Connecting The Comex Dots

Last week, there was a lot of hubbub regarding the record low Comex registered gold inventory. At the time, we suspected that the vault movements were due to December "deliveries" and today we got our answer.

Before we start, please go back and review this article from one week ago. We rushed to get it published last Tuesday as it was important for everyone to understand the context and likely rationale for the movement of the "gold" that left the registered vaults at an all-time low.

At the time we speculated this:

"So, here is how I think this all comes together and why I caution you against jumping to conclusions today.

Go back up and look at how much gold was reclassified yesterday between Brinks, HSBC and The Scoshe. Notice that the total is 201,345 ounces.

And how much "gold" did JPM allegedly deliver to their own, proprietary account back in December? Again, that number was 202,100 ounces.

And we went the entire month of December and all of January without seeing ANY sizeable deposits into JPM's Comex gold vault. JPM booked in one of those perfect and precise, two metric ton jobs back on January 4. This raised their total Vault to 409,396 ounces. On today's report it's still just 409,195 and still shows just 7,774 ounces of registered.

So, here's what I suspect...

This movement today of 201,345 ounces, out of registered and into eligible at Brinks, HSBC and Scoshe, is the actual "delivery" of "gold" for JPM from December. JPM now holds this "gold" in warrant or warehouse receipt form in their competitor's vaults and it's all in the eligible category. As February "deliveries" begin later this week, DO NOT BE SURPRISED if JPM now becomes the issuer with HSBC and Scotia taking "delivery". This would fit the pattern of the continual and endless, circle jerk parade that creates the illusion of physical delivery on the Comex and allows the exchange to claim and maintain dominion over the price discovery process.

One final item, however, and this is important: Again, let's wait to see what the Gold Stocks report shows tomorrow. Perhaps JPM will book in these ounces after all and place them back into the registered category. IF THEY DON'T, then we have another data point on the long list of signals indicating physical tightness in the global gold market. As recently as 2009, The Comex showed over 5,000,000 ounces of registered gold in its vaults. As recently as one year ago, the total Comex registered Vault exceeded 1,000,000 ounces. As of today, that number has fallen to a new all-time low of just under 74,000 ounces."

With today's latest CME Gold Stocks Report, it appears that this is precisely what transpired.

Again, the important points are these:

  1. The proprietary account of JPMorgan stopped (took "delivery") of 2,021 Dec15 gold contracts during the delivery month of December.
  2. No gold was moved at all during December.
  3. Suddenly last Tuesday, 201,345 oz get reclassified from registered to eligible at Brinks, HSBC and Scotia. See below:

And now look what was reported today. The latest Gold Stocks report shows ALL of that same gold finally being moved from Brinks, HSBC and Scotia. And where did it go? Directly into the eligible vault of JP Morgan. Note that JPM also booked in another one of those perfect and precise, 3 metric ton jobs, too:

So, this obviously connects all of the dots. JPM stopped over 200,000 ounces of gold for itself back in December and, just today, they finally booked in the gold, having it sent over from the House Accounts of HSBC and The Scoshe. This still leaves two important points, though:

  1. Once again, the Comex delivery process is shown to be nothing but a Bullion Bank Circle Jerk where a bank takes delivery one month, only to turn around and issue the gold back out the next. Rarely does gold ever actually leave the Comex vaulting system and, today's action notwithstanding, rarely does it even move from vault to vault.
  2. Total Comex registered gold remains at all-time lows. Though some gold has recently been re-classified from eligible to registered as Feb16 deliveries begin, the total Comex registered gold vaults still hold just 145,000 ounces with 3,687 Feb16 contracts still open and standing, representing as much as 368,700 ounces of delivery obligations.

As usual, we'll continue to monitor this entire charade closely as the month of February will, no doubt, bring a whole new set of interesting developments.

TF

21 Comments

Gamble's picture

Hey

Amble

Gamble's picture

I meant

Gamble amble gamble

Gamble's picture

How about 3rd

Ramble

Gamble's picture

4th

Samble

Gamble's picture

5th

Samble

What If's picture

6th

Keep Stacking

pbreed's picture

Next .....

JP Morgan will reclassify from eligible to registered and use the new found metal to smash price....

jrbro517's picture

First thru Fith

Quite the shamble

Danforth Coxwell's picture

If those mosquito's had…...

only washed their hands, we would not be having problems with the Zika virus today!

Pseudozero's picture

nice work

great commentary today!

how far can those 74,000 oz's be stretched?

indiana rod's picture

How Far Can Those 74,000

oz's be stretched?

542 times.

Swineflogger's picture

What Kind of Meds is Gamble On????

15th +or-

Gamble's picture

They could be

-74000 ounces in the vault! It doesn't matter period , they are the masters that control the universe ! What they decide the price is that's the price ! Take alook at what happened in silver the other day!

gamble 

bookers126's picture

Keith Weiner

Old Keith at Monetary Metals claims the fundamental price for gold in 2016 is $1,246 and the fundamental price

for silver is $14.20 and we will have a GSR of "around 88."  

But this guy never ever mentions the price fixin/riggin/manipulatin factors, he ignores all of it for some reason. No shock, he has been writing like this for years and I have never read any of his stuff that covers anything useful or helpful.  

Barfly's picture

obviously, paper "gold"

Is the only gold that is moving around the Comex wearhouse. The "deliveries" are clearly a part of the manufactured paper derivative price control mechanism. Only the appearance of a real market exists. There is no market.

Pseudozero's picture

hahaha

...to infinity, and beyond!

Gamble's picture

The kind you can only buy with

Fiat!!!!

gamble gamble

tanderson's picture

Thats the way to do it Danforth

From ignore to Hat tip,,that is the way to go Dan

AGAU's picture

Stretched??

those  shit biscuits could stretch a gnats asshole over trailer hitch 

ag1969's picture

My apologies

I thought I was putting this post and the one below in IWWTI.  I will leave the one below.  Why not?

ag1969's picture

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February 2, 2016 by

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