08 December 2015 — Tuesday
YESTERDAY in GOLD, SILVER, PLATINUM and PALLADIUM
The gold price got sold down a few dollars at the open in New York on Sunday evening—and then didn’t do a thing until shortly before London opened—and then the selling pressure began. And except for sideways action between the London p.m. gold fix and the COMEX close, the selling pressure never let up.
The high and low ticks were reported by the CME Group as $1,086.10 and $1,065.00 in the February contract.
Gold finished the Monday session at $1,071.20 spot, down $15.10 from Friday’s close—and back below its 20-day moving average. Net volume wasn’t overly heavy at just over 97,500 contracts—and almost a quarter of that volume was traded before the London open.
Here’s the 5-minute gold tick chart courtesy of Brad Robertson once again. The far left gray vertical line is the New York open at 6 p.m. EST on Sunday evening—16:00 Denver time on this chart. There was fairly decent background volume through most of the Monday session. But, as usual, the volume that mattered began at 6:20 a.m. MST on this chart, which was the COMEX open—and it was slightly elevated for the rest of the day, even in the electronic market in New York after the COMEX close. The vertical gray line on the right is midnight in New York—add two hours for EST—and don’t forget the ‘click to enlarge‘ feature.
It was more or less the same price action in silver—and in the process, almost all of Friday’s gains vanished. Silver was sold down to just a few pennies above its 20-day moving average.
The high and lows in this precious metal were reported as $14.64 and $14.205 in the March contract.
Silver closed yesterday at $14.23 spot, down 31.5 cents from Friday. Net volume was pretty decent at just over 37,000 contracts.
Like gold and silver, the sell-off in platinum began minutes before the London open—and most of the price damaged was done by the COMEX close. After that it didn’t do much. Platinum finished the Monday session at $853 spot, down 23 bucks and, like in silver, almost all its gains from Friday vanished as well.
Palladium also got sold down a bit at the New York open at 6 p.m. on Sunday evening—and crept lower from there until 8 a.m. in New York. The $548 low tick came shortly after COMEX trading began—and the subsequent rally was allowed to last until about 12:45 p.m. in New York. It got sold down to the $550 mark by the COMEX close—and traded flat from there. Palladium finished the day at $550 spot, down $14 from Friday’s close.
The dollar index closed late on Friday afternoon in New York at 98.32—and began to trade again starting at 1:00 p.m. EST on Sunday afternoon. It didn’t do a lot until a minute or so after 3 p.m. Hong Kong time on their Monday afternoon—and away it went to the upside. The 98.89 high tick came around 7:25 a.m. EST, before rolling over about 9:30 a.m. It dropped down to 98.56 at exactly 11:00 a.m. EST—and it quietly chopped higher from there, closing the day at 98.75—up 43 basis points from it’s close on Friday.
Here’s the 3-day U.S. dollar chart so you can see all of Sunday’s trading ‘action’ as well.
And here’s the 6-month U.S. dollar index chart so you can see its progress in the medium term.
The gold stocks opened down about two percent—and held in there until around 11:30 a.m. in New York. Then they began to slide, with their lows of the day coming shortly after 3 p.m.—and they barely managed to rally off their lows going into the close. The HUI got hit for a 4.93 percent loss.
The silver equities followed a somewhat similar pattern, except they began to head lower right from the 9:30 a.m. EST open in New York—and their lows came minutes after 3 p.m. as well. Nick Laird’s Intraday Silver Sentiment Index closed down 5.99 percent, giving up all of Friday’s gains—and then some!
The CME Daily Delivery Report showed that 120 gold and 1 silver contract were posted for delivery within the COMEX-approved depositories on Wednesday. HSBC USA was the largest short/issuer with 118 contracts—and JPMorgan was right there to take delivery of 114 of those contracts for its own account. They also picked up the lone silver contract for their own account as well. The link to yesterday’s Issuers and Stoppers Report is here.
The CME Preliminary Report for the Monday trading session is missing in action as of 3:23 a.m. EST this morning—and it still showed Friday’s final numbers. But just before I hit the send button at 4:55 a.m. EST, I checked one more time—and they finally did do the update. It showed that gold open interest for December dropped by another 300 contracts, leaving 2,469 still open. In silver, December o.i. fell by 20 contracts—and that leaves 413 left.
There was another decent withdrawal from GLD yesterday, as an authorized participant removed 133,972 troy ounces. And as of 7:42 p.m. EST yesterday evening, there were no reported changes in SLV.
And for the fifth day in a row there was no sales report from the U.S. Mint. They stated a week or so ago that they would stop making 2015 silver eagles as of December 14—but there was nothing in their press release that said that sales were ending as of November 30.
There was very little in/out activity in gold at the COMEX-approved depositories on Friday. All of the activity, such as it was, was at the Scotiabank depository, as 1,929 troy ounces were deposited—and 100 ounces were taken out. I shall dispense with linking that.
There was more activity in silver, as 579,065 troy ounces were deposited at Scotiabank—and only 2,984 troy ounces were shipped out. The ‘out’ activity was at Delaware. The link to that ‘action’ is here.
It was pretty busy over at the COMEX-approved gold kilobar depositories in Hong Kong on their Friday. They reported receiving a very chunky 18,702 kilobars were received—and 9,241 were shipped out the door. And with the exception of 12 kilobars received at Loomis International, all of the activity was at Brink’s, Inc. as per usual. The link to that action is here.
Nick passed around a chart showing the latest ‘official’ monthly gold imports into China—and for November that number was reported as 20.98 tonnes. Nick also pointed out that China’s FX reserves declined $87 billion during that month.
Of course I present these gold import numbers—and the chart below—purely for entertainment purposes, because everyone and his dog knows that China has anywhere between two to four times this much gold. There’s a story about his in the Critical Read section below. Don’t forget the ‘click to enlarge’ feature for this chart, plus the two that follow.
Hard on the heels of the last chart is this one—and the chart title is self-explanatory. According to Nick, 19.891 tonnes left the U.S. Federal Reserve Bank bound for parts unknown in October.
And I barely had that chart posted in my column, when Nick Laird sent the one below as well. It shows that China imported 71.58 tonnes of gold from Hong Kong in October. Although China’s imports through H.K. may no longer be a proxy for gold imports into China, it’s obvious that Hong Kong is still an important point of entry.
Although I hacked and slashed as best I could, I still have more stories than I would like—and so the final edit is all yours.
CRITICAL READS
U.S. Consumer Credit Rises $16 Billion in October
U.S. consumers borrowed more heavily for auto and student loans in October, taking out debt that helps them find jobs and commute to work.
The Federal Reserve said Monday that consumer borrowing rose $16 billion in October to $3.5 trillion. But the pace of borrowing decelerated sharply from the $28.5 billion increase in September.
Nearly all of the October gain came from the category that covers auto and student loans, while credit card borrowing edged up a mere $200 million. The increase suggests that more Americans are borrowing to improve their educational skills and upgrade their cars and trucks, instead of relying on debt to fund their daily shopping and emergency expenses.
Many economists expect that consumer spending will be relatively healthy in the coming months because of strong job gains that have bolstered auto and home sales for much of 2015. Yet a struggling global economy has tempered U.S. growth as the year draws to an end.
This AP story, filed from Washington, was picked up by the abcnews.go.com Internet site on Monday afternoon EST—and today’s first offering is courtesy of Elliot Simon.
Jim Rickards: I am not a robot
Many observers look at misguided Federal Reserve policy and assume the policy makers in charge must either be stupid or engaged in a conspiracy to destroy the country. I’ve actually met a fair number of current and former Fed governors, reserve bank presidents, staff economists and other Fed insiders. They are definitely not stupid. If we lined up IQ test results, I’d be at the back of the class. There’s no conspiracy either. There are a lot of well-intentioned individuals in the U.S. government, but when it comes to inter-agency coordination the bureaucracies can barely tie their shoes let alone manage the entire economy with bad intent. So, what’s the problem?
The problem is that the Fed is a model-based institution, and their models are obsolete. As a result, forecasts based on the models are persistently misguided, and policies based on the forecasts damage the real economy. Bad models produce bad results every time.
I have been a persistent critic of the economic models used by all central banks, especially the Federal Reserve. This criticism is not limited to the big econometric models used in forecasting the economy as a whole. My critique applies to a wide range of micro-models that purportedly explain particular facets of consumer behavior. One of the most defective models has just shown its deficiencies in a dramatic way. This model involves something called the “marginal propensity to consume” or MPC.
This commentary by Jim put in an appearance on the darientimes.com Internet site last Friday—and I thank Harold Jacobsen for passing it along. It’s definitely worth reading.
It Begins: Investors Brace for Mexico’s Biggest Corporate U.S.-Dollar Bond Default in 20 Years
In August, the bonds of Mexico’s biggest construction company, ICA, had the dubious honor of being the worst performing corporate bonds across all emerging markets. At a time when emerging economies are slowing down and the total debt exposure of EM corporations has never been higher, this was no mean feat.
Then in October, ICA reported its biggest net loss in 14 years. And things have only deteriorated since.
Yesterday [December 1 – Ed] the company’s shares plummeted 22% on news that it would use a 30-day grace period to make a $31 million interest payment that was due this week. Today its shares, which have lost more than 75% of their value since January, fell a further 8% to 3.76 pesos, their lowest point in 21 years.
To make matters worse, the builder recently hired corporate restructuring specialist Rothschild & Co. as financial adviser, fuelling speculation that it will soon seek debt relief.
This story appeared on the wolfstreet.com Internet site a week ago—and I just know I’ve posted a story about this already, but I suppose one more won’t hurt. I thank Brad Robertson for sharing it with us.
Puerto Rico’s Debt Relief to Get Supreme Court Hearing
The Supreme Court on Friday agreed to decide whether Puerto Rico, which is in the midst of a financial crisis, may allow public utilities there to restructure $20 billion in debt.
Puerto Rico’s lawyers had urged the court to take immediate action in light of the overall magnitude of the commonwealth’s debts, around $72 billion, which it says it cannot pay.
“Anyone who has even glanced at the headlines in recent months knows that the commonwealth is in the midst of a financial meltdown that threatens the island’s future,” the lawyers wrote in their petition seeking review of an appeals court decision that struck down a 2014 Puerto Rico law allowing the restructurings.
“Because that decision leaves Puerto Rico’s public utilities, and the 3.5 million American citizens who depend on them, at the mercy of their creditors,” the commonwealth’s lawyers wrote, “this court’s review is warranted — and soon.”
This news item, filed from Washington, appeared on The New York Times website on Friday—and it’s courtesy of Patricia Caulfield.
The Brazilian Billionaire Living in a Rat-Infested Jail
Twelve days ago, Andre Esteves moved into a cell with concrete beds. His head was shaved. Some of his fellow lodgers are rats, attracted by the landfill next door.
The 47-year-old is still a billionaire, but one using a collective squat toilet in a unit
of the notorious Bangu penitentiary complex on the edge of Rio de Janeiro. Outside, smells from sewage ditches blend with whiffs of deep-fried tidbits women buy for their incarcerated husbands from a clutch of vendors near the entrance. Inside, the former chairman and chief executive officer of Grupo BTG Pactual, Latin America’s largest independent investment bank, washes with bar soap cut into slices by guards looking for contraband.
Esteves’s detention, along with the incarceration in June of the head of Brazil’s largest construction conglomerate, has spread more than a little schadenfreude in a country accustomed to impunity for white-collar offenders. The executives are symbols of a generation of corporate leaders who profited from a boom that turned Brazil into the largest developing economy after China. A corruption probe sent them to prison to await trial, helped throw the country into a deep recession and left President Dilma Rousseff fighting for her political survival.
This very interesting Bloomberg article showed up on their Internet site at 3:01 p.m. Denver time on Sunday afternoon—and I thank Tolling Jennings for pointing it out. And as Tolling said in the covering e-mail—“Hi Ed, Perhaps we could get Jamie Dimon deported and tried in Brazil. Peace, Tolling”
The Observer view on Britain’s unedifying alliance with Saudi Arabia
Britain’s decision to join the Syria bombing has been welcomed by regional participants in the international coalition fighting Islamic State (Isis) terrorists, notably by the unelected rulers of Saudi Arabia. But this close martial association with one of the world’s most repressive, undemocratic and frankly unpleasant regimes, notwithstanding a long history of bilateral ties, should not necessarily be welcomed by Britain.
Speaking on Channel 4 News in October, David Cameron was pressed to justify his enthusiasm for the Saudi connection. “We have a relationship with Saudi Arabia and if you want to know why I’ll tell you why. It’s because we receive from them important intelligence and security information that keeps us safe. The reason… is our own national security,” he declared, adding that a Saudi tip-off had helped foil a bomb attack in Britain during his premiership.
Yet an equally strong, if not stronger, argument can be made that Saudi Arabia, far from being a valuable ally, itself represents a serious direct and indirect threat to Britain’s security, interests and values. Its role in Syria, for example, is a prime cause for concern. After joining the anti-Isis coalition formed by Barack Obama last year with great fanfare, Riyadh has gradually shifted its military’s attention elsewhere. Saudi warplanes are now mostly engaged in a destabilising, hugely costly fight with Iranian-backed rebels in Yemen, not with Isis in Syria or Iraq.
This very disturbing, but not surprising commentary was posted on theguardian.com Internet site eight minutes after midnight in London on their Sunday morning, which was 7:08 p.m. in New York on Saturday evening—EDT plus 5 hours. It’s definitely worth reading, even if you’re not a serious student of the New Great Game. My thanks go out to Patricia Caulfield for this article as well.
Far-right poll success jeopardises French reforms
Political tectonic plates are shifting in France. Marine Le Pen’s National Front won more votes than mainstream rivals in the first round of regional elections at the weekend. Whatever happens in the second round, the biggest casualty of her success could be the ruling Socialists’ economic reform plans.
The far-right party had its best ever showing, securing nearly 30 percent of votes overall and coming top in six out of 13 regions. The conservative Les Republicains and their allies were second while the Socialists and other left-leaning parties trailed in third. A bounce in President Francois Hollande’s personal ratings after the Nov. 13 Paris attacks failed to translate into votes.
Those attacks focused the national debate on issues dear to the National Front’s heart. Concern about security is rife and there is much soul-searching about cultural integration in a country that prides itself on being a secular republic.
But Le Pen’s anti-immigration stance is not the only part of her manifesto which resonates with voters. Her staunchly protectionist agenda advocates “economic patriotism” as well as measures to prevent off-shoring of jobs and what she terms unfair competition from countries with very low labour costs.
This opinion piece by Reuters columnist Swaha Pattanaik was posted on their website yesterday—and I thank Richard Saler for passing it along. Ambrose Evans-Pritchard also had something to say about this in an article posted at The Telegraph last night GMT—and it’s headlined “Euro regime is working like a charm for France’s Marine Le Pen“—and this one is courtesy of Patricia Caulfield.
Cleaning Up After Volkswagen: Editorial — The New York Times
Revelations of the extent of Volkswagen’s efforts to hide the true level of its automobile emissions just keep piling up, yet the company appears incapable of coming clean, responding to each new revelation with denial, feigned ignorance and weak apologies.
Last week, an internal e-mail surfaced that shows Volkswagen successfully lobbied the European Commission to remove two key parts of Europe’s forthcoming auto emissions tests, no doubt to make sure its cars in Europe could continue to pollute at unacceptable levels.
The new road tests were meant to measure emissions during actual driving conditions, including when starting a car when the engine is cold. The automaker, which owns the Porsche, Lamborghini and Audi brands, also argued against requiring special tests for cars designed to be driven fast. Many countries around the world follow Europe’s emissions standards.
It is particularly damning that these latest revelations come as the world gathers in Paris to tackle climate change by reducing carbon emissions. The least the European Parliament can do is to reject the new rules when they come before it for a vote, and send the commission back to draft new ones free of Volkswagen’s manipulative meddling.
This piece from The Editorial Board of The New York Times was posted on their Internet site on Sunday sometime—and I thank Patricia C. for this item as well.
The Empire Strikes Back: Week Nine of the Russian Intervention in Syria
Considering the remarkable success of the Russian intervention in Syria, at least so far, it should not have come as a surprise that the Anglo/Zionist Empire would strike back. The only question was how and when. We now know the answer to that question.
On November 24th the Turkish Air force did something absolutely unprecedented in recent history: it deliberately shot down another country’s military aircraft even though it was absolutely obvious that this aircraft presented no threat whatsoever to Turkey or the Turkish people. The Russian Internet is full of more or less official leaks about how this was done. According to these versions, the Turks maintained 12 F-16 on patrol along the border ready to attack, they were guided by AWACS aircraft and “covered” by USAF F-15s in case of an immediate Russian counter-attack. Maybe. Maybe not. But this hardly matters because what is absolutely undeniable is that the USA and NATO immediately took “ownership” of this attack by giving their full support to Turkey. NATO went as far as to declare that it would send aircraft and ships to protect Turkey as it it had been Russia who had attacked Turkey. As for the USA, not only did it fully back Turkey, it now also categorically denies that there is any evidence that Turkey is purchasing Daesh oil. Finally, as was to be expected, the USA is now sending The Harry S. Truman Carrier Strike Group into the eastern Mediterranean, officially to strike Daesh but, in reality, to back Turkey and threaten Russia. Even the Germans are now sending their own aircraft, but with the specific orders not to share any info with the Russians.
So what is really going on here?
Simple: the Empire correctly identified the weakness of the Russian force in Syria, and it decided to use Turkey to provide itself an element of plausible deniability. This attack is probably only the first step of a much larger campaign to “push back” Russia from the Turkish border. The next step, apparently, includes the dispatching of western forces into Syria, initially only as ‘advisors’, but eventually as special forces and forward air controllers. The US and Turkish Air Forces will play the primary role here, with assorted Germans and UK aircraft providing enough diversity to speak of an “international coalition”. As for the French, stuck between their Russian counterparts and their NATO “allies”, they will remain as irrelevant as ever: Hollande caved in, again (what else?). Eventually, NATO will create a de-facto safe heaven for its “moderate terrorists” in northern Syria and use it as a base to direct an attack on Raqqa. Since any such intervention will be completely illegal, the argument of the need to defend the Turkmen minority will be used, R2P and all. The creation of a NATO-protected safe heaven for “moderate terrorists” could provide the first step from breaking up Syria into several smaller statelets.
This commentary by The Saker is something that was posted on the Information Clearing House website—and it’s a must read for any serious student of the New Great Game. I thank Larry Galearis for digging it up for us yesterday.
Beijing under three-day red alert as smog envelops city
Heavy smog in Beijing prompted the city to issue its first red alert Monday, a three-day closing of factories, construction sites and schools.
The highest level of the four-tier alert indicates a severe air pollution problem is expected to last at least three days. The smog is expected to dissipate when a predicted cold front arrives Thursday.
“Coal-fired power plants are the major culprit at this point,” state-run Chinese news agency Xinhua reported. While Beijing attempts to reduce its reliance on coal, surrounding regions still heavily rely on it, and some scientists blame air pollution for 4,000 deaths per day in Beijing.
“This is history. This is a precedent set,” said Ma Jun of Beijing’s Institute of Public and Environmental Affairs.
This very interesting UPI article, filed from Beijing, appeared on their Internet site at 9:03 a.m. EST on Monday morning—and this news item is courtesy of Roy Stephens.
China saw record capital outflows in November: Expert
The constant stream of capital outflows from China that have bedeviled global financial markets likely reached a record in November, according to estimates from Capital Economics.
Julian Evans-Pritchard, China economist at the Singapore office of Capital Economics, has estimated that net capital outflows totaled $113 billion last month, accelerating from $37 billion in October.
But getting an accurate picture of how much money is actually fleeing China is somewhat tricky.
Data released Monday showed China’s foreign exchange reserves fell by $87.2 billion in November to $3.44 trillion. Evans-Pritchard’s calculations suggest that fluctuations in exchange rates accounted for $30 billion of that reduction, leaving $57 billion in foreign exchange sales by the central bank.
Combining the foreign exchange sales with Capital Economics’ trade surplus estimate of around $55 billion for November (official data are out Tuesday) leaves net capital outflows at $113 billion.
With a last name like that, I’m sure that Julian is related to Ambrose in some way. This short CNBC news item was posted on their website very early on Monday morning EST—and it was subsequently picked up by the finance.yahoo.com Internet site. It’s another offering from Richard Saler.
BIS Warns That “Uneasy Calm” In Markets May Be Shattered By Fed Hike Imperiling $3.3 Trillion In E.M. Debt
Well, perhaps because the market thinks there’s something unsavory and altogether disingenuous about the BIS criticizing the same people who make up its board of directors, or perhaps investors are just clueless and complacent, but whatever the case, no one has listened to poor Claudio. But that doesn’t mean the BIS is set to rein in the doom and gloom and in the bank’s latest quarterly review, Borio and Co. are back at it and, coincidentally, one of the key topics is EM debt.
Unlike Deutsche Bank, the BIS doesn’t see anything “benign” about the situation.
“In general, the leading indicators of economic activity [in EM] pointed to weakness ahead [as] countries in the throes of a severe recession, such as Brazil and Russia, struggled on [and] activity in China showed little signs of strengthening,” Borio says, concurring with our assessment from Saturday. “And, as the period wore on, commodity prices, including those for oil, copper and iron ore, plunged towards new depths,” he adds.
That would be bad enough on its own, but set against that rather abysmal backdrop is a USD-denominated debt pile that amounts to some $3 trillion. “The financial vulnerabilities in EMEs have not gone away,” Borio continues. “The stock of dollar-denominated debt, which has roughly doubled since early 2009 to over $3 trillion, is still there [and] in fact, its value in domestic currency terms has grown in line with the US dollar’s appreciation, weighing on financial conditions and weakening balance sheets.”
We’ve seen several stories about emerging market debt recently—and here’s another one. This one put in an appearance on the Zero Hedge website at at 10:06 a.m. on Sunday morning EST—and I thank “David in California” for bringing it to our attention. There was a story at The Telegraph on this issue as well. It’s headlined “‘Uneasy’ market calm masks debt time bomb, BIS warns“—and I thank Richard Saler for his third and final offering in today’s column.
Will U.S. ease off gold price suppression to offset rate-rise boost to dollar?
GATA secretary/treasurer Chris Powell is no market analyst. Rather, he is only the archivist of documentation of largely surreptitious intervention in the gold market by central banks to defend their currencies and government bonds, to control interest rates and the prices of strategic commodities, and, really, thereby to control the world:
But given the new warning from the Bank for International Settlements against more appreciation of the U.S. dollar, as described in the report yesterday from the London Telegraph, your secretary/treasurer will volunteer a suspicion that he hopes arises more from his experience with the deceit basic to modern central banking than from his wishful thinking, his belief in free and transparent markets and gold’s crucial function in achieving them.
That suspicion is that the U.S. government and its remaining allies in international market rigging will use and maybe already on Friday began using the Federal Reserve’s expected nominal raising of interest rates this month as cause to ease off gold price suppression and to let the gold price rise a little.
While the Fed’s raising U.S. interest rates would tend to strengthen the dollar and increase the burden of dollar-denominated debt, about which the BIS and many others are warning, a simultaneously rising gold price would tend to devalue the dollar. It would be one foot on the brake ostentatiously, the other foot on the accelerator surreptitiously, allowing the Fed to save face after its many postponements of raising rates while continuing to support asset inflation.
Of course, just as when you’re a hammer everything looks like a nail, when you’re the archivist of gold price suppression everything central banks do is read in the context of their ever-increasing intervention in the markets to protect their power. Indeed, as the new BIS report says, central bank policies themselves have become the markets. Or as a high school graduate told GATA’s Washington conference seven years ago, with no tutoring at all from the BIS, “There are no markets anymore, just interventions“.
This worthwhile commentary by Chris put in an appearance on the gata.org Internet site site yesterday.
Brutal cartels fight over Mexico’s ‘conflict-free’ gold revenues
Heroin traffickers linked to the abduction and disappearance of 43 students a year ago are battling over millions of dollars paid by Canadian mining giant Goldcorp to a village in Mexico’s southern gold belt, leading to a wave of murders.
As a signatory to a Conflict-Free Gold Standard drawn up by the World Gold Council industry group, Goldcorp commits to extracting the precious metal in a manner that “does not fuel unlawful armed conflict or contribute to serious human rights abuses.”
But residents of Carrizalillo in the impoverished state of Guerrero say the some $3 million a year in rent paid by Goldcorp for their land, which the mine is built on, is fuelling a bloody feud between two rival cartels.
Village authorities say the company is not doing all it can to protect them.
This Reuters news item, filed from Carrizalillo in Mexico, showed up on their Internet site at 9:42 a.m. EST yesterday morning—and it’s another gold-related news item that I found on the gata.org Internet site.
Colombia Says Treasure-Laden San Jose Galleon Found
The wreck of a Spanish ship laden with treasure that was sunk by the British more than 300 years ago has been found, says Colombian President Juan Manuel Santos.
“Great news! We have found the San Jose galleon,” the president tweeted.
The wreck was discovered near the port city of Cartagena.
It has been described as the holy grail of shipwrecks, as the ship was carrying one of the largest amounts of valuables ever to have been lost at sea.
Santos said the cargo was worth at least $1 billion (£662 million).
This very interesting news item appeared on the bbc.com Internet site on Saturday sometime—and I found this in a GATA release on Saturday morning. Chris Powell’s headline read “Will sunken treasure ship’s gold be leased even before it’s recovered?”
Vanishing gold trade prompts Singapore to refine contract
Just over a year ago, Singapore Exchange Ltd. started gold trading to help bolster the country’s role as a bullion hub in Asia, the world’s largest consuming region. Transactions slumped to zero in November and the bourse is now trying to revitalize the market.
“Volumes haven’t been spectacular,” William Chin, vice president of commodities at the exchange, said in an interview. “One of the key reasons is the contract specification itself, and this is quite normal across different products. You don’t always get it right the first time round.”
The absence of volume in November follows only two transactions in October and compares with 52 a year earlier, exchange data show. There have been a total of 308 trades since inception. At 25 kilograms, it’s bigger than the 1 kilogram lot traded on the CME for Hong Kong delivery and larger than contracts of as much as 12.5 kilograms in Shanghai. The size is intended to attract investors looking for a transparent, wholesale benchmark for physical delivery in Asia, Chin said.
This gold-related news item was posted on the Bloomberg website at 4:36 p.m. Denver time on their Sunday afternoon—and it’s another story I found over at the gata.org Internet site.
China ups gold reserves 20.8 tonnes in November
Analysts at Bloomberg have calculated that China’s gold reserves have grown from 55.38 million ounces (1,722.5 tonnes) at end October to 56.05 million ounces (1,743.3 tonnes) at end-November by taking the announced gold reserve figures in U.S. dollars for the two months and applying the LBMA gold price prevailing at the end of each month to make their estimate. The figures thus suggest that China increased its reserves by 20.8 tonnes over the period – the highest monthly increase in its gold reserves since it started announcing monthly reserve figures back in July.
There still remain doubts about the true levels of Chinese gold holdings, with many analysts believing these are still being understated, as they have been in the past when there were large time gaps – five or six years – between reserve increase announcements. China’s gold reserves are seen as of political significance with the country only letting the world know what it wishes it to believe!
This brief commentary by Lawrie appeared on his own website—lawrieongold.com—and I thank Patricia Caulfield for her last offering in today’s column.
The PHOTOS and the FUNNIES
Back to San Francisco for a couple of more days. Unlike the juvenile California gulls in Saturday’s column, these are the adult birds—and they’re certainly a couple of sizes larger than any gull we have around Edmonton. The first photo is such that I couldn’t avoid the unpleasant background because I just had way too much depth of field. The ‘head and shoulders’ shot in the second, is a crop from a gull that was sitting on the top of a car about fifteen feet away—and you can just make out two his compatriots siting on a roof in the far-distant background.
The WRAP
Even though daily price gains have been as rare as hens’ teeth over the past 5 or 6 weeks, Friday’s rally was enough to put both gold and silver at the highest weekly close in four weeks. I’d ask you to reflect on that for a moment, specifically, a one day rally that was significant enough, but far from record breaking, to put gold and silver prices at four week highs. And please keep in mind that on Thursday, both gold and silver traded at new intraday price lows extended back for five or six years.
Here’s what that means to me – it is unquestionable confirmation of the whole COMEX price manipulation, salami slicing, snookering of the managed money traders by the crooked commercials premise and nothing else. Something caused prices for gold and silver (and platinum, palladium, copper and even crude oil) to move in a relentless stair-step manner for nearly six weeks, only to suddenly turn up after it appeared the managed money technical funds finally sold as many futures contracts that they were capable of selling.
As it turns out, this one-day rally in gold and silver was quite unusual in that never have I witnessed more commentators and analysts getting the call right. The clear distinction between those who understood what was going on during the six week price decline and anticipated that a rally was close at hand and those commentators who didn’t, had to do with the focus on the COT market structure. Those that embraced the idea that managed money/commercial positioning is responsible for price movement proved to be “in the know,” while those looking at non-COT factors were, well, out to lunch and clueless. — Silver analyst Ted Butler: 05 December 2015
Well, what the markets gave us on Friday morning, “da boyz” were only too happy to take back on Monday with their high-frequency trading and spoofing activities. With no exceptions, all of the Big 6 commodities got taken out to the woodshed yesterday—and WTI got it the worst of all.
Here are the 6-month charts for the Big 6—so you can see the damage for yourself. I’ve substituted the 20-day moving average, for the 200-day moving average once again.
Needless to say, I was none too happy to see yesterday’s price action, as it shows that JPMorgan et al are still completely in charge of prices—and have no intention of allowing them to rise until they’re ready. And as to when that day may be, I haven’t a clue.
And as I type this paragraph, the London open is less than ten minutes away—and I see that gold got sold down a bit more in mid-morning trading in the Far East, with the current low tick coming shortly before 10 a.m. Hong Kong time. At the moment, gold is up a couple of bucks. The same thing happened in silver—and it’s currently up a whole 3 cents. Platinum is up 4 dollars—and palladium is down 3 bucks.
Net HFT gold volume is way up there at 27,500 contracts already. Net HFT volume in silver is sitting just under 5,500 contracts. The dollar index has been chopping quietly lower through all of Far East trading on their Tuesday—and is currently down 21 basis points as London opens.
Today at the close of COMEX trading is the cut-off for this Friday’s Commitment of Traders Report—and based on the last four days of trading that are currently in that report, there’s no question that the Managed Money traders were covering short positions aggressively—and it is to be hoped that the small Commercial traders, Ted Butler’s raptors, were the only sellers dumping long positions for fun, profit and price management purposes. As Ted mentioned in Saturday’s column, in rally conditions such as this, the Big 4/8 traders don’t normally show up as short sellers of last resort until the time that the raptors are almost done selling longs—because at that point, the their long selling can no longer contain the upward price momentum.
And as I post today’s column on the website at 4:55 a.m. EST, I note that there hasn’t been any price change in either gold or silver, as they’re still up 2 bucks and 3 cents respectively. But platinum is now up 6 dollars—and palladium is back to unchanged.
HFT gold volume is now just north of 31,500 contracts—and in silver, that number is just under 7,500 contracts. The dollar index hit its current 98.45 low about twenty minutes after the London open—and has rallied a bit since then, as it’s only down 12 basis points at the moment.
I have absolutely no clue as to how the precious metal prices will perform today, although it’s a given that whatever price action does occur, will be miles away from what the free-market price action might be. All eyes will be on the Fed meeting next week—and its only what happens on Wednesday at 2 p.m. EST on December 16th that really matters at this point.
That’s all I have for today—and I’ll see you here on Wednesday.
Ed
The post Will U.S. Ease Off Gold Price Suppression to Offset Rate-Rise Boost to Dollar? appeared first on Ed Steer.