Good evening Ladies and Gentlemen:
Here are the following closes for gold and silver today:
Gold: $1188.00 up $3.20 (comex closing time)
Silver: $16.87 unchanged (comex closing time)
In the access market 5:15 pm
Gold $1189.00
Silver: $17.00
Gold/silver trading: see kitco charts on the right side of the commentary.
Following is a brief outline on gold and silver comex figures for today:
The gold comex today had a poor delivery day, registering 0 notices served for nil oz. Silver comex registered 39 notices for 195,000 oz .
Several months ago the comex had 303 tonnes of total gold. Today the total inventory rests at 243.75 tonnes for a loss of 59 tonnes over that period. Lately the removals have been rising!
In silver, the open interest fell by 1298 contracts, due to short covering, as Friday’s silver price was up by 77 cents. The total silver OI continues to remain extremely high with today’s reading at 175,650 contracts. The front month of March fell by 30 contracts to 541 contracts. We are still close to multi year high in the total OI complex despite a record low price. This dichotomy has been happening now for quite a while and defies logic. There is no doubt that the silver situation is scaring our bankers to no end.
We had 39 notices served upon for 195,000 oz.
In gold we had a huge rise in OI as gold was up by $17.70 yesterday. The total comex gold OI rests tonight at 436,679 for a gain of 348 contracts. Today, surprisingly we again had 0 notices served upon for nil oz.
Today, we had a withdrawal of 5.37 tonnes at the GLD/ inventory at the GLD/Inventory rests at 744.40 tonnes
In silver, /SLV we had a withdrawal of 1.174 million oz of inventory at the SLV/Inventory, at 326.158 million oz
We have a few important stories to bring to your attention today…
1, Today we again had some short covering in the silver comex with the silver OI falling by 1298 contracts. Gold OI again rises by close 348 contracts. Both gold and silver rose nicely today (report Harvey)
2, Merkel meets Tsipras but nothing new develops. On the reparations front it looks like Germany owes Greece for the forced loan it gave the Nazis
(R Meijer)
3.Today we again see turmoil in the currencies and this does not look good. Currencies should rise by “pennies” and instead it is rising by “quarters or half dollars”!!
(zero hedge)
4. Koos Jansen reports that China requests that gold and the Chinese yuan should be included in the new SDR
(Koos Jansen)
5. First we had shale oil in overproduction. Now it is shale natural gas
(Berman)
6.More countries are leaving the USA fold, by joining the new Chinese development bank. Today the USA folded and stated that it will cooperate with the new bank. Also the iMF is giving full support to the AIIB
(zero hedge)
7. Finally, we have a report showing global earnings falling faster than Lehman.
(courtesy Dave Kranzler/IRD)
we have these and other stories for you tonight.
Let us now head over to the comex and assess trading over there today.
Here are today’s comex results:
The total gold comex open interest rose by 348 contracts from 436,331 up to 436,679 as gold was up by $15.70 on Friday (at the comex close). We are now in the contract month of March which saw it’s OI fall to 108 for a loss of 3 contracts. We had 0 notices filed upon on Friday so we lost 3 gold contracts or additional 300 oz will not stand for delivery in this delivery month of March. The next big active delivery month is April and here the OI fell by 10,716 contracts down to 192,515. We have 8 days before first day notice for the April gold contract month, on March 31.2015. The estimated volume today (which is just comex sales during regular business hours of 8:20 until 1:30 pm est) was poor at 109,075. (Where on earth are the high frequency boys?). The confirmed volume on yesterday ( which includes the volume during regular business hours + access market sales the previous day) was good at 206,940 contracts. Today we had 0 notices filed for nil oz.
And now for the wild silver comex results. Silver OI fell by 1298 contracts from 176,948 down 175,650 despite the fact that silver was up by 77 cents with respect Friday’s trading. We therefore had some short covering. We are now in the active contract month of March and here the OI fell by 30 contracts falling to 541. We had 0 contracts served upon on Friday. Thus we lost 30 contracts or an additional 150,000 oz will not stand in this March delivery month. The estimated volume today was simply awful at 21,450 contracts (just comex sales during regular business hours. The confirmed volume yesterday (regular plus access market) came in at 65,654 contracts which is good in volume. We had 39 notices filed for 195,000 oz today.
March initial standings
March 23.2015
Gold
Ounces
Withdrawals from Dealers Inventory in oz
nil
Withdrawals from Customer Inventory in oz
nil
Deposits to the Dealer Inventory in oz
nil
Deposits to the Customer Inventory, in oz
nil
No of oz served (contracts) today
0 contracts (nil oz)
No of oz to be served (notices)
108 contracts (10,800 oz)
Total monthly oz gold served (contracts) so far this month
8 contracts(800 oz)
Total accumulative withdrawals of gold from the Dealers inventory this month
114,790.651 oz
Total accumulative withdrawal of gold from the Customer inventory this month
626,388.9 oz
Today, we had 0 dealer transaction
total Dealer withdrawals: nil oz
we had 0 dealer deposit
total dealer deposit: nil oz
we had 0 customer withdrawals
total customer withdrawal: nil oz
we had 0 customer deposits:
We had 0 adjustments
Today, 0 notices was issued from JPMorgan dealer account and 0 notices were issued from their client or customer account. The total of all issuance by all participants equates to 0 contracts of which 0 notices were stopped (received) by JPMorgan dealer and 0 notices were stopped (received) by JPMorgan customer account.
To calculate the total number of gold ounces standing for the March contract month, we take the total number of notices filed so far for the month (8) x 100 oz or 800 oz , to which we add the difference between the open interest for the front month of March (108) and the number of notices served upon today (0) x 100 oz equals the number of ounces standing.
Thus the initial standings for gold for the March contract month:
No of notices served so far (8) x 100 oz or ounces + {OI for the front month (108) – the number of notices served upon today (0) x 100 oz} = 11,600 oz or .3608 tonnes
we lost 300 additional ounces that will not stand for delivery in this March contract month.
Total dealer inventory: 658,537.414 oz or 20.48 tonnes
Total gold inventory (dealer and customer) = 7.836 million oz. (243.75) tonnes)
Several weeks ago we had total gold inventory of 303 tonnes, so during this short time period 59.0 tonnes have been net transferred out. However I believe that the gold that enters the gold comex is not real. I cannot see continual additions of strictly kilobars.
end
And now for silver
March silver initial standings
March 23 2015:
Silver
Ounces
Withdrawals from Dealers Inventory
nil oz
Withdrawals from Customer Inventory
601,237.33 oz (Delaware, HSBC)
Deposits to the Dealer Inventory
nil
Deposits to the Customer Inventory
537,230.33 oz (Delaware,Scotia)
No of oz served (contracts)
39 contracts (195,000 oz)
No of oz to be served (notices)
502 contracts (2,510,000)
Total monthly oz silver served (contracts)
2043 contracts (10,215,000 oz)
Total accumulative withdrawal of silver from the Dealers inventory this month
Total accumulative withdrawal of silver from the Customer inventory this month
6,950.441.5 oz
Today, we had 0 deposit into the dealer account:
total dealer deposit: nil oz
we had 0 dealer withdrawal:
total dealer withdrawal: nil oz
We had 2 customer deposits:
i) Into Delaware; 11,748.53 oz
ii) Into Scotia; 526,230.30 oz
total customer deposit: 537,230.33 oz
We had 2 customer withdrawals:
i) Out of HSBC: 600,245.73 oz
ii) Out of Delaware; 991.600 oz
total withdrawals; 601,237.33 oz
we had 0 adjustment
Total dealer inventory: 70.021 million oz
Total of all silver inventory (dealer and customer) 174.841 million oz
.
The total number of notices filed today is represented by 39 contracts for 195,000 oz. To calculate the number of silver ounces that will stand for delivery in March, we take the total number of notices filed for the month so far at (2043) x 5,000 oz = 10,215,000 oz to which we add the difference between the open interest for the front month of March (541) and the number of notices served upon today (39) x 5000 oz equals the number of ounces standing.
Thus the initial standings for silver for the March contract month:
2043 (notices served so far) + { OI for front month of March(541) -number of notices served upon today (39} x 5000 oz = 12,725,000 oz standing for the March contract month.
we lost 30 contracts or an additional 150,000 oz will not not stand for delivery.
for those wishing to see the rest of data today see:
http://www.harveyorgan.wordpress.com orhttp://www.harveyorganblog.com
end
The two ETF’s that I follow are the GLD and SLV. You must be very careful in trading these vehicles as these funds do not have any beneficial gold or silver behind them. They probably have only paper claims and when the dust settles, on a collapse, there will be countless class action lawsuits trying to recover your lost investment.
There is now evidence that the GLD and SLV are paper settling on the comex.
***I do not think that the GLD will head to zero as we still have some GLD shareholders who think that gold is the right vehicle to be in even though they do not understand the difference between paper gold and physical gold. I can visualize demand coming to the buyers side:
i) demand from paper gold shareholders
ii) demand from the bankers who then redeem for gold to send this gold onto China
vs no sellers of GLD paper.
And now the Gold inventory at the GLD:
March 23/we had a huge withdrawal of 5.37 tonnes of gold from the GLD vaults/Inventory 744.40 tonnes
march 20/we had no changes in inventory at the GLD/Inventory at 749.77 tonnes
March 19/we had no changes in inventory at the GLD/Inventory 749.77 tonnes
March 18/ we had a withdrawal of .9 tonnes of gold from the GLD/Inventory at 749.77 tonnes
March 17.2015: no change in gold inventory at the GLD/Inventory 750.67 tonnes
March 16/no change in gold inventory at the GLD/Inventory 750.67 tonnes
March 13/ we had a small change in gold inventory at the GLD (small withdrawal/probably to pay for fees)/Inventory at 750.67 tonnes
March 12.we had a withdrawal of 2.09 tonnes of gold at the GLD/Inventory at 750.95 tonnes
March 11.2015: no changes in gold inventory at the GLD/Inventory at 753.04 tonnes
March 10 no report on the GLD tonight/computer down/inventory remains 753.04 tonnes
March 9/ we had another huge withdrawal of 3.38 tonnes of gold from the GLD, no doubt heading for Shanghai/Inventory 753.04 tonnes
March 6/we had a huge withdrawal of 4.48 tonnes of gold from the GLD/inventory rests tonight at 756.32/Also HSBC is getting out of the gold business in London and is giving up all of its 7 vaults.
March 23/2015 / we had a withdrawal of 5.37 tonnes of gold/Inventory at 744.740tonnes
inventory: 744.40 tonnes.
The registered vaults at the GLD will eventually become a crime scene as real physical gold departs for eastern shores leaving behind paper obligations to the remaining shareholders. There is no doubt in my mind that GLD has nowhere near the gold that say they have and this will eventually lead to the default at the LBMA and then onto the comex in a heartbeat (same banks).
GLD : 744.40 tonnes.
end
And now for silver (SLV):
March 23./we had a huge withdrawal of 1.174 million oz of silver from the SLV vaults/Inventory 326.158 million oz
March 20/ no changes in silver inventory/327.332 million oz
March 19/ no change in silver inventory/327.332 million oz
March 18/ no change in silver inventory/327.332 million oz
March 17/ no change in silver inventory/327.332 million oz
March 16/no change in silver inventory/327.332 million oz
March 13.2015: no change in silver inventory/327.332 million oz
March 12: no changes in silver inventory/327.332 million oz
March 11/no changes in silver inventory/327.332 million oz
March 10/ no change in silver inventory/327.332 million oz
March 9/ no change in silver inventory at the SLV/327.332 million oz
March 6: huge addition of 1.34 million oz of silver into the SLV/Inventory 727.332 million oz
March 5 no change in inventory/725.992 million oz
March 23/2015 we had a huge withdrawal of 1.174 million oz of silver inventory at the SLV/ SLV inventory rests tonight at 326.158 million oz
end
And now for our premiums to NAV for the funds I follow:
Note: Sprott silver fund now for the first time into the negative to NAV
Sprott and Central Fund of Canada.
(both of these funds have 100% physical metal behind them and unencumbered and I can vouch for that)
Not available tonight
1. Central Fund of Canada: traded at Negative 6.7% percent to NAV in usa funds and Negative 7.0% to NAV for Cdn funds!!!!!!!
Percentage of fund in gold 61.7%
Percentage of fund in silver:37.9%
cash .4%
( March 23/2015)
Sprott gold fund finally rising in NAV
2. Sprott silver fund (PSLV): Premium to NAV rises to + 1.60%!!!!! NAV (March 23/2015)
3. Sprott gold fund (PHYS): premium to NAV remains at -.13% to NAV(March 23 /2015)
Note: Sprott silver trust back into positive territory at +1.60%.
Sprott physical gold trust is back into negative territory at -.13%
Central fund of Canada’s is still in jail.
end
And now for your more important physical gold/silver stories:
Gold and silver trading early this morning
(courtesy Mark O’Byrne)
Greece and EU Running Out of Time – Bank Runs Intensify, Bail-Ins Likely
By Mark O’Byrne March 23, 2015 0 Comments
Share on facebook Share on twitter Share on linkedin More Sharing Services
- EU and Greece running out of time as talks end “in disarray” – again
- Greece warns Merkel of ‘impossible’ debt
- Concerns Greece out of money by end of April
- Friday’s “agreement” in Brussels falls apart hours later as protagonists fail to agree on specifics
- Greece now insolvent – will run out of liquidity by end of April
- Greek banks on verge of collapse as runs continue – €1.5 billion emptied out of banks last week alone
- ‘Grexit’ could propel gold to over $2,000/oz
- Cyprus style bail-ins look increasingly possible
Greece’s place in the Eurozone is as precarious as ever as talks between Prime Minister Tsipras and European leaders in Brussels broke down – hours after reaching general agreement – and Greece warned Germany that it will be “impossible” for Greece to service debt payments due in the coming weeks if the EU fails to provide short-term financial assistance.
Greece – faced with illiquidity, insolvency and a potential banking collapse – is running out of time and appears to be on the back foot as its international creditors refuse to countenance any debt restructuring, rescheduling or forgiveness.
The warning from Greece came in a letter from Tsipras to Angele Merkel provided to the Financial Times. It comes as concerns mount that Athens will struggle to make pension and wage payments by as early as next week, the end of March, and could run out of cash completely before the end of April.
The letter, dated March 15, came just before Ms Merkel agreed to meet Mr Tsipras on the sidelines of an EU summit last Thursday and invited him for a one-on-one session in Berlin, scheduled for Monday evening.
In the letter, Tsipras warns that Greece will be forced to choose between paying off loans, owed primarily to the IMF, or continue social spending. He blames ECB limits on Greece’s ability to issue short-term debt as well as eurozone bailout authorities’ refusal to disburse any aid before Greece adopts a new round of economic reforms.
“Given that Greece has no access to money markets, and also in view of the ‘spikes’ in our debt repayment obligations during the spring and summer . . . it ought to be clear that the ECB’s special restrictions when combined with disbursement delays would make it impossible for any government to service its debt,” Mr Tsipras wrote.
He said servicing the debts would lead to a “sharp deterioration in the already depressed Greek social economy — a prospect that I will not countenance”.
At a press conference on Friday Angela Merkel said “the Greek government has the opportunity to pick individual reforms that are still outstanding as of 10 December and replace them with other reforms if they . . . have the same effect,” according to the Financial Times.
That Merkel would consider holding Syriza to an agreement made between Greece’s previous government and the Troika – which Syriza have eschewed – shows how little progress has been made in the intractable negotiations between the two sides since Syriza came to power.
All that has changed is that Greece is more insolvent and Europe has bought time to deal, albeit reluctantly, with a “Grexit”.
Bloomberg confirms that the Greek government may run out of cash to pay pensions and salaries in April.
“Locked out of capital markets and with its coffers running dry, Greece is scraping the bottom of the barrel to pay pensions and salaries amid signs that it could run out of money by early next month.”
At the same time, Bloomberg reports that €1.5 billion was withdrawn from Greek banks last week alone.
January saw record drops in deposits in Greek banks. The banks have been drawing from the Emergency Liquidity Assistance (ELA) program to stay afloat. The ELA is operated by the Greek Central Bank but is reviewed weekly by the ECB.
Greece’s central bank requested a raise to the ELA ceiling to deal with the bank runs. The ECB approved a €400 million raise in the ceiling – less than half of what was requested, according to Bloomberg.
Depositors in Greek banks, both individuals, small and medium enterprises and corporates are becoming increasingly concerned about the twin risks of default and return to the drachma or remaining in the monetary union and potentially having Cyprus style bail-ins imposed on Greek savers.
Time certainly appears to be running out for Greece. Either Syriza capitulates and returns to the Troika’s bail-out mechanism – highlighting a complete loss of sovereignty, or Greece defaults and exits the Eurozone.
‘Grexit’ should propel gold higher with respected analysts saying gold could quickly rise to $2,000 per ounce should a ‘Grexit’ occur.
The Greek and EU debt ‘can’ has been continuously kicked down the road. We are running out of road …
“A must read for depositors globally seeking to protect their bank deposits from bail-ins”:
Protecting Your Savings in the Coming Bail-In Era
MARKET UPDATE
Today’s AM fix was USD 1,181.40, EUR 1,086.15 and GBP 791.77 per ounce.
Friday’s AM fix was USD 1,171.75, EUR 1,096.17 and GBP 794.73 per ounce.
Gold and silver were both strong for the week – gold rose 2.42 percent and silver surged 7.45 percent.
Gold climbed 1.1 percent or $12.90 and closed at $1,183.20 an ounce Friday, while silver surged 3.72 percent or $0.60 at $16.73 an ounce.
In Singapore, bullion for immediate delivery in afternoon trading was $1,181.71 an ounce. Gold remained steady not moving much since the close on Friday.
In London spot gold in the late morning is trading at $1,181.66 or down 0.03 percent. Silver is at $16.70 or off 0.20 percent and platinum is at $1,138.09 or up 0.10 percent.
Premiums on the Shanghai Gold Exchange (SGE) have fallen $2 to $4-$5 today compared with $6-$7 on Friday. This suggests that gold demand in China eased after the gains last week. However, Chinese gold demand remains very robust as seen in the 51.5 metric tonnes of gold withdrawals on the SGE last week.
European markets today are cautious due to concerns regarding Greece, ahead of a meeting between its prime minister and Germany’s Angela Merkel.
In Europe, Greek Prime Minister Alexis Tsipras is meeting with German Chancellor Angela Merkel today. Greece is running out of cash quickly which is heightening the risk of a ‘Grexit’ and a return to the drachma, or alternatively to Cyprus style bail-ins.
Open Europe a research group estimated a ‘Brexit’ or Britain leaving the European Union could cost Britain 56 billion pounds ($84 billion) a year by 2030 unless the country keeps its borders open, based on a departure by January 2018.
Bullion coin demand remains robust as seen in the latest data from the U.S. Mint. Sales of gold American Eagle coins by the U.S. Mint have already out sold last March’s total by well over 50% this month, reaching 34,500 ounces with another week of the month left to go according to Reuters. In March 2014 as a whole, they reached 21,000 ounces.
end
Only new new members join the London gold fix. Chinese banks are not one of them as of yet:
(courtesy Jan Harvey/Reuters)
London’s ‘reformed’ gold fix mechanism gets all of two new participants
Submitted by cpowell on Sat, 2015-03-21 01:02. Section: Daily Dispatches
Goldman, UBS Join Former ‘Fixing’ Banks for New LBMA Gold Price
By Jan Harvey
Reuters
Friday, January 20, 2015
LONDON — The new London Bullion Market Association Gold Price went live for the first time on Friday, with Goldman Sachs and UBS joining the four members of the now-defunct gold “fix” in setting its electronic replacement.
Goldman and UBS joined Barclays, HSBC, Bank of Nova Scotia, and Societe Generale to set the new benchmark gold price, administered by ICE Benchmark Administration, at 10:30 GMT on March 20.
The first LBMA Gold Price was set at $1,171.75 an ounce, after five rounds of an auction to strike a balance between bids and offers.
“The London gold fixing was eclipsed today,” Ross Norman, chief executive of Sharps Pixley, said. “The key question is: Will users have the necessary confidence in the number? My gut feeling is that, with six participants, yes is the answer.” …
… For the remainder of the report:
http://www.reuters.com/article/2015/03/20/us-gold-fix-idUSKBN0MG0YF20150…
end
Alasdair explains the significance of the new AIIB bank initiated by China which will probably have by the end of this month over 35 founding nations, but not the uSA:
(courtesy Alasdair Macleod)
By Alasdair Macleod Posted 20 March 2015
The new order emerges
China and Russia have taken the lead in establishing the Asian Infrastructure Investment Bank (AIIB), seen as a rival organisation to the World Bank and the Asian Development Bank, which are dominated by the United States with Europe and Japan.
These banks do business at the behest of the old Bretton Woods* order. The AIIB will dance to China and Russia’s tune instead.
The geopolitical importance was immediately evident from the US’s negative reaction to the UK’s announcement this week that it would join the AIIB. And very shortly afterwards France, Germany and Italy also defied the US and announced they might join. In the Pacific region, one of America’s closest allies, Australia, says she is considering joining too along with New Zealand. The list of US allies seeking to join is growing. From a geopolitical point of view China and Russia have completely outmanoeuvred the US, splitting both NATO and America’s Pacific alliances right down the middle.
This is much more important than political commentators generally realise. We must appreciate that anything China does is planned well in advance. Here is the relevant sequence of events:
• In 2002 China and Russia formally adopted the founding charter for the Shanghai Cooperation Organisation, an economic bloc that today contains about 35% of the world’s population, which will become more than 50% when India, Pakistan, Iran, Afghanistan and Mongolia join, which is their stated intention. Russia has the resources and China the manufacturing power to develop the largest internal market ever seen.
• In October 2013 George Osborne was effectively summoned to Beijing because China wanted London to be the base to develop renminbi-denominated financial instruments. London has served China well, with the UK Government even issuing the first renminbi-denominated foreign (to China) government bond. The renminbi is now on the way to being a fully-fledged international currency.
• The establishment of an infrastructure bank, the AIIB, will ensure the lead funding is available for the rapid development of road, rail, electric and electronic communications throughout the SCO, ensuring equally rapid economic development of the whole of the Asian continent. It could amount to the equivalent of several trillion dollars over time.
The countries that are applying to join the AIIB realise that they have to be members to access what will eventually become the largest single market in the world. America is being frozen out, the consequence of her belligerence over Ukraine and the exercise of her hegemonic power through the dollar. America’s allies in South East Asia are going with or will go with the new AIIB, and in Europe commercial interests are driving America’s NATO partners away from her, turning the Ukraine from a common cause into a festering liability.
The more one thinks about it, the creation of the AIIB is a masterstroke of tactical genius. The outstanding issue now is China and Russia will need to come up with a credible plan to make their currencies a slam-dunk replacement for the dollar. We know that gold may be involved because the SCO members have been accumulating bullion; but before we get there China must manage a deliberate deflation of her credit bubble, which will be a delicate and dangerous task.
Unlike the welfare-driven economies in the west, China has sufficient political authority and internal control to survive a rapid deflation of bank credit. When this inevitably happens the economic consequences for the west will be very serious. Japan and the Eurozone are already facing economic dislocation, and despite over-optimistic employment numbers, the US economy is faltering as well. The last thing America and the dollar needs is a deflationary shock from China.
The silver lining for us all is a peace dividend: it is becoming less likely that America will persist with a call to arms, because support from her allies is melting away leaving her on her own.
*The Bretton Woods system of monetary management established the rules for commercial and financial relations among the world’s major industrial states in the mid-20th century.
-Disclaimer- The views and opinions in this article are those of the author, do not reflect the views and opinions of GoldMoney, and are not advice.
end
Are these guys nuts???. The mine is owned by Nevsun
(courtesy GATA)
Ethiopian warplanes reported to have attacked Nevsun gold mine in Eritrea
Submitted by cpowell on Sun, 2015-03-22 23:28. Section: Daily Dispatches
Ethiopian Planes Raided Bisha Gold Mine
From the Asmarino Independent
(Eritrean exile Internet site)
Saturday, March 21, 2015
Ethiopian fighter planes bombed the site of Eritrea’s Bisha gold mine, reported Al-Sahafa, a leading Sudanese Arab daily in its March 21 edition.
According to the newspaper, heavy plumes of smoke and fire bellowed from the mine, located 150 kilometers from the capital city, Asmara.
At $300-$400 million in annual earnings, the gold mine is Eritrea’s only source of revenue, the newspaper added.
The paper speculated that the raid might have been intended to distract public attention from the upcoming Ethiopian elections.
In related developments, www.sallina.com has reported that Bisha gold mine sustained damages. It did not provide information on the nature or cause.
Reached at its headquarters in Canada, Nevsun Mining Co. asked Asmarino.com to contact its local offices in Eritrea directly. They were not available for comment.
… For the remainder of the report:
http://www.asmarino.com/news/4352-eritrea-ethiopian-planes-raided-bisha-…
end
On CNBC Asia, GATA secretary discusses gold market rigging and its consequences
Submitted by cpowell on Mon, 2015-03-23 03:18. Section: Daily Dispatches
11:17a HKT Monday, March 23, 2015
Dear Friend of GATA and Gold:
Your secretary/treasurer was interviewed this morning in Hong Kong by Bernie Lo on CNBC Asia’s “Squawk Box” program, discussing gold market manipulation, the failure of mainstream financial news organizations to put critical questions to central banks about their surreptitious intervention in the gold market, the “new” gold fix in London, the market-destroying and imperialistic results of gold price suppression, and the general subversion of democracy by central banking. A five-minute excerpt from the interview has been posted at the CNBC archive here:
http://video.cnbc.com/gallery/?video=3000363624
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
end
Koos discusses the fact that China wants the Yuan and gold to be included in the SDR calculations.
(courtesy Koos Jansen)
Posted on 23 Mar 2015 by Koos Jansen
Will The Shanghai International Gold Exchange Facilitate Gold Inclusion Into The SDR?
The Shanghai International Gold Exchange (SGEI) was launched in September 2014, to internationalize the Chinese gold market and the renminbi. The timing of the launch is quite remarkable though, in the context of changes in the international monetary system (IMS).
2015 is likely to force a major shift in the IMS. Two developments are worth watching, the SDR basket will be reviewed, the renminbi will probably be adopted later this year, and the rise of the Asian Infrastructure Investment Bank (AIIB), an international financial institution proposed by China with many Western members; currently France, Germany, Italy, Luxembourg, Switzerland, New Zealand and the UK. Both developments are severe blows to the US dollar hegemony.
Last week I reported on, (i) the IMF terms for the renminbi to be adopted into the SDR, (ii) if these terms can be met this year, and (iii) what the role of gold will be in the process (read China, Gold, SDRs And The Future Of The International Monetary System). Since then there has been more confirmation of renminbi adoption in the media.
From Reuters:
China’s yuan at some point would be incorporated in the International Monetary Fund’s Special Drawing Right (SDR) currency basket, IMF Managing Director Christine Lagarde said, …”It’s not a question of if, it’s a question of when,”
From Xinhua:
China and Germany conducted their first high-level financial dialogue here on Tuesday and agreed to strengthen macro-economic policy coordination
…confronted with a complex and fragile global economic situation, China and Germany as important economies should strengthen policy coordination, coordinate strategic cooperation, deepen financial and fiscal cooperation…
Representing Germany at the dialogue, German Finance Minister Wolfgang Schaeuble and Deutsche Bundesbank President Jens Weidmann said that Germany and China have been working together very well both bilaterally and multilaterally in financial and fiscal areas…
According to a joint statement after the dialogue, the German side will actively support … China’s goal to add the RMB to the special drawing rights (SDR) currency basket based on existing criteria.
…During the dialogue, both sides reached consensus on issues such as investment cooperation between China and Europe, China and Germany and in third countries.
Kindly note, Germany officially has the second largest gold reserves in the world and are currently repatriating gold from the US. Thereby expressing their affinity with gold and their lack of trust in the US as their custodian. This Germany would like the renminbi to be included into the SDR.
The most important condition for the adoption of the renminbi is that it must be freely usable. From Criteria for Broadening the SDR Currency Basket, an IMF paper published in 2011, “that discusses a number of reform options for the eligibility criteria for the SDR currency basket”:
The freely usable concept and its two key elements—currencies should be “widely used” and “widely traded” —are set out in the Articles and serve important operational purposes.
The renminbi is currently “widely used” and “widely traded”.
Will Gold Be Included In The SDR Basket?
The reason the current IMS is up for revision is because the global fiat experiment has failed miserably. Having exclusively fiat currencies circulating within countries, without any anchor to a non-fiat reserve currency, is simply not sustainable. In shaping a new IMS the designers would be mistaken to create a system based on a basket of solely fiat currencies, which have just proven to be ineffectual. Gold could provide credibility and strength to the SDR.
In addition, we could read some clues (in my prior post) that the Chinese would like gold in the SDR along side the national fiat currencies. This would explain China’s aggressive gold purchases in recent years.
On March 9, 2015, Albert Cheng, managing director of the World Gold Council Far East, was interviewed by ShanghaiDaily.com:
Q: The council has signed an understanding agreement with the Shanghai Gold Exchange to work more closely via the International Board set up in the city’s pilot Free Trade Zone last September. Could you tell us how that will work?
A: The memorandum of understanding involves objectives to improve operation of the Shanghai Gold Exchange, such as attracting more international players. Gold is a hard currency, so if it is freely traded in China, it will have an impact on the yuan. The design of the International Board, allowing international and domestic investors to participate in the onshore gold market, has a symbolic meaning of some kind of convertibility. By signing the memorandum, we can help the Board marketing this concept to the international trading community.
In general the renminbi is not yet fully convertible, but in terms of gold it is; through the Shanghai International Gold Exchange. Logically all currencies in the SDR basket must be freely usable, and allowed to be freely exchanged for one another. If the renminbi and gold were to be added to the SDR basket it would help if there is an exchange for both, which is currently operating in the Shanghai Free Trade Zone.
Will the Shanghai International Gold Exchange facilitate gold inclusion into the SDR?
Koos Jansen
E-mail Koos Jansen on: koos.jansen@bullionstar.com
end
(courtesy Bill Holter/Miles Franklin)
Three strikes and you’re out!
Last week we looked at a chart showing new orders, inventories and personal consumption expenditures.
The significance as you can see is what results when all three series are contracting in unison, a recession. In the old days when things were “normal”, recessions were no big deal. They were inconvenient and yes, they did clean out some mal investment but they were deemed necessary. Recessions were even expected and considered a natural event even though induced by the credit cycle. This is no longer true and has not been since at least the year 2000, it can even be argued all the way back to the early 1990’s.
Why? Because recessions cannot be allowed to go full cycle to clean out mal investment and bad debt. Again, why? The answer is so simple and in our face, “debt saturation”. There is simply too much debt in every corner of the economy (and global economy). “Every corner” by the way includes the government itself and the fact that our national debt cannot nor will ever be paid back with current values. As it stands now, the next recession will be the final recession …for the current monetary system and a new one will by necessity be created. China is working on this, but a story for another day.
I want to show you another chart which is as scary as any I know of but would like to frame it first. From a broad perspective, “bubbles” don’t just happen on their own, they need “fuel”. The fuel of course is credit or an overabundance of credit and on easy terms. This is certainly not a new phenomenon, we can look back to the tulip mania, the French Revolution and John Law as early examples. In current day, we have become accustomed to bubbles because they seem to form every seven years or so as a result of Fed ease and Treasury largesse to abort the previous recession. Each time the U.S. has refused to accept the medicine of a recession going through to fruition was an act of creating the fuel for the next bubble.
(courtesy M. Stevens)
After viewing the chart, do you see anything that it really is “different this time”? Yes, this time it is not just one sector in a bubble, we now have all sectors at once! This chart shows you real estate, the Russell 2000 and the hot biotech sector. We could of course overlay a chart of bonds (interest rates inverted) and even add in the dollar for a five bagger of bubbles. Globally it is the same story, real estate, stocks and bonds (with interest rates even negative) are all in bubbles. Needless to say, the falls from grace will be at least equal to if not far worse than previous falls. Why is this you ask? There is far more debt now than in 2007 entering recession. As for the U.S., there was no alternative to the dollar as a reserve currency, say what you will but the rest of the world has been working at break neck speed to change this monopoly.
The problem is, there are TOO MANY problems (bubbles) all at one time. We also have these bubbles at a very bad time so to speak. The Fed has already quintupled their balance sheet and the Treasury has now borrowed more than 100% of GDP …AND, interest rates are ZERO! What tool or tools exactly are available to temper the fall? I guess another obvious question would be “who?”. Who exactly has the ability to ride in on a white horse and use these nonexistent tools? You know the answers of course, there are no tools left, the white horse has died and the rider is broke.
Hopefully this last chart strikes a chord with you because of the ease to “see what it is saying”. The coming collapse and panic could not be more obvious to those who can look at numbers and truly understand them. Some people are more visual and need to see a “picture” to understand what is happening. The picture tells me that almost EVERYTHING we as “value” is in a bubble and will collapse with much of it actually “going away”. Our current situation has everything to do with credit. Too much of it and too easily obtained. The central bank(s) and Treasury(s) are to blame as they painted themselves into the corner where we can never again be allowed to have a recession. Mother Nature says we will have another recession, she also says the next one will be the biggest and most all engulfing ever … and at a time our policymakers have no options or tools left! Very scary indeed, even if you see it coming and have prepared to the best of your ability. Regards, Bill Holter
And now for the important paper stories for today:
Early Monday morning trading from Europe/Asia
1. Stocks generally higher on major Chinese bourses (only India’s Sensex and Australia lower)/yen rises to 119.83
1b Chinese yuan vs USA dollar/yuan falls to 6.2140
2 Nikkei up 194.14 or 0.99%
3. Europe stocks all in the red/USA dollar index down to 99.42/Euro rises to 1.0887
3b Japan 10 year bond yield .32% (Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 119.83/
3c Nikkei still above 19,000
3d USA/Yen rate now below the 120 barrier this morning
3e WTI 45.83 Brent 54.76
3f Gold up/Yen up
3gJapan is to buy the equivalent of 108 billion uSA dollars worth of bond per month or $1.3 trillion. Japan’s GDP equals 5 trillion usa.
Japan to buy 100% of all new Japanese debt and by 2018 they will have 25% of all Japanese debt. Fifty percent of Japanese budget financed with debt.
3h Oil down for both WTI and down for Brent this morning.
3i European bond buying continues to push yields lower on all fronts in the EMU
Except Greece which sees its 2 year rate slightly falls to 21.89%/Greek stocks up by a huge 1.60%today/ still expect continual bank runs on Greek banks.
3j Greek 10 year bond yield: 11.35% (down by 65 basis point in yield)
3k Gold at 1182.00 dollars/silver $16.71
3l USA vs Russian rouble; (Russian rouble up 1/0 rouble/dollar in value) 59.03 despite the lower brent price
3m oil into the 45 dollar handle for WTI and 54 handle for Brent
3n Higher foreign deposits out of China sees hugh risk of outflows and a currency depreciation. This scan spell financial disaster for the rest of the world/China may be forced to do QE!!
30 SNB (Swiss National Bank) still intervening again in the markets driving down the SF
3p Britain’s serious fraud squad investigating the Bank of England/ the British pound is suffering
3r the 7 year German bund still is in negative territory/no doubt the ECB will have trouble meeting its quota of purchases and thus European QE will be a total failure.
3s Greece’s prime minister Tsipras meets with Merkel today.
3t Bloomberg calculates Greece’s shortfall in March at 3.5 billion euros.
4. USA 10 year treasury bond at 1.91% early this morning. Thirty year rate well below 3% at 2.50%/yield curve flatten/foreshadowing recession.
5. Details Ransquawk, Bloomberg, Deutsche bank/Jim Reid.
Buying Euphoria Fizzles Ahead Of Make Or Break Tsipras-Merkel Talks
As previously observed (skeptically), a main reason for the surge in the DAX, and thus the S&P, on Friday was premature hope that the Greek talks on Thursday night were a long-overdue precursor to a Greek resolution, and as we further noted yesterday, subsequent bickering and lack of any clarity as we go into today’s critical “final ultimatum” meeting between Merkel and Tsipras, is also why the Dax is lower by 1.1% at last check, even if the EURUSD continues to trade like an illiquid, B-grade currency pair whose only HFT purpose is to slam all stops within 100 pips of whatever the current price may be.
Not helping the weak euro case was a plethora of research reports (to follow in subsequent post), which saw the penguin consensus reiterate that despite the Fed’s rhetoric, the strong dollar case is the dominant one for the coming months and well into the summer. As for whether the last few hours’ stop hunt higher in the EURUSD is credible, one look at where oil is trading (based on fundamentals or rate differentials) suggests the latest spike in the EUR is to be faded. Indicatively, Brent and WTI are trading down ~$1/bbl as talks on Iran nuclear program enter final week before political deal due, with both sides saying agreement is reachable. In addition, Saudi’s Naimi says OPEC would have lost market if it cut output, with the kingdom pumping 10 million barrels per day. Among the soundbites Naimi made was that “oil won’t rebound to $100/bbl because increased prices would draw more shale, and other higher-cost output to market.”
But back to the main event of the day, as focus falls on Greece once again as the Greek PM Tsipras looks to meet with German Chancellor Merkel today after sending a letter to her last week which said it will be “impossible” to service near-term debt obligations.The two will meet from 1600GMT, with a press conference tentatively scheduled for 1800GMT and a working dinner from 1900GMT. Lingering concerns around the periphery has caused some selling pressure in Greek bonds and the 3y yield sits higher by ~40bps, although the domestic Greek stock market remains unfazed and trades with marginal gains.
How big is today’s meeting? As Hajo Funke, political scientist with Berlin’s Free University, told AFP earlier, “two worlds will collide” when Merkel and Tsipras sit down this afternoon:
“There is the political world of Greece, where a left-wing government faces a society in collapse, (of) societal decay… as grave as anything we have seen in western Europe since 1945.”
“The other world is a content country that is dominant in Europe, Germany, which worries about maintaining its economic happiness, and which is now being asked to help the other, under conditions it doesn’t fully understand.”
So yes: today’s meeting (4:00 PM GMT), the subsequent press conference (6:00PM GMT), could well lead to a symbolic “last supper” for Tsipras at 7:00PM.
Asian equities traded mostly higher after taking the impetus from Friday’s strong Wall Street close, which saw the S&P 500 gain the most since the start of February. The Shanghai Comp (+2.0%) rose for a 9th day, the longest winning streak since Apr’07 as cash flowed back into the market after the end of subscriptions for the recent slew of IPOs. Elsewhere the Nikkei 225 (+1.0%) rose to hit yet another fresh 15yr high led by health care stocks. The ASX 200 (-0.3%) was the session’s laggard after an earlier failed attempt at testing the 6,000 key psychological level.
Positive sentiment from Asia failed to follow through to Europe, with selling seen in the DAX in the first hour of trade, exacerbated by a break below Friday’s low and the FTSE 100 back below 7000 as concerns over Greece weigh on the sentiment and as oil prices continue to slide.
This week sees a downtick in Eurozone supply with EUR 13-14bln on offer. Belgium get things underway on Monday with a trio of OLOs, followed by Netherlands on Tuesday and Italy on Thursday for which sizes are still yet to be announced. Speculation has been that Portugal could come to market on Wednesday but this is still yet to be confirmed. From a redemption perspective there is nothing too significant to report. The US come to market with 2s, 5s and 7s and 2y FRNs. The size of the auctions remain unchanged at USD 26bln, USD 35bln, USD 29bln and USD 13bln respectively although some of the USD 103bln hitting the market will be offset by the prospect of USD 78bln in 2-, & 5y redemptions due for payment on Tuesday 31st March. Supply this week equates to ~500K 10 future equivalent.
Once again FX markets have also been in focus and the USD index saw an early bid which has consequently caused EUR/USD to slide to fresh lows and a lower EUR seen as a headwind for exporters from core Europe. NZD outperformed overnight, underpinned by a sell-off in AUD/NZD as the cross touched a fresh record low, attributed to large fund liquidations and NZD/USD hit a 2-month high after large buy-stops were triggered in the cross at 0.7610. AUD also strengthened in sympathy as AUD/USD reclaimed the 0.7800 handle, further bolstered by selling in EUR/AUD after the earlier break below the 1.3900 handle and medium-term support at 1.3881 (Wed & Thurs low). In EUR/USD large vanilla option expiries are seen at 1.0850 with USD 1.5bln due to roll off at the 10am NY cut.
In summary: European shares fall, at session low, with the autos and chemicals sectors underperforming and banks, financial services outperforming. Greek PM Tsipras set to meet German Chancellor Angela Merkel for 2nd time in 5 days today. U.S. oil declines as Saudi Arabia said it was pumping near record amounts of crude. The German and French markets are the worst-performing larger bourses, the Spanish the best. The euro is little changed against the dollar. Japanese 10yr bond yields fall; German yields decline. Commodities decline, with natural gas, WTI crude underperforming and wheat outperforming. U.S. Chicago Fed index, existing home sales, due later.
Market Wr