Good evening Ladies and Gentlemen:
Here are the following closes for gold and silver today:
Gold: $1085.70 down $5.00 (comex closing time)
Silver $14.55 unchanged.
In the access market 5:15 pm
Gold $1085.80
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 2828 notices for 282,800 ounces Silver saw 0 notices for nil oz
Several months ago the comex had 303 tonnes of total gold. Today, the total inventory rests at 235.41 tonnes for a loss of 67 tonnes over that period.
In silver, the open interest fell by 2,814 contracts despite the fact that silver was up by 3 cents yesterday. The total silver OI continues to remain extremely high, with today’s reading at 185,848 contracts In ounces, the OI is represented by .9292 billion oz or 132% 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 0 notices served upon for nil oz.
In gold, the total comex gold OI rests tonight at 434,273. We had 84 notices filed for 8400 oz today.
We had a huge withdrawal of 4.77 tonnes of gold leaving the GLD today / thus the inventory rests tonight at 667.93 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 142,000 oz / Inventory rests at 326.209 million oz.
We have a few important stories to bring to your attention today…
1. Today, we had the open interest in silver fell by 2814 contracts down to 185,848 even though silver was up in price by 3 cents yesterday. Again, we must have had some short covering. The OI for gold fell by 7685 contracts to 434,273 contracts despite the fact that gold was up by $1.30. We still have over 21 tonnes of gold standing with only 19.993 tonnes of registered gold in the dealer vaults ready to satisfy that which stands.
(report Harvey)
2. One important stories on Greece with varoufakis telling exactly what happened right after the “No” vote
(courtesy zero hedge)
3.Gold trading overnight, Goldcore
(/Mark OByrne)
4 Trading of equities/ New York
(zero hedge)
5. USA stories:
i) Data for today:
a) poor ADP report
b) trade deficit rises again
ii) Peculiar plummet in the 2 year Repo rate and a possible explanation
iii) Discussion on the twin trillion dollars deficits i.e. auto loans and student loans
6. Two oil related stories:
(zero hedge)
7. James Turk discusses gold backwardation with greg Hunter
(Greg Hunter usa watchdog/James Turk)
8. Hugo Salinas Price discusses how China will play its gold card
(Hugo Salinas Price)
Here are today’s comex results:
The total gold comex open interest fell from 441,958 down to 434,273 for a loss of 7,685 contracts despite the fact that gold was up $1.30 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 301 contracts falling to 6593 contracts. We had 84 notices filed upon on yesterday and thus we lost 219 contracts or 21,900 ounces will not stand for delivery. The next delivery month is September and here the OI fell by 12 contracts down to 2278. The next active delivery month if October and here the OI rose by 723 contracts up to 26,413. 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 114,321. The confirmed volume on yesterday (which includes the volume during regular business hours + access market sales the previous day was poor at 121,313 contracts. Today we had 2828 notices filed for 282,800 oz.
And now for the wild silver comex results. Silver OI fell by 2814 contracts from 188,662 down to 185,848 contracts despite the fact that silver was up by 3 cents yesterday . We continue to have some short covering as 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 0 contracts remaining at 60. We had 1 delivery notice filed yesterday and thus we gained 1 contract or an additional 5,000 ounces will stand for delivery in this non active August contract month. The next major active delivery month is September and here the OI fell by 4250 contracts to 116,687. The estimated volume today was fair at 27,789 contracts (just comex sales during regular business hours). The confirmed volume yesterday (regular plus access market) came in at 44,480 contracts which is excellent in volume. We had 0 notices filed for nil oz.
August contract month: initial standing
August 5.2015
Gold
Ounces
Withdrawals from Dealers Inventory in oz
nil
Withdrawals from Customer Inventory in oz
2286.22 oz (Brinks,HSBC,Manfra) incl 16 kilobars
Deposits to the Dealer Inventory in oz
nil
Deposits to the Customer Inventory, in oz
nil
No of oz served (contracts) today
2828 contracts (282,800 oz)
No of oz to be served (notices)
3765 contracts (376500 oz)
Total monthly oz gold served (contracts) so far this month
3171 contracts(317,100 oz)
Total accumulative withdrawals of gold from the Dealers inventory this month
nil
Total accumulative withdrawal of gold from the Customer inventory this month
275,221.9 oz
Today, we had 0 dealer transactions
total Dealer withdrawals: nil oz
we had 0 dealer deposits
total dealer deposit: zero
we had 3 customer withdrawals
i) Out of Manfra: 96.45 (3 kilobars)
ii) Out of HSBC: 417.95 (13 kilobars)
iii) Out of Brinks; 1771.82 oz
total customer withdrawal: 2286.22 oz
We had 0 customer deposits:
Total customer deposit: nil oz
We had 2 adjustments and they were dillies
i) Out of JPMorgan: 276,049.092 oz was adjusted out of the customer and this landed into the dealer account of JPMorgan
ii) out of Scotia: 5021.13 oz was adjusted out of the customer and this landed into the dealer account of Scotia.
both of these adjustments will be used in the settling process.
JPMorgan has 11.66 tonnes left in its registered or dealer inventory.
(375,019.978 oz)
.
Today, 2750 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 2828 contracts of which 0 notices were stopped (received) by JPMorgan dealer and 418 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 (3171) x 100 oz or 317,100 oz , to which we add the difference between the open interest for the front month of August (6593) and the number of notices served upon today (2828) 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 (3171) x 100 oz or ounces + {OI for the front month (6593) – the number of notices served upon today (2828) x 100 oz which equals 693,600 oz standing so far in this month of August (21.57 tonnes of gold).
Thus we have 21.57 tonnes of gold standing and only 19.993 tonnes of registered or dealer gold to service it.
We lost 217 contracts or an additional 21,700 oz will not stand for delivery in this active month of August. These were most likely cash settled.
Total dealer inventory 642,796.092 or 19.993 tonnes
Total gold inventory (dealer and customer) = 7,568,456.953 oz or 235.41 tonnes
Several months ago the comex had 303 tonnes of total gold. Today the total inventory rests at 235.41 tonnes for a loss of 67 tonnes over that period.
end
And now for silver
August silver initial standings
August 5 2015:
Silver
Ounces
Withdrawals from Dealers Inventory
nil
Withdrawals from Customer Inventory
630,098.08 oz (CNT,Brinks, Delaware)
Deposits to the Dealer Inventory
nil
Deposits to the Customer Inventory
85,813.47 oz (Brinks)
No of oz served (contracts)
0 contracts (nil oz)
No of oz to be served (notices)
60 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
3,011,049.7 oz
Today, we had 0 deposits into the dealer account:
total dealer deposit: nil oz
we had 0 dealer withdrawal:
total dealer withdrawal: nil oz
We had 1 customer deposits:
i) Into Brinks; 85,813.47 oz
total customer deposits: 85,813.47 oz
We had 3 customer withdrawals:
i)Out of Brinks: 598,171.72 oz
ii) Out of CNT 29,999.400 oz
iii) Out of Delaware: 1926.964 oz
total withdrawals from customer: 630,098.08 oz
we had 1 adjustment
Out of Delaware:
i) 1,019,502.78 oz leaves the dealer and lands into the customer account of Delaware
Total dealer inventory: 55.754 million oz
Total of all silver inventory (dealer and customer) 173.410 million oz
The comex has been bleeding silver lately.
The total number of notices filed today for the August contract month is represented by 0 contracts for nil 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 (0) 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 (0} x 5000 oz ,= 390,000 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 5.we had a huge withdrawal of 4.77 tonnes from the GLD tonight/Inventory rests at 667.93 tonnes
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 5 GLD : 667.93 tonnes
end
And now SLV:
August 5/ a small withdrawal of 142,000 oz of inventory leaves the SLV/Inventory rests tonight at 326.209 million oz
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 5/2015: tonight inventory rests at 326.209 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 11.9 percent to NAV usa funds and Negative 11.8% to NAV for Cdn funds!!!!!!!
Percentage of fund in gold 62.0%
Percentage of fund in silver:37.7%
cash .3%
( August 5/2015)
2. Sprott silver fund (PSLV): Premium to NAV falls to -1.04%!!!! NAV (August 5/2015) (silver must be in short supply)
3. Sprott gold fund (PHYS): premium to NAV rises to – .76% to NAV(July August5/2015)
Note: Sprott silver trust back into negative territory at- 1.04%
Sprott physical gold trust is back into negative territory at -.76%
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 Two Steps Forward … One Step Back
Submitted by GoldCore on 08/05/2015 07:32 -0400
Gold Two Steps Forward … One Step Back
‘Death of gold’ greatly exaggerated
Vital context: gold rose sharply in years preceding crisis and during crisis
Important to consider gold in local currency terms
In euro, gold is up 2% in 2015, after 13% gain in 2014
Gold at €300 in 2001, rose to €1,400 during crisis and at €1,000 today
History, academic and independent research shows gold is a safe haven
Sharp fall in value of commodities means global economy is weakening
The deluge of negative publicity regarding gold in recent weeks would give one the impression that it was now worthless and serves no function in a portfolio. We believe this publicity is greatly exaggerated and will be seen as folly in the coming months.
In the years running up to the financial crisis of 2008 gold rose dramatically despite the warning signs being widely ignored. It continued to act as a reliable store of value as the crisis deepened and then began to fall back following the stability – temporary, we believe – provided by central banks creating more debt to deal with a crisis of over-indebtedness.
The negative publicity has generally focussed on the performance of the gold price in dollar terms which is not particularly relevant to investors and savers in other currencies.
Gold rose from €300 in 2000 to around €1,400 at the height of the crisis. It has since fallen back to €1,000. In this context, one can see that gold’s function as a store of value and as a safe haven is still clearly evident. Gold’s recent performance in euro terms has been reasonably strong with a very respectable 13% rise last year and 2% gains so far this year.
History, academic research and independent research show unequivocally that gold acts as a safe haven. As GoldCore’s research director Mark O’Byrne pointed out on RTE Radio 1’s Morning Ireland this morning [click to listen] gold has an inverse relationship to other financial instruments.
The recent negative publicity points out that gold should have seen gains during the recent crisis in Greece and thus failed to act as a safe haven. This is not strictly correct. The uncertainty caused by the crisis should equally have caused stock markets and bond markets to falter. They did not and therefore gold’s inverse relationship to these assets was never tested.
Mark also made the point that the sharp drop in the value of commodities in recent months should not be viewed as a triumph for non-tangible assets such as stocks and bonds. Indeed it indicates latent weakness in the global economy and possible trouble on the horizon.
“It’s interesting because the fall in value of all commodities and oil prices suggests that the global economy is much, much weaker than people actually think and that should give pause for concern in terms of the outlook in the coming months.”
The lower price for gold at this time should be viewed as an opportunity to acquire physical gold as a financial insurance against the unresolved debt crisis which must assert itself again in the coming months or years and may be imminent.
Mark, let’s go through the price movements with regard to gold over the past few years. We’ve seen it go from $700 to $1,900 during the financial crisis and it has come back to about $1,100?
Exactly, yes, and more important for Irish people, it’s important to think in local currency terms – which is obviously euros for Irish people – so there has been a similar big price move in euro terms. It actually went from €300 in the year 2000 to €1,400 at the height of the financial crisis after Lehman Brothers and indeed then the euro-zone debt crisis. So it’s very much a case of two steps forward in the early part of the decade and then one step backwards in recent months and years and we’ve had a very sharp correction, particularly in dollar terms. It’s actually more a story of dollar strength rather than gold weakness because gold in euro terms is actually up 14% last year and this year gold is actually up in euro terms but you wouldn’t know that from the headlines. It’s up 2% so far in 2015.
We had the Greek situation in July and a fall in [gold] price in July. Might we have expected to see it go up in July because of that Greek situation?
Yeah, absolutely, and I think a lot of people were scratching their heads. It is a safe haven asset – there is a huge body of academic research and indeed independent research from asset allocation experts who have shown that gold is a safe haven asset. It has an inverse relation so it goes up when everything else is going down. I suppose the Greek crisis did not lead to a correction in the stock markets and bond markets as some people were expecting and therefore that could be a reason that gold did not react as people expected.
Also, physical demand did increase but it didn’t increase hugely. There was a lot of safe haven buying going on particularly out of Germany because the Germans are worried about what is going to happen to the euro and, of course, in Greece itself. But also, there wasn’t any sudden selling of gold by central banks or investors in physical coins and bars. The selling was actually on the futures market so a lot of the speculative money that’s in the global financial system – which is a bit of a casino – and the hedge funds are momentum-driven and they follow trends. The trend in the gold price has been down in recent months and these guys are shorting the marketplace and pushing prices lower.
We also had the situation in China with very heavy losses in stock markets in July and that was accompanied by pressure on commodities. Why was that the case?
China is one of the biggest economies in the world with 1.3 billion people and a growing middle class and the narrative was that this is creating huge demand for commodities – as it was – as China industrialises. Now obviously there are concerns about China and we would have serious concerns about the Chinese economy going forward given – like most economies – a lot of the growth has been driven by huge increases in debt levels and obviously we’ve seen property markets there fall quite a bit in most of the cities around China and then we’ve had the huge wallop on the stock market over there. So people are beginning to question that story. It’s interesting because the fall in value of all commodities and oil prices suggests that the global economy is much, much weaker than people actually think and that should give pause for concern in terms of the outlook in the coming months.
You can listen to the full interview with Mark O’Byrne RTE’s Morning Ireland website.
end
A very interesting commentary tonight from Hugo on a strategy that China may orchestrate with respect to the pricing of gold.
(courtesy Hugo Salinas Price)
Will China Play The ‘Gold Card’?
Hugo Salinas Price
Alasdair Macleod has posted an article at http://www.goldmoney.com which I think is important.
(See “Credit deflation and gold”.http://www.goldmoney.com/research/analysis.)
The thrust of the article is that China, at some point, will have to revalue gold in China; which means, in other words, that China will decide to devalue the Yuan against gold.
Since “mainstream economics” holds that gold is no longer important in world business, such a measure might be regarded as just an idiosyncrasy of Chinese thinking, and not politically significant, as would be a devaluation against the dollar, which is a no-no amongst the Central Bank community of the world.
However, as I understand the measure, it would be indeed world-shaking.
Here’s how I see it:
Currently, the price of an ounce of gold in Shanghai is roughly 6.20 Yuan x $1084 Dollars = 6,721 Yuan.
Now suppose that China decides to revalue gold in China to 9408 Yuan per ounce: a devaluation of the Yuan of 40%, from 6721 to 9408 Yuan.
What would have to happen?
Importers around the world would immediately purchase physical gold at $1,084 Dollars an ounce, and ship it to Shanghai, where they would sell it for 9408 Yuan, where the price was formerly 6,721 Yuan.
The Chinese economy operates in Yuan and prices there would not be affected – at least not immediately – by the devaluation of the Yuan against gold.
Importers of Chinese goods would then be able to purchase 40% more goods for the same amount of Dollars they were paying before the devaluation of the Yuan against gold. What importer of Chinese goods could resist the temptation to purchase goods now so much cheaper? China would then consolidate its position as a great manufacturing power. Its languishing economy would recuperate spectacularly.
The purchase of physical gold would take off, no longer the activity of detested “gold-bugs”, but an activity linked to making money, albeit fiat money. Inevitably, the price of physical gold in Dollars would separate from the price of the “paper gold” traded on Comex and go higher, leaving paper gold way behind in price.
If the US were to provide the market with physical gold in the quantities being purchased for trade with China, it might be able to prevent the rise in the price of gold in Dollars; however, we know that Comex has only one ounce of physical gold for every 124 owners of paper gold, so that action would be impossible. China would be sucking up the world’s gold at a huge rate, if the price of gold in Dollars were to remain where it is at present.
The only way that the US might counter the Chinese move, would be to revalue gold in Dollars; which is to say, the US would have to effect a corresponding devaluation of the Dollar against gold, to nullify the effect of the Chinese devaluation of the Yuan against gold.
At a Dollar price of gold of $1,517 Dollars per ounce, the Chinese devaluation would be left without effect: the present Yuan/Dollar exchange rate would then remain at 6.20 Yuan per Dollar: 9,408 Yuan/6.20 exchange rate = $1,517 Dollars per ounce.
This is the old policy of the 1930’s, commonly known as “beggar thy neighbor”, where countries carried out competitive devaluations against gold in order to preserve their manufactures and continue exporting. The response of importing nations was to raise tariffs on imported goods. (Say good-bye to an integrated world economy.)
Will China decide to “beggar its neighbors”, the US and Europe? I think that the huge problem of keeping the Chinese economy on its feet and avoiding the political instability which would rage through China by not doing so – with a population in excess of 1.3 billion human beings – will be so compelling that China will practically inevitably resort to raising the price of gold in China.
When might this happen? The world economy is going from bad to worse by the day. The Chinese may opt for this measure out of sheer desperation, and it may be a reality soon. I have the sensation that things are falling apart around the world at an increasing rate of speed. PerhapsChina will move this Fall?
Devaluing the Dollar on the part of the US would upset the apple-cart of Dollar hegemony in the world. But not to devalue would price US goods out of world markets, along with European goods. “Damned if you do, damned if you don’t.”
Dollar devaluation would force a Euro devaluation and all Hell would break lose, as all countries would belatedly realize the importance of having gold reserves, and one country after another would devalue their currencies against gold. Import tariffs and restrictions on imports would once again prevail. The dream of “Globalization based on the fiat dollar” would evaporate in the orgy of currency devaluations against gold.
The era of the Dollar as reserve currency of the world, would have ended.
When the dust shall have settled on this giant crisis, the powers of this world will have recognized, once again, that gold is money; what would remain would be the work of establishing the gold standard de jure, by international accords, in order to abolish tariffs and import restrictions and renew the free international flow of goods.
However, another horrible scenario is possible: the US, run by those who insist on maintaining the plan for world domination through endless war, may decide to go to war with China and with Russia, too, for good measure. Let us hope that reason prevails and that the Dollar loses its status as world reserve currency in a peaceful manner.
end
(courtesy Stefan Gleason/GATA)_
Stefan Gleason: Five extraordinary things that will shake up precious metals
Submitted by cpowell on Tue, 2015-08-04 20:06. Section: Daily Dispatches
4:05p ET Tuesday, August 4, 2015
Dear Friend of GATA and Gold:
Writing today at TheStreet.com, Stefan Gleason, president of Money Metals Exchange in Eagle, Idaho, enumerates “Five Extraordinary Things that Will Shake Up Precious Metals,” basically a list of the fundamental factors supporting a rise in price for the monetary metals, including the imminent collapse of the monetary metals mining industry, its agreement to die quietly and cease production.
Will fundamentals ever again mean anything in markets that, like the gold and silver markets, are controlled by surreptitious intervention by central banks and their agents? Certainly not with their permission. But if this central bank policy is sufficiently exposed, anything could happen.
Gleason’s commentary is posted at The Street here:
http://www.thestreet.com/story/13242163/2/5-extraordinary-things-that-wi…
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
end
(courtesy Reuters/GATA)
on the IMF recommendation to delay the entry of the yuan into the SDR:
IMF staff review recommends delaying currency basket adoption of yuan
Submitted by cpowell on Wed, 2015-08-05 03:12. Section: Daily Dispatches
By David Chance and Krista Hughes
Reuters
Tuesday, August 4, 2015
WASHINGTON — The International Monetary Fund should put off any move to add the yuan to its Special Drawing Rights currency basket until September 2016, an IMF staff report said, a move that would effectively end the Chinese currency’s chances of an early inclusion.
The report, published today, comes after Beijing launched a major diplomatic push for the yuan’s inclusion in the IMF basket as part of its long-term strategic goal of reducing dependence on the dollar.
The report said the implementation of any formal decision to add the yuan to a basket of currencies comprising dollars, euros, pounds, and yen should be delayed so as not to disrupt financial market trading on the first day of 2016. …
… For the remainder of the report:
http://www.reuters.com/article/2015/08/04/us-imf-currency-china-idUSKCN0…
end
The following was brought to your attention yesterday. It is worth repeating
(courtesy Chris Powell./James McShirley/GATA)
James McShirley: Kitco inadvertently acknowledges that the gold price is suppressed
Submitted by cpowell on Wed, 2015-08-05 03:22. Section: Daily Dispatches
By James McShirley
via Bill Murphy’s “Midas” commentary at www.LeMetropoleCafe.com
Tuesday, August 4, 2015
How do you mention manipulation without actually saying it? Well, if you work for Kitco and your name is either Neils Christensen or Peter Hug you do it this way:
http://www.kitco.com/news/2015-08-03/U-S-Mint-Reports-469-YoY-Increase-I…
Christensen: “The one bright spot for the precious metals market appears to be the physical market as the U.S. Mint reported a 469-percent increase in July coin sales compared to last year.”
Then Christensen hands it off to Hug: “It is not just the mint that has seen unprecedented 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.”
Huh? So the one bright spot is the actual stuff flying off the shelves?
If the physical market is on fire as Neil so coyly reports, then why are there any dull spots? And Mr. Hug declares that not even phenomenal physical demand can overcome the derivative-induced malaise!
Neils and Peter both just inadvertently admitted manipulation without ever saying the “M” word. When the only “bright spot” happens to be rip-roaring demand for the actual product, you know you have an out-of-control cartel using derivatives to suppress market prices.
If all the collective commodity producers on the planet could ever understand how gold is the linchpin for the suppression of their collective products, GATA would have a million members. In the meantime we have $3 corn, $9 beans, $2 copper, and a gold suppression scheme on steroids. The financial tail continues to wag the working dog.
Gold’s days of being pinned to the mat are getting numbered. The clock is ticking. The exchange-traded fund GLD is methodically raided, the U.S. Mint is drained, and the Comex shelves are all but bare. All that’s left is the potential for a huge rally.
Maybe now Kitco could be so kind as to lease the gold in its client pool accounts to the cartel? That ought to buy another week or two of suppression. It’s the least they could do as dutiful apologists for their bullion bank buddies.
end
(courtesy GATA/Chris Powell)
Surging demand for the real stuff even as paper gold prices fall
Submitted by cpowell on Wed, 2015-08-05 14:08. Section: Daily Dispatches
10:07a ET Wednesday, August 5, 2015
Dear Friend of GATA and Gold:
Another monetary metals dealer, Money Metals Exchange in Idaho, reports surging demand for the real stuff even as prices for “paper gold” fall, “more buying interest than at any time since the 2008 financial crisis.” The firm reports its recent sales data here:
https://www.moneymetals.com/news/2015/08/05/gold-silver-demand-000746
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
CXPowell@yahoo.com
end
James Turk discusses the prolonged gold backwardation which has never happened before in monetary history
(courtesy James turk and Greg Hunter/USAWatchdog)
Prolonged Gold Backwardation Has Never Happened in Monetary History-James Turk
By Greg Hunter On August 5, 2015
http://usawatchdog.com/wp-content/uploads/2013/03/James-Turk-2.jpghttp://usawatchdog.com/wp-content/uploads/2013/03/James-Turk-2.jpgBy Greg Hunter’s USAWatchdog.com
Renowned gold expert James Turk says prolonged gold backwardation like we are seeing now, where the spot price is higher than the future price, has never happened before. Turk contends, “No, never, and I am a student of monetary history as well, and I have never seen it happen like this in monetary history. Typically, when a backwardation would occur under the classic gold standard, for example, the banks that would have fractional reserve banking would go under. There would be a banking collapse. So, typically, if there was a backwardation, it would only last for a few days as it did in 1999 and in 2008. So, we have an unusual situation where we have heavy government involvement where they are trying to keep the gold price under wraps so they can maintain this policy of zero interest rates. They are thinking they are going to jumpstart the economy, but the economy is not being jumpstarted. All it’s doing is deferring the ultimate collapse and the governments’ ability to repay all the debt that they owe.”
Turk, a best-selling author who co-wrote a book called “The Money Bubble,” says what is happening now is nothing short of an historic bubble getting ready to pop. Turk explains, “In other words, just as we look back to the South Sea bubble and the Mississippi bubble, people are going to look back to today and say this is the money bubble. People are using what they think is money, but what they are using is really a money substitute. That’s the theme of the book that John Rubino and I wrote. We have lost sight as to what money truly is. It is a physical asset without counter-party risk and that is gold and silver.”
Turk thinks this bubble will end like all bubbles. Turk predicts, “This money bubble is going to pop. It has to because there is just too much debt in the world. That debt has to be reconciled and, ultimately, when you are reconciling debt, it gets back to the point about collateral on the balance sheets. There is just not enough good collateral to support all of this paper money circulating out there.”
It comes as no surprise that Turk thinks the premier collateral is gold. Turk goes on to say, “That’s what you are going to want, and that is ultimately what’s going to reemerge in global commerce. . . . It’s ultimately going to go back to gold.”
Turk also says there is way too many paper promises for the actual physical gold that can be delivered. So, in the future, Turk says, “I see a lot of these promises to deliver gold being broken and, ultimately, the only way you are going to see this being resolved is with a much higher gold price.” How high? Turk estimates, “You’ve got to be looking back to the all-time highs of $1,900 or $2,000 per ounce. We are eventually going to take those out. It’s just a question of when we do it. It’s obvious it is going to happen because gold has been money for 5,000 years and, ultimately, people will come back to gold when they realize that all these promises of bankers and central bankers really cannot be fulfilled. So, it is just a question of when that reconciliation comes. In March of 1968, the dam broke and the gold price was released, and the gold price climbed for another 12 years. When the gold price finally gets released this time around, it’s going to climb for many, many more years. It’s hard to say how high it can go, but relative to the amount of paper that’s out there . . . a price several times higher than what we have today seems very, very reasonable in the long run.”
Join Greg Hunter as he interviews James Turk of GoldMoney.com.
(There is much more in the video interview.)
Video Link
http://usawatchdog.com/prolonged-gold-backwardation-has-never-happened-in-monetary-history-james-turk
And now your overnight Wednesday morning trading in bourses, currencies, and interest rates from Europe and Asia:
1 Chinese yuan vs USA dollar/yuan remains constant at 6.2096/Shanghai bourse: red and Hang Sang: green
2 Nikkei up 93.70 or 0.47%
3. Europe stocks all in the green /USA dollar index up to 98.03/Euro down to 1.0868
3b Japan 10 year bond yield: rises to 40% !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 124.38
3c Nikkei still just above 20,000
3d USA/Yen rate now just above the 124 barrier this morning
3e WTI 46.04 and Brent: 50.44
3f Gold up /Yen down
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 up for WTI and up for Brent this morning
3i European bond buying continues to push yields lower on all fronts in the EMU. German 10 yr bund slightly rises to .66 per cent. German bunds in negative yields from 4 years out.
Except Greece which sees its 2 year rate falls to 20.50%/Greek stocks this morning down badly again by 3.24%: still expect continual bank runs on Greek banks /
3j Greek 10 year bond yield falls to : 11.72%
3k Gold at $1087.50 /silver $14.57
3l USA vs Russian rouble; (Russian rouble down 1/5 in roubles/dollar) 62.97,
3m oil into the 46 dollar handle for WTI and 50 handle for Brent/Saudi Arabia increases production to drive out competition.
3n Higher foreign deposits out of China sees huge risk of outflows and a currency depreciation. This can 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. It is not working: USA/SF this morning .9792 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.0643 well above the floor set by the Swiss Finance Minister. Thomas Jordan, chief of the Swiss National Bank continues to purchase euros trying to lower value of the Swiss Franc.
3p Britain’s serious fraud squad investigating the Bank of England/
3r the 4 year German bund remains in negative territory with the 10 year moving further from negativity to +.66%
3s The ELA rose another 900 million euros to 90.4 billion euros. The bank withdrawals were causing massive hardship to the Greek bank. the Greek referendum voted overwhelming “NO”. Greece votes again and agrees to more austerity even though 79% of the populace are against.
4. USA 10 year treasury bond at 2.25% early this morning. Thirty year rate below 3% at 2.91% / yield curve flatten/foreshadowing recession.
5. Details Ransquawk, Bloomberg, Deutsche bank/Jim Reid.
(courtesy Jim Reid/Bloomberg/Deutsche bank/zero hedge)
Futures Rebound On Ongoing Dollar Strength; Commodities Rise, China Slides, Greek Banks Continue Plunging
In many ways the overnight session has been a mirror image of yesterday, with the dollar accelerating its Lockhart-commentary driven rise, which curiously has pushed ES higher perhaps as a result of more USDJPY correlation algos being active and various other FX tracking pairs. Indeed, the weak yen is all that mattered in Japan, where the Nikkei 225 (+0.5%) rose amid JPY weakness, despite opening initially lower as index heavyweight Fast Retailing (-4.5%) reported a 2nd consecutive monthly decline in Uniqlo sales. Elsewhere in mirror images, China slid 1.7%, undoing about half of yesterday’s 3.7% jump, and is now down for 4 of the past 5 days.
As a reminder, the key event yesterday interview by Fed centrist, Atlanta Fed President Lockhart, who said that the US economy is ready for a rate rise and that it would take a significant deterioration in data to convince him that a move in September would not be warranted: the result was sending the USD and yields surging and stocks sliding.
Speaking to the WSJ, Lockhart said that ‘my priors going into the September meeting as of today are that the economy is ready and it is an appropriate time to make a change’. Lockhart also said that ‘I think there is a high bar right now to not acting’ and that ‘it will take a significant deterioration in the economic picture for me to be disinclined to move ahead’. There was some mention from Lockhart in the article that inflation could come under pressure in the time ahead with the recent decline in the oil market, although Lockhart said that he was ‘reasonably confident’ inflation is on a path towards its goal given the slack in the labour market and broader economy is diminishing.
The comments were interesting given that Lockhart is seen as something of a centrist in the Fed camp who moves with the consensus. Lockhart had also previously said back in May that he is more prepared to take the risks of waiting rather than being too early. In his comments yesterday Lockhart also added that the addition of the word ‘some’ to the FOMC statement in relation to further improvement in the labour market was ‘a qualifier that conveys to the public that we’re getting close’. This of course will be tested somewhat today when we get the July ADP employment print (with market expectations at 215k) which of course comes as an important precursor ahead of payrolls on Friday.
As DB summarizes “one has to hand it to the Fed as they are not seemingly being derailed by the recent commodity rout, the concerns over China (and other EM countries), and the general disappointments over the state of the wider global recovery.” That, and of course the reality that a Fed hike in September will unleash the ghost of 1937...
Back to Asian equity markets which traded mixed following the weak close on Wall Street, after Fed’s Lockhart stated that a rate lift-off could be seen as appropriate in September. The Shanghai Comp (-1.6%) was the session’s laggard as the PBoC reiterated that they will follow a prudent monetary policy, in spite of the latest Services PMI posting its highest reading since Aug’14. Finally, JGB’s fell following spill-over selling in USTs weighed by the aforementioned more hawkish than usual comments from Fed’s Lockhart.
Curiously, despite Lockhart’s hawkish comment being blamed for the late day failed to weigh on European sentiment (Euro Stoxx: +0.76%) as stellar earnings from SocGen (+8.0%) buoyed demand for stocks. In turn, the upside was led by the financial sector, with materials also posting good gains following a number of positive broker updates by Liberum who upgraded BHP Billiton (+2.5%), Rio Tinto (+2.7%) and Glencore (+2.0%) to hold from sell. In terms of other notable movers, Standard Chartered shares reversed initial weakness following earnings to trade higher by 0.7%, as market participants welcomed the fact that the bank did not announce capital raising plans, that’s despite reporting less than impressive financial metrics.
One place where there was no mirror image was Greek banks which as the Bloomberg chart below shows, continued their limit down selloff for the third day in a row.
<img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/20