Harvey Organ: MASSIVE Backwardation!

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

Silver $14.15 up 4 cents

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:

 

( 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)

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