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Gold, Discussion
mullokintyre
post Posted: May 18 2020, 10:18 AM
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Gold smashed the 1700 USD level, and the asian markets are pushing it towards the 1800 level.
Lifes good.
Mick



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mullokintyre
post Posted: May 18 2020, 10:18 AM
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Gold smashed the 1700 USD level, and the asian markets are pushing it towards the 1800 level.
Lifes good.
Mick



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sent from my Olivetti Typewriter.
 
mullokintyre
post Posted: May 18 2020, 10:18 AM
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Gold smashed the 1700 USD level, and the asian markets are pushing it towards the 1800 level.
Lifes good.
Mick



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sent from my Olivetti Typewriter.
 
mullokintyre
post Posted: Apr 17 2020, 11:12 AM
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Sprott money are harping on about the iminent collapse of the paper derivitive gold market.
Maybe THIS time they are right.
From Sprott Money


QUOTE
These are dark times for The Bullion Banks. Their Fractional Reserve and Digital Derivative Pricing Scheme is in great peril as refineries, miners, and mints all shut down in response to the coronavirus pandemic. Will these Banks be able to scrounge up enough physical metal to keep their scheme afloat through June? That remains an open question.

You may recall that we've been warning of the outrageous volume of COMEX EFPs (Exchange For Physical) for years. For the calendar years 2018 and 2019, the COMEX swapped out over 14,000 metric tonnes of contracts for alleged "physical metal" in London. And this process grew even more extreme in 2020, as the first three weeks of the month saw 290,000 COMEX gold contracts "exchanged" this way. Here's the link from the last post dedicated to this subject, written on March 10: https://www.sprottmoney.com/Blog/comex-gold-efp-us...

For today's discussion, let's begin with a brief, simplified summary of how we got here over the past few weeks: • The Banks swap 290,000 COMEX contracts (over 900 metric tonnes) into EFPs in just the first fifteen trading days of March.
The Fed announces QE∞ on Monday, March 23. COMEX gold price soars over $100.
A party or parties seek actual, immediate delivery of COMEX 100-oz bars through EFP.
COMEX must admit that it has no 100-oz bars to deliver on Tuesday, March 24.
CME and LBMA make a joint announcement on Wednesday, March 25 that a new settlement contract will be introduced for Apr20 delivery. This contract will feature "delivery" of fractional ownership of 400-oz London bars.In short, with an unexpected global supply squeeze, the COMEX was caught without enough deliverable gold. Through the change of rules shown above, the exchange (and CME/LBMA) have been able to scrape together enough gold to maintain the illusion of physical delivery thus far through the Apr20 delivery period. But it hasn't been easy. As you can see below, there have already been nearly 30,000 contracts delivered this month...more than 3X the average volume of Aprils past.
As the supply squeeze continues—with many mines and refineries still shut down—the COMEX should expect these delivery issues to continue in May and June. Already we're seeing total open interest of the "non-delivery month" of May20 surge—going from 1,228 contracts late last week to over 4,500 contracts on Monday, April 13. What will happen if this number surges above 10,000 in the days before deliveries begin on April 30?COMEX Search & Seizure - Craig Hemke (April 14, 2020)
COMEX Search & Seizure - Craig Hemke (April 14, 2020)
By Craig Hemke 2 days ago 54409 Views 4 comments
April 14, 2020

These are dark times for The Bullion Banks. Their Fractional Reserve and Digital Derivative Pricing Scheme is in great peril as refineries, miners, and mints all shut down in response to the coronavirus pandemic. Will these Banks be able to scrounge up enough physical metal to keep their scheme afloat through June? That remains an open question.

You may recall that we've been warning of the outrageous volume of COMEX EFPs (Exchange For Physical) for years. For the calendar years 2018 and 2019, the COMEX swapped out over 14,000 metric tonnes of contracts for alleged "physical metal" in London. And this process grew even more extreme in 2020, as the first three weeks of the month saw 290,000 COMEX gold contracts "exchanged" this way. Here's the link from the last post dedicated to this subject, written on March 10: https://www.sprottmoney.com/Blog/comex-gold-efp-us...

For today's discussion, let's begin with a brief, simplified summary of how we got here over the past few weeks: • The Banks swap 290,000 COMEX contracts (over 900 metric tonnes) into EFPs in just the first fifteen trading days of March.
The Fed announces QE∞ on Monday, March 23. COMEX gold price soars over $100.
A party or parties seek actual, immediate delivery of COMEX 100-oz bars through EFP.
COMEX must admit that it has no 100-oz bars to deliver on Tuesday, March 24.
CME and LBMA make a joint announcement on Wednesday, March 25 that a new settlement contract will be introduced for Apr20 delivery. This contract will feature "delivery" of fractional ownership of 400-oz London bars.
https://www.nasdaq.com/articles/exclusive-c...wn-sources-2020
In short, with an unexpected global supply squeeze, the COMEX was caught without enough deliverable gold. Through the change of rules shown above, the exchange (and CME/LBMA) have been able to scrape together enough gold to maintain the illusion of physical delivery thus far through the Apr20 delivery period. But it hasn't been easy. As you can see below, there have already been nearly 30,000 contracts delivered this month...more than 3X the average volume of Aprils past.
As the supply squeeze continues—with many mines and refineries still shut down—the COMEX should expect these delivery issues to continue in May and June. Already we're seeing total open interest of the "non-delivery month" of May20 surge—going from 1,228 contracts late last week to over 4,500 contracts on Monday, April 13. What will happen if this number surges above 10,000 in the days before deliveries begin on April 30?
And what will happen if the next "delivery month" of Jun20 sees more delivery requests than the COMEX is fielding here in April? What if there is a demand for 40,000 or 50,000 deliveries? That would be 5,000,000 ounces. From where would COMEX source the gold then?

For now, an unprecedented disconnect continues to exist between the spot and front month futures price. This is indicative of tight supply and a failure of confidence in future delivery. This was the topic of last week's article. You continue to be told by System Apologists that "the gold is there, it's just in the wrong place". This is alleged to be the reason for the spread in price and the issues at COMEX. Oh, really? If that's the case, then there must be a shortage of silver, too, and it must also be "in the wrong place". The current spread shown below is more than 2% and even larger than the current spot-future spread in gold!
And these Apologists also claim that everything the CME/LBMA does is totally transparent and honest, with the moves such as fractional ownership of London bars just simply a nice new service that The Banks are providing. RRRrrriiiggghhhttt. If that was the case, then why is the CME/LBMA demanding complete secrecy from the CFTC regarding this new arrangement? Thanks to the guys at BullionStar, see the information below:

“COMEX secures secrecy agreement with CFTC under FOIA not to release details to the public of its market maker program for the new 400 oz gold futures contract hatched with LBMA, because ‘Disclosure Would Likely Cause Competitive Harm to COMEX’. Program begins tomorrow April 13. pic.twitter.com/QEuEyGz64m”

— BullionStar (@BullionStar) April 12, 2020
So if everything is just fine , and the delivery issue is simply being caused by gold "being in the wrong place" and the exchanges are forthright and honest brokers, THEN WHY WOULD CME/LBMA DEMAND PROTECTION FROM FREEDOM OF INFORMATION ACT (FOIA) REQUESTS?

I'll tell you why... BECAUSE IT'S ALL ONE BIG MASSIVE SCAM! The Bullion Banks have managed a just-in-time delivery scheme through increasingly mind-blowing amounts of promissory notes, delivery receipts, and unallocated accounts. For Pete's sake, the LBMA actually admitted to a total trading volume of 32,255 METRIC TONNES of gold IN MARCH ALONE! That's an annualized run rate of over 380,000 METRIC TONNES or about 135 years of global annual mine supply! WHAT?!?!

“You need to take a second. Stop what you're doing. Let this sink in. In March, the LBMA traded 1.04 Billion ounces of ‘gold’. That's 32,255 metric tonnes. In one month. That's an annualized run rate of 387,060 METRIC TONNES!! 138 YEARS of mine supply.


The last sentence is the most important.
Its that divergence between reality and digital gold that will be the killer.
Mick



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mullokintyre
post Posted: Apr 14 2020, 08:37 PM
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In Reply To: triage's post @ Apr 14 2020, 08:06 PM

I hope like hell he is a long way ahead of the mark.
If gold does go to 10k an ounce, it probably means that the majority of the societal institutions have failed, and a general sense of anarchy has prevailed.
It doesn't take much for humans to revert to the level of savages, as history has shown.
Mick



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triage
post Posted: Apr 14 2020, 08:06 PM
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David Llewellyn-Smith, one of the main writers at Macrobusiness, today called that gold will go to A$10,000. His bio says he used to be a gold trader but that seems to be a heroic call for me (I would be more than happy if that transpired but...). I'm not sure his prediction carries any more weight than the thousands of others who claim to have the measure of what will and wont do.But I just thought I'd post a marker:


14 April 2020, David Llewellyn-Smith, A$10k per oz.







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"The market can stay irrational longer than you can stay solvent." John Maynard Keynes

"The crisis takes a much longer time coming than you think, and then it happens much faster than you would have thought." Rudiger Dornbush

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joules mm1
post Posted: Apr 9 2020, 06:00 PM
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Chris Rutherglen‏ @CRutherglen Jan 14

In 1980, the gold price traded at a 70% premium to the model price. During the 2011 top, the price peaked exactly at the model price. This suggest: 1) 2011 was not a bubble, 2) the blow-off-top is still ahead. By 2022, model price should be ~$3000. A 70% premium would be ~$5000.
Attached Image



log scale:


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David Rosenberg‏ @EconguyRosie 1

Money supply growth is running at 12.2% on a year-on-year basis, the fastest in two decades and ongoing. The world’s above-ground gold stock grows on average by 1%-to-2% per year. Guess what the investment recommendation is from this discrepancy?



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. . . . . . . . everything has an art.....in the instance of the auction process, the only thing, needed to be listened to; price
 
mullokintyre
post Posted: Apr 7 2020, 09:53 AM
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In Reply To: mullokintyre's post @ Apr 5 2020, 12:20 PM

And today looks pretty good as well.
Mick



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mullokintyre
post Posted: Apr 5 2020, 12:20 PM
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Gold back above AUD$2700.
Gotta be positive for gold stocks come Monday mornings open.
Mick



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mullokintyre
post Posted: Apr 3 2020, 10:10 PM
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Those that do not learn from History, are doomed to repeat its mistakes.
From Zero hedge


QUOTE
Between 1962 and 1968, a cartel of central banks from the US and Europe ran a price manipulation scheme in London, aiming to keep the price of gold at $35 per ounce. They did this by constant intervention into the market, pooling their gold reserves to sell down the market. Conceived and coordinated at the Bank for International Settlements (BIS) in Switzerland by the G10 central bank governors, the dirty work of actual gold market intervention was done by the Pool's agent, the Bank of England gold trading desk in London.

The syndicate, known as the London Gold Pool was successful until it wasn’t, with the beginning of the end in early March 1968 as the huge run on gold became a tidal wave with sterling and US dollar weakness. On 10 March 1968, a Sunday, the consortium released a statement claiming that: “the London Gold Pool reaffirm their determination to support the pool at a fixed price of $35 per ounce”. At the same time, Fed chairman William McChesney Martin even vowed that the US would defend the Pool “to the last ingot”.

The Pool then proceeded to airlift hundreds of tonnes of gold bars from the US Treasury’s Fort Knox to RAF Mildenhall, which they dumped into the London market for the rest of the week (March 11 -14). With all the Good Delivery Gold siphoned off to the Market (actually a consortium of European merchant banks), the Rothschild and the Bank of England pulled the plug, and the London Gold Pool collapsed on the evening of 14 March 1968, ushering in an era of free market gold prices.
Moral of the story, don’t believe the pronouncements of the powers that be in the London and US gold markets, especially during a crisis.

Fast forward to today, and the parallels of the Pool with the modern bullion bank cartel, the London Bullion Market Association (LBMA) and CME’s Commodity Exchange (COMEX) are uncanny. In the space of a week, the LBMA – COMEX nexus, which together control price discovery in the global gold market through their combination of fractionally backed synthetic unallocated gold, and cash settled gold futures, has issued two statements to try to placate the gold market, each one more panic stricken.

Last week, as the contango between COMEX futures and London spot gold blew up to a nearly $100 differential, and London market maker bid-ask spot spreads blew out to $100, the LBMA in a rush to deflect attention, issued a statement claiming that:

“The London gold market continues to be open for business. There has, however, been some impact on liquidity arising from price volatility in Comex 100oz futures contracts. LBMA has offered its support to CME Group to facilitate physical delivery in New York and is working closely with COMEX and other key stakeholders to ensure the efficient running of the global gold market."

As we asked at the time last week:

Why is the LBMA colluding with the COMEX?

How can the London gold market be open for business if LBMA market makers are not providing liquidity in spot gold

Why is the LBMA deflecting attention from the London market and pinning the focus on the COMEX?

Why does the LBMA want to facilitate physical delivery in New York when its remit is the London Gold Market (loco London)?

Who are the other key stakeholders that the LBMA and COMEX are colluding with?hen yesterday, April 1, for a second the LBMA and CME issued an unprecedented second statement, more desperate than the first, with the pair seemingly running scared:

“LBMA AND CME GROUP COMMENT ON HELTHY GOLD STOCKS IN NEW YORK AND LONDON

CME Group and LBMA..will continue to coordinate efforts as market circumstances evolve. Together, both CME Group and LBMA are actively taking measures to ensure the continued efficient operation of global gold markets during this unprecedented time.

LBMA reports record gold stocks

Gold stocks in London remain healthy with the latest published numbers showing record stocks of 8,326 tonnes of gold, which is equivalent to 666,045 standard 400-ounce gold bars. Visit the LBMA website for more information.

CME Group depositories open and gold stocks near record high

CME Group’s New York depositories are operating normally as they have been deemed essential businesses and deliveries are occurring as planned. As of March 30, 2020, our depositories currently hold 9.2 million ounces of gold (with 5.6 million ounces eligible), nearing a record high in terms of stock levels..."
London Gold Pool - Bank for International Settlements (BIS), Basel
Never before has the gold market seen such panic from the paper gold conductors, and all this in the presence of record physical gold demand, cleared out gold bars and coin inventories across the entire gold supply chain, closed down precious metals mints and refineries, and a price disconnect between the physical and paper gold markets.

The fact that the LBMA - COMEX tag team which front for the modern bullion bank cartel have to comment not once, but twice in a week about the health of gold inventories in London and New York means they are panicking. It's unprecedented.

And this comes after the bullion banks placed disinformation into the media last week about needing to physical deliver gold bars from London to New York (hint - In modern times the US never imports physical gold from the UK), and were panicked into moving the goalposts with the launch of a new CME COMEX futures contract that brazenly tries to prop up COMEX GC 100 trading with the figment of fractional delivery of 400 oz gold bars that sit in London. Not to mention that on Monday this week, after CME published a COMEX vault report that had 400 oz bar categories listed for all the vaults, but with absolutely no 400 oz gold bars listed, and we mentioned it here on ZeroHedge, the CME then panicked and pulled the 400 oz version of the report, reverting back within an hour to the original version

The entire LBMA - CME Group statement about healthy gold stocks is, in the words of Francis Bacon - “of Simulation and Dissimulation” - simulation being a pretense of what is not, and dissimulation being a concealment of what is.

The LBMA reference to 8326 tonnes of gold in its network of London vaults is completed misleading.

This figure is from 31 December 2019, which is 3 months ago

Of this 8326 tonnes figure, 5373 tonnes (65%) represents gold held by central banks at the bank of England, and another 1895 tonnnes representes gold backing Exchange Traded Funds held in London LBMA vaults, such as the vaults of HSBC and JP Morgan. Subtracting these leaves 1057 tonnes (13% of total). Thais 1057 is just the maximum possible London float and does not itself exclude allocated gold held by entities such as sovereign wealth funds, investment institutions, ultra wealthy and family offices. I am hearing from the London gold market sources that the real LBMA bullion bank float is less than 500 tonnes and maybe be as low as 200 - 300 tonnes.
Looking at the COMEX data and vaults, as always, COMEX has very low gold holdings. The 9.2 mn ozs number which CME refers to in the above statement (actually 9.245 mn ozs) is only 287 tonnes of gold. Of that figure (which refers to Tuesday 31 March), 114 tonnes was in the Registered, meaning there already are vault warrants issued against that.
The other 5.6 mn ozs (actually 5.85 mn ozs) is ‘Eligible gold’, but eligible just means any gold that happens to be in the approved COMEX vaults that is in the form of kilo bars or 100 oz bars. It could be anything. It is already owned by entities, which would include mints, refiners, and jewellery companies, and eligible gold may have nothing to do with COMEX or CME.

There are now over 2.19 mn ounces of Comex contracts standing for delivery in April (stops issued) - that's 68 tonnes..and increasing.
From this latest April Fool’s Day statement, we can conclude that the LBMA is terrified that unallocated investors who have claims on LBMA bullion banks, will line up to take allocation of gold in London, while the CME is terrified that COMEX futures contract holders will increasingly try to take physical delivery of gold in New York (not just delivery of warrants but actually withdrawing the gold bars out of the COMEX vaults.

In March 1968 during the last days of the London Gold Pool, the cartel of central banks kept playing while the ship began to sink, brazenly saying that “the London Gold Pool reaffirm their determination to support the pool."

This time around, with their “healthy stocks of gold in London and New York” (you can be the judge of that), “the LBMA has offered its support to CME Group”. It therefore seems that while history doesn't repeat itself, it often rhymes.


At some stage, this has all got to blow up.
=It can't last forever this constant rigging of the market.
At some stage, the enemies of the west will stage a coordinated push to smash the paper warriors.
physical will eventually whem I just don't know when.
Mick



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