Time to Re-Visit a Recent Thought Experiment

Thu, Mar 27, 2014 - 6:01pm

Recent Comex gold vault activity causes us to re-examine an issue first discussed last autumn.

Rather than lengthen this new post, I'll save you the full c&p of the two posts that preceded it. If you'd like to re-acquaint yourself with the entire "controversy", here are the links:



For the sake of this post, however, I do think that the following c&p is necessary. Below are the bullet points and concluding paragraphs of the second post. Ponder this and then we'll get to the point of this new post:

Just for fun, let's explore one other option....and this is pure speculation and conjecture.

  • What if the twenty metric tonnes of gold deposited into JPM's eligible vault over the past two months really is 20,000 Kilobars, of the 999 fineness variety?
  • Why would JPM be holding, at a minimum, 20 metric tonnes of Asian Kilobars in their NY vault?
  • Could these have been acquired for a big Asian client (China)? If so, does this give credence to the idea that JPM's client is China and, by extension, China is the big NET LONG on the Comex, converted from NET SHORT after successfully driving price down by over 30% in the past year? Lots of folks think this is possible and why not? Our buddy Koos Jansen pegs Chinese imports this year alone at 2,500 metric tonnes.(https://www.ingoldwetrust.ch/shanghai-gold-exchange-physical-delivery-eq...) If you were buying that much gold and had easy access to smash the price first, wouldn't you do it that way?
  • I've often stated that JPM's verifiable NET LONG Comex gold futures position is a market corner and it gives them the ability to break and take control of The Comex at a time of their choosing. If this position is actually China's...well, that certainly changes the dynamic a bit, doesn't it?
  • And now JPM (China) is stashing away 2 metric tonnes per day of Asian-standard Kilobars?
  • And a Chinese company just purchased One Chase Manhattan Plaza in New York City? (https://www.bloomberg.com/news/2013-10-18/jpmorgan-tower-sale-sets-recor...)
  • And One Chase Manhattan Plaza is the building which has, at it's sub-9 grade level, the largest precious metals vault in the world (https://www.zerohedge.com/news/2013-03-02/why-jpmorgans-gold-vault-large...), directly across the street from the NY Fed vault?
  • And, just last year, the London Metal Exchange (LME), the world's largest market for industrial metal futures, was purchased by....wait for it...Hong Kong Exchange and Clearing Limited. (https://www.bloomberg.com/news/2012-07-24/lme-shareholders-poised-to-vot...)

So the question (thought experiment) becomes...Is China planning a takeover/buyout of The Comex? It would seem that The Chinese are readying themselves to dominate metals trading in the 21st Century...They own the LME already and Shanghai is supplanting London as the world's largest volume precious metal delivery hub. Why not take global control of precious metal futures, too?

IF that were to happen, what would this mean for price? With "control" of precious metals futures pricing and trading, would The Chinese perpetuate the manipulation or would they eliminate it? If The Chinese are moving toward the eventual backing of the yuan/renminbi with gold and/or silver, would it benefit them to have higher prices or lower, once they have physically taken control of the majority of the world's gold?

Whoa. That's some heavy stuff. I've been mentally compiling this post for about a week and then physically typing it for the past three hours. Can you now see why it has taken so long? Anyway, welcome to my world! Please roll this information and these ideas around in your head for a while. Let me know what you think. Once again, maybe old William of Ockham provides the best answer....Newly-minted, American-made Kilobars, temporarily stored in JPM's New York vault, on their way to wherever. Then again, maybe not...

OK, the reason that I bring this up once more is that The CME and JPM are at it again.

Just this week, the eligible account of JPM's Comex vault has seen another three, round-number additions. The first came on Monday and it was for a perfect and precise, five metric tonnes:

Wednesday saw a perfect and precise, one half metric ton "deposit":

And on Thursday JPM booked in another perfect and precise, five metric tonnes:

So, once again, what in the name of Inspector Clouseau is going on here? Adding these perfect and precise deposits together yields a net addition of 337,575 troy ounces or the physical settlement equivalent of 3,375 Comex contracts. But, wait a second. According to other CME-produced data, during the February Comex delivery month, JPM was actually a net issuer of deliveries. They actually lost/delivered/issued 1,750 contracts. In fact, year-to-date if you combine ALL of the JPM settlement activity...the NET issuance and stoppage from both the customer AND house accounts...JPMorgan is a NET deliverer to the tune of 1,623 contracts.

And now, suddenly, in three days time, they take in 10.5 metric tonnes? The delivery data above certainly suggests that this new gold isn't from the settlement of Comex contracts.

So, once again, we are left grasping for answers and trying to draw some logical conclusions. I'll give you two possibilities:

  1. My original supposition from October was correct. It's all bullshit. Just paper transactions made to cover up the massive Comex registered withdrawals since early 2013, giving the appearance that all is well and that the eligible vaults are literally bursting with gold that is ready to be registered and sold if the price is right. Why would the CME suddenly start putting that disclaimer at the bottom of all their daily "stocks" reports if the information was instead accurate and reliable?
  2. Go back up and read the bolded c&p above. This week's additions bring the total of perfect and precise eligible deposits up to over thirty metric tonnes over the past five months. Thirty metric tonnes. Of perfect and precise, brand spanking new kilobars. Deposited into JPM's Comex vault. Note that, aside from the occasional and rare deposits at the other depositories, no other bank sees this type of tonnage and certainly not of the "perfect and precise" type. Note the additions at HSBC on Monday and The Scoshe on Wednesday. They weren't perfect and precise. Instead, they looked like actual, measured deposits. Only JPM sees these regular perfect and precise deposits in tonnage size.

Look, I recognize that it's a pretty long walk from these possibly-worthless CME reports to an assumption that The Chinese are planning to buy out The Comex along the way to global precious metals domination. You've got to admit, though, that while there may not be "fire" here, there certainly is at least a little bit of "smoke".


About the Author

turd [at] tfmetalsreport [dot] com ()


Mar 28, 2014 - 8:15am

Recorded Wednesday evening

(The picture Elijah used cracks me up. It's from about five years ago. I had much of my original hair color then and A LOT less wrinkles. Stress. Ugh...)

Mar 28, 2014 - 8:21am


time for coffee and a great read!

Mar 28, 2014 - 8:24am


The monkeys have put money on sale. When thinking in terms of fiat, very frustrating. When thinking in terms of ounces very exciting.

Making a exchange today. A friend from Toronto is coming down today for lunch. We are going to a restaurant near the LCS. We will be stopping by there after lunch and he will see ole Silver66 put his money where his mouth is. I have encouraged him to stack and hopefully when he sees the behaviour in action today he dips a toe in.


Mar 28, 2014 - 8:25am


and listened already. Lol

Patriot FamilyTF
Mar 28, 2014 - 8:30am

Turd... Turd, Is that you in that picture?

I didn't even recognize you. I keep expecting some guy with a big yellow hat.

PS - hello from India. Here for two weeks, and going to try to visit a couple of gold/jewelry stores in Hyderabad and Bangalore to see what things are like. People here are super concerned about their currency valuation and upcoming elections. Politicians have no issues making outrageous promises to buy a few votes. Or making crazy claims about corruption on he part of their opponents. Very much like a circus.

Mar 28, 2014 - 8:36am

Will 1280 hold?

Looks like it will at least get a test today.

Mar 28, 2014 - 8:45am
Mar 28, 2014 - 8:51am

Just a dirty white boy!

I always love to hear that song.......

Mar 28, 2014 - 8:53am

Speaking of gold in dollar-price terms . . .

means we think that the western financial system will survive this debt debacle we own today. I don't think it will survive intact.

I don't know what the system that comes next will look like, but it appears that China, Russia, etc. think it will include gold.

Turd's connections between China and JPM are more dots to be connected in the overall picture. Ted Butler and Antal Fekete both surmised long ago that China was the big short in the silver market, and we here discussed that JPM may be doing China's dirty-work in silver.

Maybe the hedge funds that supply the COMEX bids are controlled by Chinese interests, so as to continue the appearance that COMEX gold and silver are markets, and to continue to hold down price so they can hoover up all the cheap gold and silver possible.

They KNOW what's coming, and therefore, they are stacking.

Mar 28, 2014 - 9:02am

So the IRS, Gestopo, wants to tax your gold?

If you sell some gold how will they determine what you owe if there is no record of the buys for capital gains?

I think if the Mafia ran things it would be fairer. These guys are much worse on a grander scale.

Key Economic Events Week of 10/21

10/22 10:00 ET Existing home sales
10/24 8:30 ET Durable Goods
10/24 9:45 ET Markit flash PMIs
10/24 10:00 ET New home sales
10/25 10:00 ET Consumer Sentiment

Subscribe or login to read all comments.


Donate Shop

Get Your Subscriber Benefits

Private iTunes feed for all TF Metals Report podcasts, and access to Vault member forum discussions!

Key Economic Events Week of 10/21

10/22 10:00 ET Existing home sales
10/24 8:30 ET Durable Goods
10/24 9:45 ET Markit flash PMIs
10/24 10:00 ET New home sales
10/25 10:00 ET Consumer Sentiment

Key Economic Events Week of 10/14

10/15 8:30 ET Empire State Fed MI
10/16 8:30 ET Retail Sales
10/16 10:00 ET Business Inventories
10/17 8:30 ET Housing Starts and Bldg Perms
10/17 8:30 ET Philly Fed MI
10/17 9:15 ET Cap Ute and Ind Prod
10/18 10:00 ET LEIII
10/18 Speeches from Goons Kaplan, George and Chlamydia

Key Economic Events Week of 10/7

10/8 8:30 ET Producer Price Index
10/9 10:00 ET Job Openings
10/9 10:00 ET Wholesale Inventories
10/9 2:00 ET September FOMC minutes
10/10 8:30 ET Consumer Price Index
10/11 10:00 ET Consumer Sentiment

Key Economic Events Week of 9/30

9/30 9:45 ET Chicago PMI
10/1 9:45 ET Markit Manu PMI
10/1 10:00 ET ISM Manu PMI
10/1 10:00 ET Construction Spending
10/2 China Golden Week Begins
10/2 8:15 ET ADP jobs report
10/3 9:45 ET Markit Service PMI
10/3 10:00 ET ISM Service PMI
10/3 10:00 ET Factory Orders
10/4 8:30 ET BLSBS
10/4 8:30 ET US Trade Deficit

Key Economic Events Week of 9/23

9/23 9:45 ET Markit flash PMIs
9/24 10:00 ET Consumer Confidence
9/26 8:30 ET Q2 GDP third guess
9/27 8:30 ET Durable Goods
9/27 8:30 ET Pers Inc and Cons Spend
9/27 8:30 ET Core Inflation

Key Economic Events Week of 9/16

9/17 9:15 ET Cap Ute & Ind Prod
9/18 8:30 ET Housing Starts & Bldg Perm.
9/18 2:00 ET Fedlines
9/18 2:30 ET CGP presser
9/19 8:30 ET Philly Fed
9/19 10:00 ET Existing Home Sales

Key Economic Events Week of 9/9

9/10 10:00 ET Job openings
9/11 8:30 ET PPI
9/11 10:00 ET Wholesale Inv.
9/12 8:30 ET CPI
9/13 8:30 ET Retail Sales
9/13 10:00 ET Consumer Sentiment
9/13 10:00 ET Business Inv.

Key Economic Events Week of 9/3

9/3 9:45 ET Markit Manu PMI
9/3 10:00 ET ISM Manu PMI
9/3 10:00 ET Construction Spending
9/4 8:30 ET Foreign Trade Deficit
9/5 9:45 ET Markit Svc PMI
9/5 10:00 ET ISM Svc PMI
9/5 10:00 ET Factory Orders
9/6 8:30 ET BLSBS

Key Economic Events Week of 8/26

8/26 8:30 ET Durable Goods
8/27 9:00 ET Case-Shiller Home Price Idx
8/27 10:00 ET Consumer Confidence
8/29 8:30 ET Q2 GDP 2nd guess
8/29 8:30 ET Advance Trade in Goods
8/30 8:30 ET Pers. Inc. and Cons. Spend.
8/30 8:30 ET Core Inflation
8/30 9:45 ET Chicago PMI

Key Economic Events Week of 8/19

8/21 10:00 ET Existing home sales
8/21 2:00 ET July FOMC minutes
8/22 9:45 ET Markit Manu and Svc PMIs
8/22 Jackson Holedown begins
8/23 10:00 ET Chief Goon Powell speaks

Recent Comments

Forum Discussion

by NW VIEW, 15 min 28 sec ago
by sierra skier, 8 hours 33 min ago
by NW VIEW, 8 hours 36 min ago
by Trail Trekker, 9 hours 55 min ago