Gold $1251.10 DOWN $3.90
Silver 17.46 DOWN 1 cent
In the access market 5:15 pm
Gold: 1255.60
Silver: 17.48
THE DAILY GOLD FIX REPORT FROM SHANGHAI AND LONDON
.
The Shanghai fix is at 10:15 pm est and 2:15 am est
The fix for London is at 5:30 am est (first fix) and 10 am est (second fix)
Thus Shanghai’s second fix corresponds to 195 minutes before London’s first fix.
And now the fix recordings:
Shanghai morning fix OCT 12 (10:15 pm est last night): $ 1261.25
NY ACCESS PRICE: $1258.90 (AT THE EXACT SAME TIME)
Shanghai afternoon fix: 2: 15 am est (second fix/early morning):$ 1259.69
NY ACCESS PRICE: 1255.60 (AT THE EXACT SAME TIME)
HUGE SPREAD TODAY!!
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London Fix: OCT 12: 5:30 am est: $1256.40 (NY: same time: $1256.40: 5:30AM)
London Second fix OCT 11: 10 am est: $1256.50 (NY same time: $1256.90 , 10 AM)
It seems that Shanghai pricing is higher than the other two , (NY and London). The spread has been occurring on a regular basis and thus I expect to see arbitrage happening as investors buy the lower priced NY gold and sell to China at the higher price. This should drain the comex.
Also why would mining companies hand in their gold to the comex and receive constantly lower prices. They would be open to lawsuits if they knowingly continue to supply the comex despite the fact that they could be receiving higher prices in Shanghai.
end
For comex gold:
3 NOTICES FILED FOR 300 OZ
For silver:
for the Oct contract month: 0 notices for NIL oz.
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Let us have a look at the data for today
.
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In silver, the total open interest FELL by 1,532 contracts DOWN to 187,469. The open interest FELL as the silver price was UP 5 cents in yesterday’s trading .In ounces, the OI is still represented by just less THAN 1 BILLION oz i.e. .938 BILLION TO BE EXACT or 134% of annual global silver production (ex Russia &ex China).
In silver for October we had 0 notices served upon for nil oz
In gold, the total comex gold fell by 5117 contracts with the tiny rise in price of gold( $1.50 yesterday) . The total gold OI stands at 500,328 contracts. The bankers have done a great job fleecing longs
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With respect to our two criminal funds, the GLD and the SLV:
GLD
LAST NIGHT WE HAD NO CHANGES OUT OF THE GLD//
Total gold inventory rests tonight at: 958.90 tonnes of gold
SLV
we had NO CHANGES at the SLV
THE SLV Inventory rests at: 361.147 million oz
.
First, here is an outline of what will be discussed tonight:
1. Today, we had the open interest in silver FELL by 1532 contracts DOWN to 187,469 as the price of silver rose by 5 cents with yesterday’s trading.The gold open interest FELL by 5517 contracts DOWN to 500,328 as the price of gold rose $1.50 IN YESTERDAY’S TRADING.
(report Harvey).
2.a) The Shanghai and London gold fix report
(Harvey)
2 b) Gold/silver trading overnight Europe, Goldcore
(Mark O’Byrne/zerohedge
and in NY: Bloomberg
end
2c) Federal Reserve Bank of New York/earmarked gold removal
(Harvey)
3. ASIAN AFFAIRS
i)Late TUESDAY night/WEDNESDAY morning: Shanghai closed DOWN 6.72 POINTS OR 0.22%/ /Hang Sang closed DOWN 142,47 POINTS OR 0.60%. The Nikkei closed DOWN 184.76 POINTS OR 1.09% Australia’s all ordinaires CLOSED DOWN 0.09% /Chinese yuan (ONSHORE) closed UP at 6.67157/Oil ROSE to 51.06 dollars per barrel for WTI and 52.63 for Brent. Stocks in Europe: ALL IN THE RED Offshore yuan trades 6.6721 yuan to the dollar vs 6.67197 for onshore yuan.THE SPREAD BETWEEN ONSHORE AND OFFSHORE NARROWS A BIT AS MORE USA DOLLARS ATTEMPT TO LEAVE CHINA’S SHORES
REPORT ON JAPAN SOUTH KOREA NORTH KOREA AND CHINA
3a)THAILAND:
Thai stocks plummet along with their currency on concerns of the King’s health and the Fed rate hike. Remember it was Thailand that caused the Asian contagion in 1997:
(courtesy zero hedge)
b) REPORT ON JAPAN
none today
c) REPORT ON CHINA
NONE TODAY
4 EUROPEAN AFFAIRS
i)GERMANY/DEUTSCHE BANK
Deutsche bank sells another 1.5 billion dollars worth of bonds at a yield of 4.25%: basically at junk. This is done prior to any announcement of a settlement. In January these guys can be bailed in if trouble occurs:
( zero hedge)
ii)ENGLAND
The now have a British bond bloodbath (occurring right after a huge downfall in the currency:
( zero hedge)
5. RUSSIAN AND MIDDLE EASTERN AFFAIRS
none today
6.GLOBAL ISSUES
ERICSSON/SWEDEN
A good indicator of troubles throughout the globe; huge telecom giant Ericsson plunges 17% after a profit warning:
( zero hedge)
7.OIL ISSUES
i)Crude tumbles after OPEC raises doubts over the timing of cuts:
( zero hedge)
ii)Confusion with OPEC: they do not know who is to cut first. Oil will head southbound especially when China stops buying;
( zero hedge
iii)Then oil tumbles after the biggest crude inventory build in 6 monthgs(courtesy zero hedge)
8.EMERGING MARKETS
none today
9.PHYSICAL STORIES
i)To understand gold you must realize that the market is just not normal
( Chris Powell/GATA)
ii)Bill Holter discusses the walking zombie bank Deutsche bank( Bill Holter/Greg Hunter/USAWatchdog)
iii)A thorough analysis of what is going on in the class action suit against Deutsche bank, Bank of Nova Scotia, HSVC and Societe Generale
( Market Slant)
iv)Scotia bank is ordered to provide emails immediately in the gold manipulation case:
(courtesy Kitco/Market Slant)
10.USA STORIES WHICH MAY INFLUENCE THE PRICE OF GOLD/SILVER
i)Another of Janet’s favourites: the JOLTS survey which details job openings and leavings. The job opening s missed the most on record and tumbles to last yrs level.
( zero hedge)
ii)Consumer spending again deteriorates in September.
( zero hedge)
iii)The FOMC minutes were released and in it we find that the hawkish fed is very fearful of losing credibility. They also state that the no hike decision was a close call
( zero hedge)
iv)Let’s close with this important paper from Egon Von Greyerz:
(courtesy Egon Von Greyerz/Matterhorn)
Let us head over to the comex:
The total gold comex open interest FELL BY 5517 CONTRACTS to an OI level of 500,328 as the price of gold ROSE by $1.50 with YESTERDAY’S trading.
We are in the delivery month is October and here the OI LOST 146 contracts DOWN to 152. We had 156 notices filed yesterday so we gained another 10 contracts or 1000 additional oz will stand.
The next delivery month is November and here the OI ROSE by 1 contract up to 3026 contracts. The next contract month and the biggest of the year is December and here this month showed an decrease of 6081 contracts down to 379,949.
Today we had 3 notices filed for 300 oz of gold.
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And now for the wild silver comex results. Total silver OI FELL BY 1532 contracts from 189,021 down to 187,469 as the price of silver rose to the tune of 5 cents yesterday. We are moving further from the all time record high for silver open interest set on Wednesday August 3: (224,540). The next non active delivery month is October and here the OI rose by 2 contracts up to 114. We had 0 notices filed yesterday so we gained 2 contracts or 10,000 additional oz will stand for delivery.The November contract month saw its OI FELL by 3 contracts DOWN to 341. The next major delivery month is December and here it FELL BY 1863 contracts DOWN to 153,348
VOLUMES.
Today the estimated volume was 117,327 contracts.
Yesterday, the confirmed volume was 155,362
today we had 0 notices filed for silver:
INITIAL standings for OCTOBER
Oct 12.
Gold
Ounces
Withdrawals from Dealers Inventory in oz
NIL
Withdrawals from Customer Inventory in oz nil
44,480.719 Scotia
Manfra
incl
3 kilobars
Deposits to the Dealer Inventory in oz
nil oz
Deposits to the Customer Inventory, in oz
nil oz
No of oz served (contracts) today
3 notices
300 oz
No of oz to be served (notices)
149 contracts
14,900
oz
Total monthly oz gold served (contracts) so far this month
7948 contracts
794,800 oz
24.7216 tonnes
Total accumulative withdrawals of gold from the Dealers inventory this month
oz
Total accumulative withdrawal of gold from the Customer inventory this month
129,678.8 oz
Today we had 1 kilobar transaction and again the comex resumes it huge withdrawal of gold!!
Today we had 0 deposit into the dealer:
total dealer deposits: nil oz
We had zero dealer withdrawals:
total dealer withdrawals: nil oz
.
We had 0 customer deposits;
total customer deposits; nil oz
We had one major customer withdrawal and one small withdrawal:
Out of Scotia: 44,480.719 oz
out of Manfr: 96.45 3 kilobars
total customer withdrawal: 44,480.719 oz
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Total dealer inventor 2,463.441.449 or 76.623 tonnes
Total gold inventory (dealer and customer) =10,617,530.530. or 330.249 tonnes
Several months ago the comex had 303 tonnes of total gold. Today the total inventory rests at 330.229 tonnes for a gain of 27 tonnes over that period. However since August 8 we have lost 24 tonnes leaving the comex.
For October:
Today, 0 notices were issued from JPMorgan dealer account and 0 notices were issued form their client or customer account. The total of all issuance by all participants equates to 156 contract of which 2 notices were stopped (received) by jPMorgan dealer and 44 notice(s) was (were) stopped received) by jPMorgan customer account.
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To calculate the initial total number of gold ounces standing for the Oct contract month, we take the total number of notices filed so far for the month (7948) x 100 oz or 794,800 oz, to which we add the difference between the open interest for the front month of OCT 152 contracts) minus the number of notices served upon today (3) x 100 oz per contract equals 809,700 oz, the number of ounces standing in this NON active month of September.
Thus the INITIAL standings for gold for the SEPT contract month:
No of notices served so far (7948) x 100 oz or ounces + {OI for the front month (152) minus the number of notices served upon today (3) x 100 oz which equals 809,700 oz standing in this non active delivery month of Oct (25.185 tonnes).
we gained 1000 additional oz standing in this active delivery month of October.
The gold comex is an absolute fraud. The use of kilobars and exact weights makes the data totally absurd and fraudulent! To me, the only thing that makes sense is the fact that “kilobars: are entries of hypothecated gold sent to other jurisdictions so that they will not be short with their underwritten derivatives in that jurisdiction. This would be similar to the rehypothecated gold used by Jon Corzine.ALSO TODAY THE LIQUIDATION OF 96 CONTRACTS HAVING STOOD FOR THE ENTIRE MONTH AND THEN ROLLING MAKES ABSOLUTELY NO SENSE
IN THE LAST MONTH and one half , 20 NET TONNES HAS LEFT THE COMEX.
end
And now for silver
OCT INITIAL standings
Oct 12. 2016
Silver
Ounces
Withdrawals from Dealers Inventory
NIL
Withdrawals from Customer Inventory
902,910.520 oz
Brinks
CNT
HSBC
Deposits to the Dealer Inventory
nil OZ
Deposits to the Customer Inventory
581,935.519 oz
No of oz served today (contracts)
0 CONTRACTS
(20,000 OZ)
No of oz to be served (notices)
114 contracts
(570,000 oz)
Total monthly oz silver served (contracts)
353 contracts (1,765,000 oz)
Total accumulative withdrawal of silver from the Dealers inventory this month
NIL oz
Total accumulative withdrawal of silver from the Customer inventory this month
1,986,418.5 oz
today, we had 0 deposit into the dealer account:
total dealer deposit: nil oz
we had 0 dealer withdrawals:
total dealer withdrawals: nil oz
we had 3 customer withdrawals:
i) Out of Brinks;; 429,862.75 oz
ii) Out of CNT: 467,772.67 oz
iii) Out of HSBC: 5275.100
Total customer withdrawals: 902,910.520 oz
We had 2 customer deposits:
i) Into Delaware: 2911.059 oz
ii) Into Scotia: 579,024.460
total customer deposits: 581,935.519 oz
we had 0 adjustments
Volumes:
Today the estimated volume was 43,155 which is good.
Yesterday the confirmed volume was 67996 which is excellent
The total number of notices filed today for the Oct contract month is represented by 0 contracts for NIL oz. To calculate the number of silver ounces that will stand for delivery in OCT., we take the total number of notices filed for the month so far at 353 x 5,000 oz = 1,765,000 oz to which we add the difference between the open interest for the front month of OCT (114) 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 OCT contract month: 353(notices served so far)x 5000 oz +(114 OI for front month of SEPT ) -number of notices served upon today (0)x 5000 oz equals 2,335,000 oz of silver standing for the OCT contract month. THIS IS STILL A HUGE SHOWING FOR SILVER AS OCTOBER IS GENERALLY A VERY WEAK DELIVERY MONTH. We gained 25,000 additional silver ounces THAT WILL STAND.
Total dealer silver: 29.286 million (close to record low inventory
Total number of dealer and customer silver: 172.745 million oz
The total open interest on silver is NOW close to its all time high with the record of 224,540 being set AUGUST 3.2016. The registered silver (dealer silver) is NOW NEAR multi year lows as silver is being drawn out at both dealer and customer levels and heading to China and other destinations. The shear movement of silver into and out of the vaults signify that something is going on in silver.
end
And now the Gold inventory at the GLD
Oct 12/No changes in inventory/inventory rests at 958.90 tonnes
Oct 11/ what!!! we had a gigantic 9.76 tonnes of inventory increase today/inventory rests at 958.90 tonnes. (this was done with gold down?)
Oct 7: 949.14 tonnes
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Oct 12/ Inventory rests tonight at 958.90 tonnes
end
Now the SLV Inventory
Oct 12:NO CHANGES in inventory at the SLV/Inventory rests at 161.147 million oz
Oct 11/ a withdrawal of 1.762 million oz of inventory from the SLV/Inventory rests at 361.147 million oz/
.
Oct 12.2016: Inventory 361.147 million oz
end
NPV for Sprott and Central Fund of Canada
will not provide today.
1. Central Fund of Canada: traded at Negative 4.0 percent to NAV usa funds and Negative 4.2% to NAV for Cdn funds!!!!
Percentage of fund in gold 60.7%
Percentage of fund in silver:38.1%
cash .+1.2%( Oct 12/2016).
2. Sprott silver fund (PSLV): Premium RISES to +1.12%!!!! NAV (OCT 12/2016)
3. Sprott gold fund (PHYS): premium to NAV rises TO 0.70% to NAV ( OCT 12/2016)
Note: Sprott silver trust back into POSITIVE territory at 1.12% /Sprott physical gold trust is back into positive territory at 0.70%/Central fund of Canada’s is still in jail.
end
FEDERAL RESERVE BANK OF NEW YORK/GOLD INVENTORY MOVEMENT:
Last month we had a reading of 7883 million dollars worth of gold at the FRBNY at $42.22 dollars per oz. This month we had a reading of 7849 million dollars
Thus we had 34 million dollars worth of gold valued at $42.22 shipped out.
In oz:
34,000,000 divided by $42.22 = 805,305 oz
in tonnage:25.048 tonnes
Since Germany is the only official nation seeking its gold, no doubt that this gold was repatriated towards Frankfurt.
end
And now your overnight trading in gold,WEDNESDAY MORNING and also physical stories that may interest you:
Trading in gold and silver overnight in Asia and Europe
Gold In GBP Up 43% YTD – “Massive Twin Deficits” To Impact UK Assets
Gold in GBP has risen another 3.5% in the last 3 trading days as the British pound continues to be “pounded” on international markets. Gold in GBP terms is now 43% higher year to date and has risen from £716/oz on January 1st to £1024/oz today.
Sterling is now the worst performing major currency in 2016 and gold the best.
Gold in GBP (10 Years)
The pound has completed its worst four day performance since Brexit and the pound remains considerably weaker versus the dollar, euro and gold since the Conservative Party conference, when Theresa May promised to trigger article 50 within six months.
Heavy losses sent sterling down by another 2 per cent yesterday to below $1.21 against the dollar, while against the euro, the pound fell below €1.10.
The pound has bounced back a little today but market participants are increasingly alarmed at the political prospect of a severe rupture between the UK and EU. All the focus has been on the real risks posed by a “Hard Brexit” but another major risk is being greatly underestimated. There is also the significant risk posed by the very poor financial situation that the UK finds itself in – with its massive twin deficits.
HSBC’s respected currency analyst David Bloom warned in a note:
“the question we have asked hundreds of investors throughout the world is do you want to buy a currency that has massive twin deficits with an unknown political direction and for that risk you can get zero rates?”
UK gilts have come under selling pressure in recent days and the yield on the 10 year is now at 1.03%.
The UK current account and budget deficits combined are around 10% of UK GDP. The UK budget shortfall was 33.8 billion pounds ($44 billion) in the first five months of the 2016-17 fiscal year. The UK budget deficit for August alone was £10.5 billion, higher than economists forecast.
Kit Juckes at Societe Generale in London warns that the demise of the UK currency could soon start impacting a broader range of assets:
“Press comment is now shifting to embracing the positive effects of a weak Pound and in due course that’ll be true but any further weakness from here might simply reflect loss of confidence and be bad for UK assets (gilts, equities, house prices, you name it…) in general.
“The market’s very short, but if Sterling weakness starts to feed weakness across assets, we will have all the conditions for a classic overshoot to start.”
Currency analysts expect sterling to fall a lot further which underlines the value of owning gold, both against local currency depreciation and also the loss of value of UK assets denominated in sterling.
HSBC is forecasting GBP—USD at 1.20 by year end and 1.10 by end 2017, taking EUR–GBP to parity. Morgan Stanley is targeting 1.24 in USD and 0.92 for EUR—GBP “relatively soon.”
Sterling dived 10% against US dollar in seconds last Friday night but the trade was later cancelled. Despite the cancelling of the allegedly “rogue trade”, a “flash crash” of 6% was still registered.
With this hugely volatile and uncertain backdrop, allied to the uncertain global geo-political and economic outlook, we are confident that gold in GBP terms will reach new nominal highs over £1,200/oz in the coming months, from £1,024/oz today (see chart above). It remains an important diversification and hedge for UK investors, savers and pension owners.
end
To understand gold you must realize that the market is just not normal
(courtesy Chris Powell/GATA)
Understanding gold begins with realizing that its market isn’t normal
Submitted by cpowell on Tue, 2016-10-11 19:52. Section: Daily Dispatches
4:06p ET Tuesday, October 11, 2016
Dear Friend of GATA and Gold:
When he’s not touting mining stocks in which he has invested, 321Gold’s Bob Moriarty is assuring his readers that everything in the monetary metals markets is perfectly normal and that anyone who expresses contrary suspicion is not merely mistaken but stupid, a charlatan, and a scam artist.
So it is again with Moriarty’s commentary published today at The Gold Report, “The Wolves Get the Golden Fleece as the Sheep Get Shorn One More Time”:
http://www.theaureport.com/pub/na/the-wolves-get-the-golden-fleece-as-th…
“The gold and silver markets,” Moriarty writes, “are filled with wolves that want nothing more than to get your money in exchange for feeding your fantasies. At every market low they are whining about how the bullion banks are manipulating the gold price and keeping it suppressed. At every high they are suggesting a Comex default is about to happen and prices are going to skyrocket. Or the market is about to have a ‘commercial signal failure.’ Of course they just made it up.
“Comex can’t default; there are provisions in every commodity market for cash settlement.”
Yet legal as it may be, “cash settlement” is exactly what many people mean by a default — the failure of a counterparty to deliver what was promised and expected. Moriarty knows very well that this is how his adversaries define default and indeed how the readers of his adversaries understand it.
If there were no provisions for cash settlement, Moriarty adds, “anyone with pockets deep enough could force every commodity market into failure.”
Indeed, and anyone with pockets deep enough can control any commodity futures market. But Moriarty has not the slightest curiosity about the surreptitious intervention by governments and central banks — which have the deepest pockets — in the commodity futures markets, intervention documented by filings with the U.S. Commodity Futures Trading Commission and the Securities and Exchange Commission:
http://www.gata.org/node/14385
http://www.gata.org/node/14411
Moriarty continues: “We hear about how the shorts are into ‘naked short selling’ one more time even though there is no such thing.”
Yet even the lowliest trader working out of his parents’ basement can open a commodity futures trading account and, having posted a certain amount of earnest money, sell a contract for a commodity he does and may never own.
“Some of these fools,” Moriarty writes, “want to convince their readers that the central banks are behind a ‘gold takedown,’ but if you go to Google and put in ‘central banks buying gold’ you can find dozens of articles showing that, contrary to the con men, actually the central banks are buying gold.”
Yes, a few central banks outside North America and Europe lately have reported buying gold. Most central banks lately havenot reported buying gold, even as the Bank for International Settlements, the central bank of the central banks, recently reported reviving its gold swap operations and the director of market operations for the Banque de France, another central bank that has not reported adding to its gold reserves, told the London Bullion Market Association meeting in Rome three years ago that his bank is secretly trading gold for itself and other central banks “nearly on a daily basis”:
http://www.gata.org/node/16704
http://www.gata.org/node/13373
That is, there is a lot more activity by central banks in the gold market than the occasional purchase announcements cited by Moriarty.
Moriarty goes on: “Yet another writer on one of those single-string banjo-playing web sites said he doubted the central banks had half the gold they claim, but through Google we now know that not only have the central banks been buying gold, they have been buying gold stocks with both hands.”
But even the International Monetary Fund has admitted that central banks have done a lot of gold “leasing,” which means that certain gold reserves are, to put it politely, impaired, and that doubts about those reserves are well-founded:
http://www.gata.org/node/12016
As for central banks “buying gold stocks with both hands,” the most we can find on this point is Zero Hedge’s report a month ago that two central banks, Norway’s and Switzerland’s, lately have bought gold stocks:
http://www.zerohedge.com/news/2016-09-08/switzerland-and-norway-begin-ma…
Maybe other central banks have bought gold stocks too, but if such purchases have been reported, GATA has missed them and maybe Google has missed them too. At least GATA is a little less credulous than Moriarty, as we concede that Google is not the final word, that Google doesn’t know everything, in part because central banks don’t tell Google everything.
Back to Moriarty: “One word the experts, the gurus, and all the other fools never use is ‘correction.’ All markets go up and down. It’s the way of the world. A market enters a bull phase but it will correct. A market enters a bear phase but it corrects. If you are reading anyone taking about naked short sales or Comex defaults or gold takedowns and you never hear the word ‘correction,’ either the writer is a fool or you are. And in the greatest bull market in history, you are going to lose all your money because at the very top they are going to be telling you to buy.”
But Moriarty is the one always telling people to buy — to buy the stocks he already has bought.
Fools and charlatans as we may be, GATA is telling people that 1) central banks have been surreptitiously manipulating the gold market for longstanding policy reasons involving the defense of their currencies and bonds, manipulating markets so much lately that it’s barely surreptitious anymore; 2) that this manipulation is destroying market economies and doing great injustice around the world; 3) that justice, if and when it comes, will be a cosmic correction made endurable only by a form of money without counterparty risk, the ultimate money, the money whose market central banking has always sought to control — gold; and 4) there is no understanding the gold market and the world financial system generally without discerning what central banks are doing with the gold market — that the gold market is not the normal market Moriarty likes to imagine.
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
CPowell@GATA.org
END
Bill Holter discusses the walking zombie bank Deutsche bank
(courtesy Bill Holter/Greg Hunter/USAWatchdog)
Deutsche Bank Walking Dead-Bill Holter
By Greg Hunter On October 12, 2016
By Greg Hunter’s USAWatchdog.com
Financial writer Bill Holter says if you want to know how bad the global financial problems are in the world, start with Germany’s Deutsche Bank (DB). The problems keep mounting, and it’s been all downhill since June when the International Monetary Fund (IMF) deemed DB as the most systemically dangerous bank in the world. Holter warns, “Deutsche Bank is dead. It’s a walking dead institution. . . .Just the fact that there is a debate, whether or not there’s a problem, means they’re dead. Once you start talking about a financial institution and whether or not they are solvent or not, it doesn’t matter. The sharks are going to come into the water.”
There is much more wrong than just the one global mega bank in trouble. Holter goes on to point out, “The markets need to be and pretty much have been locked down. We’ve seen virtually zero volatility in the stock market, and even the credit markets have been nonvolatile for the last two or three months. The reason being when volatility picks up, then margin calls happen. When you’ve got an illiquid system, you can’t allow margin calls to occur because margin calls can’t be met.”
Holter, who has decades of financial and broker experience, circles back to DB that he estimates has a $15 billion market cap. This may seem like a lot of money, but Holter contends it is not much with trillions of dollars in derivative exposure. Holter explains, “$15 billion would not even cover a 1% move in their book. A 1% move would be something like $50 billion. So, they (DB) are so undercapitalized that any type of margin call turns them upside down. Deutsche Bank is one of the biggest links in the derivatives chain. If they break, the whole thing goes. . . . This is not a Bill Holter opinion. This is math.”
In the second Presidential debate, Donald Trump said his opponent Hillary Clinton “would be in jail” if he were President. Holter contends, “I have been saying for months now, there is a better than a coin toss chance that we do not have an election. During the debate, Trump basically said he’d have his Attorney General appoint a Special Prosecutor, and you (Clinton) are going to go to jail. The problem is it’s not just Hillary. It goes throughout all of Washington, and it includes both the Democrat and Republican Party. If it looks like Trump is going to win, and he does not get assassinated, they may cancel the election by starting a war.”
Holter closed by saying, “The conservatives are not going to be separated from the liberals. When this thing goes down, it’s going to be all the American people. If this election gets stolen, all American people are going to be targeted. We are all going to be destroyed. . . . Between now and the election is extremely, extremely dangerous.”
Join Greg Hunter as he goes One-on-One with financial expert Bill Holter of JSMineset.com.
(There is much more in the video interview.)
Video Link
http://usawatchdog.com/deutsche-bank-walking-dead-bill- holter/
-END-
A thorough analysis of what is going on in the class action suit against Deutsche bank, Bank of Nova Scotia, HSVC and Societe Generale
(courtesy Market Slant)
Market Slant: What happens next in antitrust suit against London gold fix banks
Submitted by cpowell on Wed, 2016-10-12 00:55. Section: Daily Dispatches
8:56p ET Tuesday, October 11, 2016
Dear Friend of GATA and Gold:
Market Slant, which last week broke the story about the advancement of the antitrust lawsuit against the banks involved with the daily London gold fix, today examines the discovery procedures ahead as the plaintiffs pry evidence out of the defendants, a process that could take a long time but also produce much incriminating evidence. Market Slant’s report is headlined “Gold Fix: ScotiaBank Ordered to Produce Internal Documents” and it’s posted here:
http://www.marketslant.com/articles/gold-fix-scotiabank-ordered-produce-…
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
CPowell@GATA.org
END
Scotia must go first and supply emails
(COURTESY MARKET SLANT/FROM THE ABOVE STORY)
UPDATE:Scotia Bank Gets Tapped for Documents
Today, we learned that Scotia Bank, one of 5 defendant banks in the case, is the first to be ordered to produce internal documents requested by the plaintiffs. These documents go back years covering emails, Instant Message records, internal memorandums, notes from risk meetings and anything the plaintiffs’ attorneys think to ask for that could help their case. Things are about to start getting interesting. Here’s why.
Why Things are Different Now
Judge Caproni’s decision was a landmark event for the plaintiffs. It is the first time that a precious metals manipulation case had made it past the “Opinion and Order” stage with a recommendation the case be litigated.
The decision is key in that the plaintiffs will be able for the first time to obtain evidence through discovery and depositions of the defendants. We cannot emphasize that enough. A barrier has been broken that cannot be put back in place. The production of discovery, depositions of witnesses, and other evidentiary processes have never been on the table before are now accessible.
The Defendants Have Risk
Using a different analogy, cans of worms are being opened now. The defendants have real risks now. Risks like: perjury, internal contradictions, contradictions across different firms, and escalation up the corporate ladder (respondeat superior). The defendants know it. And Daniel Brockett, the point man for the plaintiffs knows it.
“They have to produce all the relevant emails and chat room instant messages, however they communicated with each other”--Daniel Brockett, senior partner and litigator at Quinn Emanuel Urquhart & Sullivan LLP
So, to what ends do these requests for documents serve?
What Do the Plaintiffs Hope to Find?
Broadly speaking, we believe the plaintiffs’ attorneys hope to find 2 types of proof from the documents; proof of intent and proof of Sherman Antitrust law violations. In essence: 1) Did they mean it? and 2) Were they working together?
Proving Intent-The Plaintiffs’ attorneys will look for evidence of intent. Intent is the most difficult part to prove in any manipulation case. Intent involves knowing what the “manipulator” was thinking leading up to the action. Essentially, did the offender intend to do what he did? There are at least 3 ways of proving intent, none of which are easy.
The defendant admits it- a product of depositions and/or discovery
A written audit trail that shows intent exists- discovery
An email in which a defendant describes why he did a trade- a written admission
An internal inquiry asking for justification in the scope of the firm’s risk- usually involves a superior officer and getting the 2 parties to contradict each other in deposition
An operational or programming person was made privy to the intent as a function of their duties.- underutilized in our opinion
These are very real risks and if the defendants don’t “get their story straight” (not pejorative), any divergence between word and deed can hurt their credibility and open the door for more aggressive tactics by the plaintiffs.
Proving Antitrust Law Violations-The plaintiffs will seek putative damages under the Sherman Anti-trust act. Specifically under Section 1 governing unlawful restraint of trade. Section 1 delineates and prohibits specific means of anti-competitive conduct. The plaintiffs seek to prove collaboration between 2 or more defendant banks. They will attempt to prove cartel-like behavior between the defendants. The burden of proof here, even with evidence is high.
As stated in Judge Caproni’s decision(emphasis ours):
“Because the Sherman Act does not prohibit [all] unreasonable restraints of trade . . . but only restraints effected by a contract, combination, or conspiracy, . . . [t]he crucial question is whether the challenged anticompetitive conduct stem[s] from independent decision or from anagreement, tacit or express.”
Sherman Anti-Trust Act, Section 1:
“Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal.”
The purpose of the Sherman Act was to preserve a competitive marketplace and protect consumers from abuses. However its more recent applications involve the prevention of cartel operations or monopolies (Wikipedia). Certainly an email from an employee of Scotia Bank to one of its fellow defendants describing what it has done or intends to do would serve this purpose well. But the burden of proof is high.
Even with the uphill battle ahead for the plaintiffs, Brockett was not blowing hot air when he said,
“The ruling is a major victory for the plaintiffs because it upholds the core anti-trust claim against the five fixing banks, and the statutory commodity manipulation claim against the five fixing banks.”
What’s Next
Requests for documents will come in for each defendant.
Plaintiff attorneys will review the documents and drawn up their plan of attack.
Depositions of defendant personnel will occur as plaintiffs will look for contradicting and/or corroborating statements of the documents reviewed
New requests are made
Defendant Legal Tactics
The following are legitimate reasons for difficulty complying with a court order. They are however easily abused.
Delay: “Those documents have been archived. It will take time to get them”
Inability to Comply: ” ..and some of them have been destroyed as a matter of the statute for keeping records has expired”
Redirect: “check (former employee) their personal cell phone records”
No longer works here: “We do not employ that person anymore”
Trade Secrets: “We cannot give you information that our competitors can use to destroy our business”
The Peter Gabriel: ” I don’t remember, I don’t recall”
Lesser Evils Get Ranked
The Prisoner’s Dilemma grid will come into play, even if nothing was done wrong. There will be triage as well.
Contempt over perjury
Perjury over fraud/ intent
Fine over jail
Rogue employee over Ceo scandal
Why This is Far from Over
The law operates on facts, not intuition. That means inductive logic, patterns of abuse, and circumstantial evidence don’t prove intent.In manipulation cases, intent is the hardest leg to prove of the 3 legged stool concept in law. Judge Caproni said as much in her decision.
From Page 1
Whether the detailed statistical analyses contained in the Complaint reveal ground truth about the activities of the Defendant banks who participated in the Gold Fix or are on the “lies, damn lies and statistics” side of the dichotomy remains to be seen.
In context of her whole statement we take that to mean: “In my judgment you have met the burden of proof and have the right to seek the facts you need to corroborate your statistical conclusions. But statistics are not facts, they are probabilities. You will need facts after today.”
DeutscheBank Opted Out
h/t Silverdoctors
Final Word From the Players Themselves
For The Plaintiffs
“So we’ll be able to tell from the communications whether the traders were actually agreeing to manipulate the gold fix price for their own personal gain, which is what we allege.”- Daniel Bockett
They may be able to tell. Doubtful if the communications alone will offer a smoking gun, as cool as that would be. A world of grey exists here.
For The Defendants
“We are unable to comment as the matter is still before the courts,”- Rick Roth for Scotia
We bet you are unable to do a lot of things, like produce documents in a timely manner if at all.
END
Scotia bank is ordered to provide emails immediately in the gold manipulation case:
(courtesy Kitco/Market Slant)
Scotia Bank Pressed For Emails In Gold Manipulation Case
Tuesday October 11, 2016 12:07
(Kitco News) – Move over Hillary Clinton, Scotia Bank is now being pressed for internal emails in a trial looking to shed light on allegations of gold manipulation involving five major banks.
Last week, Kitco News broke the news that a New York judge said there is validity behind manipulation allegations in a class action lawsuit involving five banks accused of manipulating gold prices through the twice-daily London Fix.
The London gold fix, the benchmark used by miners, jewelers and central banks to value the metal, may have been manipulated for a decade by the banks setting it, researchers said.
However, the Judge dismissed all claims against global firm UBS, leaving The Bank of Nova Scotia, Barclays, Deutsche Bank, HSBC, and Societe Generale still facing manipulation charges.
On Tuesday, the Financial Post reported that Canada’s Bank of Nova Scotia will now have to turn over internal emails and other correspondence spanning several years, this according to their source, Daniel Brockett, the New York lawyer leading the U.S. lawsuit. Kitco News confirmed the news with a source close to the matter.
“They have to produce all the relevant emails and chat room instant messages, however they communicated with each other,” Brockett said in an interview with the Financial Post. Brockett is a senior litigation partner at Quinn Emanuel Urquhart & Sullivan LLP.
By Daniela Cambone of Kitco News; dcambone@kitco.com
END
Your early WEDNESDAY morning currency, Asian stock market results, important USA/Asian currency crosses, gold/silver pricing overnight along with the price of oil Major stories overnight
:
1 Chinese yuan vs USA dollar/yuan DOWN to 6.67175( REVALUATION NORTHBOUND /CHINA UNHAPPY TODAY CONCERNING USA DOLLAR RISE/MORE $ USA DOLLARS LEAVE CHINA/OFFSHORE YUAN NARROWS TO 6.67218 / Shanghai bourse CLOSED DOWN 6.72 POINTS OR 0.22% / HANG SANG CLOSED DOWN 142.47 POINTS OR 0.60%
2 Nikkei closed DOWN 184.76 OR 1.09% /USA: YEN RISES TO 103.72
3. Europe stocks opened ALL IN THE RED ( /USA dollar index UP to 97.76/Euro DOWN to 1.1023
3b Japan 10 year bond yield: FALLS TO -.056%/ !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 103.72/ THIS IS TROUBLESOME AS BANK OF JAPAN IS RUNNING OUT OF BONDS TO BUY.
3c Nikkei now JUST BELOW 17,000
3d USA/Yen rate now well below the important 120 barrier this morning
3e WTI:: 51.06 and Brent:52.63
3f Gold DOWN /Yen DOWN
3g Japan 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./“HELICOPTER MONEY” OFF THE TABLE FOR NOW /REVERSE OPERATION TWIST ON THE BONDS: PURCHASE OF LONG BONDS AND SELLING THE SHORT END
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 RISES QUITE A BIT to +061%
3j Greek 10 year bond yield FALLS to : 8.24%
3k Gold at $1252.00/silver $17.41(8:45 am est) SILVER FINAL RESISTANCE AT $18.50 WILL BE DEFENDED
3l USA vs Russian rouble; (Russian rouble DOWN 15/100 in roubles/dollar) 62.54-
3m oil into the 51 dollar handle for WTI and 52 handle for Brent/
3n Higher foreign deposits out of China sees huge risk of outflows and a currency depreciation (already upon us). This can spell financial disaster for the rest of the world/China forced to do QE!! as it lowers its yuan value to the dollar/GOT a REVALUATION UPWARD from POBC.
JAPAN ON JAN 29.2016 INITIATES NIRP. THIS MORNING THEY SIGNAL THEY MAY END NIRP. TODAY THE USA/YEN TRADES TO 103.72 DESTROYING WHATEVER IS LEFT OF OUR YEN CARRY TRADERS
30 SNB (Swiss National Bank) still intervening again in the markets driving down the SF. It is not working: USA/SF this morning .9898 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.0908 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 VOTES AFFIRMATIVE BREXIT
3r the 10 Year German bund now NEGATIVE territory with the 10 year RISES to +.061%
/German 9+ year rate BASICALLY negative%!!!
3s The Greece ELA NOW at 71.4 billion euros,AND NOW THE ECB WILL ACCEPT GREEK BONDS (WHAT A DISASTER)
The bank withdrawals were causing massive hardship to the Greek bank. the Greek referendum voted overwhelming “NO”. Next step for Greece will be the recapitalization of the banks and that will be difficult.
4. USA 10 year treasury bond at 1.789% early this morning. Thirty year rate at 2.519% /POLICY ERROR)
5. Details Ransquawk, Bloomberg, Deutsche bank/Jim Reid.
(courtesy Jim Reid/Bloomberg/Deutsche bank/zero hedge)
HELICOPTER MONEY STILL ON THE TABLE FOR THE FUTURE/JAPANESE STIMULUS PLAN DISAPPOINTS
Global Stocks Pressured By Weak Earnings, Rate Hike Concerns; Pound Jumps
Global stocks are pressured this morning after a plunge in the Thai stock market and currency on concerns about the king’s health and Fed hikes coupled with some more bad news out of Samsung which cut profit estimates by a third, while European stocks are suffering after Swedish telecom giant Ericsson issued a profit warning, sending its shares plunging 17%.
The big macro story is the jump in the sterling which soared as much as 200 pips after Theresa May accepted a debate on a motion from the opposition Labour Party today who are arguing for a ‘full and transparent debate on the government’s plan for leaving the EU’ and which will allow for MP’s to be able to ‘properly scrutinize’ the government’s plan prior to the start of formal negotiations. The motion will be debated in Parliament today. However, according to Bloomberg May did table an amendment that added that there shouldn’t be an attempt to block Brexit or undermine the government’s position and while there is no binding result attached the fact that there will at least be some discussion amongst Parliament is slightly easing some of those hard Brexit concerns this morning.
“The vote is a major concession that does reduce the room to maneuver for Theresa May’s government in the negotiation,” said Hans Redeker, Morgan Stanley’s chief global currency strategist in London. “That is currently read as positive for sterling.”
Meanwhile, the next potentially interesting event for the fate of sterling comes tomorrow where the High Court will deem whether or not an Act of Parliament is needed for Article 50 to be triggered. A second hearing is scheduled for October 17th. A loss for the government would then force the issue into the House of Commons and House of Lords which could lead to delays although we’d expect appeals in such an outcome. One to watch however.
Ericsson AB sank 17 percent after the Swedish network maker reported a slump in third-quarter sales and profitability, dragging a gauge of technology shares to the worst performance of the Stoxx Europe 600 Index’s 19 industry groups. BASF SE rose 0.6 percent after the world’s largest chemical maker posted a smaller-than-expected decline in quarterly profit. Fresnillo Plc slipped 2.2 percent as the precious-metals miner said silver production slowed in the third quarter from a year earlier due to personnel issues and availability of equipment.
“The market will need some reassurance that a soft start to earnings season has been nothing more than a few outliers,” said Alan Higgins, chief investment officer at Coutts & Co. in London. His firm oversees the equivalent of $18 billion. “Investors are also building in a higher probability of a Fed hike as each week goes past. These next few months will be very busy.”
The MSCI Asia Pacific Index dropped 0.6 percent. Hong Kong’s Hang Seng Index retreated 0.6 percent in a third day of losses as Bank of China Ltd. and Bank of Communications Co. sank more than 2.8 percent. In Japan, the Topix lost 1 percent.
Aside from Europe, the MSCI Asia Pacific Index retreated to a three-week low. Thailand’s stock market and currency extended this week’s losses after the royal palace said Sunday that King Bhumibol Adulyadej’s condition was unstable.
Emerging markets are once again feeling the heat on concerns a Fed hike may lead to a return in capital outflows from EM, leading to preemptive. The Bloomberg Dollar Spot Index, a gauge of the greenback against 10 major peers, was little changed after rising for the past two days and closing at the strongest level since July 25 on Tuesday. Investors will scrutinize minutes from the Fed’s latest decision due Wednesday, with odds of a U.S. rate increase by year-end climbing to 68 percent amid speculation the recent surge in oil prices will fuel inflation, based on futures data compiled by Bloomberg.
Responding to the stronger dollar, China’s central bank weakened the yuan’s reference rate for a sixth day, pushing it to the lowest in 6 years with a USDCNY fixing of 6.7258, down 5.5% Y/Y, the longest run of cuts in n