Good evening Ladies and Gentlemen:
Here are the following closes for gold and silver today:
Gold: $1090.20 up $4.50 (comex closing time)
Silver $14.67 up 12 cents.
In the access market 5:15 pm
Gold $1090.00
Silver: $14.67
First, here is an outline of what will be discussed tonight:
At the gold comex today, we had a poor delivery day, registering 8 notices for 800 ounces Silver saw 27 notices for 135,000 oz
Several months ago the comex had 303 tonnes of total gold. Today, the total inventory rests at 235.44 tonnes for a loss of 67 tonnes over that period.
In silver, the open interest fell by 1637 contracts despite the fact that silver was unchanged yesterday. The total silver OI continues to remain extremely high, with today’s reading at 184,211 contracts In ounces, the OI is represented by .9210 billion oz or 131% 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 27 notices served upon for 135,000 oz.
In gold, the total comex gold OI rests tonight at 432,301. We had 8 notices filed for 800 oz today.
We had no change in 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 no changes in silver inventory at the SLV, / 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 1637 contracts down to 184,211 even though silver was unchanged in price yesterday. Again, we must have had some short covering. The OI for gold fell by 1972 contracts to 432,301 contracts as gold was down by $5.00 yesterday. We still have close to 22 tonnes of gold standing with only 19.66 tonnes of registered gold in the dealer vaults ready to satisfy that which stands.
(report Harvey)
2. One story on Greece whereby the IMF will delay making a decision to join in the bailout until the fall
(courtesy Reuters)
3.Gold trading overnight, Goldcore
(/Mark OByrne)
4. Two stories on the plummeting stock market and economy inside China
(zero hedge)
5 Trading of equities/ New York
(zero hedge)
6. USA stories:
i) Data for today:
a) huge layoffs reported in the Challenger/Christmas/Gray report
b) the Thursday jobless report
c) Atlanta Fed reports that they believe 3rd quarter GDP will be only 1%
d) Personal finance confidence falters badly
ii) Looks like the FBI are undergoing a criminal probe on Hillary
(zero hedge)
6. Two oil related stories:
(zero hedge/Wolf Richter)
7. James Turk discusses gold backwardation with greg Hunter
(Greg Hunter usa watchdog/James Turk/Dave Kranzler)
8. The next “Argentina” is Brazil: (i.e. to default)
(two stories/zero hedge)
9. Iran refuses to let inspectors in:
(zero hedge)
10. The Bank of England reports that they are now moving to the dovish side as the global economy is sinking:
(zero hedge/Bloomberg)
11.Silver production from the mines fell off the cliff these past few months;
(Steve St Angelo/SRSRocco report)
12.
Here are today’s comex results:
The total gold comex open interest fell from 434,273 down to 432,301 for a loss of 1972 contracts as gold was down $5.00 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 stopped its decline and actually rose. 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 2718 contracts falling to 3875 contracts. We had 2828 notices filed upon on yesterday and thus we gained 110 contracts or 11,000 additional ounces will stand for delivery. The next delivery month is September and here the OI rose by 245 contracts up to 2523. The next active delivery month if October and here the OI rose by 300 contracts up to 26,713. 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 82,238. The confirmed volume on yesterday (which includes the volume during regular business hours + access market sales the previous day was poor at 127,924 contracts. Today we had 8 notices filed for 800 oz.
And now for the wild silver comex results. Silver OI fell by 1637 contracts from 185,848 contracts down to 184,211 despite the fact that silver was unchanged in price 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 0 delivery notices filed yesterday and thus we gained 0 contracts or an additional zero 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 3023 contracts to 113,664. The estimated volume today was poor at 21,236 contracts (just comex sales during regular business hours). The confirmed volume yesterday (regular plus access market) came in at 43,932 contracts which is excellent in volume. We had 27 notices filed for 135,000 oz.
August contract month: initial standing
August 6.2015
Gold
Ounces
Withdrawals from Dealers Inventory in oz
nil
Withdrawals from Customer Inventory in oz
16,916.156 oz (JPMorgan,Scotia)
Deposits to the Dealer Inventory in oz
nil
Deposits to the Customer Inventory, in oz
18,043.443 (Delaware,Scotia)
No of oz served (contracts) today
8 contracts (800 oz)
No of oz to be served (notices)
3867 contracts (386,700 oz)
Total monthly oz gold served (contracts) so far this month
3178 contracts(317,800 oz)
Total accumulative withdrawals of gold from the Dealers inventory this month
nil
Total accumulative withdrawal of gold from the Customer inventory this month
292,138.1 oz
Today, we had 0 dealer transactions
total Dealer withdrawals: nil oz
we had 0 dealer deposits
total dealer deposit: zero
we had 2 customer withdrawals
i) Out of JPMorgan: 16,783.956 oz
ii) Out of Scotia: 100.05 oz
iii) Out of Manfra; 32.15 oz (1 kilobar)
total customer withdrawal: 16,916.156 oz
We had 2 customer deposits:
i) Into Delaware: 1770.37 oz
ii) Into Scotia: 16,273.406 oz
Total customer deposit: 18,043.443 oz
We had 1 adjustment
ii) out of Scotia: 10,754.504 oz was adjusted out of the dealer and this landed into the customer account of Scotia.
JPMorgan has 11.66 tonnes left in its registered or dealer inventory.
(375,019.978 oz)
.
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 8 contracts of which 0 notices were stopped (received) by JPMorgan dealer and 2 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 (3178) x 100 oz or 317,800 oz , to which we add the difference between the open interest for the front month of August (3875) and the number of notices served upon today (8) 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 (3178) x 100 oz or ounces + {OI for the front month (3875) – the number of notices served upon today (8) x 100 oz which equals 704,600 oz standing so far in this month of August (21.916 tonnes of gold).
Thus we have 21.916 tonnes of gold standing and only 19.66 tonnes of registered or dealer gold to service it.
We gained 110 contracts or an additional 11,000 oz will stand for delivery in this active month of August.
Total dealer inventory 632,041.588 or 19.66 tonnes
Total gold inventory (dealer and customer) = 7,569,584.573 oz or 235.44 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 6 2015:
Silver
Ounces
Withdrawals from Dealers Inventory
nil
Withdrawals from Customer Inventory
1,028,623.39 oz (CNT,Brinks, Scotia)
Deposits to the Dealer Inventory
nil
Deposits to the Customer Inventory
nil
No of oz served (contracts)
27 contracts (135,000 oz)
No of oz to be served (notices)
33 contracts (165,000 oz)
Total monthly oz silver served (contracts)
45 contracts (225,000 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
4,039,673.1 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 0 customer deposits:
total customer deposits: nil oz
We had 3 customer withdrawals:
i)Out of Brinks: 1000.000 oz ????
ii) Out of CNT: 967,619.46 oz
iii) Out of Scotia: 1,028,623.38 oz
total withdrawals from customer: 1,028,623.38 oz
we had 2 adjustments
Out of Brinks:
i) 35,902.400 oz leaves the customer account and lands into the dealer account of Brinks
ii) Out of CNT:
39,098.000 oz (???) leaves the customer and lands into the dealer account at CNT:
Total dealer inventory: 55.829 million oz
Total of all silver inventory (dealer and customer) 172.381 million oz
The comex has been bleeding silver lately.
The total number of notices filed today for the August contract month is represented by 27 contracts for 135,000 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 (45) x 5,000 oz = 225,000 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 (27) x 5000 oz equals the number of ounces standing.
Thus the initial standings for silver for the August contract month:
45 (notices served so far)x 5000 oz + { OI for front month of August (60) -number of notices served upon today (27} x 5000 oz ,= 390,000 oz of silver standing for the August contract month.
we neither gained nor lost any silver ounces 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 6/no change in gold inventory at the GLD/Inventory rests at 667.93 tonnes
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 6 GLD : 667.93 tonnes
end
And now SLV:
August 6/no changes in SLV/inventory rests at 326.209 million oz
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 6/2015: 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 11.4 percent to NAV usa funds and Negative 11.7% to NAV for Cdn funds!!!!!!!
Percentage of fund in gold 62.0%
Percentage of fund in silver:37.7%
cash .3%
( August 6/2015)
2. Sprott silver fund (PSLV): Premium to NAV falls to -1.04%!!!! NAV (August 5/2015) not out today
3. Sprott gold fund (PHYS): premium to NAV rises to – .76% to NAV(July August5/2015) not out today
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)
a must read….
Gold Bullion Demand In ‘Chindia’ Heading Over 2,000 Tons Again
By Mark O’ByrneAugust 6, 2015No Comments
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Shanghai Gold Exchange deliveries at 73.289 tonnes last week
3rd largest week of gold withdrawals ever on SGE
Both China and India heading for over 1,000 metric tonnes in 2015 … again
India imports 96.1 tonnes in May alone
‘Chindia’ imports 296.55 tonnes in May – 14% greater than global production
South Korean gold demand surges in wake of Chinese crash
Asian and global gold demand robust contrary to anti-gold narrative
The recent lower prices in gold have not deterred investors internationally from buying gold coins and bars in large volumes again. Indeed the Perth Mint and the US Mint are struggling to fulfill demand for gold coins and bars.
This is particularly the case in the eastern hemisphere – especially in India and China – where demand has again increased significantly on price weakness.
Between them, these two countries are on-track to import 2,000 tonnes of gold this year – that is more than two thirds of the total annual global gold mine production, which is set to be about 2,800 tonnes this year. (Harvey: 2,200 ex China ex Russia)
The Shanghai Gold Exchange, which deals exclusively in physical bullion, saw buyers take delivery of over 73 tonnes of gold last week, the third largest withdrawal on record. This follows two weeks of steadily increasing demand as investors pull or attempt to pull money out of the Chinese stock market.
Demand out of China is on track to surpass last year’s official figure of 974 tonnes and may reach 1,000 tonnes this year. Chinese demand has been steadily growing, with the encouragement of the government. The ban on gold ownership imposed by Chairman Mao in 1949 was lifted in 2003.
As such, demand from the nation of 1.3 billion people who have a strong cultural affinity to gold – and experience of monetary mismanagement and hyperinflation – has been rising from a base of nearly zero and has recently surpassed that of India to become the world’s top gold buying nation. Nonetheless, Chinese gold ownership remains very low when compared to that of India.
Prudent Indian households hold 11% of the world’s gold. That is more gold than the gold reserves that the U.S. Federal Reserve, the German Bundesbank and the Swiss central bank are believed to own put together.
Indian demand remains robust. In April and May alone the country imported over 155 tonnes of the precious metal.
Demand so far this year has greatly exceeded that of the same period last year – up 61% – as Indians take advantage of the low prices despite the fact that we are some months away from the typical gold buying season. Indian demand is also expected to hit 1,000 tonnes this year.
Together, “Chindia” imported 296.55 tonnes of gold in May. This surpasses current monthly mine supply globally by 14%. Clearly there is an imbalance in the gold market when demand from two countries alone exceeds total mine supply, which must then be supplemented by existing stocks. (Harvey: world produces 183 tonnes per month)
Yet prices remain in a downward trend as speculative short selling continues to depress prices. Indeed it not just the huge Asian nations of China and India where demand remains high. There are reports of strong demand – including by thePerth Mint – in Thailand, Vietnam and Malaysia. Demand for gold in South Korea has surged in recent weeks, according to Reuters.
Koreans, nervous about the fallout from the crash in China’s stock market, are choosing to diversify into gold and take advantage of lower dollar prices.
This trend is likely to be repeated across east and south-east Asia in countries who are reliant on the increasingly important Chinese economy.
While it is unlikely to have significant impact on global demand – last year’s demand from South Korea amounted to only 17 tonnes – it demonstrates the psychological appeal that gold still has in times of economic crisis among people across the world – and especially in Asia.
The triumphalism with which some Wall Street commentators have covered the temporary set-back in gold prices looks misplaced and misguided. This is especially the case when the bigger picture is taken into account – including the significant macreconomic, systemic, geopolitical and monetary risks of today.
These are being ignored for now – as they were in 2007 and early 2008.
Gold will continue to retain value well into the future – a claim we would not be too confident about making with regards to paper currencies and bonds issued by the most indebted nations in the world.
Own allocated, segregated gold coins and bars of which you can take delivery.
MARKET UPDATE
Today’s AM LBMA Gold Prices were USD 1,085.00, EUR 996.05 and GBP 694.56 per ounce.
Yesterday’s AM LBMA Gold Prices were USD 1,086.50, EUR 1,000.18 and GBP 697.82 per ounce.
Gold and silver on the COMEX were nearly unchanged yesterday – down $3.20 and up 1 cent respectively – to $1,085.00/oz and $14.60/oz.
Silver futures for September delivery fell less than 0.1 percent to $14.66 on the Comex.
Palladium for September delivery rose 0.8 percent to $602 an ounce on the New York Mercantile Exchange. Platinum for October delivery rose 0.3 percent to $955.90 an ounce.
Breaking News and Research Here
Follow GoldCore on Twitter, GoldCore on Facebook, GoldCore on LinkedIn
end
(courtesy Moneymetals.com/GATA)
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
I brought this to your attention yesterday, but it is worth repeating due to its importance:
(courtesy James Turk/Greg Hunter/GATA)
Unprecedented backwardation in gold, Turk tells USAWatchdog
Submitted by cpowell on Wed, 2015-08-05 20:40. Section: Daily Dispatches
4:40p ET Wednesday, August 5, 2015
Dear Friend of GATA and Gold:
GoldMoney founder and GATA consultant James Turk today tells USAWatchdog’s Greg Hunter that he has never seen such a long period of backwardation in the gold market. Turk says that “the money bubble” is getting ready to pop. His interview is 26 minutes long and can be watched at USAWatchdog here:
http://usawatchdog.com/prolonged-gold-backwardation-has-never-happened-i…
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
CPowell@GATA.org
end
the following commentary from Dave Kranzler is extremely important.
The number of shorts in the GLD has now risen from 9 million shares to over 14 million shares. This is how the criminals are obtaining some gold by borrowing shares and then redeeming them for metal. Gold is in severe backwardation in the physical gold market in London. Although we do not get the GOFO rates, Kitco publishes the gold lease rates. The higher the rate, the more gold is in tight supplies. The lease rates today are extremely high!!
(courtesy Dave Kranzler/IRD)
Massive Shortages In Gold And Silver Developing – GLD Looting Continues
August 6, 2015Financial Markets, Gold, Market Manipulation, Precious Metals, U.S. Economybackwardation in gold, GLD, gold eagles, gold lease rates, James Turk, Shanghai Gold Exchange
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. – James Turk on Greg Hunter’s USAWatchdog
The signs are everywhere. We are seeing extreme “backwardation” in gold on the LBMA. Backwardation occurs when the spot price is higher than the future price for LBMA forward contracts. It means that buyers of gold are willing to pay more for gold for immediate delivery than pay a lower price to receive delivery in the future (30-day, 60-day, etc). It means that physical gold buyers do not trust the ability of the market to delivery physical gold in the future.
It is an unmistakable sign of physical gold shortages.
Not surprisingly, the LBMA suspended reporting the gold forward rate which was the best indicator of physical gold shortages in London, but we can still get reports onphysical market conditions from London gold market participants, like James Turk.
To reinforce this information, Bill Murphy reported his latest conversation with his LBMA trader source in London (www.lemetropolecafe.com):
The essence of it is more confirmation that the BIG MONEY is buying down here at these price levels.More confirmation that silver is extremely difficult to buy in size. It takes two to four weeks for delivery. What is new is that buying gold in size is now becoming a thing … for our source says it now takes two weeks to buy in size.
Perhaps the most visible sign is the removal of gold from the GLD ETF. The only way gold is removed from the Trust is when an Approved Participant bank redeems 100k share block in exchange for delivery of bars from the Trust. – (source: John Titus of the “Best Evidence” Youtube channel, edits are mine) – click to enlarge:
Make no mistake about it, the bullion banks often can borrow GLD shares to scrape together 100k share lots in order to redeem gold. Or they can smash the gold price with paper and force weak holders of GLD to sell shares in the hands of the bullion banks. In the last two weeks the short interest in GLD has soared 49% from 9.4 million shares to 14 million. That represents roughly 46 tonnes.
The ongoing raid of GLD gold is perhaps the most direct evidence that the Central Banks and their bullion bank agents are struggling to find gold in which to deliver into Asia. But speaking of which, something interesting is occurring on the Shanghai gold exchange. In the last three days, 298 tonnes of gold have been delivered into the SGE. While everyone monitors the amount of gold withdrawn from the SGE, the amount of gold flowing in to the SGE is just as important. This is by far the most amount of gold that has been delivered into the SGE that I can recall.
I get my data from John Brimelow’s “Gold Jottings” report, which is invaluable for tracking the physical gold market outside of London. He had this to say about the stunning flow of gold into China over the last three days:
Delivery Volume was 90.444 tonnes (Wednesday 112.454 tonnes) and open interest surged 48.374 tonnes (11.26%) to 477.920 tonnes. Since last Friday Shanghai open interest has risen 18.68%. Something is happening in gold in China. What is not immediately apparent.
Finally, to further reinforce the evidence of physical market shortages, we can monitor the gold lease rates, published by Kitco everyday. I sourced this graph from Jesse’s Cafe Americain, who sourced it from Sharelynx – click to enlarge:
Gold lease rates spike up like this when there is heavy demand from bullion banks to borrow physical gold from Central Banks in order to sell the gold into the market or deliver gold that can’t be readily procured in adequate quantities in the spot market. It is one of the most visible signs that there is a shortage of physical gold on the market.
To be sure, the unprecedented degree manipulation of the gold price in the paper gold market reflects a serious desperation by the Central Banks and western Governments to cover up an enormous disaster fomenting beneath the heavily applied of veneer of “things are so good we need to raise interest rates in September” mantra. In fact, the specific reason to keep a lid on the price of is to enable the Central Banks to maintain a zero interest rate policy.
The truth is, the Fed can’t afford to raise interest rates and anyone with two brain cells to rub together and a willingness to look at the truth knows that the Fed is trapped – unless it wants to crash the system for some reason.
We note that physical off-take of gold is spiking higher, with Reuters reporting yesterday that the South Koreans are buying gold in record sums while the US Mint reports that sales of gold coins in July were nearly 5 times what they were a year ago. – John Brimelow, “Gold Jottings” report
end
Not only is demand for silver skyrocketing but the supply side of the equation is well down with all the 3 major countries reporting lower production of silver:
1, Mexico
2. Peru
3. Australia
it will not be long before silver is in backwardation in London.
a must read…
(courtesy Steve St Angelo/SRSRocco report)
Big Production Declines From The World Largest Silver Producers
Filed in Mining, News, Precious Metals by SRSrocco on August 6, 2015 • 4 Comments
In a stunning development, the world’s largest silver producing countries reported big declines in recent months. This was surprising because the top two producers, Mexico and Peru, stated positive growth in the first two months of the year. However, silver production from these two countries reversed this trend by declining in April and May.
While this was a significant drop in silver mine supply from the leading producers, what took place in Australia (world’s fourth largest silver producer), was quite a shocker. Not only did Australian silver production fall precipitously, it was down a stunning 31% during the first quarter of 2015 compared to the same period last year:
As we can see, Australian silver production declined from 491 metric tons (mt) in Q1 2014, to 340 mt Q1 2015. This was a 151 mt decline (31%) year-over-year (y.o.y.). I tried to contact the Australian Government Department that provides the Resources & Energy Quarterly Reports on this figure, but did not receive a reply.
Often, the figures are revised. However, I have never seen silver production figures revised more than 5-8%. Furthermore, I went back to the site several times to see if there was a revision, or if the figure was a misprint… no change. Here is the table from their June 2015 Quarterly Report:
You will notice silver production started to decline in Q3 2014, but fell off a cliff in the first quarter of 2015. Queensland, Australia suffered the largest declines, falling from 381 mt in Q2 2014, to 246 mt in Q1 2014.
Again, I am reporting the data put out by the Australian Government. I will put out an update when their Q2 figures come out. If they still show the 340 mt (or figure close to it), this will not be good news.
Okay, let’s look at Peru silver production. Peru is the second largest silver producer in the world. In the first three months of the year, Peru’s silver production was up a whopping 11%. However, production was flat y.o.y. in April, and really declined in May. Here is Peru’s silver production in the first five months of 2015:
Even though production was up 11% in the first quarter, when we factor in the large 14% decline in May, total production for the first five months was only up 42 mt or 3%. This same trend (to a lessor extent), was also experienced in Mexico… the world’s largest silver producer.
Mexico’s silver production was up slightly during the first two months of 2015, but this all changed starting in March. Silver mine supply from Mexico dropped 7% in March compared to the same month last year, a stunning 12% in April, and another 10% in May:
Which means, Mexico’s silver production is down 188 mt (6%) in the first five months of 2015, compared to the same period last year. If we combine the figures for Mexico, Peru and Australia, this is the total decline of silver production in the first five months of the year:
Total estimated silver production from these top producers in the world would be down from 4,704 mt (Jan-May) 2014, to 4,365 mt in 2015. Again, I say estimated because I don’t have Q2 data for Australia. I assumed a small build in production in the second quarter and estimated Australia’s silver production for the first five months of 2015.
If my assumption for Australia’s Q2 silver production is correct (or close), then total silver mine supply from these top producers will be down 339 mt (7%) compared to the same period last year. This is a lot of silver…. nearly 11 million oz.
Falling silver mine supply from the world’s leader producers (China is ranked 3rd, no public data released) comes at a time when silver investment demand has gone into HIGH GEAR. How high? Well, we know the U.S. Mint sold more Silver Eagles than ever in the first half of the year. Furthermore, July’s Silver Eagle sales which reached 5,529,000 were even higher than June (4,840,000).
Then we had this news release by the folks at Money Metals Exchange on the huge increase in precious metal purchases, especially from first-time buyers, Retail Gold & Silver Demand Surged 135% since June, 365% More First-Timers:
From June 16 to July 31, Money Metals Exchange experienced a 135% surge in gold and silver sales over the prior 45-day period (which was representative of the early months of 2015). Since June 16, the number of first-time customers rose even more dramatically, with 365% more new purchasers than the prior period.
Not only did their total precious metals sales double from June 16-July 31, First-Time orders increased 365%. I would imagine this was similar through-out the precious metals retail industry.
Precious metals investors need to realize there are very few real STORES OF WEALTH to own in the future. These stores of wealth are based on stores of ECONOMIC ENERGY. The world is about to witness a huge collapse in the Great U.S. Shale Oil Industry. Watch for fireworks to start in Q3 and pick up speed in Q4 when the shale oil companies will have to revalue their reserves due to much lower oil prices.
This should start to speed up the peak and decline of lousy global unconventional oil production. Falling oil production will be DEATH on most PHYSICAL & PAPER ASSETS. This is the most important reason to own gold and silver. More on this in future articles and reports.
end
(courtesy Avery Goodman/seeking Alpha/GATA)
Avery Goodman: U.S. guarantees Comex gold, hastening offtake there
Submitted by cpowell on Wed, 2015-08-05 04:15. Section: Daily Dispatches
Demand for Physical Gold Deliveries Doubles in August
By Avery Goodman
Tuesday, August 4, 2015
Last month I wrote about an usual situation at the COMEX futures exchange:
http://seekingalpha.com/article/3227026-gold-market-tightness-puts-comex…
At that time, only 376,000 ounces of gold were available to back up a delivery requirement of about 550,000 ounces. A day later, JPMorgan Chase bailed out the clearing firms that handle short-side speculators, adding enough registered gold to meet deliveries.
In the article, I reached several conclusions. First, given that commercial for-profit institutions don’t normally put themselves at financial risk to bail out their competitors, it was likely that JPMorgan was an agent of the U.S. government. I also concluded that the Comex is an excellent place for large physical gold buyers to source gold. …
… For the full commentary:
http://seekingalpha.com/article/3396845-demand-for-comex-physical-gold-d…
end
And now your overnight Thursday 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: red
2 Nikkei up 50.38 or 0.24%
3. Europe stocks mixed /USA dollar index up to 97.98/Euro down to 1.0900
3b Japan 10 year bond yield: rises to 42% !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 124.84
3c Nikkei still just above 20,000
3d USA/Yen rate now just above the 124 barrier this morning
3e WTI 44.73 and Brent: 49.45
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 down for WTI and down 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 .75 per cent. German bunds in negative yields from 4 years out.
Except Greece which sees its 2 year rate rises to 20.65%/Greek stocks this morning up by 3.34%: still expect continual bank runs on Greek banks /
3j Greek 10 year bond yield rises to : 11.98%
3k Gold at $1086.45