happen to the value of 1 real ounce of Gold when it is learned that "supply" was overstated by more than 100 to 1? Or another way, what will happen to the price of Gold when it is discovered that Gold is 100+ times more scarce than it was commonly believed?
You see, what was "supply" really wasn't even though it temporarily acted that way (on price) but it will now be flipped into demand, real demand for real Gold...no substitutions. Not only will those who are contractually short need to cover and compete with natural demand, those who "thought" they had the bases covered will become buyers to buy what they "thought" they already had. This will work not only like a high horsepower motor, you can add the turbo charger (short covering) and a NOS shot of another couple hundred horsepower when "owners" find out that they are only holding an empty paper bag.
There is now virtually no question in my mind whatsoever that we have a short squeeze and a wipeout "run" on inventories coming. I believe that a $200-$300 week is coming shortly that will be followed by Reg Howe's "you'll go to bed with $1,500 Gold and wake up $4,000 bid and nothing offered". What will you do then? Sell? Buy what is no longer buyable? It's a good question which I will broach later this week.
Regards, Bill H.
(courtesy David Baker, David Franklin/Sprott/GATA)
David Baker and David Franklin: The Shanghai gold surprise
Submitted by cpowell on Mon, 2013-07-22 03:55. Section: Daily Dispatches
11:52p ET Sunday, July 21, 2013
Dear Friend of GATA and Gold:
Sprott Asset Management's David Baker and David Franklin note that the new Shanghai Gold Exchange seems to be arranging delivery of the equivalent of all the world's gold production, many times the amount of gold delivery arranged by the New York Commodities Exchange. "How that can coincide with a gold price drop of $400 per ounce over Q2," Baker and Franklin write, "is beyond our capability to explain."
No problem -- explaining such anomalies is what GATA is for.
The Baker and Franklin essay is headlined "The Shanghai Gold Surprise" and it's posted at the Sprott Internet site here:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
Bill Holter is now preparing us when gold hits 4,000 bid no offer>>>
(courtesy Bill Holter/Miles Franklin)
What will you do?
I finished my piece yesterday asking the question "what will you do?". Assuming that I am correct that a massive short squeeze in precious metals has started (if you disagree, please point out where my logic is wrong), we should see several events occur. First, we will probably see a week or two (maybe not in succession) where Gold trades up $200-$300 bringing us back to the $1,700-$1,900 level, what will you do ?
Will you wipe your brow, breath a sigh of relief and call your broker or coin dealer and sell? Will you be "relieved" that you could get out of your "trade" at break even or "maximum profit"? Will you "swear" never to do anything as "stupid" as chasing Gold and leaving the "safety" of your FDIC "insured" Dollar account? ...OR, will you get out of more Dollars for ounces...or, will you do nothing ?
* * *
Let's go another step further, let's assume (as I do) that this happens and we get news of an exchange failure or default on a Friday afternoon. Monday morning we have chaos and some exchange doesn't even open. We look at other exchanges and see that Gold is $2,500 bid, or $4,000 bid or even higher with little to no volume because there are virtually no offers. What would you do in this situation? Would you call a cash dealer and sell, sell, sell followed by doing a "happy dance" because you "scored" and SCORED BIG? Or would you call this cash dealer to see if he had any morsels available for sale...or would you do nothing?
Almost 11% of short gold positions covered in the last week according to CFTC Commitment of Traders' data. That is thelargest weekly drop in net shorts for four months and the combined futures-and-options net long position jumped 13,287 contracts or an impressive 48% (the most since Nov 08). Following the ubiquitous "sell-while-Bernanke-is-speaking" dump last Wednesday gold has risen almost 4% touching $1320 this evening as Asia opens. So with Asian physical demand remaining high and COMEX vault's running dry (and JPMorgan's on fire), we wonder - now that Taper is off (according to equity market pundits) if this is the start of the long-awaited short-covering rally back to reality for the precious metal.
Big short-covering in gold last week...
and gold is breaking back above $1300...
The Gold bank run is on....
(courtesy Bill Holter/Miles Franklin)
The Gold bank run is on....
(courtesy Bill Holter/Miles Franklin)
(courtesy Bill Holter/Miles Franklin)
"I really don't understand Gold"
Friday Friday marked the end of two straight weeks where the GOFO rates were negative. Over the weekend, Reuters finally put an article out explaining this http://www.reuters.com/
What is happening is that investors are pushing back against the "fractional reserve" paper Gold market. Put simply, they are valuing Gold in hand, now, at a higher price than a futures price locked in by a contract. Whether it is because investors are skeptical that they won't receive their Gold (for good reason) because it's not there or they don't trust the counter party it doesn't matter, "trust is breaking down".
We also got word late Friday that JP Morgan had a withdrawal from their customer inventory of 90,000 ounces, this was a 66% drop and has left the inventory at a laughable 46,000 ounces. Was this to settle contracts that were due in May and June? Probably, but we are now staring August directly in the face with potential settlements greater than the inventories of JP Morgan, Scotia, HSBC and Brinks combined. The potential for an historic short squeeze in the Gold market has never been greater, I think we will soon find out who "really" has it and who doesn't.
I do want to pick on our chairman of the Federal Reserve just a little more because he reached a new high in disinformation and a new low in stupidity in front of the Senate Thursday. He said and I quote "Nobody understands gold prices, and I don't really pretend to understand them either". Really? Nobody? But wait, why would you even answer any questions or even speak about Gold? It, according to you "is not money" and Lord knows since you are "the chairman" who would know the definition of "money" better than you?
Regardless (irregardless is not a word) of what Ben Bernocchio says or wants people to think, we are (and have been for more than 3 months) witnessing a bank run. This "bank run" is not on any one single bank, it is on the system itself. Inventories being drawn down, custodians refusing to deliver and even sovereigns making claim to their Gold shows that a choice has been made. The negative curve (backwardation) is proof positive that investors are voting with their feet and saying "I want my Gold, real Gold, and I want it now...I will not accept any substitutes".
As we have said all along, the paper markets have written receipts for more than 100 ounces for every one real ounce that is available to deliver. How do you suppose this is going to work out? I guess the best way to explain this is by asking a question or two. What do you suppose will happen to the value of 1 real ounce of Gold when it is learned that "supply" was overstated by more than 100 to 1? Or another way, what will happen to the price of Gold when it is discovered that Gold is 100+ times more scarce than it was commonly believed?
You see, what was "supply" really wasn't even though it temporarily acted that way (on price) but it will now be flipped into demand, real demand for real Gold...no substitutions. Not only will those who are contractually short need to cover and compete with natural demand, those who "thought" they had the bases covered will become buyers to buy what they "thought" they already had. This will work not only like a high horsepower motor, you can add the turbo charger (short covering) and a NOS shot of another couple hundred horsepower when "owners" find out that they are only holding an empty paper bag.
There is now virtually no question in my mind whatsoever that we have a short squeeze and a wipeout "run" on inventories coming. I believe that a $200-$300 week is coming shortly that will be followed by Reg Howe's "you'll go to bed with $1,500 Gold and wake up $4,000 bid and nothing offered". What will you do then? Sell? Buy what is no longer buyable? It's a good question which I will broach later this week.
Regards, Bill H.
(courtesy David Baker, David Franklin/Sprott/GATA)
David Baker and David Franklin: The Shanghai gold surprise
Submitted by cpowell on Mon, 2013-07-22 03:55. Section: Daily Dispatches
11:52p ET Sunday, July 21, 2013
Dear Friend of GATA and Gold:
Sprott Asset Management's David Baker and David Franklin note that the new Shanghai Gold Exchange seems to be arranging delivery of the equivalent of all the world's gold production, many times the amount of gold delivery arranged by the New York Commodities Exchange. "How that can coincide with a gold price drop of $400 per ounce over Q2," Baker and Franklin write, "is beyond our capability to explain."
No problem -- explaining such anomalies is what GATA is for.
The Baker and Franklin essay is headlined "The Shanghai Gold Surprise" and it's posted at the Sprott Internet site here:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
Bill Holter is now preparing us when gold hits 4,000 bid no offer>>>
(courtesy Bill Holter/Miles Franklin)
What will you do?
I finished my piece yesterday asking the question "what will you do?". Assuming that I am correct that a massive short squeeze in precious metals has started (if you disagree, please point out where my logic is wrong), we should see several events occur. First, we will probably see a week or two (maybe not in succession) where Gold trades up $200-$300 bringing us back to the $1,700-$1,900 level, what will you do ?
Will you wipe your brow, breath a sigh of relief and call your broker or coin dealer and sell? Will you be "relieved" that you could get out of your "trade" at break even or "maximum profit"? Will you "swear" never to do anything as "stupid" as chasing Gold and leaving the "safety" of your FDIC "insured" Dollar account? ...OR, will you get out of more Dollars for ounces...or, will you do nothing ?
* * *
Let's go another step further, let's assume (as I do) that this happens and we get news of an exchange failure or default on a Friday afternoon. Monday morning we have chaos and some exchange doesn't even open. We look at other exchanges and see that Gold is $2,500 bid, or $4,000 bid or even higher with little to no volume because there are virtually no offers. What would you do in this situation? Would you call a cash dealer and sell, sell, sell followed by doing a "happy dance" because you "scored" and SCORED BIG? Or would you call this cash dealer to see if he had any morsels available for sale...or would you do nothing?
What is happening is that investors are pushing back against the "fractional reserve" paper Gold market. Put simply, they are valuing Gold in hand, now, at a higher price than a futures price locked in by a contract. Whether it is because investors are skeptical that they won't receive their Gold (for good reason) because it's not there or they don't trust the counter party it doesn't matter, "trust is breaking down".
We also got word late Friday that JP Morgan had a withdrawal from their customer inventory of 90,000 ounces, this was a 66% drop and has left the inventory at a laughable 46,000 ounces. Was this to settle contracts that were due in May and June? Probably, but we are now staring August directly in the face with potential settlements greater than the inventories of JP Morgan, Scotia, HSBC and Brinks combined. The potential for an historic short squeeze in the Gold market has never been greater, I think we will soon find out who "really" has it and who doesn't.
I do want to pick on our chairman of the Federal Reserve just a little more because he reached a new high in disinformation and a new low in stupidity in front of the Senate Thursday. He said and I quote "Nobody understands gold prices, and I don't really pretend to understand them either". Really? Nobody? But wait, why would you even answer any questions or even speak about Gold? It, according to you "is not money" and Lord knows since you are "the chairman" who would know the definition of "money" better than you?
Regardless (irregardless is not a word) of what Ben Bernocchio says or wants people to think, we are (and have been for more than 3 months) witnessing a bank run. This "bank run" is not on any one single bank, it is on the system itself. Inventories being drawn down, custodians refusing to deliver and even sovereigns making claim to their Gold shows that a choice has been made. The negative curve (backwardation) is proof positive that investors are voting with their feet and saying "I want my Gold, real Gold, and I want it now...I will not accept any substitutes".
As we have said all along, the paper markets have written receipts for more than 100 ounces for every one real ounce that is available to deliver. How do you suppose this is going to work out? I guess the best way to explain this is by asking a question or two. What do you suppose will happen to the value of 1 real ounce of Gold when it is learned that "supply" was overstated by more than 100 to 1? Or another way, what will happen to the price of Gold when it is discovered that Gold is 100+ times more scarce than it was commonly believed?
You see, what was "supply" really wasn't even though it temporarily acted that way (on price) but it will now be flipped into demand, real demand for real Gold...no substitutions. Not only will those who are contractually short need to cover and compete with natural demand, those who "thought" they had the bases covered will become buyers to buy what they "thought" they already had. This will work not only like a high horsepower motor, you can add the turbo charger (short covering) and a NOS shot of another couple hundred horsepower when "owners" find out that they are only holding an empty paper bag.
There is now virtually no question in my mind whatsoever that we have a short squeeze and a wipeout "run" on inventories coming. I believe that a $200-$300 week is coming shortly that will be followed by Reg Howe's "you'll go to bed with $1,500 Gold and wake up $4,000 bid and nothing offered". What will you do then? Sell? Buy what is no longer buyable? It's a good question which I will broach later this week.
Regards, Bill H.
(courtesy David Baker, David Franklin/Sprott/GATA)
David Baker and David Franklin: The Shanghai gold surprise
Submitted by cpowell on Mon, 2013-07-22 03:55. Section: Daily Dispatches
11:52p ET Sunday, July 21, 2013
Dear Friend of GATA and Gold:
Sprott Asset Management's David Baker and David Franklin note that the new Shanghai Gold Exchange seems to be arranging delivery of the equivalent of all the world's gold production, many times the amount of gold delivery arranged by the New York Commodities Exchange. "How that can coincide with a gold price drop of $400 per ounce over Q2," Baker and Franklin write, "is beyond our capability to explain."
No problem -- explaining such anomalies is what GATA is for.
The Baker and Franklin essay is headlined "The Shanghai Gold Surprise" and it's posted at the Sprott Internet site here:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
Bill Holter is now preparing us when gold hits 4,000 bid no offer>>>
(courtesy Bill Holter/Miles Franklin)
What will you do?
I finished my piece yesterday asking the question "what will you do?". Assuming that I am correct that a massive short squeeze in precious metals has started (if you disagree, please point out where my logic is wrong), we should see several events occur. First, we will probably see a week or two (maybe not in succession) where Gold trades up $200-$300 bringing us back to the $1,700-$1,900 level, what will you do ?
Will you wipe your brow, breath a sigh of relief and call your broker or coin dealer and sell? Will you be "relieved" that you could get out of your "trade" at break even or "maximum profit"? Will you "swear" never to do anything as "stupid" as chasing Gold and leaving the "safety" of your FDIC "insured" Dollar account? ...OR, will you get out of more Dollars for ounces...or, will you do nothing ?
* * *
Let's go another step further, let's assume (as I do) that this happens and we get news of an exchange failure or default on a Friday afternoon. Monday morning we have chaos and some exchange doesn't even open. We look at other exchanges and see that Gold is $2,500 bid, or $4,000 bid or even higher with little to no volume because there are virtually no offers. What would you do in this situation? Would you call a cash dealer and sell, sell, sell followed by doing a "happy dance" because you "scored" and SCORED BIG? Or would you call this cash dealer to see if he had any morsels available for sale...or would you do nothing?
I do want to pick on our chairman of the Federal Reserve just a little more because he reached a new high in disinformation and a new low in stupidity in front of the Senate Thursday. He said and I quote "Nobody understands gold prices, and I don't really pretend to understand them either". Really? Nobody? But wait, why would you even answer any questions or even speak about Gold? It, according to you "is not money" and Lord knows since you are "the chairman" who would know the definition of "money" better than you?
Regardless (irregardless is not a word) of what Ben Bernocchio says or wants people to think, we are (and have been for more than 3 months) witnessing a bank run. This "bank run" is not on any one single bank, it is on the system itself. Inventories being drawn down, custodians refusing to deliver and even sovereigns making claim to their Gold shows that a choice has been made. The negative curve (backwardation) is proof positive that investors are voting with their feet and saying "I want my Gold, real Gold, and I want it now...I will not accept any substitutes".
As we have said all along, the paper markets have written receipts for more than 100 ounces for every one real ounce that is available to deliver. How do you suppose this is going to work out? I guess the best way to explain this is by asking a question or two. What do you suppose will happen to the value of 1 real ounce of Gold when it is learned that "supply" was overstated by more than 100 to 1? Or another way, what will happen to the price of Gold when it is discovered that Gold is 100+ times more scarce than it was commonly believed?
You see, what was "supply" really wasn't even though it temporarily acted that way (on price) but it will now be flipped into demand, real demand for real Gold...no substitutions. Not only will those who are contractually short need to cover and compete with natural demand, those who "thought" they had the bases covered will become buyers to buy what they "thought" they already had. This will work not only like a high horsepower motor, you can add the turbo charger (short covering) and a NOS shot of another couple hundred horsepower when "owners" find out that they are only holding an empty paper bag.
There is now virtually no question in my mind whatsoever that we have a short squeeze and a wipeout "run" on inventories coming. I believe that a $200-$300 week is coming shortly that will be followed by Reg Howe's "you'll go to bed with $1,500 Gold and wake up $4,000 bid and nothing offered". What will you do then? Sell? Buy what is no longer buyable? It's a good question which I will broach later this week.
Regards, Bill H.
(courtesy David Baker, David Franklin/Sprott/GATA)
David Baker and David Franklin: The Shanghai gold surprise
Submitted by cpowell on Mon, 2013-07-22 03:55. Section: Daily Dispatches
11:52p ET Sunday, July 21, 2013
Dear Friend of GATA and Gold:
Sprott Asset Management's David Baker and David Franklin note that the new Shanghai Gold Exchange seems to be arranging delivery of the equivalent of all the world's gold production, many times the amount of gold delivery arranged by the New York Commodities Exchange. "How that can coincide with a gold price drop of $400 per ounce over Q2," Baker and Franklin write, "is beyond our capability to explain."
No problem -- explaining such anomalies is what GATA is for.
The Baker and Franklin essay is headlined "The Shanghai Gold Surprise" and it's posted at the Sprott Internet site here:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
Bill Holter is now preparing us when gold hits 4,000 bid no offer>>>
(courtesy Bill Holter/Miles Franklin)
What will you do?
I finished my piece yesterday asking the question "what will you do?". Assuming that I am correct that a massive short squeeze in precious metals has started (if you disagree, please point out where my logic is wrong), we should see several events occur. First, we will probably see a week or two (maybe not in succession) where Gold trades up $200-$300 bringing us back to the $1,700-$1,900 level, what will you do ?
Will you wipe your brow, breath a sigh of relief and call your broker or coin dealer and sell? Will you be "relieved" that you could get out of your "trade" at break even or "maximum profit"? Will you "swear" never to do anything as "stupid" as chasing Gold and leaving the "safety" of your FDIC "insured" Dollar account? ...OR, will you get out of more Dollars for ounces...or, will you do nothing ?
* * *
Let's go another step further, let's assume (as I do) that this happens and we get news of an exchange failure or default on a Friday afternoon. Monday morning we have chaos and some exchange doesn't even open. We look at other exchanges and see that Gold is $2,500 bid, or $4,000 bid or even higher with little to no volume because there are virtually no offers. What would you do in this situation? Would you call a cash dealer and sell, sell, sell followed by doing a "happy dance" because you "scored" and SCORED BIG? Or would you call this cash dealer to see if he had any morsels available for sale...or would you do nothing?
(courtesy David Baker, David Franklin/Sprott/GATA)
(courtesy David Baker, David Franklin/Sprott/GATA)
David Baker and David Franklin: The Shanghai gold surprise
Submitted by cpowell on Mon, 2013-07-22 03:55. Section: Daily Dispatches
11:52p ET Sunday, July 21, 2013
Dear Friend of GATA and Gold:
Sprott Asset Management's David Baker and David Franklin note that the new Shanghai Gold Exchange seems to be arranging delivery of the equivalent of all the world's gold production, many times the amount of gold delivery arranged by the New York Commodities Exchange. "How that can coincide with a gold price drop of $400 per ounce over Q2," Baker and Franklin write, "is beyond our capability to explain."
No problem -- explaining such anomalies is what GATA is for.
The Baker and Franklin essay is headlined "The Shanghai Gold Surprise" and it's posted at the Sprott Internet site here:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
Bill Holter is now preparing us when gold hits 4,000 bid no offer>>>
(courtesy Bill Holter/Miles Franklin)
What will you do?
I finished my piece yesterday asking the question "what will you do?". Assuming that I am correct that a massive short squeeze in precious metals has started (if you disagree, please point out where my logic is wrong), we should see several events occur. First, we will probably see a week or two (maybe not in succession) where Gold trades up $200-$300 bringing us back to the $1,700-$1,900 level, what will you do ?
Will you wipe your brow, breath a sigh of relief and call your broker or coin dealer and sell? Will you be "relieved" that you could get out of your "trade" at break even or "maximum profit"? Will you "swear" never to do anything as "stupid" as chasing Gold and leaving the "safety" of your FDIC "insured" Dollar account? ...OR, will you get out of more Dollars for ounces...or, will you do nothing ?
* * *
Let's go another step further, let's assume (as I do) that this happens and we get news of an exchange failure or default on a Friday afternoon. Monday morning we have chaos and some exchange doesn't even open. We look at other exchanges and see that Gold is $2,500 bid, or $4,000 bid or even higher with little to no volume because there are virtually no offers. What would you do in this situation? Would you call a cash dealer and sell, sell, sell followed by doing a "happy dance" because you "scored" and SCORED BIG? Or would you call this cash dealer to see if he had any morsels available for sale...or would you do nothing?
Submitted by cpowell on Mon, 2013-07-22 03:55. Section: Daily Dispatches
11:52p ET Sunday, July 21, 2013
Dear Friend of GATA and Gold:
Sprott Asset Management's David Baker and David Franklin note that the new Shanghai Gold Exchange seems to be arranging delivery of the equivalent of all the world's gold production, many times the amount of gold delivery arranged by the New York Commodities Exchange. "How that can coincide with a gold price drop of $400 per ounce over Q2," Baker and Franklin write, "is beyond our capability to explain."
No problem -- explaining such anomalies is what GATA is for.
The Baker and Franklin essay is headlined "The Shanghai Gold Surprise" and it's posted at the Sprott Internet site here:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
Gold Anti-Trust Action Committee Inc.
Bill Holter is now preparing us when gold hits 4,000 bid no offer>>>
(courtesy Bill Holter/Miles Franklin)
Bill Holter is now preparing us when gold hits 4,000 bid no offer>>>
(courtesy Bill Holter/Miles Franklin)
What will you do?
I finished my piece yesterday asking the question "what will you do?". Assuming that I am correct that a massive short squeeze in precious metals has started (if you disagree, please point out where my logic is wrong), we should see several events occur. First, we will probably see a week or two (maybe not in succession) where Gold trades up $200-$300 bringing us back to the $1,700-$1,900 level, what will you do ?
Will you wipe your brow, breath a sigh of relief and call your broker or coin dealer and sell? Will you be "relieved" that you could get out of your "trade" at break even or "maximum profit"? Will you "swear" never to do anything as "stupid" as chasing Gold and leaving the "safety" of your FDIC "insured" Dollar account? ...OR, will you get out of more Dollars for ounces...or, will you do nothing ?
* * *
Let's go another step further, let's assume (as I do) that this happens and we get news of an exchange failure or default on a Friday afternoon. Monday morning we have chaos and some exchange doesn't even open. We look at other exchanges and see that Gold is $2,500 bid, or $4,000 bid or even higher with little to no volume because there are virtually no offers. What would you do in this situation? Would you call a cash dealer and sell, sell, sell followed by doing a "happy dance" because you "scored" and SCORED BIG? Or would you call this cash dealer to see if he had any morsels available for sale...or would you do nothing?
I finished my piece yesterday asking the question "what will you do?". Assuming that I am correct that a massive short squeeze in precious metals has started (if you disagree, please point out where my logic is wrong), we should see several events occur. First, we will probably see a week or two (maybe not in succession) where Gold trades up $200-$300 bringing us back to the $1,700-$1,900 level, what will you do ?
Will you wipe your brow, breath a sigh of relief and call your broker or coin dealer and sell? Will you be "relieved" that you could get out of your "trade" at break even or "maximum profit"? Will you "swear" never to do anything as "stupid" as chasing Gold and leaving the "safety" of your FDIC "insured" Dollar account? ...OR, will you get out of more Dollars for ounces...or, will you do nothing ?
* * *
Let's go another step further, let's assume (as I do) that this happens and we get news of an exchange failure or default on a Friday afternoon. Monday morning we have chaos and some exchange doesn't even open. We look at other exchanges and see that Gold is $2,500 bid, or $4,000 bid or even higher with little to no volume because there are virtually no offers. What would you do in this situation? Would you call a cash dealer and sell, sell, sell followed by doing a "happy dance" because you "scored" and SCORED BIG? Or would you call this cash dealer to see if he had any morsels available for sale...or would you do nothing?
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