March Comex Silver "Deliveries"

41
Wed, Mar 29, 2017 - 11:25am

It seems that every few months, the charade of "physical delivery" on Comex becomes so outrageous that we feel compelled to write about it. Well here we are again today.

Before we get to the CME-reported numbers, let's start with the usual background...

What you need to know is that most of this is just a massive scam. Rarely is any actual, physical metal exchanged. Instead, the bi-monthly Comex delivery process is primarily a shuffle of paper warehouse receipts and warrants. Additionally, the parties to these exchanges of paper are usuallly The Banks themselves, acting in one seemingly endless circle jerk where one month Scotia "delivers" to HSBC and, the next month, HSBC turns around and "delivers" metals back to Scotia. It's been this way for years and it continues to this day.

And the volume of "deliveries" rarely changes, as well. For March, the initial amount of contracts still open and "standing" when the contract went off the board on February 27 was 7,299. Even at the conclusion of First Notice Day on the 28th, there were still 4,271 contracts still open. The delivery month is now complete and a total of 3,855 "deliveries" have been made. How does this compare to previous delivery months? It's about average. See below:

Delivery Month Total "Deliveries"

Dec 2014 2,975

Mar 2015 2,583

May 2015 2,840

July 2015 3,637

Sept 2015 1,555

Dec 2015 3,939

Mar 2016 1,356

May 2016 2,716

July 2016 2,474

Sept 2016 3,215

Dec 2016 3,980

Two-year average: 2,843

So, as you can see, the total amount of "deliveries" for March were not extraordinary by any means, though when compared to the previous to Marches, the 3,855 for March 2017 is above average. Regardless, let's dispel with the idea that suddenly there is some surge of physical demand for silver on the Comex for as you can see above, March 2017 was really no different from any other month in the past two years.

However, I do want to make note of two items and they both have to deal with The Major Power in Comex silver...JP Morgan. Not only does JP Morgan control about half of the total vaulted silver on the Comex, they only do so after nearly experiencing an extinction-level event back in 2011 when they were caught massively short paper silver with no physical silver with which to cover it. This led to the final short squeeze of April 2011 and all of the events that followed. In response and to prevent this from happening again, JPM was rushed through the approval process for their own Comex silver vault. See here: https://seekingalpha.com/article/259549-will-jpmorgan-now-make-and-take-...

In the years since, JP Morgan has amassed a stockpile of what is alleged to be physical silver in their Comex Vault. As of Monday, their total stockpile of registered and eligible silver stood at just over 94,000,000 ounces versus a total Comex vaulting structure of 191,488,871 ounces. That's just a shade over 49% and JPM now has enough silver to "physically settle" a short position of nearly 19,000 Comex contracts should they ever find themselves squeezed again.

How did JPM acquire all of this "physical silver"? Primarily through the Comex "delivery" process. Below are the year-end summaries for just 2015 and 2016 (click to enlarge). Note that the "house" or proprietary account of JPM is the primary stopper of "deliveries" nearly every month, to the tune of a NET 10,199 contracts. At 5,000 ounces per contract, that's just shy of 51,000,000 ounces of their current 94,000,000 ounce warchest.

And this continued during the just-completed March "delivery" month. As you can see below, of the stated 3,855 "deliveries", the proprietary account of JPM stopped a total of 2,689 for nearly 70%. That's another 13.5MM ounces added to the stockpile for use in the event of another paper metal short squeeze.

Lastly, just one other item of note. Since there is a stated position limit of just 1,500 contracts for each front/delivery month, you might be asking yourself how JPM gets away with stopping far more than that number. If you go back and look at the 2015 and 2016 tables above, note that they seem to adhere to these limits each month. So why and how did they manage to stop 2,689 in March? That's a good question so I took the time yesterday to submit a formal complaint to the CFTC:

Given my past experience in dealing with the CFTC, in no way do I expect any aggressive action from this neutered and fully-controlled agency. Instead, I just thought it would be fun to see if I heard anything back from them at all. Will I even get a response? I can tell you that, so far, I haven't even received one of those "thank you for writing us, we'll look into it" emails so it's not looking good. However, if I do eventually hear from them, I'll be sure to write follow-up to this post.

Thanks for reading and thanks for taking the time to understand some of the forces aligned against you in the Bullion Bank Paper Derivative Pricing Scheme.

TF

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  41 Comments

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AGXIIKtyberious
Mar 30, 2017 - 9:58am

THEY TOOK 'UR JOBS TYBERIOUS

When Dimon, Blankfein and Buffet find they've been replaced by androids and automatons; we hear them shout "They took 'ur jobs" like the people on South Park, we might have a chance against the banksters.

Unless crony criminal code is written into the soft ware. Given that banks are so easy to hack that a cave man could do it, hacking these three jagoffs would be fun.

I'd love to see Dimon and Buffet, arm in arm, waltzing down Wall Street, looking like the bastard stepchildren of St Vitus Dance and Tourette's Syndrome. With Julian Assange working the joy stick.

qwertyinfometron
Mar 30, 2017 - 5:50am

Thanks for the link,

Thanks for the link, Tainter's thesis is fascinating

climbthathill
Mar 30, 2017 - 4:05am

Automation

Look for a LOT more automation coming very quickly.

Deep learning chips currently cost about $50 and can be used for roles that require shaded judgment.

tyberious
Mar 30, 2017 - 1:13am

Automation wasn't a problem

Automation wasn't a problem until it took YOUR job

Industry invented the forklift and lots of people got jobs building, repairing and operating forklifts. BUT, lots of stevedores lost their jobs. The State put the stevedore on the dole and tried to retrain him. Well, he was only a stevedore for a reason. Industry and finance complained loudly about having to pay welfare to the stevedore. But, what was he going to retrain for that was within his limited cerebral powers? Industry also complained loudly about retirees.

There was little worry about automation taking the jobs away in the upper loop. Times are changing.
Ray Dalio runs the worlds largest hedge fund. He is changing to automation.
https://www.theguardian.com/technolo...nce-management
Sberbank has "the bank had over 137 million retail clients and over 1.1 million corporate clients" It is automating it's loan approval process with AI.

"Just today, BlackRock announced a plan to consolidate $30 billion of their actively managed mutual fund activities with funds that are managed by algorithms and quantitative models."
Stockpickers refer to themselves as "big swinging dicks". It's no great wonder that a few of them have destroyed their employer bank.
Martin Armstrong had $3 trillion under management. He and his program, Socrates were beating the pants off the New York banks so, they had him thrown in jail.
The finance sector is more than tired of prima-donas placing bets and destroying banks.

The whole finance sector will have to pull away from human decisions,,, they are just too ill-informed.
The best, new studies show clearly that the robots are taking a lot of jobs;
https://www.24hgold.com/english/news-...f+Richter&mk=1
Our ENTIRE financial collapse is centered around the lack of wages and purchasing power. Gov hands out more and more debt money for welfare. GOV creates more and more make-work jobs. Trump is a huge threat to the practitioners of these make-work jobs.

Headlines;
Trump budget expected to seek historic cuts to federal workforce
Trump Budget Would Abolish 19 Agencies, Cut Thousands of Federal Jobs
President Trump wants Jared Kushner to lead a new White House office aimed at overhauling the federal bureaucracy and infusing the executive branch with ideas from the "business world."

The whole point of GOV is inefficiency. GOV takes up the slack for those who just can't make it in the private sector.
Cutting all these gravy jobs will also reduce aggregate spending power.

Automation has made big inroads in the productive sector. Automation is making huge inroads in the finance sector. Soon, automation will make huge inroads in the GOV sector.
https://sputniknews.com/middleeast/2...ae-government/
Once the white-collar jobs disappear en masse, the upper loop will finally recognize that automation is definitely a problem. I can't stretch my imagination far enough to come up with a job niche that would be compatible with a redundant GOV worker.

lakedweller2
Mar 29, 2017 - 11:42pm

@TF

I think the "position limit" argument has some real merit as a way to attack the manipulation issue. It provides an argument that is factual and it is based on numbers and not emotion. Position limits are defined in statute or regulation or somewhere. It can be answered yes or no and the COT is published as true whether it is or not. More complaints should be filed with indisputable data.

AlienEyes
Mar 29, 2017 - 9:24pm

SilverBelle

Your post on Wiki leaks / Suck-a-turd is absolutely spot on !

.

(we are SOooo screwed !)

CaptK
Mar 29, 2017 - 8:44pm

BULLIONSTAR BLOGS

What sets the Gold Price – Is it the Paper Market or Physical Market?

https://www.bullionstar.com/blogs/bullionstar/what-sets-the-gold-price-i...

ag1969
Mar 29, 2017 - 5:40pm

Sometime in March in the year 2045

Some bought off retarded stooge at the CFTC reads Turd's complaint for the first time.

Visit the FAQ page to learn how to track your last read comment, add images, embed videos, tweets, and animated gifs, and more.

rxman
Mar 29, 2017 - 4:33pm

Gartman

Idiot. Don't even read his shit (drivel).

Rxman

scoremore
Mar 29, 2017 - 4:20pm

Dr. P

AG Looks like...

7.93 > 8.01

+1.008%

Wait on March 14th it was 7.23 so +10.788%

7.93 was the March 15th close.

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