Harvey Organ: MASSIVE Backwardation!

bottom of the barrelToday both the gold comex and the silver comex are in severe stress, with gold in backwardation up to August!

 

Buy gold and silver coins at SDBullion

Gold:  $1107.10 up $17.20    (comex closing time)

Silver $14.15 up 4 cents

In the access market 5:15 pm

Gold $1101.20

Silver:  $14,16

At the gold comex today,  we had a poor delivery day, registering 0 notices for nil ounces.Silver saw 2 notices for 10,000 oz.

Several months ago the comex had 303 tonnes of total gold. Today, the total inventory rests at 199.26 tonnes for a loss of 104 tonnes over that period.

In silver, the open interest fell by 2,830 contracts down to 159,531. In ounces, the OI is still represented by .797 billion oz or 114% of annual global silver production (ex Russia ex China).

In silver we had 2 notices served upon for 10,000 oz.

In gold, the total comex gold OI fell by 1,913 contracts to 408,835 contracts as gold was down $1.60  with yesterday’s trading.

Today both the gold comex and the silver comex are in severe stress with gold in backwardation up to August.

We had no changes into inventory at the GLD,  / thus the inventory rests tonight at 657.92 tonnes. The appetite for gold coming from China is depleting not only gold from the LBMA and GLD but also the comex is bleeding gold. Our 670 tonnes of rock bottom inventory in GLD gold has been broken. It looks to me that China has taken the last amounts of physical gold from the GLD. I guess the only place left for China to receive physical gold, after they deplete the GLD will be the FRBNY and the comex.   In silver,/we had no change to inventory/Inventory rests at 313.606 million oz.

First, here is an outline of what will be discussed tonight:

1. Today, we had the open interest in silver fall by 2,830 contracts down to 159,521 despite the fact that silver was up by 23 cents with respect to yesterday’s trading.   The total OI for gold fell by 1913 contracts to 408,835 contracts as gold was down $1.60 in price yesterday

(report Harvey)

2 a) Gold trading overnight, Goldcore

(Mark OByrne)

3. ASIAN AFFAIRS

let us begin!

i)Late  TUESDAY night,WEDNESDAY morning: Shanghai down badly despite  manipulation  / Hang Sang falls badly. The Nikkei closed deeply  in the red as did all of Asia . Chinese yuan down a touch and yet they still desire further devaluation throughout this year.   Oil is much lower, falling below 28 dollars per barrel and clinging to the 27 dollar level. Stocks in Europe all in the red. Offshore yuan trades at 6.6056 yuan to the dollar vs 6.5790 for onshore yuan.  The POBC tries to soaks up off shore yuan to no avail as massive dumping occurred in Hong Kong . Hong Kong dollar suffers a decline, and the peg is in jeopardy.  The Saudis engage in currency controls to stop bets against the riyal

 ii) Shanghai opens below 3,000 and continues its descent.  Margin debt continues to drop as many small time players exit:

( zero hedge)

iii) This hedge fund predicts that the yuan will devalue by a huge 50%

( zero hedge)

iv)And then there is this account which should also give you a good idea as to what is happening to Chinese factory workers:

 Buy Silver Philharmonic Coins at the Lowest Price
( zero hedge)

EUROPEAN AFFAIRS:

i)  Mr Draghi:  I think we have a problem!!
take a look at credit default swaps at Italian banks especially Unicredit:
( zero hedge)

ii) Financial entities in Italy and Greece cash/bond prices collapse/yields skyrocket:

( zero hedge)
RUSSIAN AND MIDDLE EASTERN AFFAIRS:
i)A suicide bomber strikes the Russian embassy in Kabul, Afghanistan
( zero hedge)
GLOBAL ISSUES

i) Canada is in a pickle: it needs to lower the Cdn dollar to help the oil patch.

However the lower dollar unleashes huge inflation which will cause citizens to scale back purchases and thus kill the economy
( zero hedge)
OIL MARKETS

i)Crude early last night falls below 28 dollars and with that it drags the entire globe equity markets lower:

( zero hedge)

ii) Then late in the morning, it slips below 27 dollars

Bloomberg/CNBC)

iii) Bankrupt shale boys cannot give their assets away.

A good glimpse as to what to expect shortly when others go belly up:
( zero hedge)

iv) Late in the day oil falls again due to API huge inventory build:

 (zero hedge)

PHYSICAL MARKETS

i)a. Please read Egon Von Greyerz’s important piece embedded in the following Embry/Kingworld piece

b).  Also read what Embry states:
( zero hedge)
ii)Bill White, former chief economist for the BIS now admits gold market rigging

( Ambrose Evans Pritchard/UKTelegraph/GATA)

iii) Donald trump is to engage in higher currency wars and this should benefit gold:

(courtesy Marketwatch.com/GATA)

USA STORIES WHICH WILL INFLUENCE THE PRICE OF GOLD/SILVER

i) Goldman posts the worst 4th quarter revenue since 2011:

( zero hedge)

ii) The Fed needs to inflate.  More bad news for the Fed as the CPI drops in December. However it is good news for consumers:

( zero hedge)

iii) Average earnings for USA citizens shows the weakest growth in a year:

( zero hedge)
iv) More bad news on the housing front:
( zero hedge)

v)Ray Dalio is one person you must pay attention to:

( zero hedge)

vi) The following story is quite logical.  The truth behind the two American vessels being captured off Farsi island in the Gulf is the fact that Iran had the capability to disarm both of the boats. GPS systems:

( Justin King/AntiMedia.org)

vii) Dave Kranzler on the global state of economic affairs

( Dave Kranzler/IRD)
viii) Greg Hunter interviews John Williams
(Greg Hunter/USAWatchdog/John Williams of Shadowstats.com)

Let us head over to the comex:

The total gold comex open interest fell to 408,835 for a loss of 1913 contracts as gold  was down  $1.60 in price with respect to yesterday’s trading.   For the past two years, we have strangely witnessed two interesting developments with respect to the gold open interest:  1) total gold comex collapse in OI as we enter an active delivery month, and 2) a continual drop in the amount of gold standing in an active month.   Today, both scenarios held. We are now in the non active January contract which saw it’s OI fall by 4 contracts to 216.  We had 2 notices filed on yesterday, so we lost 2 contracts or an additional 200 oz will not stand for delivery in this non active delivery month of January.   The next big active delivery month is February and here the OI fell by 10,589 contracts down to 200,960.First day notice is Friday, Jan 29.2016. The estimated volume today (which is just comex sales during regular business hours of 8:20 until 1:30 pm est) was 203,406 which is good. The confirmed volume yesterday (which includes the volume during regular business hours + access market sales the previous day was also fair at 188,714 contracts. The comex is deeply into backwardation up until October.

Today we had 0 notices filed for nil oz.
And now for the wild silver comex results. Silver OI fell by 2,830 contracts from 162,351 down to 159,521 despite the fact the price of silver was up 23 cents with respect to yesterday’s trading. We are now in the non active month of January saw it’s OI fall by 9 contracts down to 19. We had 11 notices filed yesterday so we  gained 2 contracts or an additional 10,000 oz will stand for delivery. The next big active contract month is March and here the OI fell by 3,321 contracts down to 115,761. The volume on the comex today (just comex) came in at 35,726 , which is fair. The confirmed volume yesterday (comex + globex) was excellent at 51,102. Silver is not in backwardation at the comex but is in backwardation in London. 
We had 2 notices filed for 10,000 oz.

<

December contract month:

INITIAL standings for January

Jan 20/2016

Gold
Ounces
Withdrawals from Dealers Inventory in oz   nil
Withdrawals from Customer Inventory in oz  nil nil oz
Deposits to the Dealer Inventory in oz  nil
Deposits to the Customer Inventory, in oz   3,312.620 oz

Scotia

No of oz served (contracts) today 0 contracts

nil oz

No of oz to be served (notices) 216 contracts(21,600 oz)
Total monthly oz gold served (contracts) so far this month 12 contracts (1200 oz)
Total accumulative withdrawals  of gold from the Dealers inventory this month   nil
Total accumulative withdrawal of gold from the Customer inventory this month 50,704.4 oz
Today, we had 0 dealer transactions
We had 0  customer withdrawals
total customer withdrawals;  nil oz
We had 1 customer deposit:
 i) Into Scotia  3,312.820 oz

Total customer deposits  3312.820 oz

we had 0 adjustments.

Here are the number of oz held by JPMorgan:

 JPMorgan has a total of 7774.663 oz or 0.2418 tonnes in its dealer or registered account.
***JPMorgan now has 401,621.707 or 12.49 tonnes in its customer account.
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 was stopped (received) by JPMorgan dealer and 0 notices were stopped (received)  by JPMorgan customer account.
 
To calculate the final total number of gold ounces standing for the Jan contract month, we take the total number of notices filed so far for the month (12) x 100 oz  or 1200 oz , to which we  add the difference between the open interest for the front month of January (216 contracts) minus the number of notices served upon today (0) x 100 oz   x 100 oz per contract equals the number of ounces standing.
 
Thus the initial standings for gold for the January. contract month:
No of notices served so far (12) x 100 oz  or ounces + {OI for the front month(216) minus the number of  notices served upon today (0) x 100 oz which equals 22,800 oz standing in this active delivery month of January (0.7091 TONNES)
we lost 2 contracts or an additional 400 oz will not stand for delivery in this non active delivery month of January.
We thus have 0.7091 tonnes of gold standing and 8.566 tonnes of registered gold for sale, waiting to serve upon those standing
Last month, at the conclusion of the December contract month, we had 6.445 tonnes of gold standing and 8.57 tonnes of registered (dealer) gold for sale.
No evidence of any movement out of the registered gold to settle upon longs.
Total dealer inventory 275,425.112 or 8.566 tonnes
Total gold inventory (dealer and customer) =6,406,242.893 or 199.26 tonnes 
Several months ago the comex had 303 tonnes of total gold. Today the total inventory rests at 199.26 tonnes for a loss of 104 tonnes over that period. 
JPmorgan has only 12.73 tonnes of gold total (both dealer and customer)
end
And now for silver

January INITIAL standings/

Jan 20/2016:

Silver
Ounces
Withdrawals from Dealers Inventory nil
Withdrawals from Customer Inventory 1,072,616.150 oz, CNT,Delaware
Deposits to the Dealer Inventory nil
Deposits to the Customer Inventory 6952.990 oz

CNT

No of oz served today (contracts) 2 contracts

10,000 oz

No of oz to be served (notices) 17 contracts (85,000 oz)
Total monthly oz silver served (contracts) 97 contracts (485,000 oz)
Total accumulative withdrawal of silver from the Dealers inventory this month nil oz
Total accumulative withdrawal  of silver from the Customer inventory this month 3,327,004.4 oz

Today, we had 0 deposits into the dealer account: 

total dealer deposit;nil  oz

we had 0 dealer withdrawals:

total dealer withdrawals:  nil

we had 1 customer deposits:

i) Into CNT:  6952.990 oz

total customer deposits: 6952.990 oz

We had 2 customer withdrawals:
i) Out of CNT: 1,071,660.950 oz
ii) Out of Delaware: 955.200 oz
 

total withdrawals from customer account: 1,072,616.150   oz 

 we had 1 adjustments:

i) Out of CNT vaults:

45,792.75 oz was adjusted out of the dealer and this landed into the customer account of CNT

 

The total number of notices filed today for the January contract month is represented by 2 contracts for 10,000 oz. To calculate the number of silver ounces that will stand for delivery in January., we take the total number of notices filed for the month so far at (97) x 5,000 oz  = 485,000 oz to which we add the difference between the open interest for the front month of January (19) and the number of notices served upon today (2) x 5000 oz equals the number of ounces standing
Thus the initial standings for silver for the December. contract month:
95 (notices served so far)x 5000 oz +(19) { OI for front month of January ) -number of notices served upon today (2)x 5000 oz or 570,000  of silver standing for the January. contract month.
We  gained 2 silver contracts or an additional 200 oz  will stand for delivery in this non active delivery month of January.
Total dealer silver:  36.148 million
Total number of dealer and customer silver:   155.394 million oz
more silver leaves the dealer and customer vaults
end
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

And now the Gold inventory at the GLD:

jan 20/ no change in inventory at hte GLD/Inventory rests at 657.92 tonnes

Jan 19/no change in inventory at the GLD/Inventory rests at 657.92 tonnes

jan 15.2016/a huge deposit of 3.86 tonnes of  inventory at the GLD/Inventory rests at 657.92 tonnes

I doubt that this is real gold/probably a paper gold addition.

Jan 14/ no changes into inventory at the GLD/Inventory rests at 654.06 tonnes.

JAN 13.2016/another huge deposit of 2.38 tonnes in gold inventory at the GLD/Inventory rests at 654.06 tonnes

JAN 12/no change in inventory at the GLD/Inventory rests at 651.68 tonnes

JAN  11./another 2.09 tonnes of gold addition (deposit) to the GLD/Inventory rests at 651.68 tonnes.again, I doubt that the gold added was physical.

jan 8/another huge addition of 4.46 tonnes of gold into GLD/Inventory rests at 649.59 tonnes

  • I highly doubt that the gold added was physical. Gold is severely in backwardation in London and thus almost impossible to source in two days almost 9 tonnes of gold.

Jan 7/a huge addition of 4.16 tonnes of gold into GLD/Inventory rests at 645.13 tonnes

Jan 6/2016/we had a withdrawal of 1.6 tonnes of gold from the GLD/Inventory rests at 640.97 tonnes/

Jan 5/2016: since my last report we had a total of 3.57 tonnes of gold withdrawal from the GLD/Inventory rests at 642.37 tonnes

Jan 20.2016:  inventory rests at 657.92 tonnes

Now the SLV:
Jan 20/no change in silver inventory at the SLV/inventory rests at 313.606 million oz
jan 19/a massive withdrawal of 2.762 million oz of silver inventory from the SLV/Inventory rests at 313.606 million oz
jan 15.2016:no changes in inventory at the SLV/Inventory rests at 316.368 million oz
Jan 14./no changes in inventory at the SLV/Inventory rests at 316.368 million oz
JAN 13.2016:/no change in inventory at the SLV/Inventory rests at 316.368 million oz
Jan 12.2016: no change in inventory at the SLV/Inventory rests at 316.368 million oz
JAN 11/no change in inventory at the SLV/Inventory rests at 316.368 million oz/
Jan 8/we had a huge withdrawal of 1.429 million oz of silver from the SLV/Inventory rests at 316.368 million oz
someone was in urgent need of silver tonight.
jan 7 no change in inventory/rests tonight at 317.797 million oz
Jan 6/no change in inventory/rests tonight at 317.797 million oz
Jan 5/2016: we had huge withdrawals of 4.282 million oz/Inventory rests at 317.797 million oz
Jan 20.2016: Inventory 313.606 million oz.
1. Central Fund of Canada: traded at Negative 10.0 percent to NAV usa funds and Negative 10.8% to NAV for Cdn funds!!!!!!!
Percentage of fund in gold 63.3%
Percentage of fund in silver:36.7%
cash .0%( Jan 20.2016).
2. Sprott silver fund (PSLV): Premium to NAV falls to  -0.84%!!!! NAV (Jan 20.2016) 
3. Sprott gold fund (PHYS): premium to NAV rises  to- 0.65% to NAV Jan 20/2016)
Note: Sprott silver trust back  into negative territory at -.84%/Sprott physical gold trust is back into negative territory at -0.65%/Central fund of Canada’s is still in jail.

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