Comex Silver "Deliveries" Surge In September

50
Tue, Oct 3, 2017 - 11:22am

Though Comex metal "delivery" remains a sham and circle jerk where The Banks simply shuffle paper warehouse receipts and warrants, we thought the latest totals for September were noteworthy enough to bring them to your attention.

Again, we've written about this on countless occasions and this post is not meant to imply that "the Comex is about to break" or that "there is a run on The Banks". Instead, September saw the continuation of two trends of which you need to be aware. Comex "deliveries" are up dramatically in 2017 and JPM continues to stand down.

First, take a look at the historical pattern of "deliveries" during the so-called "delivery months" of March, May, July, September and December. Below is a summary of the "delivery" activity for 2015:

The one way we've always quantified "deliveries" here at TFMR is to consider the total amount of stated "deliveries" at the end of each month versus the total number of contracts that had been left open and allegedly "standing for delivery" at the beginning of the process. For 2015, it looked like this:

Contract Total Standing Total "Deliveries" Percentage

Dec14 3,950 2,975 75.3%

Mar15 3,142 2,583 82.2%

May15 3,371 2,840 84.2%

Jul15 2,699 3,637 134.8%

Sep15 2,198 1,555 70.7%

Dec15 4,078 3,939 96.6%

As you can see, the only outlier in 2015 was the month of July where nearly 1,000 additional contracts materialized requesting immediate "delivery". Other than that, it was a rather orderly process.

Now, let's look at the summaries for 2016.

Contract Total Standing Total "Deliveries" Percentage

Mar16 3,804 1,356 35.6%

May16 5,603 2,716 48.5%

Jul16 2,957 2,474 83.7%

Sep16 3,412 3,215 94.2%

Dec16 3,056 3,980 130.2%

Again, a rather mundane year of silver "deliveries" with one exception. This time, the month of December saw an "oversubscription". Where Jul15 had seen "deliveries" exceed standing by 938 contracts, Dec16 saw the same exception to the tune of 924 contracts. Other than that, it was another somewhat orderly year.

So let's move on to consider the "delivery" action in 2017 to see if anything unusual is taking place:

Contract Total Standing Total "Deliveries" Percentage

Mar17 7,299 3,872 53.1%

May17 3,360 4,657 138.6%

Jul17 2,423 3,287 135.7%

Sep17 4,103 6,575 160.2%

Well now. This is beginning to look a bit different, isn't it? Go back up and review the data for 2015 and 2016. Note that only one month in five ever shows a "delivery" total in excess of the amount of contracts still open before First Notice Day. And now, if we include last December, we've seen this occur in four of the past five months with the most recent "delivery month" of September seeing the largest percentage "oversubscription" yet at 160.2%

And when we look at it in absolute terms, the "deliveries" for last month get even more interesting. Note that there were 4,103 contracts still open when the contract went off the board on August 30. At 5,000 ounces per contract, that's a total potential "delivery" obligation of 20,515,000 ounces of silver or about 638 metric tonnes. By the end of the month, the Comex had actually "delivered" 6,575 contracts for 32,875,000 ounces of silver or about 1023 metric tonnes.

So, what's the deal here? Why the sudden rush in 2017 to jump the queue and take immediate "delivery" instead of simply waiting until the next "delivery month"? Could it indicate wholesale physical tightness? Could it indicate a lack of trust amongst The Banks? Could it indicate absolutely nothing?

Well, one thing we know for certain is that this anomaly is not being caused by the House or proprietary account of JPMorgan. Recall that in March we caught JPM blatantly exceeding that stated front-month position limits for Comex silver. We wrote about it at the time and even went so far as to file a formal complaint with the CFTC: https://www.tfmetalsreport.com/blog/8243/march-comex-silver-deliveries

Back in July, we next noticed that the House Account of JPMorgan had completely discontinued all "delivery" activity in Comex silver: https://www.tfmetalsreport.com/blog/8451/specific-peculiarity

Well guess what...that trend has continued through September. See below:

So, at the end of the day, what do we make of all this? I guess that's up to you, the reader, to decide. No doubt "deliveries" in Comex silver have increased dramatically in 2017 but what is a "delivery" anyway? Is it actual metal or just an exchange of warehouse receipts between Banks, made to create the illusion of physical delivery for their paper derivative market? And does this increase in "deliveries" translate to physical demand and Comex stress or is it just emblematic of the general increase in total Comex silver open interest?

These are all interesting questions and, unfortunately, these deliberately-opaque "markets" make it impossible to state the answers with certainty. One thing is certain, however, and that is the notion that no institution built upon fraud, lies and deceit will stand indefinitely. Eventually, this current paper derivative pricing scheme will fail as true physical demand overwhelms The Banks' ability to manage their unallocated and fractional reserve system. For that day, we continue to prepare accordingly.

TF

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  50 Comments

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infometron
Oct 3, 2017 - 3:09pm

@boomer sooner Re: Sorry, OT

I tried to relocate the position of the taxi using google maps (street view) as best I could, then estimated a region as best I could (red circle) where the muzzle flashes were coming from on the taxi video. Compare that with the shooter locations indicated in NBC's "official narrative." Is there a discrepancy here?

I tried, but could not find a daytime photo of the Mandalay Bay Hotel from today. Presumably, there should be at least one other window knocked out on a much lower floor (unless by some 'miracle', it was repaired overnight, eh?).

brolgaboy
Oct 3, 2017 - 3:08pm

Detour Gold

really getting some legs here, leaving KL in it's wake. Cannacord just upped target to $22.50 CAD

Oct 3, 2017 - 3:05pm

From last week

I missed this one. For others who might also have missed it: https://investmentresearchdynamics.com/peak-housing-bubble-the-big-short...

Jihk2431
Oct 3, 2017 - 2:33pm

I have not heard a serious analyst state that Novo

does not appear to be legitimate. Sprott had Kirkland write that check for a reason-this thesis has legs and the question is really how big this might be. FANG stocks trade at levels that are more obscene than this, yet people are calling for it to crash. Good luck with that.

fluxplus
Oct 3, 2017 - 2:25pm

@ancientmoney: Scenario when gold going to $500 or even ZERO

Walking Dead scenario. Nobody cares about gold there. Only food, guns and ammo.

Markedtofuture
Oct 3, 2017 - 2:21pm

O/T Trey Gowdy

Friend,

I’ll get straight to it — I’ve ticked off Nancy Pelosi & her buddy in Congress — Adam Schiff, and the Democrats are targeting me for defeat.

Because I have been speaking the truth in Congress this past week (and always), Nancy Pelosi and Adam Schiff are lining up the Democrat machine to take me down next election.

Friend, I will NEVER be bullied into silence.

If I can count on you for a donation, please let me know by either following this secure link or clicking the button below.

An online contribution is the fastest way to show your support and it would mean a great deal to me. It would also send a clear message to Nancy Pelosi and Adam Schiff that picking a fight with me is picking a fight with you.

DONATE TODAY
HELP TREY GOWDY>>

I was elected to Congress because the great citizens of South Carolina put their faith in me to represent them well and hold Washington accountable.

Friend, I remember every single day why I am in Washington and I am working around the clock to make our nation proud and our future safer and brighter. I’m focused on putting Washington back to work, holding lawmakers accountable, and upholding my promise to put the safety and security of South Carolinians – and all Americans – first.

I would not be back in Washington DC fighting for our shared beliefs and values – if it were not for your help and support.

Friend, as you know, I try to hold everyone in power in Washington accountable for their actions – which hasn’t always made people happy.Though we are months away from Election Day, many are already targeting me for defeat, and no one would love to see me leave Congress more than Nancy Pelosi and Adam Schiff.

You can always count on me to stand up and tell the truth – no matter how angry that makes people. So, Friend, if you want me to be able to stay fighting and speaking up for our values then please let me know if I can count on you right now.

DONATE TODAY
HELP TREY GOWDY>>

Please consider making a financial contribution of whatever amount you are able to afford.

Thank you for your help.

Sincerely,

Trey Gowdy
South Carolina 4th District

P.S. The Democrats fear my voice of the truth and want me out of Congress as soon as possible. I want to stay fighting for our shared beliefs, but I won’t be able to if these groups set on defeating me are successful. That’s why I need your help today! Any amount you can afford to donate will go a long way towards meeting our goal.

DONATE TODAY
HELP TREY GOWDY>>

Paid For By Trey Gowdy for Congress

Angry Chef
Oct 3, 2017 - 2:06pm

Ancientmoney....

Your post makes a lot of sense. Though I suspect that foreign buyers would be soaking up the bargain basement prices all the way down thus accelerating the process. But quite possible for sure.

boomer sooner
Oct 3, 2017 - 2:03pm

Sorry, OT

Mandalay Bay Las Vegas Massacre Taxi Driver Viewpoint

Go to the 4:58 mark and tell me that's muzzle flashes on the 32nd floor?

brolgaboy
Oct 3, 2017 - 1:58pm

it's all over but the crying......

Novo peaks out at a billion, just a concept at this point. Who knows I could be wrong, never owned any shares.

I'll take Detour insted - multi million ounces in the ground producing something like 575,000 ounces AU

for the next 20 years....and in Canada too! Incredible. as NOVO has gone up every day for the last month,

Detour has gone down. Have a look, I mean seriously until today it was down like 20 freakin days in a row.

YukonCorneliusRickshawETF
Oct 3, 2017 - 1:57pm

I'm sure I miss many good posts on the boards...

I'll go back and have a look. Thanks for letting me now.

Please keep posting great ideas!

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