More Evidence That JPM Has Cornered Comex Gold

If I can bring all of this together, it will go a long way toward proving correct Ted Butler's theory on JPM's current corner of the Comex gold futures market.

So, let's start with Uncle Ted and his assertions. Recall that Ted is a first-rate analyst who has been trading commodities for about 40 years. He has paid particular interest to the silver manipulation for the past 20. He writes an excellent newsletter to which you can subscribe by clicking here: http://www.butlerresearch.com

Using the CFTC-issued weekly and monthly data (Commitment of Traders & Bank Participation Report), Ted has followed along over the past eight months of position changes and, over that time, the changes have been dramatic. As you know, The Bullion Banks were caught heavily short at the initiation of QE∞ last autumn. I contend that this entire manufactured correction scheme was initiated by The Bullion Banks to give them an opportunity to get out from under their naked short positions and move net long. Ted has concluded that it's not the Bullion Banks per se. Instead, the scheme was initiated by JPM solely for the benefit of JPM and, from a net short gold position in excess of 50,000 contracts last December, JPM has now transitioned into a net long gold position of more than 65,000 contracts. IF THIS IS TRUE, there can be absolutely no doubt as to:

  • The motive behind the counter-intuitive price correction AND
  • The certainty of a very large and significant UP move for gold in the very near future.

I did not set out to prove or disprove Ted's assertions. After following the Comex gold and silver deliveries these past 60 days, simple curiosity led me to do some research on recent delivery patterns. What I found not only piqued my interest, I think it proves Ted correct. And again, IF TED IS CORRECT, then there is most certainly a very big move coming in gold.

So, let's start here: After taking into their house account (again, this means stopping the metal to themselves, into their own, proprietary account) 280 of 3,922 Dec12 silver deliveries, 970 of 2,526 March13 silver deliveries, a big fat zero of 3,416 May13 silver deliveries, JPM stopped to themselves 2,824 of the 3,444 July13 silver deliveries. That's 82%. For obvious reasons, this anomaly got my attention.

As I've been chronicling here all month, this trend continued into the August13 gold delivery period. Last Thursday alone, the final day of August deliveries, the JPM house account took down 154 of the 164 Aug13 gold deliveries. This brings their monthly total to 3,151 of the 4,075 contracts delivered. That's 77.3%! What's more, after the initial surge of 1,962 deliveries on the 1st and 2nd of the month, the JPM house account claimed for itself 1,945 of the 2,113 remaining deliveries. That's 92%!

With this as inspiration, I went back and reviewed the previous delivery months for gold on The Comex. These delivery months in 2013 have been February, April, June and now August. What I found is startling.

Let's start with February. Before we begin, recall that for every buyer, there is a seller...and...for every person or entity taking delivery, there is an issuer from whose vaults that metal will flow. Further, keep this in mind...If you have been naked shorting paper contracts all month, you stand the risk that the entity on the other side of your trade will stand for delivery. So, it follows that, when we see one firm taking consistently taking delivery and another firm consistently issuing the metal, we can deduce who has been shorting all along and who has been buying. Does that make sense? I hope so. If it doesn't. then please re-read that info before proceeding. It is critical that you understand this.

OK, back to February. During that month, the Feb13 contract was in its delivery period. What initially caught everyone by surprise was the sheer volume of deliveries. After just 3,253 in Dec12, a month which is usually one of the biggest delivery months of the year, the delivery total for February surged to 13,070. Of that total, the DeutscheBank house account took 5,917 and the HSBC house account took 4,879. Between the two of them, they accounted for 82% of all Feb deliveries. And just whom was issuing this metal? JPMorgan. For the month, JPM issued 7,854 of the 13,070 delivery requests. That's 60%. Also getting in on the act was Scotia. They got clipped for the issuance of 3,644 contracts. That's 28%. So, the DB and HSBC house accounts took 82% of the deliveries while the JPM (house and customer) and Scotia house accounts supplied 88%. And don't forget, this was a lot of metal! Thirteen thousand and seventy Comex contracts is 1,307,000 troy ounces, which equates to 40.6 metric tonnes.

Suddenly, the deliveries for March surged, too. Instead of the moribund 500 or so settlements that we typically see in this "non-delivery" month, March13 saw an incredible 4,229 made...more than last December! I'm quite certain that that has never happened before. So what happened? Why was the March total about 3,000 to 3,500 more than typical and expected? Keep reading...

After getting clipped for 3,644 deliveries in February, Scotia immediately went on to warpath to get that gold back. For the month of March, the Scotia house account took in 3,383 deliveries while at the same time issuing 179. All totaled, Scotia net deliveries were 3,204 of the 4,229 deliveries for March. That's 76% and, if you take that away, you're left with just the typical 1,025 March deliveries. (Actually, it's not that typical. The Barclays customer account took 834 of the 1,025.) Oh, you're probably wondering which firm provided the metal for all those deliveries? JPM. For March, JPM issued 1,813 out of their house account and 2,209 out of their customer account. That's a total of 4,022 or 95% of all March deliveries.

The next month is April and, once again, it's a delivery month. The surge in total deliveries continued as 11,632 contracts were delivered to eager buyers. Of those, HSBC was again the big winner with 3,954 deliveries into their house account. Scotia took 3,292 and Barclays got in on the act with 1,276. Between the three of them, these proprietary house accounts combined for 73% of all April13 gold deliveries. And who got stuck with the bill? DB paid out 992 and Scotia paid out 595. This left the balance with none other than JPM and they issued 9,690 contracts or 83%. 5,990 came out of JPM house and 3,700 came out of their customer accounts. Again and just for fun, 9,690 Comex settlements means that JPM had to ship out another 969,000 troy ounces or 30.1 metric tonnes.

So now it's May and, remarkably, the trend of deliveries in traditional non-delivery months continues and, whaddayaknow, it's a near-repeat of March. Of the 3,050 total deliveries in May, the Scotia house account took 1,746 or 57%. And guess who provided the metal...again? JPM. This time they got stuck providing 97% of the metal or 2,948 of the 3,050 deliveries. What's more, they issued the vast majority of this out of their customer account, which was raided for 2,781 of the 2,948 contracts. Again, "customer" gold is metal held on deposit for JPM customers. This is registered and eligible gold and, as we've seen for years, JPM is able to shift it around wherever they see fit. (And who are JPM's "customers"? Well, wouldn't you like to know?...)

Finally, this trend repeated one more time during the delivery month of June. For the month, 9,869 contracts were delivered. Once again, HSBC grabbed the lion's share, moving 4,935 (almost exactly half) of the deliveries directly into their house account. The Barclays house account took 2,000 and, for the first time since last December, the JPM house account claimed 547 or 5.5%. Issuing? You guessed it. JPM issued 7,425 or 75% while Barclays and DB added about 1,400.

So, through adding all of this together we get this. For the 3 delivery months of Feb, Apr and June plus the traditional non-delivery months of March and May:

HSBC House Account: 13,768 deliveries. Total issuance: One. Yes, you read that right. One.

Scotia House Account: 8,932 deliveries. Total issuance: 4,259

DeutscheBank House Account: 5,918 deliveries. Total issuance: 1,746

Barclays House and Customer: 5,384 deliveries. Total issuance: 908

JPM Customer: 1,444 deliveries. Total issuance: 16,758

JPM House: 547 deliveries. Total issuance: 15,181

OK, now before we go any further, I want you to take a second and review this excellent piece by Mark McHugh from back in April. Not only had he spotted this trend, he also goes on to explain how and why the deliveries out of the "customer" account should almost always match. There should not be a significant disparity. http://acrossthestreetnet.wordpress.com/2013/04/26/jamie-dimon-has-issues-or-meet-the-idiot-selling-gold/

Can you see what has transpired here?

Desperate to cover and eliminate their 50,000 contract short position but not wanting to do so through the actual buying of futures contracts for fear of disrupting the building price collapse, JPM decided to eliminate most of the position by settling and closing the short contracts in physical metal, instead. They likely made this decision in the expectation of re-acquiring the metal in the near future at lower prices. So confident were they in this eventuality, they even used customer gold to settle more than half of these obligations.

The month of June marked the bottom for the manufactured "correction" with price beginning the month at $1390 before trading down to a low of $1179 and closing out the month at $1224. Price has since continued to recover to a last of $1375.

Not coincidentally, June was also when Uncle Ted first noticed the change of position for JPM and he reported it in early July after reviewing the Bank Participation Report changes from June. Ted got me all worked up so I did some of my own research and wrote about it here. (http://www.tfmetalsreport.com/blog/4824/amazing-cot-and-bpr-gold) The gist of it is this: After years of being net short, the U.S bullion banks were net long, so much so that on the July BPR, they were suddenly net long almost 45,000 Comex gold contracts! This trend then continued onto the August BPR (http://www.tfmetalsreport.com/blog/4929/reconciliation) which showed the four largest U.S. banks to be net long an astounding 59,473 contracts.

It's important to note here that the BPR does not provide specifics. It simply aggregates the positions of the four largest U.S. bullion banks and the 20 largest non-U.S. bullion banks. So, it's impossible to say with certainty how the 59,473 contract net long position is divided. But consider this:

On the BPR dated 2/5/13, the 4 U.S. banks had a combined net short position of 69,300 contracts. After five months of deliveries and a $500 price drop, the 4 banks had flipped to 59,473 contracts net long. Now, go back up and reconsider all of the delivery totals listed above. Can you connect the dots??? If not, I'll do it for you.

JPMorgan decided late last year to rig the gold market lower in order to create the ideal conditions under which they could flip a 50,000 net short position to a sizeable net long position. Price, delivery notices and the CFTC-supplied reports document that they accomplished this feat by covering and delivering shorts while at the same time initiating and buying longs. They have no doubt been on the buy side of the record-setting Large Spec selling: http://www.zerohedge.com/news/2013-05-22/they-better-pray-there-no-short-squeeze.

And here is where it begins to come together...

If this is the case, and JPM is now net long a massive amount of gold futures, we should expect a complete change in the recent delivery pattern on The Comex. Instead of JPM being the primary issuer, they should be the primary stopper. Additionally, instead of the other banks being the stoppers, they should now be the issuers, particularly the non-U.S. banks as the August BPR showed them to have a net short position in excess of 22,000 contracts.

And what has happened this month? Exactly that! As stated above, of the 4,075 total contracts deliveries in August, and noting the huge dropoff from the volume of the three previous delivery months, 3,414 were stopped by JPM with 3,151 specifically designated for the JPM house account. And which firms have been issuing? Deutsche issued 1,116, Barclays has done 447 and Scotia accounted for 463. That's a total of 2026 or 49.7%. Note that all three are non-U.S. banks!

To me, this proves that Ted is correct. Not only is JPM net long the entire 59,473 shown on the August BPR, their position is likely even higher, offset in the net total by a net short position held by the other three U.S. banks included in the report.

And now...finally...here's the rub. The Big Kahuna. The Grand Finale. JPM is likely going to want back most, if not all, of the 3,193,900 ounces of gold that they delivered earlier this year. (16,758 customer + 15,181 house = 31,939 contracts = 3,193,900 troy ounces = 99.341 metric tonnes of gold) But the other banks aren't budging...at least not yet. There were only 4,075 total deliveries in August! And note that HSBC has taken delivery of 13,768 contracts so far in 2013 while delivering just ONE. And who is HSBC??? Yes, they're an English company but what do the "H" and "S" stand for? Do you really think that they are going to be in any hurry to return this 1,376,700 ounces of gold to The Comex and JPMorgan??? I'd say that this is pretty unlikely. Think about it. If HSBC would have simply played ball and handed back to JPM the 4,935 contracts that it settled to itself in June, total deliveries for August would have been at 9,000 not 4,000, a pace that would have matched February, April and June. Instead, total delivery volume came in at just 4,075 and JPM was left grasping to deliver any contract it can get its grubby little hands on as the final two delivery days saw JPM House stop 395 of the 419 remaining deliveries (19 out of every 20).

So, most importantly, what happens next?

Right now, the total open interest for the typically slow delivery month of October is just 23,758. Of that total, how many do you think are held long by JPM? 5,000? I'll guess we'll see when the deliveries begin next month. More significantly, the total open interest of the December contract stands at 229,838 (that's 60% of the entire Comex gold complex) and this is where JPM likely holds the majority of its net long position. If that's correct...and it most likely is...what the heck is going to happen in December? Is JPM going to simply roll into the Feb14 and the Apr14 OR are they going to stand for delivery AND, if they stand for delivery, are they going to attempt to extract 20,000 contracts or more worth of gold from the other BBs? And if the other BBs get wind of this, are they just going to sit idly by and wait to deliver or will they begin to move net long before it even gets that far? And then you're only left with Spec Shorts who don't have the capability to deliver 2,000,000 ounces of gold because they don't have it. They're just short the paper!

All of this could and should set off a buying frenzy/short-covering spree like no one has ever seen. Not only could and should price move higher in the weeks and months ahead, it should move dramatically higher, catching nearly everyone (except the readers of this site) by complete surprise.

Of course, all sorts of unforeseen events could come along and derail this plan so caution is always warranted. War could erupt in the MENA. Another Financial Collapse could materialize. Maybe India really will dump 200 metric tonnes onto the market. Any of these things could happen and nullify this forecast. However, I firmly believe that it is highly likely that this plays out almost exactly as I've described above.

I hope you're ready. Prepare accordingly.

TF

 

470 Comments

Mr. Fix's picture

Reply to interesting:

Bugzy,

well said, one of Obama's primary strategies on the homefront is to create as much infighting as possible. I am certain that we will have that debate, and it will be epic, and I agree with you, it will also be  irrelevant.

Expect weeks of grandstanding by politicians both for and against, while behind the scenes, the American public continues to be robbed in every possible way.

as Rahm Emanuel said, “never let a crisis go to waste,” as much damage as possible will be done both here and abroad, before the first shot is even fired.

Thank you for pointing out the irrelevancy of letting Congress have its debate, I had not considered that before.

Maximillion's picture

Mr Fix

You may be correct, however in your scenario who will be supplying the internet utility, as if fiat's decided as worthless then Turd might as well do the site for free, and then how would his provider get paid? Fiat will always be required to facilitate trade, therefore what's the benefit to TPTB to prove to the masses it's worthless?   

Kcap's picture

@fix

Just a discussionable counterpoint.

If the price, which the manips control, was indeed going to go toward zero with a massive dumping of paper at or near that bottom, wouldn't the Cartel have waited to go long Au at that point?  Couldn't they have just made a brutal killing doing that?  I feel that they would have....I actually think it could happen very soon, right now.  Because they went long, they don't want to give people paper profits either, so why not do the reset when people are still way down on the initial investments and folks are looking to make some serious dough in the paper game?

That said...I also believe that the contrarian view of higher paper silver suckers in a bunch of new big shots, and retail players, who becomes the new holders to be fleeced.  They would drop the hammer standing for delivery clearing out all the bullion just before others stand.....and any shorts would be royally frumped.

So, the near zero price, although it made more sense 6+ months ago, doesn't seem a likelihood in my opinion now. 

Kcap

SamSchlepps's picture

same but different point of view

What if we just consider where we are - macro versus how we got there

G20 meetings as a checkpoint - where are we on the trail at  some point significant where the immovable meets the irresistible - until something gives. Meetings before and around the G20 event are the real negotiating. Maybe it should be follow the Sherpas instead.

USA has aligned its FOMC taper and all the financial weaponry associated with it. USA president has declared military actions are good to go and wants the political machinery - Congress,the people,and also countries on the sidelines to declare which side they are on and preferably fall in with the USA. Quite probably the Congress is already onboard and will use the time and MSM resources to build the supporting case. The budget ceiling, sequester, and budget fall out after this event

Tinfoil hat but also mind boggling and hands down a sequencing of biblical proportion to get us to this point. Perhaps the reason Syria looks so weak, is because it was a backup event to a situation in Egypt.

Mr. Fix, I also saw the middle finger given by Obama in the press conference and even spent time trying to replicate  it myself to see if it was a natural move - it was hard to do. I think we may only differ on who it was gestured for. I also looked at the timing of SandyHook and then so close was the Boston bombing when Sandyhook (read gun control was falling apart) and wonder if Boston event to appease the G20 requirements - see we have control. Obama's press conference on the failure of the gun control laws was a rare show of his emotions - honest anger or a contrived show to sell the effort - be the judge. Pieces fit in different ways with a different look

argent rampant's picture

Argent rampant?

Live 24 hours silver chart [ Kitco Inc. ]

SamSchlepps's picture

Support for the view its more than Syria

http://www.moonofalabama.org/2013/09/obamas-carte-blanche-war-resolution.html#more

Obama's Carte Blanche War Resolution

Any war resolution Congress would pass would likely be interpreted by the administration as a license for all out war on Syria and beyond.

But the first draft the executive is putting to Congress is even worse:

The President is authorized to use the Armed Forces of the United States as he determines to be necessary and appropriate in connection with the use of chemical weapons and other weapons of mass destruction in the conflict in Syria in order to -

  1. prevent or deter the use or proliferation (including the transfer to terrorist groups or other state or non-state actors), within, to or from Syria, of any weapon of mass destruction, including chemical or biological weapons or components of or materials used in such weapons; or
  2. protect the United States or its allies and partners against the threats posed by such weapons.

This draft is nearly as wide as the Authorization for Use of Military Force Against Terrorists that Congress passed on September 14 2001 and which has been (ab-)used by the Bush and Obama administrations as an undiscriminating, unlimited license to incarcerate, torture or kill anyone at the free discretion of the executive.

Dudley Do-Right's picture

Tepco Says: "Oops!"

Not exactly good news:

"Radiation levels around Japan's Fukushima nuclear plant are 18 times higher than previously thought [last week], Japanese authorities have warned."

But if you appreciate truly black humor, check this out re Tepco's monitoring equipment:

http://www.bbc.co.uk/news/world-asia-23918882  

Good Grief!..Unbelievable.

DD

Mr. Fix's picture

Maximilian,

give me a couple more minutes, my Internet crashed as I was about to post your response, and it was somewhat involved, I hate when that happens, I will do it again and save a copy, should be about 10 more minutes.

Your question deserves an answer.

DeaconBenjamin's picture

Wha happened?

silver.gif

John Galt's picture

Article Linking Rebels to Syrian Gas Attacks

This article provides evidence linking in Syrian gas attack to rebels trying to overthrow the Assad government.

http://www.mintpressnews.com/witnesses-of-gas-attack-say-saudis-supplied-rebels-with-chemical-weapons/168135/

Apparently, the rebels received these weapons from the Saudis, specifically Prince Bandar who has close ties to the US government.

But the story gets even more interesting: according to this article Bandar has been trying to get Putin to stand down with his support of Assad, saying that if Putin plays ball Bandar will guarantee not to attack the upcoming Sochi Olympics being hosted by Russia.

“I can give you a guarantee to protect the Winter Olympics next year. The Chechen groups that threaten the security of the games are controlled by us,” Bandar allegedly told the Russians.
 
So, let me understand this clearly: there are US politicians allied with Saudi Prince Bandar who, in turn, controls Chechen terror groups. 
 
And who, according to the US government, are we to believe was behind the Boston Marathon bombings?
 
I'm not drawing conclusions, merely reporting the news.
 
F.Capra's picture

Fukushima Update

Newsy.com video

The aftershock of Japan’s disastrous earthquake and tsunami can still be felt by the continuous cleanup at the Fukushima Daiichi nuclear power plant. Two years of nuclear runoff spilling into the ocean have caused environmental activist Joe Martino to warn: “Your days of eating Pacific Ocean fish are over."

His choice words on the activist website Collective Evolution are quantified in this infographic compiled by German researchers at GEOMAR. The animation shows the dispersion of Cesium-137, a radioactive byproduct, will reach every corner of the Pacific by the year 2020. (Via GEOMAR)

Martino’s claim comes after the latest numbers by the Tokyo Electric Power Company, or TEPCO, show more than 300 tons of contaminated water seep into the Pacific Ocean each day.

Bugzy's picture

Maybe...

Obama "handlers" are forcing him to war. Maybe he is trying to stir up congress to vote overwhelmingly against it; that he will have no option but to tell his handlers that he cannot sanction it.

So many if's...

Gold going to zero - hmmm cannot see it. As soon as there is a failure to deliver - thing is busted. I cannot see it going for extra time to then have folk bidding less on non existent Gold. How one go long if it is shown that a short cannot deliver?

However - I can see it causing a LOT of problems and they might want to stop trading all together. How to marginalize the only "real" (scuse pun) alternative to the petro dollar.... So... how would that then re emerge? different exchange? Mass selling of US treasuries causing interest rates to spike? (cos it is almost like a default).

SilverSurfers's picture

had to

I just had to. At USAwatchdog, Hunter claims Snowden is not a traitor.  Feeling a deep sense of concern for Hunter's internal conflict, so, being such a nice guy, that I truly am, I post:

http://usawatchdog.com/edward-snowden-is-not-a-traitor/#comment-130606

Derrick Michael Reid says: Your comment is awaiting moderation.

Gregg, dont be so hard on yourself. Snowden is a traitor and a hero,
its perspective …. ;) which is the kind of thing that happens in corrupt societies,
our money is corrupt (paper), the courts are corrupt (fiat), the politicians are corrupt (pandering), the nanny-granny state is corrupt (moral hazard), the markets are corrupt (manipulation), as corruption permeate our society. I hope that helped. So cheer up.

wow from 23.04 to 23.95 in an hour, that is 91c move, hugely volatile in historically slow boat china. Wang Chung it baby!!! Have fun tonight!!!

Mickey's picture

Retaliation if US strikes in Syria

China drops the Treasury bomb on US.

cleanly nuc us.

they buys us out at 20 cents on the dollar.

US becomes a wholly owned subsidiary of China.

or something like that probably in the future regardless of whether we attack.

Mr. Fix's picture

Maximillion, A good question deserves a good answer.

A reply to 

Mr Fix

You raised a very good question,

and it is relevant to nearly every human being on the planet, particularly those that live in countries that are printing their currency to oblivion.

As I understand it, the powers that be are planning on a new monetary system which has been referred to as SDR (Special Drawing Rights). In this system, we would move to a cashless society, and all currency would be digital. It would have no backing whatsoever, much like paper currency today, but what it would do, is wipeout black markets overnight, this has become a problem for the banking elite, since through their government cohorts, they can not extract taxes from cash transactions, and therefore, their opportunity to steal value as it passes hands is undermined. The banking elite want to be able to get paid every single time an exchange is made regardless of its value, and with SDR, they will be able to steal their cut from every transaction. Of course, their accomplices in government will be 100% behind this plan as tax receipts will expand considerably, as commerce without taxes will be impossible.

Unfortunately for them, I do not believe that Russia and China along with the rest of the developing world will go along with this scam. I expect the SDR to have a relatively short shelf life, since when currencies collapse, there will be countries such as China that institute a gold backed currency, and it will immediately have value to the rest of the world, the SDR, not so much.

In your scenario, of how will people get paid? For at least a while, they won't. Supply chains will collapse, and chaos will ensue, that is also part of their plan, since it is going to take a incredible amount of chaos to get people to consider SDR as a solution. SDR, by many is analogous to the biblical mark of the beast, as without a number, you will be unable to buy or sell anything, and I expect them to try this at some point. In the meantime, they will do what they can to make sure that the little people cannot use gold and silver for barter, I expect its trade to be illegal.

It is entirely possible that China, along with Russia and the rest of the world will Institute a genuine gold backed currency, even if it is digital, it will be honest.

The way this would work, is that a bank could hold a certain amount of gold (or silver for that matter), on account, and credit that account a certain value.

This account could then be drawn upon to pay bills, so that Turd specifically could get paid. He would then be able to go to the bank, any time he wished, and cash in his credits for the gold that is held in the account. For this system to work, there can not be fractional banking, or any other Ponzi scheme that tries to create wealth where none exists.

Because such a system would be honest and work, the ones that are unbacked, and were a scam from the get-go, will eventually collapse since people who have something of value to offer will not accept something that has no value in payment.

Unfortunately, we are still in the setup phase for SDR, which is a currency collapse, orchestrated by the bankers, so that in their psychotic dreams they will have full control over every transaction made.

You did ask what they have to gain from it, that is your answer.

In the end, they will fail, but it is entirely possible that millions if not billions will die in the process.

It might be wise to prepare accordingly.

Mr. Fix's picture

kcap, discussionable counterpoints:

your points are well considered, but in the end, and there will be one, the COMEX is toast.

By many estimates that we have read, there are at least 100 paper ounces for every physical ounce.

There is no possible way to cash these in for physical, and many who believe that they own a piece of the physical action will discover that they actually own nothing. Of course trading on the COMEX will have to be halted at some point, and it may even have a price listed for gold and silver that they will have to pay out on in cash,

I suspect that this will be a very low number, not because they can't afford to pay out, they have access to a printing press, and could theoretically pay the holders $1 trillion a piece, but they won't do that. Just paying attention to what's going on, and how people's savings are being eroded across the board, it is my contention that they have no desire to make good on these paper investments, and will settle them at a ridiculously low number, effectively bankrupting all those that thought they were getting rich.

But like I said in a previous post, if the dollar is virtually worthless, the number is irrelevant.

momac's picture

opticsguy midwest crops

I'm in NE MO.  it is very dry here, as well as central IL and se iowa.  the corn is turning already even though most of it was planted late.  . the beans were  planted late as well.  I''d be very surprised if the yields aren't affected

Dudley Do-Right's picture

@John Galt, Re Prince Bandar

(From Wikipedia): "Bandar bin Sultan... is a member of the House of Saud and was Saudi Arabia's ambassador to the United States from 1983 to 2005.... He was appointed director general of the Saudi Intelligence Agency by King Abdullah on 19 July 2012."

Clearly he must have extensive contacts in the US Gov't, and with US intelligence agencies. 

DD

Kcap's picture

@fix

1) In hyperinflation with a truly devalued dollar, yes, it would not matter what price things get settled.

or

2) Without hyperinflation, things would be settled at a very very low price.  (I just don't see that happening anymore, because.....)

3) They are now LONG.  Their interest is not in getting price lower....its screwing the new shorts at HIGHER prices.  Much has changed this summer.

Thoughts to chew on....

Kcap

pforth's picture

Nice Silver surge...

I thought for sure that the monkeys would be out by now to continue what they started on the open.  It's a good sign, especially if we can keep a mostly constant level from here through the holiday trading.

Pining 4 the Fjords's picture

Guess who supports Mr. Fix's view of O?

Stanford Fellow, University of California Professor of the classics and author of two dozen books on the history of ancient Greece, Rome, and political philosophy.  Here's what Dr. Hansen recently wrote:

Obama is the first president who genuinely feels U.S. exceptionalism and power were not ethically earned and should be in an ethical sense ended. As a candidate, he consistently undermined current U.S. foreign policy at a time of two critical wars; as president, he has systematically forfeited U.S. authority and prestige. There is no inconsistency: whatever makes the traditional idea of the U.S as a superpower weaker, Obama promotes; whatever enhances our profile, he opposes. He is often quite angry at what could be called traditional America — seen often as a downright mean country here and abroad. (link)

VDH is one of the smartest intellectuals and most insightful authors I've ever read.  Just sayin'...

Dagney Taggart's picture

Hi Fix!

Good to see you here so I can do some reflection-worthy reading.

So I'm sitting conversing with Dad before going home and he sees the tidbit about an aircraft carrier or whatnot going to further antagonize the Syrians and a US House vote for military action. Then he starts laughing! Here's what he says (paraphrased):

Either way the globalists win this fight. Those ships are nothing but sacrificial pawns. If the Americans vote no, the ships will be deliberately destroyed by whoever, and the president will use this as the excuse to call the no voters in the US House who know he is a liar "dangerous pacifists" and punish them politically while also using this as a reason to attack. If the Americans vote yes, they still attack, and escalate. And escalate. And escalate......

Then China dumps US Treasuries ................. and stops delivering cheap plastic junk. surprise

PS. Hi to you too, Kcap. Don't let me distract from your dialogue.

maravich44's picture

*even a peace keeper*...

and more irritating babble from the members.

Mr. Fix's picture

Bugzy I find only one hole in your theory.

Obama's handlers are also the Congress  critters handlers, and all of them do what they are told to do.

Obviously, Obama has been making some enemies in high places, but they all answer to the banking cabal that firmly backs the military-industrial complex. In the end, there will be war, I suspect that only the motivation differs, as many of the Congress critters will back a war to further the currency collapse, and the military-industrial complex, but Obama on the other hand wants a war to destroy the US, and the military-industrial complex. This is where it gets interesting, because the only thing that can avert a war now, is a military coup.

the military themselves have been taught not to obey an illegal order, and most of them know the difference.

It's going to be a epic battle between good and evil, but both Obama and the Congress critters are on the wrong side, they are both evil, they just have different goals.

Patriotic soldiers are being eliminated from the ranks in droves, and those that are loyal to the Constitution that refused to quit, are being used as  Cannon fodder, and will be put in harms way on the other side of the world so that it is unlikely they can ever return to defend their homeland from the enemies within.

This is why it is so hard to predict the outcome in the near future, because victory is literally going to go to whoever can keep a better secret, but I suspect that there are many in the military working right now to undermine Obama was credibility, and hence his authority. Hopefully they will be successful before he does too much damage.

Urban Roman's picture

Bandar Bush ...

Bandar

Ain't luv grand?

Kcap's picture

@ Mr Taggart

Your pop seems like one very wise man....excellent.  And to think, people charge for that kind of insight....yet, its all so sensical.

Kcap

Mr. Fix's picture

Hi Dagney Taggart !!!

I just love how you and your dad think! Of course you guys are right, and the warmongers  win either way.

I suspect that the US military sees this set up, and realizes that their losses could be massive.

What does your dad think of the chances of a military coup?

Not that I'm for one, it's just that I don't see any other plausible scenario that averts World War III at this point.

PS, it's great to see you here.

Mr. Fix's picture

Screwing the shorts:

kcap,

Who do you think bought all the shorts? How do we know that they are not a false front for more JP Morgan shenanigans? Doesn't it seem rather convenient that somehow J.P. Morgan was somehow miraculously able to unwind its colossal short position without driving the price higher? We don't know who the shorts are, but I suspect they have just as much access to the free money coming from the Fed as J.P. Morgan does.

So, speaking of Circle jerks, I strongly suspect that the same games that we have been witnessing for the past two years can continue unabated until the war starts, or the currency collapses.

Under no circumstances will gold and silver be allowed to rise significantly to compete with the dollar.

The dollar will collapse first, probably in a nuclear cloud.

Kcap's picture

@fix

Your option is certainly plausible.

I just feel the certainties are now out of play, obfuscated by all of the action since last fall. 

Got your popcorn ready?  Or gas masks? ;-)

Kcap

Mr. Fix's picture

Pining 4 the Fjords

My wife told me all about that guy last week, and I completely forgot about him. Thank you for providing the link,

great minds think alike.wink

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