Wednesday, August 7, 2013

Gold and Silver reports - August 7 , 2013 - Data for the day , news and views ..... good articles and reports from Zero Hedge , Harvey Organ , Jesse's Crossroads Cafe blogspot.....


http://www.zerohedge.com/news/2013-08-07/hello-hsbc-jpmorgan-we-urgently-need-some-your-gold

( So , HSBC only provided 6,444.96 ounces - how much does JP Morgan need to cover this month's urgent delivery demands ? )


"Hello HSBC, This Is JPMorgan - We Urgently Need Some Of Your Gold"

Tyler Durden's picture
Submitted by Tyler Durden on 08/07/2013 18:21 -0400



What happens when 63.5K ounces of registered gold in your warehouse (16% of total) just has their warrants detached and the vault is about to finds itself 63.5k ounces of gold emptier? If you are JPM you call the gold vault with most inventory in town, that of HSBC, and politely request that they transfer as much eligible gold as they can on short notice - in this case a tiny 6,444.936 oz to be exact.
None of which changes the fact that in a few days, the inventory in JPM's gold vault will drop to another record low of only 380K ounces and the JPM "rescue" pleas from HSBC and other Comex members will become ever louder and more desperate until one day they may just go straight to voicemail.
Source: COMEX


http://harveyorgan.blogspot.com/2013/08/aug-7gld-declines-again-by-451-tonnes.html

Wednesday, August 7, 2013

aug 7/GLD declines again by 4.51 tonnes to 910.53/No change in silver SLV. Total comex dealer gold falls to 27.23 tonnes of gold/ JPMorgan dealer gold falls to 10.15 tonnes/GOFO rates become increasingly negative

Good evening Ladies and Gentlemen: 

Gold closed up  $2.90 to $1286.10 (comex closing time ).  Silver was up 1 cents to at $19.53 (comex closing time).

 In the access market today at 5 pm tonight here are the final  prices: 

gold: $1287.50
silver:  $19.57

At the Comex, the open interest in silver fell by 1566 contracts to 132,053 with silver down 19 cents yesterday .


  
The open interest on the entire gold comex contracts fell by 1661 contracts to 397,618 with  gold's fall in price yesterday by $19.40 cents. 

Tonight, the Comex registered or dealer inventory of gold  falls considerably and this time, still well below the 1 million oz mark at 875.713 thousand oz or 27.23 tonnes.  This is dangerously low especially when we are now into  the August delivery month.  The total of all gold at the comex (dealer and customer) remains constant tonight and this time just above the 7 million oz barrier resting at 7.011 million oz or 218.07 tonnes. 

JPMorgan's customer inventory rises tonight to 116,244.557  oz or 3.61 tonnes.  It's dealer inventory however lowered to 326,362.152 oz (10.15 tonnes) 

The total of the 3 major gold bullion dealers( Scotia , HSBC and JPMorgan)  in its Comex gold dealer account registers only 22.636 tonnes of gold. The total of all of the dealers falls tonight to  27.23 tonnes!! Brinks continues to record a low of only 4.15 tonnes in its dealer account.



The GLD  reported a huge loss of 4.51 tonnes  in inventory  tonight with a  reading of 910.53  tonnes of gold.  We had no change in silver inventory at the SLV today. 

Today, we have the 23th consecutive day for negative GOFO rates with the 3 months rate rising to -.085% from yesterdays level of -.0633% .  The one month GOFO rate rose in negativity to -0.11% from yesterday's level of -.088%.  The two month rate rose in negativity to -.0967 from yesterday's -.0800% and the 6 month lowered to only +.0016% from yesterday's +.02%.  Thus metal is becoming increasingly scarce. Basically it means that gold is dearer in the present than in the future and it also signifies that London has scarce supplies of good delivery bars.  No doubt that China, being a huge buyer of physical gold is responsible for this.  The whacking of gold yesterday is incompatible with an increasing negative GOFO rates.

then Dave Kranzler correctly states this:

"Negative GOFO - this is getting serious

The negativity of GOFO blew out again

today: http://www.lbma.org.uk/pages/index.cfm?page_id=55&show=2013

The 3-mo negative rate is by far the most negative its been since GOFO went negative 23 days ago. What's interesting is the fact that the GOFO is indicating extreme short term shortages in bullion over in London despite the fact that India and the Muslim world has been largely dormant for the past 4 weeks with Ramadan and the Government trying to stop Indians from buying gold.

Ramadan ends tonight and the primary Indian gold-buying season will start to kick in.

Either the GOFO rates published are a complete fraud or there's a big problem in the physical gold market brewing."


On the physical side of things, we have one great discussions with Stephen Leeb   talking gold issues with Eric King of Kingworld news.


We have a great article on China courtesy of Mineweb's Lawrence Williams and this time he tackles whether China would confiscate its citizens' gold just like Roosevelt did in 1933.

We have two commentaries on manipulation, with the first by John Browne of Euro Pacific and the second by Market Watch's Paul Farrell.

Gene Arensberg of Got Gold Report does a good commentary on the backwardation of gold.


 We have another big commentary  from Bill Holter who tackles the difficult topic of who is right, the East: by buying massive gold or the West who is supplying the stuff!!  You do not want to miss this very important commentary.
*****

The total gold comex open interest fell by 1556 contracts from  397,618 down to 396,062 with  gold falling in price by $19.40 yesterday.  The front August contract month has an OI of 2476 contracts down from Monday's level of 2772 for a loss of 296 contracts .  We had 5 contracts filed on Tuesday so we lost 291 contracts or 29,100 oz will not be standing.    The next non active delivery month for gold is September and here the OI fell by 18 contracts to 618.  The next active delivery month is October and here the OI fell by 591 contracts down to 30,166. I will now start to provide figures for the biggest of all delivery months,the  December contract month.  Today, the December  OI rose by 5 contracts from  242,954 up to 242,957. The estimated volume today was  poor at 125,647 contracts. The confirmed volume yesterday was better at  163,761. It seems that many players are now leaving the comex arena as they refuse to play in a rigged game. 


The total silver Comex OI fell by 1661 contracts with silver falling in price by 19 cents on Tuesday.  The total of all comex silver OI stands at 132,053 contracts. For the front month of August we have an OI reading of 130 for a gain of 117 contracts. We had  3 notices served upon our longs yesterday and thus  we gained 120 contracts or 600,000 oz of additional silver will stand for metal in August.  The next big delivery month is September and here the OI fell by 2690 contracts down to 70,145.  The estimated volume today was good coming in at  43,993 contracts.  The confirmed volume on Monday was also good  at 43,113. 

Comex gold/May contract month:
August 7.2013


Ounces
Withdrawals from Dealers Inventory in oz
nil
Withdrawals from Customer Inventory in oz
 6444.936 (HSBC)
Deposits to the Dealer Inventory in oz
nil
Deposits to the Customer Inventory, in oz
6444.936 (JPM)
No of oz served (contracts) today
 302 ( 30,200  oz)
No of oz to be served (notices)
2174  (217,400 oz)
Total monthly oz gold served (contracts) so far this month
2270  (227,000 oz)
Total accumulative withdrawal of gold from the Dealers inventory this month
4598.77
Total accumulative withdrawal of gold from the Customer inventory this month


 
13,563.664

****


Today we had 2 adjustments:



i) Out of Scotia:  3735.995 oz was adjusted out of the customer (client/eligible) and into the dealer (house/registered) at Scotia.

ii) Out of JPMorgan: a huge 63,537.26 oz was adjusted out of the dealer and this landed in the customer.



Thus tonight we have big changes to JPMorgan gold inventory

JPM dealer inventory:  326,362.152 oz   10.15 tonnes
JPM customer inventory:  116,244.557 oz  or 3.61 tonnes

*****

Now let us check on gold inventories at the GLD first:


August 7.2013:  we lost a huge 4.51 tonnes



Tonnes910.53

Ounces29,274,423.53

Value US$37.524  billion






****

selected news.....

Gold replaces narcotics as the biggest smuggled item in India



MUMBAI (Scrap Monster) : The recent series of actions by the Indian government along with tax hike on bullion imports have created acute shortage for gold in domestic markets. Estimates released by the country’s Finance Ministry have signaled alarming rise in illegal gold imports to the country


http://www.scrapmonster.com/news/gold-replaces-narcotics-as-t
he-biggest-smuggled-item-in-india/1/9460



A very important commentary courtesy of Lawrence Williams of Mineweb

(courtesy Lawrence Williams/Mineweb)


Could China confiscate its citizens' gold en route to global domination?

Is China moving rapidly towards holding enough gold to have the clout it needs to replace the dollar with the renminbi as the global reserve currency?
Author: Lawrence Williams
Posted: Tuesday , 06 Aug 2013 
LONDON (MINEWEB) - 
Australia’s ANZ bank is the latest to open a gold vault in the Singapore Freeport area next to the city state’s Changi airport.  Other recent vault builders there include Deutsche Bank and JP Morgan, while Switzerland’s Metalor has one under construction and due to open in a couple of month’s time.  Together with new gold vault openings in Hong Kong this is yet another outward sign of the continued flight of gold from West to East, although the vaults are also servicing western precious metals investors seeking safe, and relatively low cost vaulting facilities outside of the traditional depositories in the U.S. and Europe.
Now either the Western bullion banks have misjudged the power that gold still retains in the global psyche and as a key financial instrument, or the Asian investors and governments, which are continuing to accumulate gold at a high rate, have got it wrong.  Much is made of the rundown in COMEX gold bullion stocks and the drain of physical gold out of the big ETFs which are fully gold backed and certainly all the figures are telling us that the gold is indeed moving East – it is not only Asian governments which are buying gold, but also countries like Russia, Kazakhstan and Turkey (which falls between the European and Asian blocs) have been accumulating the precious metal and raising their overall gold reserves.  They obviously all see gold holdings as a vital factor in any changing world financial order.
The big question in this respect is, of course China.  Logic – and the statistics – suggests that China is at the very least buying in its own gold production, which by law has to be sold to the state.  As the world’s largest gold producer with output of around 400 tonnes annually, even if this is all it is taking into reserves, this is a very significant amount being around 15% of the world’s newly mined gold.  This amount of gold alone would mean that China will have taken around 1,500 tonnes into its reserves since it last reported an upgrade in its holdings to the current official figure of 1,054 tonnes in April 2009.  This suggests China’s gold reserves may well have at least more than doubled over the period since then and would put it in fourth place amongst the global gold holders with ca 2,500 tonnes, after the U.S. with official gold holdings of 8,133.5 tonnes, Germany with 3,390.6 tonnes and the IMF with 2,814 tonnes.
Tyler Durden, writing in Zero Hedge picked up on a recent statement by Yao Yudong of the People’s Bank of China monetary Policy Committee calling for a new Bretton Woods type system to strengthen the management of global liquidity – click here to read Durden’s article.  In it he suggested that Yao’s statement could be the first salvo in a Chinese push for a new gold standard – or something approaching this – or at least yet another indication that China is moving towards trying to overturn dollar hegemony and make a place for the renminbi in the new global reserve currency – a point we have made on Mineweb in the past.  The suggestion is that China may look towards some kind of hard asset backed ‘optionality’ as a future negotiating point in rejigging the world financial order at some point in the future.
Coming back to China’s likely gold holdings, many observers feel that, in addition to taking its own gold output into some kind of separate government account which, in its view it is not obliged to disclose as part of its official reserves until it feels it is politically opportune to do so, it is also buying gold on the open market given the huge volumes of gold pouring into the nation.  Even so it would still have a way to go to match the U.S. gold reserves – unless of course the government does a ‘Roosevelt’ and confiscates its citizens’ gold, at which point, in a fell swoop it could perhaps get close to matching the U.S. in total gold holdings.  This is something that, in theory, it would be easier to do in a totalitarian state than in a democracy like the U.S.   One can be sure that Chinese economists have studied what Roosevelt did  and have built it into one of their possible scenarios.  one would assume, though, under such a scenario the state would not just confiscate the gold, but pay a 'reasonable' price for it.  China is not short of monetary resources.
One recalls that China positively encouraged its citizens to buy gold - a cynic might suggest that this was just a route to bringing more and more gold into the country which could then subsequently be used as a de facto reserve.
China might then feel, if it can match, or perhaps exceed,  the U.S. in its gold holdings it would be in a position to demand a place in a global reserve currency – or indeed replace the dollar as such with the renminbi and revalue gold to whatever level it sees fit.  Pure speculation on our part, of course, but the Chinese have learnt from the capitalist system turning it to their own advantage.  As Durden points out in his article, global reserve currencies don’t last forever and the U.S. dollar could be nearing the end of its reign as such.

The big question of the day:  Is the East right in buying massive supplies of gold or is the west right in supplying the stuff to the east?

you decide...

(courtesy Bill Holter/Miles Franklin)


So who is right?




I spoke yesterday with David Schectman and he told me that he had a "moment".  No, not a senior moment, the type of moment where all of the noise and hype seems to go away.  He told me he had a "clarity" moment.  There are as you know many many signals pointing to Gold and Silver being way undervalued.  There are also many "footprints" along with clear motive that clearly point to manipulation of price.  I try to point these out on a daily basis in the hope that people will have a better understanding (and thus less fear and confusion) about why it is imperative to own Gold and Silver.
  The meat of the conversation yesterday really was simple and to the point, when you look at the "numbers" it will be self fulfilling.  David said to me "it really boils down to who is right, are the Asians, Indians and Russians of the East correct or are the peoples of the West correct?".  In a nutshell, the East is buying and buying BIG while the West is supplying this demand from cobwebby inventories, it is this simple.  Is the West "fooling" the East into buying a barbarous relic?  ...Or is the East fooling the West into emptying their inventories?  You know where I stand on this and I would simply ask "what happens when the Western Gold runs out?  Then what?  Please remember "why" the nickname "King Dollar" came about.  Yes, because we were the strongest military power in the world AND...because we "had" the most Gold in the world.
  So, as I mentioned above, the East can and in my opinion certainly and shortly WILL make the answer to the question "who is right?" ...self fulfilling.  Notice that I used the term "self fulfilling" and added when you look at the numbers.  No, not the "fundamental" numbers like cost of production, debt or money supply growth, inflation, deflation or anything like them, I am talking about the sheer number of PEOPLE in the East!  We are talking about well over 2 billion people, some rich, many poor and some in between...  2 BILLION+ people!
  These people rightly or wrongly truly believe that Gold and Silver are "savings".  Gold is not an "investment" in their view...it is purely the ultimate in savings.  They have a very long history and have blown up more paper currencies over the years than the U.S. and Europe have states.  They know!  They know what always eventually happens to paper money, it always, sooner or later devalues and eventually is lost forever.  As for the West, the U.S. has blown up 3 currencies so far but the memory has been brainwashed away and even the school history books say very little on the subject.  My point is this, "we" are the newbies to the currency game.
  2 billion+ people represent better than 1/3rd of the world's population.  They will ultimately "make" the reality that Gold and Silver "ARE" monies simply because they believe it to be so.  Governments can say, do or legislate whatever they'd like, it will not change the minds of these 2 billion.  I would like to mention that currently, the East is "standing in line", long lines to get metal.  On top of the long lines, they are paying premiums on every ounce purchased. 
  The "premium" part is important for several reasons.  First, these people have decided that the "price" in the West is too low and they are voting with their savings.  Secondly, "arbitrage" between East and West is taking delivery of metal in the West (where prices are lower) and shipping, then selling it to the demand in the East for a profit (though as short sighted as it is).  It is this reason that inventories are being severely bled down.  By my count, when you take 100+ tons away from each the COMEX and GLD, then add in a vaporized 1,300 tons from the LBMA you get over 1,500 tons in 6 months!  This is on top of and equal to 70% of normal global production.
  So, who is right?  It does not matter.  It only matters that Gold will ultimately end up in the East with Western vaults emptied.  I can tell you that throughout history, Gold has "flowed" (as it is now) to where economic and military "power" was being amassed.  Was it "right or wrong"?  That's not for me to say, only that this is what has always happened and is happening again.  The East is speaking and we are not listening!  By the way, we will find out who was "right" and who was "wrong" ...when the Gold runs out, of this you can be assured.  Regards,  Bill H.









http://jessescrossroadscafe.blogspot.com/2013/08/gold-daily-and-silver-weekly-charts_7.html


Gold Daily and Silver Weekly Charts - It's Been A Long Time Coming


"Though the mills of God grind slowly;
Yet they grind exceeding small;
Though with patience He stands waiting,
With exactness grinds He all."

Henry Wadsworth Longfellow

As I noted earlier today there was a drawdown, most likely a redemption, of gold bullion in the past week or so of about 10 million dollars worth of gold bullion from the Sprott Physical Gold Trust.

I am informed that Sprott utilizes the highly prized 400 oz. bars that are the standard in Asia, versus the 100 oz. bars common used on the COMEX. Apparently someone wanted the actual bullion badly enough to go through the delivery process.

Let's see how the bullion inventories go during this August delivery month.

As you may recall I have had a stawman theory in the back of my mind that some major player with a good insight into the global supply could manage to create a corner in the gold bullion market without necessarily executing it on the COMEX, which is hard to do because they would be quick to declare force majeure.

But with the tightness of supply and the protracted negative lease rates for gold there appears to be some sort of squeeze going on with drawdown in inventory at COMEX and allegedly at the LBMA.

I would hate to be holding that bag, for the return of leased gold or other contractual obligations for example.

The wind of change is blowing a hurricane.

Weighed, and found wanting.

Stand and deliver



NAV Premiums of Certain Precious Metal Trusts and Funds - Drawdown in Sprott Gold Trust


I do not know when it happened as I just noticed it today, but the Sprott Physical Gold Trust reduced its bullion level and the shares outstanding in what was apparently a redemption of units for gold.

The bullion level was reduced by 8,292 ounces, and the units outstanding by exactly 1,000,000. The cash on hand dropped by 434,969 which may be unrelated since it is used to pay storage and management fees.

The two spreadsheets are dated today and August 2. I sometimes neglect to update inventory so it could have happened earlier than that.

As you know the Sprott Trusts do have a facility for the redemption of units for bullion, so I do not view this with any concern, merely curiosity. Obviously someone wanted physical gold bullion for some purpose.

I include both the current and my last spreadsheet pages below.











Gold backwardation is increasing, Arensberg's Got Gold Report says

Submitted by cpowell on Wed, 2013-08-07 17:54. Section: 
1:54p ET Wednesday, August 7, 2013
Dear Friend of GATA and Gold:
Backwardation in gold is increasing, the Got Gold Report's Gene Arensberg finds today. Arensberg writes: "Not only is the spot or cash price (the price for gold sold for immediate delivery) trading above the near active futures contract, but we are now seeing the near months' contracts trading at higher prices to months thereafter in the front part of the futures strip."
Arensberg's commentary is headlined "Comex Gold Backwardation Continues" and it's posted at the Got Gold Report here:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.


West does everything it can to disparage gold and China, Leeb says

Submitted by cpowell on Wed, 2013-08-07 17:24. Section: 
1:25p ET Wednesday, August 7, 2013
Dear Friend of GATA and Gold:
Fund manager Stephen Leeb today gives King World News what may be his best interview yet, exposing the Western financial news media's distortion about Chinese gold demand, which, Leeb says, remains extraordinary.
"The West is desperately throwing everything they can at gold and China, in an attempt to destroy investor psychology toward these two investment themes," Leeb says. "But it is becoming very apparent that gold and the yuan are becoming the next big thing in the currency world."
An excerpt from the interview is posted at the King World News blog here:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.



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