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, this gives 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!
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?

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By Turd Ferguson, TFMetals Report:

About a month ago, I was maligned and pilloried by some detractors for having the audacity to suggest that the reported Comex vault stock numbers were obviously dubious. Other bloggers suggested that the deposits in question were easily explained by the deposit of 99.99% pure, Asian kilobars. OK, maybe. For fun today, I thought we’d take these folks at their word and see where it leads us.

First, some histoire….

Back in the middle of October, some very odd and very precise deposits were made into the eligible vault of JPMorgan. Over three days, the total amount of gold booked in was exactly and precisely ten metric tonnes. It looked like this:

These oddly precise eligible deposits prompted me to write this: http://www.tfmetalsreport.com/blog/5182/more-deception-comex

The chagrin and malignment came about when it was suggested that, instead of being “bullshit”, these deposits are simply the reflection of Kilobars of gold being deposited at The Comex.  Of course, given that dealings on the Comex are so deliberately opaque that the CME Group itself “disclaims all liability whatsoever with regard to the accuracy or completeness” of these reports, there’s no point in continuing to debate whether or not these are simple paper shenanigans or Kilobar deposits. We can’t know for certain so, in the end, we are just arguing for arguments sake and getting nowhere.

So, today, I thought it’d be more fun to just simply take as fact and accurate the CME Group reports. Let’s go ahead and presume that the deposits of late October really were perfect, one kilogram bars….and then let’s see where that takes us. And, again, a disclaimer: I’m not claiming to have all of the answers here. This is just a thought experiment and I’m simply trying to lay out the information that I see every day and asking you for your opinion. What do you think?


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Some have suggested a simple explanation for the 10 metric ton delivery in October. This addition was the gold that JPM stopped during the October Comex gold delivery process. Hmmm. OK. But here’s the problem. JPM only stopped 1,054 contracts that month between their House and Customer accounts. That works out to be about 3 1/3 metric tonnes, yet JPM booked in 10 metric tonnes over the three days in question. Again, hmmm.

JPM also stopped 3,414 contracts in August and that’s a little more than 10 tonnes. Could the October bookings simply be the delivery to their vaults of the August metal? That seems plausible, I guess, but more likely just leads us to…


Here’s how the Comex math works. According to the CME Rulebook (http://www.cmegroup.com/rulebook/NYMEX/1a/113.pdf), this is how deposits and deliveries are accounted:

The contract for delivery on futures contracts shall be one hundred (100) troy ounces of gold with a weight tolerance of 5% either higher or lower. Gold delivered under this contract shall assay to a minimum of 995 fineness and must be an Approved Brand.

Gold meeting all of the following specifications shall be deliverable in satisfaction of futures contract delivery obligations under this rule:

  1. Either one (1) 100 troy ounce bar, or three (3) one (1) kilo bars.
  2. Gold must consist of one or more of the Exchange’s approved brand marks, as provided in Chapter 7, current at the date of the delivery of contract.
  3. Each bar of Eligible gold must have the weight, fineness, bar number, and brand mark clearly incised on the bar. The weight may be in troy ounces or grams. If the weight is in grams, it must be converted to troy ounces for documentation purposes by dividing the weight in grams by 31.1035 and rounding to the nearest one hundredth of a troy ounce. All documentation must illustrate the weight in troy ounces.
  4. Each Warrant issued by a Licensed Depository shall reference the serial number and name of the Approved Producer of each bar.
  5. Each assay certificate issued by an Approved Assayer shall certify that each bar of gold in the lot assays no less than 995 fineness and weight of each bar and the name of the Approved Producer that produced each bar.
  6. Upon receipt of the gold bar by the Licensed Depository who must also qualify and be designated a Licensed Weighmaster for gold, each gold bar shall be weighed in the lot measured to 1/100 of a troy ounce (two decimal points). In accomplishing such measurement, each bar shall be weighed to the nearest 1/1000 of a troy ounce (three decimal points); weights of 4/1000 of a troy ounce or less shall be rounded down to the nearest 1/100 of a troy ounce and weights of 5/1000 of a troy ounce or more shall be rounded up to the nearest 1/100 of a troy ounce.

OK, now this is getting interesting. There are several things to note here.

  • Comex good delivery bars are 995 fineness. This is important because the “Asian Standard” that so many folks are discussing these days is 999 fineness. A difference that is not insignificant. Because of this variance in quality, it would seem quite foolish for an owner of a 999 bar to “register” and sell it on The Comex.
  • Time for a little math. Point #3 from the rulebook states: If the weight is in grams, it must be converted to troy ounces for documentation purposes by dividing the weight in grams by 31.1035 and rounding to the nearest one hundredth of a troy ounce.  Hmmm. The actual math then looks like this: One Kilogram = 1000 grams. Divide 1000 grams by 31.1035 and you get 32.1507226 troy ounces. The CME ten says you can “round to the nearest hundredth”. This give us 32.15. Multiply that by 1000 and you get…VOILA…32,150.000 troy ounces for every 1000 Kilobars deposited.
  • Problem solved.
  • Not quite.
  • Where I take issue with this is in the accounting. Remember, we’re dealing with bankers and bean counters here. They often do not take kindly to “rounding errors”. What if we don’t “round to the nearest hundredth”? The math changes slightly. Not much to begin with but, with increasing size, it becomes significant.
  • 32.1507226 X 1000 ounces = 32,150.7226. Note that this is NOT 32,150.000. There’s 0.7226 troy ounces of gold “lost” in each of these one metric ton bookings. For just one metric ton, that’s about $1000. Maybe not much to you and I but, to a soulless, greedy banker, a $1000 rounding error should raise some eyebrows.
  • Then, when you book in ten metric tonnes this way, the error becomes 7.226 troy onces. At current prices this is about $9000. Now we’re talking some more serious cheese.



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Let’s get back to the “fineness” issue. If we’re dealing in Kilobars, it is very likely, given all of the reports of Asian demand and refinery backlogs, and given the method through which they were booked in, that the Kilobars allegedly deposited into JPM’s eligible vault are of the 999 fineness variety. IF THAT’S THE CASE, these bars are not, and will not, ever be switched to registered. Why? Because the owner would be crazy to do so. If the minimum Comex standard is 995 then, as stated in Point #2 above, wouldn’t it seem foolish to sell your 999 bars in New York? Therefore, the only likely way that a 999 bar would ever be registered and sold is if The Comex changes their purity rules. (Hold onto that thought. We’ll get back to that in a minute.)

Perhaps here we have actually stumbled upon our answer to this entire riddle:

  • These really are Kilobars, temporarily held for safekeeping in the NY vault of JPM, before being shipped overseas.
  • They are the product of American refiners. They are perfect, brand new 1KG bars destines for China etc. The JPM bankers don’t necessarily care about the rounding errors because the very same bars will soon be shipped back out of the vaults, to destinations East.
  • If this is the case, we should eventually see equivalent, ten metric ton withdrawals take place. So far though, in the 2 months since, this hasn’t happened. In fact, quite the opposite, which leads us to…


Last Wednesday, JPM booked in another perfect and precise, two metric tonnes of eligible gold. But that wasn’t the only day…the four days since have all seen identical deposits. This makes five, consecutive days of exact and precise, two metric ton deposits. It looks like this:

(As rounding errors go, now we’re really getting somewhere. 20 metric tonnes X 0.7726 troy ounces/ton = 14.452 troy ounces. Misplacing/disregarding 14.452 troy ounces equals almost $18,000 at current prices.)

Again, some might suggest that this is simply the gold that JPM has stopped during the December delivery month. As we’ve painstakingly noted each day, JPM has now stopped exactly 5,000 of the total 5,207 December deliveries or 96%. Five thousand contracts is 500,000 ounces and, as shown above, over the past five days JPM has taken delivery of about 643,000 ounces.

But now what do you make of this? Below is the CME Gold Stocks report for November 29, right before the December delivery period began. Note the inventory levels of HSBC and Scotia. Why? Since this report was generated, the House account of HSBC has issued/delivered 2,939 contracts (293,900 ounces) and the House account of Scotia has delivered another 1,225 (122,500 ounces). Here’s the 11/29 report:

And here’s another look at the report from yesterday:

Note the changes. The amount of gold in the vaults of each have gone UP, not down. In fact, if you go back to the report of 12/9, you’ll see that HSBC even got in on the 32,150.000 act:


And I guess this is the main point…These “markets” are broken. The futures markets were set up as a place where producers could hedge and manage risk. Speculators were free to take the other side of these trades if they felt they could profit. Underlying these exchanges was the promise to actually deliver the physical commodity. Without this promise and process, you have an empty shell…a “market” comprised of nothing but paper derivatives and deliveries made with book-entries and the shuffling of warrants and warehouse receipts. The Comex was not designed to “discover price” but that’s exactly what it does, and it does so at the whim of HFT speculators and bullion banks. And this has real world consequences.

Look at the past two weeks of market activity. There has been tremendous volatility with price swings from day-to-day of 2-4%. The CFTC-generated CoT reports demonstrably show that all of this price action was due to the squeezing of Spec shorts one day, only to have them and replaced and put back on the next. Nowhere in this price action were the real world, supply and demand fundamentals of the producers ever in play. You tell me, did the fundamentals for silver mining production suddenly improve on December 10th, when price surged 62¢ or 3%? If so, then the fundamentals must have immediately turned back around two days later when price fell by 90¢ on December 12th.

The global pricing mechanism for precious metal is now almost entirely the domain of speculating hedge funds and bullion banks. They do this through The Comex where rarely, if ever, anyone has to deliver against a paper short obligation. By rigging and momo-chasing prices lower, the banks and hedgies are forcing mining companies out of business and real jobs are being lost, often in places where there is no alternative employment. Lives and families are ruined, all to prop up confidence in The Great Ponzi and enrich and fatten some banker bonus pools.

The good news is…Like all fraudulent schemes that distort the laws of supply and demand, this pricing structure will eventually come to and end. For me, it can’t happen soon enough.


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.(http://www.ingoldwetrust.ch/shanghai-gold-exchange-physical-delivery-equals-chinese-demand-part2) 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? (http://www.bloomberg.com/news/2013-10-18/jpmorgan-tower-sale-sets-record-for-chinese-in-new-york.html)
  • 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 (http://www.zerohedge.com/news/2013-03-02/why-jpmorgans-gold-vault-largest-world-located-next-new-york-fed), 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. (http://www.bloomberg.com/news/2012-07-24/lme-shareholders-poised-to-vote-on-hkex-s-2-2-billion-takeover.html)

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?

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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…


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    • The silver world is populated by people with strange post handles. 
      Turd, Bix Weir, Doc, the Golden Jackass.
        I’d chose ‘stinky’ but you can never get rid of that handle–never.
      As for JPM being a China gold shill, you can count on that.  After being roto-bleeped by the ‘Holder Hole the Wall Gang’ for $20 billion or so, if I was Dimon (Scary thought there) I’d use whatever means at my disposal to screw the US back and go straight to China to make money. 
      Dimon may be a card carry member of the oligarchs but that doesn’t mean he’s stupid.

      Mr. T’s crunched some serious numbers here to disclose the phoniness in the amounts of precious metals held by bullion banks and the account for same, down to the merest fractions of ounces.  Craig’s come out of the shadows recently to make sure people knew his intentions and his personal situation. Like most silver speakers, he is not doing this to get rich. He is doing it to inform us and make us more aware of the situation we face.  Intel like this is hard to come by and harder to actually assimilate. I am one who salutes a person willing to expose themselves to the evil forces who would harm others who try to get out the good word.
      But Turd as a post handle still makes me wince a bit.

  1. In the latest Andrew Maguire interview on KWN, at around the 4.00 minute mark, he states that the Chinese are NOT involved in paper trading on the Comex. He also stresses that the Comex is NOT a delivery market.

  2. First, I have to say I really love the way your mind works Turd. Thank you for having the moral integrity to speak the truth and for being a light in a dark world.
    There seems to be a lot of smoke surrounding the idea that JPM is holding gold for China but I think a kink in the theory is that they historically have been thought of as an extension of Uncle Sam and I don’t think he would take too kindly to his right hand helping China kill the dollar hegemony. Unless, it is all part of a larger play.

  3. Lets assume Turd is correct. We are China`s largest market for goods. I`ve always assumed China wants the US to continue purchasing goods from them. In other words China wants the Ponzi scheme to continue. Assuming Turd is right, and the Chinese taking possession of the London gold exchange, and storing gold with JPM, would give China a huge advantage here. But to what end? They don`t want to damage the largets market they have. Do they really want to back Chinese currency with gold, and then accept US dollars, backed by nothing in exchange for goods sold here?  Perhaps China holds gold as a hedge against a global currency crisis. But why store it here?

    • Silver Dollar  I’ve tried to figure out this peculiar situation.  It seems to me that China would want us as a trading partner, both imports and exports, and holds $1.3 trillion in US Dollar holdings.  Something tells that at some time inthe future they will consider the USD a sunk cost, a paper asset that has to be written off.  Kind of like writing off a few pawns on the way up the chess board.  They must become more internally self sufficient and use the USD and other currencies to buy and invest in other asset bases and countries. Gold and silver are just to good to let go at these prices so they buy with frantic vigor.  If I was in their shoes I’d be doing that exact same thing. Preppers think alike in regards to that score

    • One assumption most Americans make is that we are China’s biggest customer.  WE ARE NOT! PERIOD!  Europe is.   In fact China has been working diligently to reduce their dependency on the US for sometime.  China is a very forward looking/ long term planner and their US exports only amount to 16% of the Chinese pie. 
      The Ponzi is actually the US dollar.   Only those that benefit want to see it continue and China voted down on the Ponzi with the following statement:  “we want to reduce our foreign reserve holdings”.   It is known China is NOT buying US debt and mid year sold some USTs on the open market.
      At the G20 in Russia China made it clear that the world needs a new reserve currency and it also needs to be “de-Americanized”.  THe US has countered China with the Trans Pacific Partnership.  A program that forces members who produce goods to only purchase materials to make those goods from members who produce, regardless of price.  This cuts China out of the equation.   It would be in China’s best interest to see the US economy collapse soon and expose the charade of EZ credit that gives the US it’s massive consumption hegemony.  If they can force “REAL MONEY” into the system, the US credit game is over.   
      I believe the end is coming soon and 2014 is shaping up to be a dandy of a year!  The 40 year reign of FIAT is finally coming to an end.  Want to see what it looks like as the last fight plays out? go to a Chevy dealer and watch who is getting new cars!!   I believe very soon the FED is going to buy all mortgages with a “no money down” program.  They will fight to the bitter end!

  4. Well dudes and dudettes, 2013 was a tough year psychologically on us silver bugs, but only psychologically! I remind myself often that although they can take paper prices down, they can’t take your stack and that’s the real value here, not fictitious naked contracts that are used to drive the prices down for the Chinese to hoard 80% of the global gold reserves. The very same reason the east is positioning themselves in metals, is the same reason I/we do. We all know what end is up because we are standing on knowledge and wisdom, not fear and propaganda. I see silver going to the moon regardless of the fed, a possible collapse or any other reason, other than the fact that the white metal is precious and will become more so as time passes, unlike fiat ponzi paper.
    Happy holidays to you all and may your 2014 be a prosperous year for you and yours.

    • copy that BOP   They also limited the amount of cash a merchant can deposit to $50,000 and curtailed wires out of the US. News out about 2 months ago.  If they are the merchants of the FIAT DEATH STAR, these plans and other events sure seem to be foretelling of worse things to come.
      40,000,000 Target shoppers were hacked. That takes some serious skills.  We are seeing even more of these uber hacks against big banks, governments, businesses and individuals.  What if the Target hack was another Flase Flag wrapped in a hack attempt.  It’s a great way to test a system shutdown, limiting or completely curtailing personal access to ATMs and debit card use.  Limits of $100 are worse than the ATM limits of 300 Euros in Cypress.  If JPM can test run an ATM limitation, and I have a Chase Card (Dumb ass hat at the ready)then when the real deal hits and we don’t have some folding money at the ready, those debit cards will be useful for scraping snow off your windows.
      Test test test, nudge nudge nudge, steal steal steal.
       This probably cost Chase and like banks little. Someones getting fat on this hack. Maybe JPM will get a rebate.
      It’s just a tax write off. Target gets hammered but who cares about Target.  They’re just a big red circle.  Even the boneheads in our central government could zero a bullseye as big as this one.
      Sheesh  It’s getting a little thick around here. 
      I need to find another conspiracy theory.  Anything new come to mind BOP?  Cheers
      JPM is just to easy.

    • 40M? That sounds outrageously inflated and high. How many people could actually shop at Target during that window of time?
      That’s why I suggested it could be a false flag.  🙂

    • @Bay of Pigs … “(false flag, capital controls?)”

      Or it could be ‘false flag’ pre-positioning for an already obvious horrendously dismal set of retail figures that can be ‘blamed’ on bogus credit card curtailment of so many ‘otherwise eager buyers’ … supposedly thwarted from their ‘full potential’. With nearly half our ‘free people’ (not rowing government’s ‘galley ships’) needing food stamp EBT cards to eat, how much CAN they afford to ‘charge up’. We’re in a Debt Saturation condition and it’s only deepening for the foreseeable future. The recent string of housing numbers portend what the retail totals WOULD pretty certainly have looked like. So, some kind of ‘cover’ operation had to materialize.

  5. Okay, I’m confused. Who is fighting who? Is it a bad guy against another bad guy or are all the bad guys out to get the few good guys that are left, if there are any. Would be nice to know what the names of the teams are since we got such a great seat watching the game. Reminds me of what I read about in the days of the gangsters, vying for territory where the innocent usually got in the way.

  6. Lao-Tsu  I think we little folks are our own individual teams; a team of one for the most part.
     The big dogs are tussling.
    We become collateral damage if we get too close. 
    First rule of a dog fight.  Don’t try to separate the dogs.  You will get bitten.
    One thing I am certain of.    We could be said to be on at least one team, the Silver Doctors Irregulars.  We give each other advice, support and good intel that is usable in daily matters. That is a personal opinion
    Individually we are not gangsters.  We live at the effect of gangsters.  The gangsters like to drag the innocents into the fight. 
    The bad guys and good guys are all serving their own interests, not ours.  
    The names ‘Good Guys and Bad Guys’ are interchangeable,  depending which side of the border you live on.
     All countries serve their own interests,  always.
     Even allies are adversaries when their own interests are not being served by the other guys 
    Keep your enemies close and your friends closer. 
    Being an enemy of the US is a bad place to be.
    Being a friend is worse–said an American politician
    No country, by their own self serving nature, is benevolent, charitable and altruistic.  America is no exception though we’ve been proclaimed as charitable.
    Most of that charity is usually on an individual basis. Those who have the most generally give the most. That’s the American people’s way
    But just because things look bad, keep planting those apple trees

    • A few decades behind the USA I see.
      In any case, this has more effect on India, Japan, South Korea, Philippines etc. than it does on Europe or America.

  7. Another lesson from ‘historie’ …

    Further speculating on those deposits being Chinese standard kilo-bars …

    In 1450 AD, China converted all its ‘Flying Money’ (the very first paper implosion fiasco) into copper ‘cash’. On that platform, it began a three century agenda of restoring its most preferred monetary standard of silver. If its positioning of gold in key markets (America and Europe) is a prelude to re-imposing the poly-metallic scheme on the entire world this time round instead of ‘merely’ its Asian Empire of that time period, then that gold will stay put as a physical guarantee for trade of its goods priced in silver and copper … from which it MAY cull out that coveted silver AGAIN. Only I doubt they’ll loll about for ANOTHER three hundred years on the project, because this time it isn’t their own damned fault.

    Going back into the remotest mists of history, China has ALWAYS been a very big elephant with a VERY long memory. If the ulterior motive is to get revenge on the families and organizations responsible for poisoning their society with opium and ‘Gunboat Commerce’, then these tactics imply just such an encore performance. In a related way … I’m wondering if those Euro-American clone cities are alluring ‘Gilded Cages’ made to appear as refuge for those ‘elites’ believing their Machiavellian ‘control’ of Chinese politicians will play out the same as in the ‘West’. Won’t THEY be ‘amused’ to pay outlandish prices to live in their ‘special hide-aways’ … in gold and silver ONLY.

    There ya’ go Craig … that’s my two cents on the matter.

    • interesting thoughts.  Points one and two can lead to false arguments (stopping gold is but one way to increase ones ownership, and is often in others vaults. Itnis largely believed these kilobars are “fresh” meaning that they would have been deposited, not stopped… further the gold came in the eligible line not registered, further supporting the “fresh” theory)… but still an interesting read. Some have speculated that due to reduced demand in china recently (last few months) that premiums on kilo bars have dropped to the point where it makes sense to store them in NY forma period of time and then ship later, not sure if i buy that or not as storage can get costly at published rates.

      Side note, I would find it almost impossible to believe that this gold was not hedged unless somehow it still belonged to the producer.

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