Good evening Ladies and Gentlemen:
Here are the following closes for gold and silver today:
Gold: $1090.70 up $1.30 (comex closing time)
Silver $14.55 up 3 cents.
In the access market 5:15 pm
Gold $1087.80
Silver: $14.60
First, here is an outline of what will be discussed tonight:
At the gold comex today, we had a good delivery day, registering 84 notices for 8400 ounces Silver saw 1 notice for 5,000 oz
Several months ago the comex had 303 tonnes of total gold. Today, the total inventory rests at 235.52 tonnes for a loss of 67 tonnes over that period.
In silver, the open interest rose by 2,736 contracts despite the fact that silver was down by 23 cents yesterday. The total silver OI continues to remain extremely high, with today’s reading at 188,662 contracts In ounces, the OI is represented by .9430 billion oz or 135% of annual global silver production (ex Russia ex China). 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 as they continue to raid as basically they have no other alternative.
In silver we had 1 notice served upon for 5,000 oz.
In gold, the total comex gold OI rests tonight at 435,095. We had 84 notices filed for 8400 oz today.
We had no withdrawals in gold tonnage at the GLD today / thus the inventory rests tonight at 672.70 tonnes. The appetite for gold coming from China is depleting not only gold from the LBMA and GLD but also the comex is bleeding gold. I thought that 700 tonnes is the rock bottom inventory in GLD gold, but I guess I was wrong. However we must be coming pretty close to a level of only paper gold and the GLD being totally void of physical gold. In silver, we had a small change in silver inventory at the SLV,a withdrawal of 478,000 oz / Inventory rests at 326.351 million oz.
We have a few important stories to bring to your attention today…
1. Today, we had the open interest in silver rose by 2736 contracts up to 188,662 even though silver was down in price by 23 cents yesterday. The OI for gold rose by 6863 contracts to 441,958 contracts despite the fact that gold was down by $5.50. We still have over 22 tonnes of gold standing with only 11 tonnes of registered gold in the dealer vaults.
(report Harvey)
2. ONE big commentary from Bill Holter titled:
They will say “YOU WERE WARNED”!
(Bill Holter/Holter-Sinclair collaboration)
3. One important stories on Greece on the collapse of their banks
(zero hedge)
4.Gold trading overnight, Goldcore
(Stephen Flood/Mark OByrne)
5. Saudi Arabia invades Yemen
(zero hedge)
6. Dept of Justice in the USA launches another probe against Deutsche bank with respect to laundering of USA dollars
(zero hedge)
7. Japan’s real wages instead of rising, it plummets by 2.4% totally throwing cold water on Abenomics:
(zero hedge)
8 Six warning signs that the economy is in deep trouble
(Mauldin Economics/Sagami
9 Trading of equities/ New York
(zero hedge)
10. USA stories:
i) Data for today:
a) Gallup consumer spending report (down)
b) Factory orders down.
ii)
Fed governor Lockhart opens his mouth and states that September is the right time to raise interest rates
(zero hedge)
11. Steve St. Angelo delivers a terrific commentary on the rapidly depleting silver inventory at the Shanghai silver commodity exchange in Shanghai
(Steve St Angelo/SRSRoccoReport)
Here are today’s comex results:
The total gold comex open interest rose from 435,095 up to 441,958 for a gain of 6,863 contracts despite the fact that gold was down $5.50 yesterday. For the past two years, we have strangely witnessed two interesting developments with respect to the gold open interest: 1) total gold comex collapse in OI as we enter an active delivery month, and 2) a continual drop in the amount of gold standing in an active month, and today the latter was again the norm. What is interesting is that the LBMA gold is witnessing a 7.40 premium spot/next nearby month as gold is now in backwardation over there. We are now in the contract month of August and here the OI fell by 1401 contracts falling to 6,894 contracts. We had 256 notices filed upon on yesterday and thus we lost 1145 contracts or 114,500 ounces will not stand for delivery. The next delivery month is September and here the OI rose by 297 contracts up to 2290. The next active delivery month if October and here the OI rose by 496 contracts up to 25,690. The estimated volume on today (which is just comex sales during regular business hours of 8:20 until 1:30 pm est) was poor at 139,721. The confirmed volume on yesterday (which includes the volume during regular business hours + access market sales the previous day was poor at 117,719 contracts. Today we had 84 notices filed for 8400 oz.
And now for the wild silver comex results. Silver OI rose by 2736 contracts from 185,926 to 188,662 contracts despite the fact that silver was down by 23 cents yesterday . We continue to have our bankers pulling their hair out with respect to the continued high silver OI as the world senses something is brewing in the silver arena. We are in the delivery month of August and here the OI fell by 29 contracts down to 60. We had 16 delivery notices filed yesterday and thus we lost 13 contracts or 65,000 ounces will not stand for delivery in this non active August contract month. The next major active delivery month is September and here the OI rose by 315 contracts to 120,937. The estimated volume today was fair at 33,052 contracts (just comex sales during regular business hours). The confirmed volume yesterday (regular plus access market) came in at 47,878 contracts which is excellent in volume. We had 1 notice filed for 5,000 oz.
August contract month: initial standing
August 4.2015
Gold
Ounces
Withdrawals from Dealers Inventory in oz
nil
Withdrawals from Customer Inventory in oz
64.30 oz (,Manfra)2 kilobars
Deposits to the Dealer Inventory in oz
nil
Deposits to the Customer Inventory, in oz
nil
No of oz served (contracts) today
84 contracts (8400 oz)
No of oz to be served (notices)
6810 contracts (681,000 oz)
Total monthly oz gold served (contracts) so far this month
343 contracts(34,300 oz)
Total accumulative withdrawals of gold from the Dealers inventory this month
nil
Total accumulative withdrawal of gold from the Customer inventory this month
272,935.7 oz
Today, we had 0 dealer transactions
total Dealer withdrawals: nil oz
we had 0 dealer deposits
total dealer deposit: zero
we had 1 customer withdrawals
ii) Out of Manfra: 64.30 (2 kilobars)
total customer withdrawal: 64.30 oz
We had 0 customer deposits:
Total customer deposit: nil oz
We had 1 adjustments
i) Out of Scotia: 10,005.78 oz was adjusted out of the customer and this landed into the dealer account of Scotia
JPMorgan has only 3.098 tonnes left in its registered or dealer inventory.
.
Today, 0 notices was issued from JPMorgan dealer account and 12 notices were issued from their client or customer account. The total of all issuance by all participants equates to 84 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 August contract month, we take the total number of notices filed so far for the month (343) x 100 oz or 34,300 oz , to which we add the difference between the open interest for the front month of August (6894) and the number of notices served upon today (84) x 100 oz equals the number of ounces standing
Thus the initial standings for gold for the August contract month:
No of notices served so far (343) x 100 oz or ounces + {OI for the front month (6894) – the number of notices served upon today (84) x 100 oz which equals 921,200 oz standing so far in this month of August (22.24 tonnes of gold).
Thus we have 22.24 tonnes of gold standing and only 11.25 tonnes of registered or dealer gold to service it.
We lost 1145 contracts or an additional 114,500 oz will not stand for delivery in this active month of August. These were most likely cash settled.
Total dealer inventory 361,725.87 or 11.25 tonnes
Total gold inventory (dealer and customer) = 7,570,743.173 oz or 235.48 tonnes
Several months ago the comex had 303 tonnes of total gold. Today the total inventory rests at 235.48 tonnes for a loss of 67 tonnes over that period.
end
And now for silver
August silver initial standings
August 4 2015:
Silver
Ounces
Withdrawals from Dealers Inventory
85,818.470 oz (HSBC)
Withdrawals from Customer Inventory
1,190,475.78 oz (CNT,HSBC)
Deposits to the Dealer Inventory
nil
Deposits to the Customer Inventory
600,687.510 (CNT)
No of oz served (contracts)
1 contract (5,000 oz)
No of oz to be served (notices)
59 contracts (295,000 oz)
Total monthly oz silver served (contracts)
18 contracts (90,000 oz)
Total accumulative withdrawal of silver from the Dealers inventory this month
85,818.47 oz
Total accumulative withdrawal of silver from the Customer inventory this month
2,380,951.6 oz
Today, we had 0 deposits into the dealer account:
total dealer deposit: nil oz
we had 1 dealer withdrawal:
i )out of HSBC: 85,818.470
total dealer withdrawal: 85,818.47 oz
We had 1 customer deposits:
i) Into CNT; 600,687.510 oz
total customer deposits: 600,687.510 oz
We had 2 customer withdrawals:
i)Out of HSBC: 590,534.38 oz
ii) Out of CNT 599,941.400 oz
total withdrawals from customer: 1,190,475.78 oz
we had 2 adjustment
Out of CNT:
i) 1,019,502.78 oz leaves the dealer and lands into the customer account of CNT
ii) Out of HSBC:
301,548.110 oz leaves the customer and this lands in the dealer account of HSBC
Total dealer inventory: 55.764 million oz
Total of all silver inventory (dealer and customer) 173.954 million oz
The total number of notices filed today for the August contract month is represented by 1 contract for 5,000 oz. To calculate the number of silver ounces that will stand for delivery in August, we take the total number of notices filed for the month so far at (18) x 5,000 oz = 90,000 oz to which we add the difference between the open interest for the front month of August (60) and the number of notices served upon today (1) x 5000 oz equals the number of ounces standing.
Thus the initial standings for silver for the August contract month:
18 (notices served so far)x 5000 oz + { OI for front month of August (60) -number of notices served upon today (1} x 5000 oz ,= 385,000 oz of silver standing for the August contract month.
we lost 13 contracts or an additional 65,000 oz will not stand in this delivery month of August.
for those wishing to see the rest of data today see:
http://www.harveyorgan.wordpress.comorhttp://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:
August 4.2015: no change in inventory/rests tonight at 672.70 tonnes
August 3.2015: no change in inventory at the GLD./Inventory remains at 672.70 tonnes
July 31/we had a huge withdrawal of 7.45 tonnes/Inventory rests this weekend at 672.70 tonnes
July 29/no change in inventory/rests tonight at 680.13 tonnes
July 28/no change in inventory/rests tonight at 680.13 tonnes
July 27/no change in inventory/rests tonight at 680.13 tonnes
July 24.2015/we had another massive withdrawal of 4.48 tonnes of gold form the GLD/Inventory rests at 680.13 tonnes.
July 23.2015: we had another withdrawal of 2.68 tonnes of gold from the GLD/Inventory rests at 684.63 tonnes
july 22/another withdrawal of 2.38 tonnes of gold from the GLD/Inventory rests at 687.31
July 21.2015: a massive withdrawal of 6.56 tonnes of gold from the GLD.
Inventory rests at 689.69 tonnes. China and Russia need their physical gold badly and they are drawing their physical from this facility.
July 2o.2015: no change in inventory
July 17./a massive withdrawal of 11.63 tonnes in gold tonnage tonight from the GLD/Inventory rests at 696.25 tonnes
July 16./we lost 1.19 tonnes of gold tonight/Inventory rests at 707.88 tonnes
August 4 GLD : 672.70 tonnes
end
August 4.2015: a small withdrawal of 476,000 oz of inventory at the SLV/Inventory rests at 326.351 million oz
August 3.2015; no change in inventory at the SLV/inventory remains at 326.829 million oz
And now for silver (SLV) July 31/no change in inventory/rests tonight at 326.829 million oz
July 29/no change in silver inventory/326.829 million oz
July 28/we had a huge withdrawal of 2.005 million oz from the SLV/Inventory rests at 326.829 oz
July 27/no change in silver inventory/inventory rests tonight at 328.834 million oz
July 24/no change in silver inventory/inventory rests tonight at 328.834 million oz
July 23.2015; no change in silver inventory/rests tonight at 328.834 million oz
july 22/no change in silver inventory/inventory rests at 328.834 million oz.
July 21.we had a massive addition of 1.241 million oz into the SLV/Inventory rests tonight at 328.834 million oz.
Please note the difference between gold and silver (GLD and SLV). In GLD gold is being depleted and sent to the east. In silver: no depletions, as I guess this vehicle cannot supply physical metal.
July 20/no change
july 17.2015/no change in silver inventory tonight/inventory at 327.593 million oz
July 16./no change in silver inventory/rests tonight at 327.593 million oz
August 4/2015: tonight inventory rests at 326.351 million oz
end
And now for our premiums to NAV for the funds I follow:
Sprott and Central Fund of Canada.
(both of these funds have 100% physical metal behind them and unencumbered and I can vouch for that)
1. Central Fund of Canada: traded at Negative 11.4 percent to NAV usa funds and Negative 11.0% to NAV for Cdn funds!!!!!!!
Percentage of fund in gold 62.1%
Percentage of fund in silver:37.6%
cash .3%
( August 4/2015)
2. Sprott silver fund (PSLV): Premium to NAV falls to -.68%!!!! NAV (August 4/2015) (silver must be in short supply)
3. Sprott gold fund (PHYS): premium to NAV falls to – .90% to NAV(July August4/2015)
Note: Sprott silver trust back into negative territory at- 0.68%
Sprott physical gold trust is back into negative territory at -.90%
Central fund of Canada’s is still in jail.
Sprott formally launches its offer for Central Trust gold and Silver Bullion trust:
SII.CN Sprott formally launches previously announced offers to CentralGoldTrust (GTU.UT.CN) and Silver Bullion Trust (SBT.UT.CN) unitholders (C$2.64)
Sprott Asset Management has formally commenced its offers to acquire all of the outstanding units of Central GoldTrust and Silver Bullion Trust, respectively, on a NAV to NAV exchange basis.
Note company announced its intent to make the offer on 23-Apr-15 Based on the NAV per unit of Sprott Physical Gold Trust $9.98 and Central GoldTrust $44.36 on 22-May, a unitholder would receive 4.45 Sprott Physical Gold Trust units for each Central GoldTrust unit tendered in the Offer.
Based on the NAV per unit of Sprott Physical Silver Trust $6.66 and Silver Bullion Trust $10.00 on 22-May, a unitholder would receive 1.50 Sprott Physical Silver Trust units for each Silver Bullion Trust unit tendered in the Offer.
* * * * *
>end
And now for your overnight trading in gold and silver plus stories
on gold and silver issues:
(courtesy/Mark O’Byrne/Goldcore)
Gold Sentiment Is Just Ugly
By Stephen FloodAugust 4, 20150 Comments
Share on facebookShare on twitterShare on linkedinMore Sharing Services
The headlines are dramatic, ugly and depressing to anyone who holds gold right now. Broad market sentiment has shifted from disdain and dismissive to highly negative. Hedge funds are shorting gold aggressively, hedge funds that own gold are being “outed”. The market pundits are are sticking the proverbial knife in and twisting it with glee. The Financial Times published an interesting article over the weekend.
“Why gold has lost its shine for investors”
by Mohamed El-Erian. He is one of the world’s most respected investors and market commentators. In his piece he makes a number of interesting observations.
According to El Erian gold is falling because:
In a world of ETFs investors can mange risk more effectively and therefore do not need a traditional safe haven such as gold.
Gold does well in inflationary environments, we don’t have one right now, ergo, gold does poorly.
Central banks are not buying gold as aggressively as they once did; lower demand, lower prices.
Gold has not reacted as a safe haven as it should. Greece should have sent the price soaring but it did not.
Official and institutional demand for gold has not materialised.
Physical market demand at lower prices is not strong enough to create a firm bid for gold, there are not enough small guys in the market.
Gold’s recent price move up $1,000 from $700 in 2008 was the outlier and not the norm and gold is now priced more correctly then it was then.
But then he drops the biggest bomb of all. He states that gold could buck its recent trend and the reason he gives should give you all reason to take notice.
“This situation is unlikely to change soon but it need not be terminal. A shift would probably require a broader normalisation of financial markets, including a diminution in the direct and indirect role of central banks in determining asset prices and their correlations.”
Does this not strike you as a particularly insightful statement, from one of the world’s foremost investment minds no less?
I read it as follows, “the game is rigged until it is not rigged and then and only then will gold normalise to its true market value (straw poll please), as will other assets.”
Nearly all his previous points are rendered mute if in fact the market is rigged and we lack an effective fair price discovery mechanism.
The fact is the markets are massively dependent on central bank funding, central bank benchmark rates and central bank meeting minutes. The small matters of risk premia, allocations, efficiencies, debt levels, productivity, ROCE, even dividends are not so important any more. Just look at the rise of the Fed balance sheet and the S&P500. Literally, they are one for one.
Nope, its the unelected masters of the universe that now control the financial destiny of every human on the planet. Not one of them was ever elected. We are witness to the most extraordinary concentration of power that has ever existed, and our political representatives have allowed this to happen.
If you are foolish enough to trust in the markets’ internal risk pricing mechanism, efficient market theory, think again.
For example do a search on “Alladdin”. You will find that it is a centralised risk management service and asset manager monster that now controls a massive, circa $17 trillion, of the global capital market, or circa 8% of the world’s stocks, bonds and loans. 17,000 traders the world over rely on its risk models directly or partially.
We may all be witness to the first chapter of the MBA class of 2025’s required course “Failed Monetary Theories of the Last 100 Years”. Your grand kids may even ask you what it was like…. before the great reset.
Trust me this will get a lot worse before it gets better. I would wager that the central bank officials of the Fed and the BOE, BOJ and that intellectual vacant organisation that is the ECB, wear with great unease the new found power that they have.
If you need proof look at the number of market mechanisms that have been wholesale rigged for the past 15 years. These operators never operated in absolute secret. The watchers that watched knew and their silence implied unofficial sanction. Soon the banks again will be recapitalised, this time not with nameless tax payers but with your pensions and your savings. Bail-ins are coming, google “bail-ins” and read up.
Gold may well fall further in the near term and the powers that be may well keep the bus on the road for the near future, but if history teaches us anything is that you never bet against the wisdom of the crowd. Ultimately, these markets will be freed up and when they do gold will be bid up aggressively. On the other hand, the markets can stay irrational longer then you can stay liquid, so don’t put all your money into gold but do keep a small percentage (5% – 20%) and look at it as a firm of financial insurance. If it is falling in value then the rest of your assets should be rising and that is the essence of investing: asset diversification.
Stephen Flood
Chief Executive Officer
I am the CEO of GoldCore. We help investors buy and store gold and silver easily and cost effectively. We work with clients of every variety from wealth family offices to everyday people. We provide the very best market data and client service and we care deeply for our clients interests.
Published in Daily Market Update
end
From the Kitco site: (notice that they are not allowed to say the word manipulation)
(courtesy Kitco.com)
Christensen: “The one bright spot for the precious metals market appears to be the physical market as the U.S. Mint reported a 469% increase in July coin sales, compared to last year.”
After that, Christensen talking to Hug: “It is not just the mint that has seenunprecedented demand for bullion as prices significantly dropped last month. In his morning commentary, Peter Hug, global trading director for Kitco.com said that many bullion dealers have been struggling to obtain a supply of silver coins and small gold bars. However, he added that he does not see this reemergence of physical bullion to help support prices as gold trades under $1,100 an ounce and silver under $15 an ounce.”
So, let me get this straight: the only bright spot for gold and silver is the huge demand for it????
Ladies and Gentlemen: we do not make this up!!
end
(courtesy Mike Kosares/USAGold.com/GATA)
Mike Kosares: The gold investment demand juggernaut
Submitted by cpowell on Mon, 2015-08-03 16:52. Section: Daily Dispatches
By Michael J. Kosares
USAGold.com, Denver
Monday, August 3, 2015
Whenever the mainstream media decides to undertake one of its periodic attacks on gold and gold ownership, it almost always begins by laying out gold’s long history as a proven inflation hedge. It proceeds to explain that inflation is not a problem at the present, and, as a result, no one with any common sense would bother to own it. This argument is a setup — a pretext meant to confuse investor thinking and redirect interest away from the one investment vehicle likely to do them some good in these uncertain times.
In mid-2007, the year the financial crisis began, gold was trading at $650 per ounce. As financial markets courted collapse in the following two years, gold rose steadily. By the time the global economy came up for air in late 2010, gold was trading at $1,400 per ounce and well on its way to an interim top of $1,900 in September, 2011. …
… For the remainder of the commentary:
http://www.usagold.com/publications/NewsViewsAug2015.html
end
(courtesy Chris Powell/GATA)
Is there any limit to creation of paper gold on the Comex?
Submitted by cpowell on Mon, 2015-08-03 19:28. Section: Daily Dispatches
3:32p ET Monday, August 3, 2015
Dear Friend of GATA and Gold:
A week ago the TF Metals Report disclosed that leverage in gold futures contracts on the New York Commodities Exchange had reached 116 times the metal available for delivery:
http://www.gata.org/node/15598
Today Zero Hedge reports that the leverage is up to 124 claims per ounce. Zero Hedge’s report is headlined “Comex On The Edge? Paper Gold ‘Dilution’ Hits a Record 124 for Every Ounce of Physical” and it’s posted here:
http://www.zerohedge.com/news/2015-08-03/comex-edge-deliverable-gold-dro…
Zero Hedge suspects that the growing leverage signifies that refugees from China’s stock market are frantically reaching out for golden insurance, and wonders about a default on Comex gold contracts.
Since the JPMorganChase gold vault seems to be connected to the gold vault of the Federal Reserve Bank of New York, your secretary/treasurer isn’t sure that the Comex leverage figure means all that much. For if the United States is prepared to compromise all the gold it holds in custody for foreign governments, the gold futures price well could go to zero.
Indeed, gold now is priced substantially below its cost of production mainly because Western central banks and their bullion bank agents have figured out how to make metal appear to be in many places at once, perhaps in as many as 124 places. That gold mining company shares continue their fall toward zero suggests that investors figure that no one ever again will need actual metal, at least not for investment purposes, and that the gold mining industry, remaining silent amid the overwhelming evidence of surreptitious central bank intervention in the gold market, has agreed to die quietly and thus truly is worth nothing.
The TF Metals Report last week may have posed the crucial question: What’s to stop Comex gold contract leverage from going to 200 times or even 500 times the metal available for delivery?
If there’s anything to stop that, it won’t be the World Gold Council or mainstream financial journalism.
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
CPowell@GATa.org
end
(courtesy James Turk/Kingworldnews/Eric King)
Despite media’s propaganda, gold has performed well in Europe, Turk tells KWN
Submitted by cpowell on Tue, 2015-08-04 01:06. Section: Daily Dispatches
9:05p ET Monday, August 3, 2015
Dear Friend of GATA and Gold:
GoldMoney founder and GATA consultant James Turk tells King World News tonight that despite the mainstream financial news media’s ever-intensifying propaganda against gold, the monetary metal has been performing well in Europe, protecting the wealth of Greeks who own it and providing superior returns against the euro. An excerpt from Turk’s interview is posted at the KWN blog here:
http://kingworldnews.com/propaganda-greece-gold-and-are-people-really-pr…
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
CPowell@GATA.org
end
Why you own gold
(courtesy Simon Black/Sovereign Man Blog)
Some Clear Thinking About The Price Of Gold
Submitted by Simon Black via Sovereign Man blog,
On April 2, 2001, the price of gold closed the market trading session at $255.30.
And that was the lowest price that gold has seen ever since.
In US dollar terms, gold closed the 2001 calendar year higher than it did in 2000. Then it did the same thing again in 2002. And again in 2003.
In fact, after reaching its low in April 2001, gold closed higher for twelve consecutive years– something that had never happened before in ANY financial market with ANY asset.
Then came a correction; the price started falling, and gold is now on track for 2015 to be its third down year in a row.
What’s incredible is that, despite its history of gains, and 5,000 years of tradition behind it, gold is rapidly becoming one of the most widely despised assets.
But before we pronounce it dead and write the final gold eulogy, however, let’s consider the following:
1) Nothing goes up (or down) in a straight line. After 12 straight years of unprecedented gains with any asset class, it’s not unusual to have a meaningful correction.
(Just imagine how severe the correction in stocks will be. . .)
And like all frantic booms which go way past sustainable levels, corrections also overshoot fair value.
This correction in the gold market could easily last for several more years, with prices potentially well below $1,000.
But then we could just as easily see another massive surge all the way past $2,000 and beyond.
That’s the nature of these markets– to be extremely fickle (and highly manipulated).
Even over a period of a few years, the market can show about as much maturity as a middle school lunchroom, complete with pubescent gossip and inane popularity contests.
But it’s rather short-sighted to completely lose confidence in an asset that has a 5,000 year track record because of a few down years.
2) The gold price shed nearly 5% after the government of China announced recently that they owned 1,658 metric tons of gold.
This amount was lower than what many investors and analysts had been expecting, and the price of gold dropped as a result.
My question- since when did anyone start believing official reports from the Chinese government?
Seriously. The Chinese have a vested interest in understating their gold holdings.
They know that doing so will push the price of gold LOWER, which is exactly what they want.
China is sitting on trillions of dollars in reserves right now, a portion of which they’re rapidly trying to rotate OUT of US dollars.
So it’s clearly beneficial to the Chinese government if they can sell dollars while they’re strong and buy gold while it’s cheap.
And if they can push gold to become cheaper, even better for them.
3) Remember why you own gold to begin with.
Gold is a very long-term store of value. Notwithstanding a few down years, gold has maintained its purchasing power for thousands of years.
Paper currencies come and go. They get devalued, revalued, and extinguished altogether.
How much would you be able to buy today with paper money issued by the 7th century Tang Dynasty? Nothing. It no longer exists.
Or a pound sterling from 1817? Very little. It’s barely pocket change today.
Yet the gold backing up that same pound sterling from 1817 is worth over $250 today (165 pounds).
Even in modern history, the gold backing up a single US dollar from 1971 is worth vastly more than the paper currency that was printed 44 years ago.
But even more importantly, aside from being a long-term store of value, gold is a hedge— a form of money that acts as an insurance policy against a dangerously overleveraged financial system.
How much will your dollars and euros buy you in the event of real financial calamity? Or if there’s a major government default or central bank failure?
No matter what happens in the financial system– whether it collapses under its own weight, or cryptofinance technology revolutionizes how we do business– gold ensures that you’re protected.
4) Resist the urge to value gold in paper currency.We all have this tendency– we invest in something, and then hope it goes up in value.
But that’s a mistake with gold. It’s a hard thing for some people to do, but try to stop yourself from thinking about gold in terms of its paper price.
(It’s also important to remember that there’s a huge disconnect between the ‘paper price’ of gold, and the physical price of gold.)
Remember, gold is not an investment; there are plenty of better options out there if you’re looking for a great speculation.
So the notion of trading a stack of paper currency for gold, only to trade the gold back for a taller stack of paper currency misses the point entirely.
5) Having said that, if you find it too difficult to do this, and you catch yourself constantly refreshing the gold price and checking your portfolio, you might own too much.
Listen to your instincts; if you’re always feeling frantic about the daily gyrations in the market, lighten your load.
Don’t love anything that won’t love you back. Stay rational. Own enough gold that, in the event of a crisis, you will feel comfortable that you have enough ‘real savings’… but don’t own so much that you’re constantly worrying about the paper price.
end
An extremely important commentary tonight from Steve St Angelo ((SRSRocco report.)
You will recall last year that we reported that Shanghai Silver stocks had plummeted from May 2013 at 1143 metric tonnes (36.747 million oz) down to a paltry 81 tonnes in September 2014 (2.604 million oz).
You can see from the chart below that Shanghai slowly added silver to its vaults from September 2013 reaching this year’s highs in June ’15 at 394 metric tonnes or 12.667 million oz. The demand has been so great that inventories today have now dropped to 261 metric tonnes or 8.39 tonnes a fall of 34%.
China produces around 117 million oz of silver from its mines. It looks like demand for silver is exceeding supplies so China must follow India to import as much silver as it can get. Both China and India are the leading countries making solar panels.
(courtesy Steve St Angelo/SRSRocco report)
SHANGHAI SILVER STOCKS PLUMMET: More Signs Of A Global Run On Silver?
Filed in News, Precious Metals by SRSrocco on August 4, 2015
There seems to be more evidence indicating the beginning stages of a global run on silver. How so? Well, ever since the middle of June, something significantly changed in the silver market. Physical silver investment demand skyrocketed. Why June? This was at the time Greece was voting on whether or not to remain in the European Union.
Since the middle of June, investment demand for silver has increased considerably. Matter-a-fact, the U.S. Mint suspended sales of the Silver Eagle for two weeks starting on July 12th. When Silver Eagle sales resumed on July 27th, over 2.5 million were sold over the next two days.
Furthermore, the Royal Canadian Mint has put its Gold and Silver Maple Leaf sales on allocation to its Authorized Participants. In addition, India has imported a record 3,824 metric tons (mt) in the first six months of the year. This is up 35% compared to the same time last year. And according to theBankBazzar.com July 28th press release:
Generally, as far as market observation goes, silver imports rise in the second half of the year. The rise in demand in August, is a result of the jewellery making and silverware industry, just before the festive season in Autumn as well as supplying for exports before Christmas.
So, if India imported a record 3,824 mt in the first half of the year, this will only increase in the second half as jewelry and silverware demand pick up considerably due to the festive season in the Autumn.
Another factor in a rise in global silver demand is the recent decline in silver stocks at the Shanghai Futures Exchange. Some of my readers have sent me emails stating, “Whatever happened to the silver stocks at the Shanghai Futures Exchange?” Well, let’s first look at my last update from September, 2014:
Shanghai silver stocks peaked in May of 2013 at 1,143 mt and fell to a low of 81 mt in September of 2014. Since the last update, silver stocks at the Shanghai Futures Exchange (SHFE) continued to slowly build until they reached a peak in the middle of June:
As we can see, SHFE silver warehouse stocks increased from 176 mt at the end of January to a peak of 394 mt on June 15th. However, silver stocks began to decline at the latter part of June, then plummeted in July falling 34% to 261 mt by the beginning of August.
And then we had this from a Money Metals Exchange article, Investment Silver Demand Draining COMEX Vaults:
One or more major players “jumped the queue” and took delivery of about 6.5 million more ounces of silver out of COMEX warehouses than anticipated at the beginning of the month.
The July data should send a shiver down the spine of anyone with a naked short position on silver, i.e. anyone who doesn’t have physical silver to deliver if a counter-party demands it. Short sellers are counting on being able to settle in cash – or grab silver bars from exchange vaults if necessary.
Mints Scouring America for Raw Silver
The big spike in investment coins, rounds, and bars is almost certainly behind the unusual delivery activity at COMEX warehouses.
Our sources indicate mint and refinery demand is largely responsible for this “jumping [of] the queue” and offtake of 1,000-ounce bars. The silver is needed for manufacturing into smaller retail products currently in very short supply.
Some major precious metals depots around the country, such as those in Los Angeles, completely ran out of all forms of pure silver last week, and mint owners are scouring the country to lock up the silver they need to keep production running.
Folks, we have to remember, this huge spike in physical silver demand is still from a fraction of investors. The only folks buying silver are either a few wealthy individuals (some who are finally waking up) and the diehard precious metals investors that make up 1-2% of the total investment market.
What happens when more wealthy individuals, institutions and the masses finally get on board? There just isn’t enough silver if any of these individual classes of investors wanted to purchase physical silver.
Lastly, physical silver investment demand continues to get stronger every year… even as the price declines. Savvy investors realize the Fed and Central Banks haven’t fixed anything so the day of reckoning is still coming. The situation today is is much different than the two and a half decade lull in silver prices after its meteoric rise in 1979.
The Fed and Central Banks had 35 years of rising global oil production to increase paper leverage and debt. Now that the world has plateaued in conventional oil production (U.S. shale oil peaked months ago), the peak and decline will wreak havoc on the world’s highly leverage paper Ponzi Scheme.
Investors better take notice in the huge increase of physical silver investment demand and market shortages as this will likely to only get worse in the future. Better to have your silver now, then wait until it’s nearly impossible to acquire.
end
(courtesy Bill Holter/Holter-Sinclair collaboration)
They will say “YOU WERE WARNED”!
It is not often I write something as important as what follows. It was said after the last crash that “no one could’ve seen it coming”. This was not so back then and is not so today. If you were looking for the truth in 2007, the average investor had ample warning from many sources warning of what was to come. The warnings are now much louder, far easier to hear and coming from some mainstream and even “official sources”. Are you listening?
After the biggest financial and social crash in history occurs, “they” will say you were warned! Who are “they” and how exactly were we warned? For several years and in particular the last 12 months, the IMF (International Monetary Fund) and the BIS (Bank for International Settlements) have been issuing warning after warning. They have truly warned us as I will show you. Do I believe they did this out of the goodness of their hearts? No, I believe it has been in “c.y.a” fashion followed by their laughter because the sheep have and will sleep through it all until it’s too late.Thanks to Larry White from www.Lonestarwhitehouse.blogspot.com a full listing of the recent warnings has been compiled and logged. I had seen each one of these over the last year and have even commented on a couple of them but it never really registered with me there were so many. Normally I try not to “link” articles to death, this one is different because it is important you see how many and just how in depth the warnings have been! I will asterisk the three most important articles in my opinion, there have been 16 such warnings over the last 12 months!July 2014 – BIS –BIS Issues Strong Warning on “Asset Bubbles”July 2014 – IMF –Bloomberg: IMF Warns of Potential Risks to Global GrowthOctober 2014 – BIS –“No One Could Foresee this Coming”October 2014 IMF Direct Blog — What Could Make $3.8 Trillion in global bonds go up in smoke?October 2014 IMF Report –“Heat Wave”-Rising financial risk in the U.S.******** December 2014 – BIS –BIS Issues a new warning on markets
December 2014 – BIS —BIS Warnings on the U.S. Dollar
February 2015 – IMF – Shadow Banking — Another Warning from the IMF – This Time on “Shadow Banking”
March 2015 – Former IMF Peter Doyle – Don’t expect any warning on new crisis-Former IMF Peter Doyle: Don’t Expect any Early Warning from the IMF –
*******April 2015 IMF – Liquidity Shock –IMF Tells Regulators to Brace for Liquidity Shock
May 2015 BIS – Need New “Rules of the Game” –BIS: Time to Think about New Global Rules of the Game?
June 2015 BIS Credit Risk Report –BIS: New Credit Risk Management Report
June 2015 IMF (Jose Vinals) –IMF’s Vinals Says Central Banks May Have to be Market Makers
*******BIS June 2015 (UK Telegrahph, no blog article) –The world is defenceless against the next financial crisis, warns BIS
July 2015 – IMF – Warns US the System is Still Vulnerable (no blog article) –IMF warns U.S.: Your financial system is (still) vulnerable
July 2015 – IMF – Warns Pension Funds Could Pose Systemic Risk (no blog article) –IMF warns pension funds could pose systemic risks to the US
And there you have it in black and white! You have been warned! MANY TIMES in fact…and from the most inside and official of sources! Yet on a daily basis we hear from our own mainstream press, Washington and Wall St. …don’t worry be happy! These are very real articles with well thought out and cogent logic. They are not to be ignored!
One piece by the BIS last October talked about the “no one could have seen it coming” meme we heard so often back in 2008-09. THEY see it coming and have been telling you for over a year! Please understand this, the BIS is the central bank for central banks. No one knows the inside situation (particularly in derivatives) better than they do. If you don’t believe me or others who have worked so hard to get the warnings out, listen to what both the BIS and IMF are telling you. They have gotten out in front of this and will only say “we tried to warn you” after the fact.
Standing Watch,
Bill Holter
Holter-Sinclair collaboration
Comments Welcome! bholter@hotmail.com
And now your overnight Tuesday morning trading in bourses, currencies, and interest rates from Europe and Asia:
1 Chinese yuan vs USA dollar/yuan remains constant at 6.2095/Shanghai bourse: green and Hang Sang: red
2 Nikkei down 27.75 or 0.14%
3. Europe stocks all in the red /USA dollar index down to 97.33/Euro up to 1.0975</
