A Big, Fat Zero (public)

The subscriber base reached a consensus over the weekend that important articles such as this one should always be made "public" within 24-48 hours. So here you go...

A doughnut. A cookie. A goose egg. Call it what you want and it's still the same. A big, fat zero. It's not often that I get all worked up on a Saturday but, when I noticed this, it was clear that I needed to write up a new post.

"What in the world are you talking about, Turd?'"

Comex August gold delivery notices. Would you like to know how many went out yesterday? Zero. Zilch. Nada. In other words...none.

And this is happening in the midst of an incredible surge of global demand for physical gold. To refresh your memory or in case you missed it, this data comes from a World Gold Council (not exactly our best friend) report that summarized global demand for the second quarter.

On the demand side we have:

  • Demand from India and China alone in Q2 was 310 tonnes and 276 tonnes or 586 tonnes combined. This demand alone vastly outnumbers the ETF outflows.
  • Globally, jewelry demand was up 37% in Q2 2013 to 576 tonnes (t) from 421t in the same quarter last year, reaching its highest level since Q3 2008. In China, demand was up 54% compared to a year ago; while in India demand increased by 51%.
  • There were also significant increases in demand for gold jewelry in other parts of the world: the Middle East region was up by 33%, and in Turkey demand grew by 38%.
  • Bar and coin investment grew by 78% globally compared to the same quarter last year, topping 500 tonnes in a quarter for the first time.  In China, demand for gold bars and coins surged 157% compared with the same quarter last year, while in India it jumped 116% to a record 122t. Taking jewelry demand and bar and coin investment together, global consumer demand totaled 1,083t in the quarter, 53% higher than a year ago.
  • For the tenth consecutive quarter, central banks were net buyers of gold, purchasing 71t, which reinforces the trend that began in Q1 2011

But on the supply side of the equation, we have this:

  • On the supply side, recycling fell 21% in the quarter while mine production was 4% higher than a year ago, at 732t. In total, supply was 6% lower than a year ago.

I would also ask you to once again consider these charts. Thank you, Jesse! (http://jessescrossroadscafe.blogspot.com/2013/08/comex-gold-remains-at-low-levels-owners.html)

So, let me see if I've got this straight...

Global, physical demand is surging and even on The Comex we've seen this this trend influence things. How?

Last December, a month that is typically one of the biggest delivery months of the year for Comex gold, I was surprised to note that The Comex only delivered 3,253 contracts. Then, once February rolled around, got an even bigger surprise. For the February delivery month, The Comex delivered 13,070 contracts. Holy cow, that's a lot! The trend continued in April as The Comex delivered 11,632 contracts and June saw 9,869 delivered. But now in August....even though there have been no signs of decreased global demand....there have only been 2,965 deliveries? AND ZERO YESTERDAY? Seriously??

And what if I threw this next log on the fire???...

The cumulative total deliveries for the last four delivery months is 37,824 contracts. During that period, JPMorgan settled (stopped) a total of 2,162 contracts directly into their proprietary (house) account. That's 5.71% of all deliveries for the past four delivery months.

This month, of the 2,965 gold deliveries made through last Thursday, JPM had stopped into their house account 2,151 of them (72%). That's interesting, isn't it? Just this month alone, JPM has stopped as many contracts for themselves as they had in the previous four months combined.

But wait, there's more...Over the past nine days (8/5 - 8/15), The Comex has delivered just 1,003 contracts and the JPM house account has stopped 945 of them. That's 94%! And now yesterday, 8/16, The Comex has no deliveries at all? Seriously??

So now, suddenly, even though global demand does not seem to be falling off, The Comex is on a run rate of just 4,000 deliveries again. Hmmm. The average total deliveries for the previous three delivery months this year is 11,524 and yet this month is coming in 60% less? Seriously??

Does anyone else see and smell a very smoky fire here? Here are just some random dots. Feel free to connect them:

  • The CoT and BPR reports show that JPM has flipped a 50,000+ contract net short Comex position into an 85,000+ net long position over the past eight months.
  • Though they had shown very little interest in silver deliveries earlier this year, JPM's demand for silver deliveries into their house account rose to 2,824 of 3,444 total Comex deliveries for July. That's 82%.
  • First Notice Day for the July silver contract was Friday, June 28. On that day, silver rose 92¢ from $18.60 to $19.52. By July 16th, it had risen to $20. Yesterday, it closed at $23.37.
  • First Notice Day for the August gold contract was Wednesday, July 31. It was a very volatile day. Gold traded $15 higher before closing $20 lower at $1313. Yesterday, gold closed at $1371 and then traded even higher on The Globex with cash gold closing at $1376.

So, if you're like me and you think that this points to even higher prices ahead, you'd probably like some charts with a few mileposts for the road ahead. Here you go. The journey won't be easy but it certainly seems to be heading in one direction.

OK, I think I'll stop there. It's after noon on a Saturday and MrsF is calling. Go now and get some rest. I'm going to need you back here on Monday with your gameface on. It promises to be a very interesting week and remainder of the month...and year....and next year...

TF

90 Comments

Turd Ferguson's picture

Re public releases

MODERATOR

Maybe we'll do one of these per week, depending upon the timeliness and importance of the content.

Orange's picture

Bix

Turd any Comments?

Just a heads up to those whose emotions are affected by violent moves in gold and silver prices...
 
HANG ON TIGHT THIS WEEK!
 
There are a few things that are pointing to something big hitting this week or next. This would be OFFICIAL market manipulation moves and not necessarily the handy work the banking cabal working on their own. Obama is calling in all the heads of the big financial regulators for meetings tomorrow...in which he usually gives them "stand down" orders on market surveillance for an upcoming operation. 
 
Also, the silver COT's are showing that SOMEONE is massively shorting on the latest rise in the price of silver. Although in the past it has usually been JP Morgan, I believe that it may be someone else this time...a non-regulated hedge fund like BLACKROCK. This would be part of their takeover plans of the silver rigging reigns.
 
Not sure if they will spike the price up or down but in the past it has been down. Again, my advice to everyone is to sit on the sidelines with physical metal in hand and wait out the manipulations.
 
FYI - You should be excited about these moves because this is all part of the END GAME. The more action we see....the closer we are to the END!
 
May the Road you choose be the Right Road.
 
Bix Weir
 
PS - For those who missed my alert last Friday about getting out of Gold you can find it here..
 
ALERT: Get out of GOLD and into Silver NOW!
 
 
ArtL's picture

GOFO still negtive!

is this the beginning of the permanent backwardation that Professor Fekete was talking about?

Turd Ferguson's picture

Time will tell, I guess

MODERATOR

It promises to be a wild week, nonetheless.

Response to: Bix
Turd Ferguson's picture

It sure looks like it.

MODERATOR

It sure looks like it.

Response to: GOFO still negtive!
hai's picture

World Gold Council's Grubb: Speculative Shorts Caused Gold Plung

World Gold Council's Grubb: Speculative Shorts Caused Gold Plunge

Very interesting interview. Grubb says futures, not ETFs were the source of the decline. In fact, "to some degree, the ETFs have become a source of physical gold for the market. If you have backwardation in the gold futures, the ETFs almost become a cheap source of physical gold for consumers who are prepared to pay a premium in Eastern markets," he said.

thesandbox's picture

got bling?

wink

Blinged out: New Apple iPhone may be gold

Apple will be selling its next generation iPhone in a gold shade, according to a report.......a new low-cost iPhone dubbed the iPhone 5C, are reportedly going to be revealed Sept. 10, according to All Things D. It's also been rumored that the new iPhone 5C will feature a fingerprint scanner, which would allow the iPhone owner to unlock their phone with their finger.

I guess those with bling will be giving the gov't their fingerprints now as well! surprise

Got Bling?

thesandbox's picture

Is the government trying to break up JPMorgan?

http://www.cnbc.com/id/100972097

"The United States government has made it a priority to break this company," said Dick Bove, vice president of equity research at Rafferty Capital Markets. "In my view, it wants the firm broken up and it wants the management changed. Every action that it has taken in the past few years is oriented toward this goal."

Bove alleged that there are "eight U.S. government agencies seeking ways to harm" JPMorgan and purposely linked confidential documents to the Times as part of the effort, in which he believes the press also has been complicit.

"The government and the press are out to breakup JPMorgan Chase," he said. "Its shareholders have a stake in this attack. They need to be careful."

spin? propaganda? foretelling? disinfo? ????

Kcap's picture

Lets see.

This "could" be the perfect contrarian trap tomorrow.

What if the metals MOPE training has been deemed effective?... and since the short-time shorts that have rushed back in very recently, could they be sitting ducks for an unexpected contrarian move tomorrow?

At the very least, we know the move has the potential to be big.  Its either look out below like April, or watch out above...in fact, put your jetpack helmet on....and take an anti-nausea pill as the negative-G's tomorrow (to the upside) could make you sick.  (which would be a great thing)

For the faint hearted, sleep will not be easy tonight.

Kcap

Ps.  I am going with the latter.

Mudsharkbytes's picture

Seventh on the freebie post?

Thanks for making this public!

TheGoodDoctor's picture

Thanks Turd.

Thanks Turd.

thesandbox's picture

CIA finally admits it masterminded Iran’s 1953 coup

Manipulation is, was, and shall be...in all areas where the govt is interested in its selfish desires.  The meeting with the pres and the regulators shall be nothing different no matter what the outcome is.

It was even about oil then....we've come such a long way...... blush

http://rt.com/usa/iran-coup-cia-operation-647/

....On the 60th anniversary of the 1953 military coup in Iran that overthrew the government of radical nationalist Mohammad Mossadegh, the US has declassified documents detailing how the CIA’s secret operation brought the country’s Shah back to power.

“American and British involvement in Mossadegh’s ouster has long been public knowledge, but today’s posting includes what is believed to be the CIA’s first formal acknowledgement that the agency helped to plan and execute the coup,” the US National Security Archive said.

Monday’s publication under the US Freedom of Information Act came as something of a surprise, since most of the materials and records of the 1953 coup were believed to have been destroyed by the CIA, the Archive said. The CIA said at time that its “safes were too full.”

The newly-revealed documents declassify documents about CIA’s TPAJAX operation that sought regime change in Iran through the bribery of Iranian politicians, security and army high-ranking officials, and massive anti-Mossadegh propaganda that helped to instigate public revolt in 1953....MORE

Do we have 60 more years to find out what the plans of today are????

JML-2012's picture

Delayed release of public article- without the member comments?

Turd- I appreciate the public release.  Although the answer appears obvious, I'll ask it anyway- so with delayed public releases of important articles like this from the locked regions of the Turd vault (Turd locker? :p), are non-subscribed Turdites still going to be restricted from seeing the original member commentary that pertained to it (230+ comments on the original post)? 

As so many others here have pointed out during the course of the recent site change, many of us find the greatest content value in the pertinent community insights found in comments section.  It would great if that material came along with publicly released articles.  Not bitching or trying to tell you how to run your site, just wondering if that's how its going to be.

Thanks again.

AlienEyes's picture

My Fault.

I bought a gold oz over the weekend. Monday, southbound and down. Seriously, it has never failed since I found that doll with a nail through it in our mailbox.

boatman's picture

bugzy..........bond yield

while the FED is buying 80% of new bond issues,  many entities buy and sell EXISTING bonds in the usual buyers bid offers vs. sellers actual selling price that moves the price of anything in a market up or down....... 

as selling pressure increases bond value [and therefore price] goes down and this is directly reflected immediately in the yield%.

if someone can say it better or correct me have at it. 

this is a subject that is somewhat counter-intuitive.........to me anyway.

***************************************************************

i echo JML-2012's comment above, also.

Bugzy's picture

Boatman

Thanks.

Yes, I understand the counter intuitive value ,V, yield thing.

So... the bond market as a whole has a big call in setting yields?

Many folk sell their original bond as they see/or fear rates rising and decide to get out to preserve their capital.

This puts a glut of bonds on the market which lowers the price to pay further. Thus effectively pushing the yields up - which then affects the yields primary dealers demand and as such the fed needs to pay these rates too?

So even though they are buying 80%, they are not just saying - let us call the yield "x", we rule har har har.

It is more of a supply and demand thing; in that the sop up supply and make LESS available so demand increases and as such the yield needed to sell them is lower? Yet on the other hand - supply is increasing, forcing yields higher, and that what we are seeing now? Folk fear inflation and are selling, and those who want to buy demand more interest.

************************************************************

I also echo Boatman's echo. Your stuff is interesting Turd. However, the collective knowledge of the group is my primary focus.

opticsguy's picture

Obama meeting with regulators

planning the bank holiday bail-in after the 10-year spikes.  What clout does the NCUA chief have, anyway?   The have a few accounts insured, I guess.

¤'s picture

Zig...Zag

I'm a bit wary how JPM appears to be telegraphing their seemingly big PM positions and their strategy that appear to be radically different then their past MO.

JPM has everyone wondering all kinds of  things which is exactly what they want.

I'm expecting a kick in the gut from them soon in order to really throw everyone off. Last thing they want is a crowded trade or to create any public sentiment or momentum.

Zig.....Zag. Get ready for it.

Bugzy's picture

And this is why we hold Gold

http://www.zerohedge.com/news/2013-08-19/indian-rupee-collapses-worst-day-20-years

Try stopping those Indians buying Gold any which way they can.

They ALL know how to preserve their wealth. Soon the whole world will awaken to it. Asia already has.

tyberious's picture

http://blog.milesfranklin.com/now-they-tell-you

"To finish, I'd like to make an "outrageous" prediction (not outrageous at all).  Gold will finish the year positive.  We need about a $300 run from here to do it and 4 1/2 months' time to do it in.  In reality a move like this could be done in a month, a week or even just a day or two.  In fact it can (I think likely) even be done while you are sleeping!  I still believe that some sort of "mark-up" is in the cards and may even be kicked off at the G-20 Summit by our angry trading partners.  As usual I have a question for you to ponder, if a "mark-up" of the price of gold had been decided on already...would JP Morgan be... A. short, B. long, C. really long, or D. really REALLY long and have the gold market cornered?  A no brainer right?"

sengfarmer's picture

bonds

Is this right?  As more bonds come on the market the price goes down because of the increased supply.  The yield then goes up because the new buyer gets the original interest rate plus the difference between the original price of the bond and what he has just paid.

This would increase his yield for holding the risky crap till maturity.

¤'s picture

2.9%

10 UST just double bumped it.

I'm not sure how long they'll let it hover close to 3% but I suspect they'll throw some type of monkey wrench at it soon (this week).

http://www.marketwatch.com/investing/bond/TMUBMUSD10Y?countrycode=BX

Boswell's picture

Your Munificence...

Is Magnificent!

(Just wanted to say that ;-)

Hawkman's picture

10yr now at 2.90

That is all.

-Jack

Edit: Agreed DPH, they can't let it hit 3%, look for wars and rumors of wars to drive it back down. For now the 'taper' must stand - at least until the Bernank steps down.

Irene's picture

@alien eyes

I hold a perfect 100% FAIL when it comes to buying PMs.  Each time I buy, the price goes down - often only minutes after.  Sunday night was no exception.  *sigh*

alan2102's picture

turd (following boswell)

Your Magnificent Munificence is  a Marvel of Magnanimity and Matchless, near-Miraculous Meritoriousness.

But it sure would be nice to read the community comments, too.  smiley

alan2102's picture

Irene

So Turd should post your calls, daily, at the top right, as the "Irene Index" -- the perfect contrary indicator on which all of us can clean up. Better than McGuire?

Bugzy's picture

Sengfarmer

No, I think the yield is just the spot yield, what you would pay TODAY for a new bond.

The old bond has an OLD fixed rate stamped on it - this cannot change - so if you sell your old bond to someone, they get that old rate locked in. So the ONLY variable in an old bond is the SELLING PRICE. This must reflect the CURRENT spot price, which has a fixed selling price BUT a debatable yield.

OLD - only selling price of the bond is variable - yield is locked.

NEW - only Yield is variable, price is locked.

Say you hold an old with a yield of 1% - you cannot sell it for the price you paid if current yield goes to 3% you would have to discount it.

So... as more become available on the second hand market,,,, the price must come down until equilibrium is reached. This in turn must translate to higher yield in the new bond spot price. I think,,, anyone?

gold slut's picture

Questions, questions...

@ Irene,

Don't worry, you are not the only one who has a natural talent for predicting the next drop in price...

@ DPH,

I very much agree with what you say about JPM trumpeting their positive PM position...  they do NOTHING unless it is to their advantage, NOTHING! (my suspicion glands are going bonkers).  As for this meeting with the big money people and the POTUS tomorrow, as with the last time something along these lines took place, I will repeat what I said then, whatever the reason and outcome, it won't be good for us little folk.  They don't meet to chat about how well things are going...

¤'s picture

50 year UST's?

It seems to me that at some point the US will introduce a 50 yr. UST in order to generate an additional revenue stream that's nothing more than another can-kicking maneuver.

With housing in the U.S. remaining tepid and with good paying full employment becoming scarcer (and housing becoming harder to  achieve by many) it seems to me that generational housing trends will allow for something like a 50 yr. UST concept  to develop into reality.

Without a robust housing demand there will be no stable economic recovery. Without plentiful full time well paid positions there will be no housing recovery.

With a 50 year mortgage available it'll make housing more affordable to more families even though it's a long term debt commitment. If the commitment by the home buyer is based on his families future potential housing needs then I see a 50 year mortgage...and UST...more likely then not.

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