Friday, April 25, 2014

Gold updates April 25 2014 --- Is Germany gold sitting in the vaults of some investment bank ( rather than Central Banks who have pledged to safeguard said gold ? ) Or sold off long ao ? whatever the answer is , Germany can't get back what they stored at the Central Banks - and that is a quiet default ! CIBC decides to sell physical gold ! While chinese gold demand has dropped off somewhat , demand to date is 606 tons - Germany can only dream of obtaining back 606 tons in less than 4 four months from either the French or US Central Banks !

By PM Fund Manager Dave Kranzler, Investment Research Dynamics:
Clearly, if the U.S. were “safekeeping” Germany’s gold in a segregated custodial account, it should have been nearly effortless to ship 300 tonnes back to Germany via two cargo flights.   After all, Venezuela received 160 tonnes of gold in about 4 months from several different Central Bank vault locations.
As it turns out, found a Reuters article yesterday which surreptitiously reported the fact that Central Banks keep a portion of their gold outside of their own vaults and in the custody of investment bank vaults.  This enables the investment bank to “serve central banking customers with large bullion reserves to manage.”  Here’s the article link:  Central Bank gold trading operations.   The GATA link also contains a link to a policy paper from the Central Bank of France which describes Central Bank gold trading policies.
While those of us who follow the precious metals market professionally know that Central Banks actively dump their bullion on the market for the purposes of managing the price.  But the Reuters article stunningly acknowledges that a significant portion of Central Bank custodial gold is being held outside of Central Bank custody.
As the example of the U.S. default to Germany demonstrates, any entity that keeps its gold in a western Central Bank for “safekeeping” is at great risk of never having it returned.


So central bank gold is being held in investment bank vaults

10:38a ET Wednesday, April 23, 2014
Dear Friend of GATA and Gold:
Today's Reuters report about changes at the gold and currency trading desks of investment banks, which was called to your attention in a dispatch a little while ago --
-- is notable for more than its acknowledgment that central banks are surreptitiously trading gold every day, an acknowledgement made last September by the Banque de France:
For in reporting that "banks that serve central banking customers with large bullion reserves to manage will have a greater need to offer gold trading and storage services," Reuters also has acknowledged that much central bank gold is now held outsidecentral bank vaults.
That's what the reference to "storage services" is about.
Presumably the central bank gold being vaulted by investment banks is gold that central banks have leased or swapped into the market for market-rigging purposes.
Of course anyone who has been following GATA realizes that neither Reuters nor any other mainstream financial news organization will be permitted to pursue this issue, and that gold market "analysts" from CPM Group's Jeff Christian to the World Gold Council's Pierre Lassonde will conscientiously distract from it. So let's be grateful that Reuters has let this much slip and hope that the news service won't suffer too much official retaliation for it.
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.


Canadian bank CIBC starts selling real gold, not just paper

Gold and Silver Purchases Made Easy at CIBC Branches and Online
Company Press Release
via Canada NewsWire
Friday, April 25, 2014
TORONTO -- Canadians looking to buy gold and silver now have fast and convenient options at CIBC branches and a new online store, which can also be accessed via a mobile device.
High-quality gold and silver bars, coins including collectibles, and certificates are available for purchase at all CIBC branches across Canada.
Bars and coins can also be ordered online at:
Branch, online and mobile purchases may be made by CIBC clients and by those who currently bank elsewhere.
Key features of CIBC's gold and silver service include:
-- Secure online ordering 24 hours a day.
-- Live market pricing.
-- Branch and home delivery options.
-- Bars and coins in various denominations, as well as collector and commemorative coins. ...
... For the complete press release:

Chinese Gold Demand Dropping

It has been a bit silent on In Gold We Trust for a few days as I was working on moving this website to a new server, which didn’t happen as planned. Yesterday the website has been offline for hours due to transition. I was forced to move because the old server couldn’t handle the repeated DDoS attacks, the new one is supposed to be better armed providing visitors, finally, stable and faster access.

Anyway, I still owe you guys un update on withdrawal numbers from the SGE, published last friday April 18. SGE withdrawals, which equal Chinese wholesale demand, in week 15 (08-04-2014/11-04-2014) accounted for 21 metric tonnes. A lot of gold but the lowest numbers since March 2013 – also due to the fact the SGE was closed on April 7, leaving only four days of trading in week 15. Nonetheless, demand has been in a downtrend for six weeks in Shanghai and premiums have been sub zero since late February, which doesn’t hint at a supply shortage on the SGE. At the same time we saw GOFO rates being negative in week 15 in western markets, which does hint at supply shortages. This situation illustrates the PBOC’s gold policy; gold is allowed to be imported but not exported.

GOFO 2013 - 2014

Overview Shanghai Gold Exchange data 2014 week 15

- 21 metric tonnes withdrawn in week 15 (08-04-2014/11-04-2014)
- w/w – 16.7 %
- 606 metric tonnes withdrawn year to date

My research indicates that SGE withdrawals equal Chinese wholesale gold demand. For more information readthis.

Shanghai Gold Exchange withdrawals 2014 week 15

This is a screen shot from the weekly Chinese SGE trade report; the second number from the left (blue – 本周交割量) is weekly gold withdrawn from the vaults in Kg, the second number from the right (green – 累计交割量) is the total YTD.

SGE withdrawals

This chart shows SGE gold premiums based on data from the SGE weekly reports (it’s the difference between the SGE gold price in yuan and the international gold price in yuan).

SGE premiums

Below is a screen shot of the premium section of the SGE weekly report; the first column is the date, the third is the international gold price in yuan, the fourth is the SGE price in yuan, and the last is the difference.

SGE premiums

In Gold We trust