Harvey Organ: HUGE DERIVATIVES LOSSES COMING From Swiss De-Peg

Gold: $1276.90 up $12.20   (comex closing time)
Silver: $17.74 up 74 cents  (comex closing time)

 

 

In the access market 5:15 pm

 

Gold $1280.50
silver $17.79

 

 

 

Gold/silver trading:  see kitco charts on right side of the commentary.

 

What a day.  Late last night we got word that two brokerage firms are in serious trouble due to these guys being on the wrong side of the Long USA dollar/short Swiss Franc trade. Then today, many more firms stated that they have lost serious money on the trade. What is interesting on the Swiss unpegging of its currency (the peg was 120 Swiss Franc/1 Euro) was this was done in total  secrecy.  Christine Lagarde was totally unaware that this was forthcoming.  Generally the bankers know in advance but this time everyone was in total darkness.  Again we are witnessing central banks not trusting one another. You can bet the farm that there will be huge derivative losses on the Swiss unpegging.

 

Late in the day we got word that all 4 major Greek systemic banks have asked for emergency funding (ELA) as depositors bail out of all banks. I cannot see how Greece can remain in the Euro Monetary Area.

 

The gold comex today had a poor delivery day, registering 0 notices served for nil oz. Silver comex registered 120 notices for 600,000 oz.

Three months ago the comex had 303 tonnes of total gold. Today the total inventory rests at 247.23 tonnes for a loss of 56 tonnes over that period.

 

In silver, the open interest rose  by 77 contracts with yesterday’s silver price being up by 11 cents.  The total silver OI continues to  remains relatively high with today’s reading at 157,013 contracts. However the bankers are still loathe to supply much of the non backed silver paper. The January silver OI contract rose by 74 contracts up to 200.

 

In gold we had a gigantic increase in OI with the huge rise  in price of gold  yesterday to the tune of $30.30. The total comex gold OI rests tonight at 421,911 for a gain of 18,889 contracts. The January gold contract remains constant at 87 contracts.

 

 

 

Today we had a huge addition of  gold inventory at the GLD to the tune of 9.56 tonnes/ /Inventory 717.15 tonnes

 

In silver, we had another huge reduction in   silver inventory at the SLV of 1.340 million oz

SLV’s inventory rests tonight at 325.011 million oz

.

We have a few important stories to bring to your attention today…

Let’s head immediately to see the major data points for today

.

First: GOFO rates:

 

All rates moved in the negative direction/  All months are in contango and thus positive in rates.

 

Sometime in January the LBMA will officially stop providing the GOFO rates.

 

Jan 16 2015

 

+.10%                     +1025%                       +.105%                +.1075            .135%

 

Jan 15 2014:

 

 

+.105%                   +.1075%                 +.1075 %             +.1175%               +.1475%

 

 

end

 

 

Let us now head over to the comex and assess trading over there today.

 

 

Here are today’s comex results:

 

 

The total gold comex open interest rose today by 18,829 contracts from 403,082 all the way up to 421,911 with gold up by $30.30 yesterday (at the comex close).  We are now onto the January contract month.   The non active January contract month saw it’s OI contracts remain constant at 87 for a loss of 0 contracts. We had 0 contracts served yesterday.  Thus we neither  lost nor gained any  gold contracts standing for delivery in this January contract month.   The next big delivery month is February and here the OI rose by 10,762 contracts to 189,258 contracts with few moving to April. The estimated volume today was poor at 121,113. The confirmed volume yesterday was excellent at 323,074 contracts, even though  the high frequency traders gave some help  with respect to volume.  Today we had 0 notices filed for nil oz . The world reacted to the unpegging of the Swiss Franc.

 

 

And now for the wild silver comex results. Silver OI rose by 77 contracts from 156,936 up to 157,013 with  silver up by 11  cents yesterday. The front January contract month saw its OI rise to 200 contracts for a gain of 74 contracts. We had 0 notices filed yesterday, so we gained 74  silver contracts or an additional 370,000 oz will stand for silver in the January contract month. As I mentioned yesterday, somebody was in great need of physical silver  and they seem to be robbing the cookie jar for very valuable silver. The next big contract month is March and here the OI fell by 462 contracts down to 102,432.  The estimated volume today was poor at 21,651. The confirmed volume yesterday was excellent at 63,612. We had 0 notices filed for nil oz today. The rise in silver is certainly scaring our bankers from supplying more non backed paper. The OI in silver has seen a slow and steady rise for the past few weeks.

 

January initial standings

Today, we had 0 dealer transactions

total dealer withdrawal: nil oz

 

we had 0 dealer deposit:

total dealer deposit: nil oz

 

we had 1 customer withdrawal

 

i) out of Brinks:  32.15 oz

 

total customer withdrawal: 32.15 oz

 

we had 0 customer deposits:

total customer deposits; nil  oz

 

We had 0 adjustments

 

Today, 0 notices was issued from JPMorgan dealer account and 0 notices were issued from their client or customer account. The total of all issuance by all participants equates to 0 contracts of which 0 notices were stopped (received) by JPMorgan dealer and 0 notices were stopped (received) by JPMorgan customer account.

To calculate the total number of gold ounces standing for the December contract month, we take the total number of notices filed for the month (8) x 100 oz  or 800 oz to which we add the difference between the January OI (87) minus the number of notices served upon today (0) x 100 oz  = 9500 oz , the amount of gold oz standing for the January contract month. (.2954 tonnes of gold)

 

Thus the initial standings:

8 (notices filed for the month x 100 oz) +OI for January (87) – 0(no. of notices served upon today) 9500 oz (.2954 tonnes).

 

We neither lost nor gained any gold ounces standing for delivery today.

 

Total dealer inventory: 770,487.09 oz or 23.96 tonnes

Total gold inventory (dealer and customer) = 7.948 million oz. (247.23) tonnes)

 

Several weeks ago we had total gold inventory of 303 tonnes, so during this short time period 56 tonnes have been net transferred out. We will be watching this closely!

 

This initializes the month of January for gold.

 

end

 

 

And now for silver

 

Jan 16 2015:

 

 

 January silver: initial standings

 

 

Silver	Ounces
Withdrawals from Dealers Inventory	nil oz
Withdrawals from Customer Inventory	686,095.32 oz (BRINKS,SCOTIA,)  oz
Deposits to the Dealer Inventory	602,440.600 (CNT)
Deposits to the Customer Inventory	600,248.170 oz (Scotia)
No of oz served (contracts)	120 contracts  (600,000 oz)
No of oz to be served (notices)	80 contracts (400,,000 oz)
Total monthly oz silver served (contracts)	354 contracts (1,770,000 oz)
Total accumulative withdrawal of silver from the Dealers inventory this month
Total accumulative withdrawal  of silver from the Customer inventory this month	5,810,595.4 oz

Today, we had 1 deposit into the dealer account:

i) Into CNT:  602,440.600 oz (one decimal)

total dealer deposit: 602,440.600   oz

 

we had 0 dealer withdrawal:

total dealer withdrawal: nil oz

 

We had 1 customer deposit:

 

i) Into Scotia:  600,278.170 oz

total customer deposit  600,278.17 oz

 

 

We had 2 customer withdrawals:

i) Out of Brinks:  635,713.89 oz

ii) Out of Scotia: 50,381.43 oz

 

total customer withdrawal: 686,095.32 oz

 

 

we had 2 adjustments

i) out of CNT:  1,046.09 oz was adjusted out of the customer and this landed into the dealer account of CNT

 

ii) Out of Delaware:  156,674.700 oz was adjusted out of the customer and this landed into the dealer account of Delaware.

 

 

Total dealer inventory: 66.313 million oz

Total of all silver inventory (dealer and customer) 174.430 million oz.

The total number of notices filed today is represented by 120 contracts for 600,000 oz. To calculate the number of silver ounces that will stand for delivery in December, we take the total number of notices filed for the month (354) x 5,000 oz  to which we add the difference between the OI for the front month of January (200) – the Number of notices served upon today (120) x 5,000 oz  = 2,170,000 oz the number of ounces standing so far for the January delivery month.

 

Initial standings for silver for the January contract month:

354 contracts x 5000 oz= 1,770,000 oz  +OI standing so far in January  (200)- no. of notices served upon today(120) x 5,000 oz   equals 2,170,000 ounces standing for the January contract month.

 

 

we gained 74 contracts or an additional 370,000 oz will stand for the January contract month.

Again somebody was in great need of silver.

 

The two ETF’s that I follow are the GLD and SLV. You must be very careful in trading these vehicles as these funds do not have any beneficial gold or silver behind them. They probably have only paper claims and when the dust settles, on a collapse, there will be countless class action lawsuits trying to recover your lost investment.

There is now evidence that the GLD and SLV are paper settling on the comex.

***I do not think that the GLD will head to zero as we still have some GLD shareholders who think that gold is the right vehicle to be in even though they do not understand the difference between paper gold and physical gold. I can visualize demand coming to the buyers side:

i) demand from paper gold shareholders

ii) demand from the bankers who then redeem for gold to send this gold onto China

vs no sellers of GLD paper.

 

 

And now the Gold inventory at the GLD:

 

 

Jan 16.2015 we had a huge addition of 9.56 tonnes of gold into the GLD/New inventory 717.15 tonnes.  (where on earth did they obtain that quantity of physical gold??)

 

Jan 15/ no change in inventory at the GLD today/inventory 707.59 tonnes

 

Jan 14.2015  we had a small withdrawal of .23 tonnes of gold from the GLD/inventory 707.59 tonnes

 

Jan 13.2015 no change in gold inventory/GLD inventory tonight at 707.82 tonnes

 

Jan 12 no change in gold inventory/GLD inventory tonight at 707.82 tonnes

 

January 9.2015: an addition of 2.99 tonnes of gold/Inventory 707.82 tonnes

 

Jan 8.2015: no change/inventory 704.83 tonnes

 

Jan 7.2015: we lost another exact 2.99 tonnes of gold inventory at the GLD/Inventory at 704.83 tonnes

 

Jan 6.2015: we lost 2.99 tonnes of gold inventory at the GLD//inventory 707.82 tonnes

 

 

 

 

Today, Jan 16/2015 /a huge addition of 9.56 tonnes of   gold   inventory at the GLD ) /Inventory rests tonight at 717.15 tonnes

 

inventory: 717.15 tonnes.

 

 

The registered vaults at the GLD will eventually become a crime scene as real physical gold departs for eastern shores leaving behind paper obligations to the remaining shareholders. There is no doubt in my mind that GLD has nowhere near the gold that say they have and this will eventually lead to the default at the LBMA and then onto the comex in a heartbeat (same banks).

GLD : 717.15 tonnes.

 

 

end

 

 

And now for silver (SLV):

 

 

Jan 16.2015: we had another withdrawal of 1.34 million oz of silver inventory/Inventory 325.011 million oz

(something is up!!)

 

Jan 15.2015 we had a huge withdrawal of 1.628 million oz/Inventory 326.391 million oz

 

Jan 15.2015: no change in silver inventory/327.979 million oz

 

 

Jan 13.2015 no change in silver inventory/327.979 million oz/

 

Jan 12.2015 we had a huge withdrawal of 1.915 million at the SLV/inventory at 327.979 million oz.

 

Jan 9.2015: we had a huge addition of 1.437 million oz at the SLV/Inventory 329.894 million oz

 

Jan 8.2015: no change in silver inventory/inventory at 328.457 million oz.

Jan 7.2015:  we had another loss of 958,000 oz of silver from the SLV/Inventory 328.457 million oz

jAN 6.2015: we had a small loss of  149,000 oz/inventory 329.415 million oz

 

 

 

Jan 16/2015 / a huge withdrawal of 1.34 million oz of  silver from the SLV/ inventory at the SLV

registers: 325.011 million oz

 

 

end

 

 

 

And now for our premiums to NAV for the funds I follow:

Note: Sprott silver fund now for the first time into the negative to NAV

Sprott and Central Fund of Canada.
(both of these funds have 100% physical metal behind them and unencumbered and I can vouch for that)

 

BIG CHANGE!!!

1. Central Fund of Canada: traded at Negative  5.6% percent to NAV in usa funds and Negative 5.9 % to NAV for Cdn funds!!!!!!!

Percentage of fund in gold 62.1%

Percentage of fund in silver:37/4%

cash .5%

 

 

( Jan 16/2015)

 

 

2. Sprott silver fund (PSLV): Premium to NAV falls to + 1.35%!!!!! NAV (Jan 16/2015)

3. Sprott gold fund (PHYS): premium to NAV falls to negative -0.60% to NAV(Jan 16/2015)

Note: Sprott silver trust back  into positive territory at +1.35%.

Sprott physical gold trust is back in negative territory at -0.60%

Central fund of Canada’s is still in jail.

 

 

end

 

At 3:30 pm we receive the COT which lays out positions of our major players:

 

First the gold COT:

 

Gold COT Report – Futures
Large Speculators			Commercial		Total
Long	Short	Spreading	Long	Short	Long	Short
192,959	62,733	40,729	129,436	267,112	363,124	370,574
Change from Prior Reporting Period
5,254	-2,794	-170	-991	14,013	4,093	11,049
Traders
130	76	73	51	61	214	185
	Small Speculators
	Long	Short	Open Interest
	38,984	31,534	402,108
	3,994	-2,962	8,087
	non reportable positions		Change from the previous reporting period
COT Gold Report – Positions as of				Tuesday, January 13, 2015

 

Our large specs:

 

Those large specs that have been long in gold added a large 5254 contracts to their long side

Those large specs that have been short in gold covered 2794 contracts from their short side.

 

Our commercials:

 

Those commercials that have been long in gold pitched 991 contracts from their long side

Those commercials that have been short in gold continued to supply the non backed paper to the tune of 14,013.

 

Small specs;

 

Those small specs that have been long in gold added another 3994 contracts to their long side

 

Those small specs that have been short in gold covered 2962 contracted from their short side.

The commercial side is very heavy on its short side.

 

And now for silver:

 

Silver COT Report: Futures
Large Speculators			Commercial
Long	Short	Spreading	Long	Short
59,808	19,869	15,845	61,363	108,167
4,897	-3,003	945	-1,092	6,103
Traders
74	51	48	40	49
Small Speculators		Open Interest		Total
Long	Short	157,282		Long	Short
20,266	13,401			137,016	143,881
-347	358	4,403		4,750	4,045
non reportable positions		Positions as of:		135	131
		Tuesday, January 13, 2015		© SilverSeek.c

 

Our large specs;

Those large specs that have been long in silver added a rather large 4897 contracts to their long side

Those large specs that have been short in silver covered 3003 contracts from their short side.

 

Our commercials:

Those commercials that have been long in silver pitched 1092 contracts from their long side.

Those commercials that have been short in silver added a whopping 6103 contracts to their short side.

 

Our small specs:

Those small specs that have been long in silver pitched a tiny 347 contracts from their long side

Those small specs that have been short in silver added a tiny 358 contracts to their short side.

Conclusion: something has got to give on both gold and silver as the commercials continue to hugely into the negative

 

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