A Comex Bank Run For Scotia Mocatta

46
Fri, Sep 25, 2015 - 12:23pm

While much has been made about the record low Comex registered gold inventory, we've also been following a slow-motion "run" on the gold vaults of Scotia Mocatta. Could this be evidence of failing confidence in the bullion bank system?

First, a reminder of what the terms "eligible" and "registered" mean:

Gold held in the eligible category is gold that meets the exchange requirements. Eligible gold is simply the gold that is stored in Comex warehouses. The Banks store/vault this gold for private clients and this gold is NOT available for immediate delivery to futures contract holders.

Registered gold means that the gold has been certified to meet the exchange standards for purity and size. Registered gold is deliverable or available for delivery to a long contract holder standing for bullion delivery.

OK? Then let's get started. No sense spending a lot of time with speculation. Instead, we'll just give you the numbers and let you decide for yourself.

The oldest CME Gold Stocks report we could find in our files is from almost exactly two years ago today and dated September 30, 2013. Note the size of Scotia's registered, eligible and total vault. (For fun, you might also note registered gold total for all six depositories. See the blue arrow.)

<click to enlarge>

As you can see, two years ago The Scoche reported to have holdings of 168,579 ounces of registered gold and 2,820,376 ounces of eligible gold for a total vault of 2,988,955 troy ounces or about 93 metric tonnes of gold.

OK, with that report as a reference, let's fast forward a few months to the report dated January 13, 2014. As you can see below, Scotia's vault is down a little bit. Registered gold is just 88,532 ounces and eligible is 2,524,008 ounces for a total vault of 2,612,540 troy ounces or a little over 81 metric tonnes.

Moving forward, our next snapshot is dated August 12, 2014 and, WOW, look at the change! Scotia's registered vault has soared to 303,091 ounces and it's eligible vault is back up to 2,748,423 ounces. This brings the total vault up to a whopping 3,051,514 troy ounces or nearly 95 metric tonnes of gold. (Also note that the TOTAL Comex registered vault has grown to 1,106,902 ounces.)

Let's fast forward again and review the report from March 5, 2015. There hadn't been much overall change for the previous seven months and you can see the continued, static nature of the reporting below. As of the previous day, Scotia reported registered holdings of 345,778 ounces and eligible holdings of 2,720,391 ounces for a total vault of 3,066,169 troy ounces or still about 95 metric tonnes.

And now here is where the intrigue begins. Did you notice the withdrawal on the report above? That day, Scotia reported a movement of 114,790 ounces out of their registered vault. At the time, it seemed like no big deal...just the daily Comex delivery shenanigans. However, that withdrawal marked a significant top in the total size of Scotia's Comex gold vault.

Let's count it down. Here's April 16, 2015. Note that the total vault is already down to 2,282,697 ounces or 71 mts:

By April 21, 2015, they're down to 2,164,737 or 67 metric tonnes:

And by May 7, 2015, they're down to a total of 1,879,274 troy ounces or 58 metric tonnes:

So, was this just a two-month anomaly? Did gold soon begin flowing back into The Scoshe's vault? Nope. Below is the report from June 16, 2015. Scotia's vault now holds just 176,734 ounces in registered gold and 1,446,588 in eligible gold for a total of 1,623,322 troy ounces or a little over 50 metric tonnes:

Here's August 10, 2015 showing 180,412 in registered and 1,124,028 in eligible for a total of 1,304,440 troy ounces or just over 40 metric tonnes of gold:

Which brings us to the most recent report dated yesterday, September 24, 2015. The latest total for the amount of gold held in Scotia Mocatta's Comex gold vault are as follows:

  • Total registered gold: 92,017 troy ounces
  • Total eligible gold: 1,084,123 troy ounces
  • Total vault: 1,176,140 troy ounces or 36.6 metric tonnes
  • (Additionally, be sure to note that the TOTAL Comex registered vault, which peaked at over 1.1 million ounces in August of 2014, remains at just 162,034 or down about 85% in a little over a year.)

    So, to summarize...Over the past seven months, the Comex vaults of Canada's largest Bullion Bank, Scotia Mocatta, have seen significant and persistent withdrawals. How much? See below:

    DATE TOTAL REGISTERED TOTAL ELIGIBLE TOTAL COMBINED

    3/5/15 345,778 2,720,391 3,066,169 OR 95.37 mts

    9/24/15 92,017 1,084,123 1,176,140 OR 36.58 mts

    TOTAL CHANGE (253,761 or 73.4%) (1,636,268 or 60.2%) (1,890,029 or 61.6%)

    ________________________________________________________________________________________

    Ultimately, the question you must ask yourself is this:

    Are we seeing a "run" on the "bank"?

    Over the past 6+ months, clients of Scotia Mocatta, technically the oldest of all the Bullion Banks, have removed over 60% of their gold stored and kept in safekeeping with this company. Hmmm. Why the sudden rush to re-establish ownership and lay claim to gold held within The Comex vaulting system?

    Again, nearly 60 metric tonnes of gold, stored by The Scoshe for their clients, have now been removed. And, over the same time period, total Comex registered gold has fallen by 85%?

    Does this constitute a slow-burning lack of confidence or "run"? Are clients of Scotia Mocatta seeking to slowly, gradually reclaim their gold from the over-leased and over-hypothecated bullion bank system?

    Would you want to be left holding the bag with nothing but paper certificates and warehouse receipts when the paper derivative pricing scheme finally collapses? Me, neither. And perhaps the closely-connected clients of the world's oldest bullion bank feel the same way? If you hold gold in safekeeping with Scotia or any of the other Bullion Banks, you might want to follow their lead.

    TF

    About the Author

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    turd [at] tfmetalsreport [dot] com ()

      46 Comments

    Gamble · Sep 25, 2015 - 12:27pm

    Hugh

    In

    TF Metals fan · Sep 25, 2015 - 12:28pm

    first

    And I am looking forward to read the article. 

    To all: enjoy your weekend!

    arch stanton · Sep 25, 2015 - 12:31pm

    a coveted

    turd or maybe a Marchas fort

    AgAuMan · Sep 25, 2015 - 12:33pm

    turd

    turd + 1 = 4th

    wildstylechef · Sep 25, 2015 - 12:36pm

    fifth

    num 5

    JackPutter · Sep 25, 2015 - 12:36pm

    What of the Rumors?

    Of the owner of Scotia Mocatta dying?

    SilverX3 · Sep 25, 2015 - 12:40pm

    Turd, just wondering how long

    Turd, just wondering how long you need to prepare the "final four" for each A2A guest on average? I think you must put some thought and time into it as each question should be tailored to the guest in question. Always wanted to ask you this as I think these questions are very interesting because it demonstrates that you did your homework on your guest's background. Thank you for all you do, and for being that watchtower guiding light for the past 4 arduous years.

    Joseph Warren · Sep 25, 2015 - 12:57pm

    Poor George Bailey . . .

    he worked for a fraudulent system (fractional reserve, fiat private debt note based banking ) - - and didn't even know it. Ignorance is no excuse, though. I doubt that he ever got his wings.

    SilverX3 · Sep 25, 2015 - 12:59pm

    Thanks

    Usually takes just 5-10 minutes of thought and research. Depends upon the guest, I suppose.

    And, actually, we're rapidly approaching our 5th Anniversary. (Five years of my life I won't get back...indecision)

    https://tfmetalsreport.blogspot.com/2010/11/test-this-is-only-test.html

    · Sep 25, 2015 - 1:05pm

    Updated S&P charts

    Today's USDJPY-driven ramp is holding at about +16 S&P points. A bounce for sure but not enough to change the dreadful look of these charts.

    The spiking Pig will, no doubt, force more PBoC devals next week and the emerging market carnage will likely continue. We'll have a "Death Candle" update next Thursday and, as of this moment, the S&P is down 22 points or a little over 1% for the month of September.

    JackPutter · Sep 25, 2015 - 1:10pm

    Makes me wonder

    How much plunge protection it took to maintain the S&Ps 1% loss? Where would the ownership of all those stocks go?

    Owtovit · Sep 25, 2015 - 1:10pm

    "Turdite"

    Wow, 5 years........Did the last commenter coin the term "Turdite"

    Kev McCauleyNovember 12, 2013 at 2:33 AM

    Hey Turd, 
    So far I love your site.
    Never thought of my self as a turdite but hey the shoe fits

    · Sep 25, 2015 - 1:14pm

    Though a huge squeeze in Brazilian Real today

    Still...take a look at YTD gold priced in the Brazilian currency:

    Mr. Fix · Sep 25, 2015 - 1:15pm

    What if…

    The slow exit from the bullion banking system has already occurred, the money has been printed up, and those wishing to exit already have been paid. What's left, is a completely contrived, Government owned and operated illusion of a market.

    There may not be a run on the gold, the government now owns both sides of every trade. In such a scenario, a market can continue, or vanish, on whatever timetable is predetermined. Public sentiment is irrelevant.

    So we have the illusion of markets, the illusion of gold disappearing, and the illusion of shortages.

    Sure, it all looks bullish on the surface, but in reality, if it all just goes away, the marketmakers leave with all the gold, all the silver, all the wealth, leaving worthless paper Fiat, and worthless paper promises in their wake.

    This system doesn't even have to collapse in a traditional way, it can simply close down, leaving all of us wondering what really happened.

    Futures wouldn't be worth much in such a scenario, would they? wink

    lakedweller2 · Sep 25, 2015 - 1:24pm

    Boehner

    Resigned

    tyberious · Sep 25, 2015 - 1:35pm
    Coffee Black · Sep 25, 2015 - 1:52pm

    Market crash Jim sinclair

    In his interview on usa watch dog Jim said there is no way we make it out of September without a real crash. It definitely isn't happening today. What does anyone think about next week. I personally feel that the market should have already crashed, and that the only way this is going to happen is with some "event" as the cause. Your thoughts ?

    Swineflogger · Sep 25, 2015 - 1:59pm

    Have a Great Weekend Folks

    Metaphor: A type of comparative analogy that avoids using any distancing words of comparison such as "like" or "as". Example: The entire current bullion bank fractional reserve system: photo livecatfish_zpsmhvrk0bw.jpg

    JackPutter · Sep 25, 2015 - 2:05pm

    Fraud bars of gold were emerging

    Through the last few years fraud bars with tungsten innards and the like were emerging in the news. Now that could have been a management of the perception of risk in gold, or actual frauds in action. 

    Either way I was wondering if we have a list somewhere on the internet of all of the ones reported? Were there any continuing investigations ever reported?

    · Sep 25, 2015 - 2:11pm

    Bank run on real money?

    Turd,

    Are the other bullion banks showing a decline in their eligible gold? Or is ti impossible to tell due to the accounting shenanigans?

    -----

    Shenanigan--Word origin: suggestions include Spanish chanada for "trick, deceit;" or, German Schenigelei for "work, craft," or Irish sionnach for "fox."

    All these seem to sum up Bullion Bank accounting nicely.

    Lintltj5 TF · Sep 25, 2015 - 2:13pm

    "Five years of my life"

    "Five years of my life I won't get back.."

    No, Turd, you wont, but you have opened many people's eyes and helped them begin saving their lives and building a new lives eith the time you have given.

    Time well spent.

    Deo Vindice!

    waxybilldupp · Sep 25, 2015 - 2:28pm

    CNBS'ers can't say it ....

    But I certainly can: "STOCKS OFF THEIR HIGHS!"

    wax off

    Swineflogger · Sep 25, 2015 - 2:31pm

    @Pining

    Its good to see you post. Wish I could have HT'd more than once. It's good to be Enrico. 

    SteveW · Sep 25, 2015 - 2:31pm

    COMEX vaults

    Well assuming that the figures are truthful there are several ways of looking at the data. Simply comparing 9/30/2013 and 9/23/2015 a number of things stand out.

    1. The format of the report has changed; LOL.

    2. Total registered gold is down to 21%

    3. Total eligible gold has increased 9.9%

    4. Whereas eligible gold in Scotia is down 1.74 million oz or a loss of 62%.

    5. Eligible gold in HSBC is up 1.65 million oz.

    No doubt the figures indicate that registered gold has collapsed but has the eligible merely been moved from Scotia to HSBC? Or are the owners wisely removing gold from Scotia but not HSBC? Why? Can they remove gold from Scotia because they own it but not HSBC because it is rehypothecated? HSBC, money launderers since 1865!

    AIJ · Sep 25, 2015 - 2:32pm

    Celebrated Post Marshall Swing day

    by buying a few of these.

    andrewbyrd Coffee Black · Sep 25, 2015 - 2:34pm

    markets

    I don't understand. If it's just banks swapping shares back and forth through their proprietary algo's, why would the market ever crash? If it does crash, it will not stay down for long. It's just one manufactured crisis/headline to the next leading you to believe that the inevitable crash is just around the corner. If you tried to flowchart all the inter-connections and cross-currents, you might need a whiteboard the size of a small field. It's mind numbing all the information to be processed. I don't know how you do it Turd?

    JackPutter · Sep 25, 2015 - 2:40pm

    Wasn't Boehner

    third in line to the presidency in case of accidents? Where is Biden? Where is Cheney? (Gotta keep an eye on that one)

    brolgaboy · Sep 25, 2015 - 2:48pm

    Yellen hawk

    S&P turns negative

    Swineflogger · Sep 25, 2015 - 2:52pm

    Last Friday Post - I Promise

    Garden conundrum: petite winter banana squash (really good for baby food - for the new grandson not me Pining).

    Oops. Must be something in the water . . . . . . .

     photo petite banana squash_zpsgxuwb4kl.jpg

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