The latest from John Williams’ www.ShadowStats.com.
- Real Household Income Falls Slightly in October, Remaining Near Cycle-Low - Shutdown Effects on October Labor Data, and Misreporting of Same, Are More than Reversed in Headline November Numbers - Resulting Seasonal-Factor Distortions Weigh Heavily on Data Significance; Current Headline Labor Numbers Have Little Meaning - November Unemployment: 7.0% (U.3), 13.2% (U.6), 23.2% (ShadowStats)
Turkey’s Gold imports, investment demand hit record high so far this year December 06 2013 6:00 PM
ANKARA (Scrap Register): Turkey’s gold imports and gold investment demand hit a new record high level so far this year.
According to the latest figures from Borsa Istanbu, country imported 270.7 tons of gold during the first eleven months of this year more than double as compare to 2012’s full-year imports of 120.8 tons.
“Turkey, like most of the price-sensitive markets, saw this year’s lower price level as an opportunity to replenish stocks and release some of the pent-up demand that has been building as consumers have been priced out of the market,” said Cameron Alexander, an analyst with Thomson Reuters GFMS.
“Official gold coin demand has more than doubled so far this year, gold investment demand has also more than doubled, and jewellery demand has rebounded by around a fifth this year.”
According to London based World Gold Council, Turkey gold investment demand hit all time high during January to September. Turkey gold investment sustained the exceptional momentum from the first half of 2013; demand for the year to end-September is 92.8 tons, a figure that exceeds any annual total since our records began.
The US dollar after the Federal workers returned and therefore skewed employment figures.
Notice the USD gap down to .80227 to the right of the vertical axis.
80.227 -0.035 (-0.05%) 2013-12-06 09:05:30, 30 MIN DELAY
Here Is The "Growth" – Inventory Hoarding Accounts For Nearly 60% Of GDP Increase In Past Year Submitted by Tyler Durden on 12/05/2013 10:22 -0500
As we reported earlier, while on the surface the headline revised Q3 GDP number was a stunner coming at 3.6%, the reality is that more than 100% of the growth from the initial estimate came from a revised estimate of how many private Inventories were stockpiled in the quarter. The reality was that of the $230 billion in total increase in SAAR GDP, $146 billion of this, or over 63%, was due to inventory stockpiling.
So how does inventory hoarding – that most hollow of "growth" components as it relies on future purchases by a consumer who has increasingly less purchasing power – look like historically? The chart below shows the quarterly change in the revised GDP series broken down by Inventory (yellow) and all other non-Inventory components comprising GDP (blue).
But where the scramble to accumulate inventory in hopes that it will be sold, profitably, sooner or later to buyers either domestic or foreign, is seen most vividly, is in the data from the past 4 quarters, or the trailing year starting in Q3 2012 and ending with the just released revised Q3 2013 number. The result is that of the $534 billion rise in nominal GDP in the past year, a whopping 56% of this is due to nothing else but inventory hoarding.
Deutsche Bank quits commodities under regulatory pressure Thu Dec 5, 2013 5:52pm EST By David Sheppard and Ron Bousso
Dec 5 (Reuters) – Deutsche Bank AG pulled the plug on its global commodities trading business on Thursday, cutting 200 jobs as it becomes the first major bank to exit the once lucrative sector due to toughening regulations and diminished profits.
Germany’s largest bank, which was one of the top-five financial players in commodities, said in a statement it will cease trading in energy, agriculture, base metals, coal and iron ore, retaining only precious metals and a limited number of financial derivatives traders.
The cuts are expected to largely fall on its main commodity desks in London and New York.
The move comes as the financial sector’s role in commodity trading has been squeezed by lower margins, higher capital requirements and growing political and regulatory scrutiny of the role of banks in the natural resources supply chain.
"The decision to refocus our commodities business is based on our identification of more attractive ways to deploy our capital and balance sheet resources," Colin Fan, co-head of Corporate Banking & Securities at Deutsche Bank, said in a statement.
"This move responds to industry-wide regulatory change and will also reduce the complexity of our business."
Deutsche Bank’s decision will also raise questions for other banks in the sector, after JPMorgan Chase & Co put its physical commodity arm up for sale this summer, while Morgan Stanley has been exploring a sale of its energy trading unit for almost two years.
China is taking equivalent of all world gold production, John Ing tells KWN Submitted by cpowell on Fri, 2013-12-06 13:42. Section: Daily Dispatches 8:40a ET Friday, December 6, 2013
Dear Friend of GATA and Gold:
Market analyst John Ing of Maison Placements in Toronto today tells King World News that the Shanghai Gold Exchange now has delivered more metal than supposedly is kept at Fort Knox and that China appears to be acquiring this year the equivalent of all the world’s annual gold production. An excerpt from the interview is posted at the King World News blog here:
CHRIS POWELL, Secretary/Treasurer Gold Anti-Trust Action Committee Inc.
Alex Stanczyk: Gold Physical Supply Never Been Tighter
Wednesday I had the privilege again to interview Alex Stanczyk, Chief Market Strategist for the Anglo Far- East group of companies, who just returned from a trip to Switzerland. Alex confirmed to me the distribution of gold from west to east is not slowing down whatsoever. Refineries in Switzerland are still working 24 hour a day to cast bars for China, sometimes having difficulties sourcing the gold..
What was the purpose of your trip to Switzerland?
The purpose was two fold. We go to Switzerland once a year as part of our governance, we’re required to have an annual inspection of the gold, that was the main purpose of the trip. But in addition to that we also liked to talk to the refineries. It was myself, it was the managing director of Anglo Far-East mister Philip Judge, and Jim Rickards went with us, he sits on our advisory board.
We met with the managing director of the largest refinery in Switzerland and spend about two hours talking to him, we learned some very interesting things. Whats going on in the gold market as far as the price, is I think very counter intuitive. Everybody understands, knows and believes the price should be higher than it is, but it isn’t. There’s confusion in the marketplace, and there are two reactions; the reaction in the west is fear, confusion and uncertainty; the reaction in the east is buying. Now, this gentleman we were talking to probably has a better idea of physical gold flow than anybody else globally. He sees what is coming from the mines, he sees what is coming from the UK, and all over the world, as well as where its going. He indicated the price didn’t make sense because he has got so much fabrication demand. They put on three shifts, they’re working 24 hours a day, and originally he thought that would wind down at some point. Well, they’ve been doing it all year. Every time he thinks its going to slow down, he gets more orders, more orders, more orders. They have expanded the plant to where it almost doubles their capacity. 70 % of their kilobar fabrication is going to China, at apace of 10 tons a week. That’s from one refinery, now remember there are 4 of these big ones [refineries] in Switzerland.
That makes sense because withdraws from the Shanghai Gold Exchange vaults are 40 tons a week on average this year.
Economy Added 203,000 Jobs in November, as Unemployment Falls to 5-Year Low Friday, December 6, 2013 8:37 AM EST
The economy added 203,000 jobs in November, a bit better than expected, as the unemployment rate fell to 7 percent, the lowest in five years.
While the return of hundreds of thousands of federal employees following October’s government shutdown may have exaggerated the move in the unemployment rate for November, the continuing payroll gains suggest the economy has picked up at least a modicum of momentum very recently.
Economists surveyed by Bloomberg before the Labor Department announcement had expected an increase of 185,000 jobs, with the unemployment rate falling by 0.1 percentage point to 7.2 percent.
There could be no better sign on a gold price bottom than producer’s ultimate bearishness, paper hedging.
Barrick’s Thornton Weighs Return to Gold Hedging By Steven Frank & Christopher Donville – Dec 5, 2013 4:10 PM ET
Four years after Barrick Gold Corp. (ABX) stopped hedging bullion sales, its next chairman, John Thornton, says the practice makes sense and is worth considering.
Thornton, a former Goldman Sachs Group Inc. president and currently Barrick’s co-chairman, spoke yesterday after the world’s biggest producer of the metal announced he would succeed Chairman Peter Munk next year.
“As an outsider, I always thought it made great sense to hedge,” Thornton told reporters at Barrick Gold Corp.’s Toronto headquarters. Photographer: Andrew Harrer/Bloomberg
Barrick spent at least $5.6 billion in 2009 to get out of fixed-price sales contracts as it bet on rising gold prices. The metal is heading for its first annual drop in 13 years, having declined 27 percent so far in 2013. That slump has helped to erode earnings and prompted gold producers to take at least $26 billion of writedowns this year,
“As an outsider, I always thought it made great sense to hedge,” Thornton told reporters at Barrick’s Toronto headquarters. “I can’t understand for the life of me why that wouldn’t be an active topic that you would be carefully following at all times.”
Once a strategy used by Barrick and other major gold producers such as AngloGold Ashanti Ltd., hedging fell out of favor in the past decade as companies found themselves locked into lower prices as gold rose. Producers de-hedged 8.16 million ounces in 2009, according to a report from London-based researcher GFMS Ltd. the following year.
There Is Too Little Gold in the West The history of gold’s flight to the developing world by Alasdair Macleod Friday, December 6, 2013, 12:53 AM
Western central banks have tried to shake off the constraints of gold for a long time, which has created enormous difficulties for them. They have generally succeeded in managing opinion in the developed nations but been demonstrably unsuccessful in the lesser-developed world, particularly in Asia. It is the growing wealth earned by these nations that has fuelled demand for gold since the late 1960s. There is precious little bullion left in the West today to supply rapidly increasing Asian demand. It is important to understand how little there is and the dangers this poses for financial stability.
An examination of the facts shows that central banks have been on the back foot with respect to Asian gold demand since the emergence of the petrodollar. In the late 1960s, demand for oil began to expand rapidly, with oil pegged at $1.80 per barrel. By 1971, the average price had increased to $2.24, and there is little doubt that the appetite for gold from Middle-Eastern oil exporters was growing. It should have been clear to President Nixon’s advisers in 1971 that this was a developing problem when he decided to halt the run on the United States’ gold reserves by suspending the last vestiges of gold convertibility.
After all, the new arrangement was: America issued the petrodollars to pay for the oil, which were then recycled to Latin America and other countries in the West’s sphere of influence through the American banks. The Arabs knew exactly what was happening; gold was simply their escape route from this dodgy deal.
The run on U.S. gold reserves leading up to the Nixon Shock in August 1971 is blamed by monetary historians on France. But note this important passage from Ferdinand Lips’ book GoldWars:
Because Arabs did not understand bonds and stocks they invested their surplus funds in either real estate and/or gold. Since Biblical times, gold has been the best means to keep wealth and to transfer it from generation to generation. Gold therefore was the ideal vehicle for them. Furthermore after their oil reserves are exhausted in the distant future, they would still own gold. And gold, contrary to oil, could never be wasted.
According to Lips, Swiss private bankers, to whom many of the newly-enriched Arabs turned, recommended that a minimum of 10% and even as much as 40% should be held in gold bullion. This advice was wholly in tune with Arab thinking, creating extra demand for America’s gold reserves, some of which were auctioned off in the following years. Furthermore, Arab investors were unlikely to have been deterred by high dollar interest rates in the early eighties, because high interest rates simply compounded their rapidly-growing exposure to dollars.
Using numbers from BP’s Statistical Review and contemporary U.S. Treasury 10-year bond yields to gauge dollar returns, we can estimate gross Arab petrodollar income, including interest from 1965 to 2000, to total about $4.5 trillion. Taking average annual gold prices over that period, ten percent of this would equate to about 50,500 tonnes, which compares with total mine production during those years of 62,750 tonnes, over 90% of which went into jewellery.
On the heels of more volatile trading in global markets, today Canadian legend John Ing told King World News that the Shanghai Gold Exchange has now delivered more than gold than what is supposedly stored at Fort Knox in the United States. Ing, who has been in the business for 43 years, also spoke about how this will impact the price of gold in the future. Below is what Ing had to say in his fascinating interview.
Ing: “There has been a great deal of noise, but amid that noise you have to separate the rhetoric from the reality. This on-again, off-again quantitative easing is just more of the rhetoric. It reminds of the 1970s, when there was ‘peace in Vietnam.’ Well, it took 3 years to have peace in Vietnam.
But every time peace was declared, the stock market went up 100 points, and then it would go down when it wasn’t going to happen. It feels like the same thing with quantitative easing….
The war between bullish physical gold and bearish paper-gold will be entirely determined by the future of this chart.
The dollar is too large for a government to manipulate where trend is concerned. The Exchange stabilization fund will try hit and run support, but that is not enough to change the trend.
Yet another massive nail in the dollar’s coffin December 4, 2013 Santiago, Chile
On the other side of the world today, a couple of gentlemen that few people have ever heard of signed an agreement that has massive consequences for the global financial system.
It was a Memorandum of Understanding signed by representatives of the Singapore Exchange and Hong Kong Exchange. Their aim– to combine their forces in rolling out more financial products denominated in Chinese renminbi..
- No Signs of a Growing Economy - Intensifying Weakness in Revised Third-Quarter Trade and Construction Data Should Soften Third-Quarter GDP Growth - Construction Spending Falters Despite Statistically-Insignificant October Gain - New Home Sales Monthly Data Are Nonsense, Extreme Volatility and Revisions Leave Monthly Changes Meaningless
- "Booming"� GDP Growth Not Reflected in Any Other Major Economic Indicator - Involuntary Inventory Build-Up Spiked GDP Revision; Final Sales (GDP Less Inventory Change) Growth Revised to 1.9% from 2.0% - Revised Headline Growth in Third-Quarter GDP Was Reported at 3.6%; GNP Was 3.9%; But GDI (the Theoretical GDP Equivalent) Was 1.4% - Another Set of GDP Revisions in Two Weeks
Silver imports surge 40 pct in Oct, hit three-month high By Siddesh Mayenkar MUMBAI Tue Dec 3, 2013 12:01pm IST
(Reuters) – India’s silver imports rose to a three-month peak in October and are on track to hit a record this year, data from Thomson Reuters GFMS showed, as buyers opt for the precious metal instead of expensive gold to meet high seasonal demand.
More shipments by the world’s top buyer may help underpin global silver prices that have slumped 37 percent so far this year – their biggest annual drop in at least three decades.
Silver imports jumped 40 percent to 338 tonnes in October from 241 tonnes in September, GFMS data showed, driven by demand during the festivals and weddings season that starts from October and tapers off by early May next year.
"By the end of the year, silver imports should be at 5,200-5,400 tonnes," said Sudheesh Nambiath, an analyst with Thomson Reuters GFMS. This would be more than India’s record high purchases of 5,048 tonnes in 2008.
The country has imported 4,652 tonnes of silver in the first ten months from January, GFMS data shows.
The auto loan delinquency rate (the ratio of borrowers 60 days or more delinquent on their auto loans) increased to 1.04 percent in the third quarter, up on both a quarterly and yearly basis (from 0.87 percent in the second quarter and 1 percent in the third quarter of 2012).
The delinquency rate, though, is well below the third quarter average of 1.22 percent observed between 2007 and 2013.
Auto loan debt per borrower increased for the 10th straight quarter, moving up 4.7 percent from $15,943 in the third quarter of 2012 to $16,685 in the third quarter. On a quarterly basis, auto loan debt also increased from $16,410 in the second quarter.
The data provided are gathered from TransUnion’s proprietary Industry Insights Report, a quarterly overview summarizing data, trends and perspectives on the U.S. consumer lending industry. The report is based on anonymized credit data from virtually every credit-active consumer in the U.S.
The subprime delinquency rate (those consumers with a Vantage Score 2.0 credit score lower than 640 on a scale of 501-990) increased from 5.3 percent in the third quarter of 2012 to 5.6 percent in the third quarter. Despite the increase, the delinquency rate for this group remains near levels observed in recent third quarters: the third quarter 2011 – 5.45 percent; the third quarter 2010 – 5.82 percent; the third quarter 2009 – 6.59 percent.
Inventories accounted for a massive 1.68 percentage points of the advance made in the July-September quarter, the largest contribution since the fourth quarter of 2011. The contribution from inventories had previously been estimated at 0.8 percentage point. Stripping out inventories, the economy grew at a 1.9 percent rate rather than the 2.0 percent pace estimated last month.
Grant Williams: Today’s gold suppression will break just as London Gold Pool did Submitted by cpowell on Thu, 2013-12-05 04:59. Section: Daily Dispatches 12:02a ET Thursday, December 5, 2013
Dear Friend of GATA and Gold:
December’s "Things That Make You Go Hmmm. …" letter by Grant Williams of Vulpes Investment Management in Singapore compares the current mechanisms used by central banks and bullion banks to suppress the gold price with the mechanisms used by the London Gold Pool of the 1960s, which, Williams observed, worked fine every day for a long time until suddenly it didn’t.
Williams draws heavily on the long Bloomberg News report from a week ago that raised suspicion about the daily gold price "fixing" undertaken by bullion banks in London, a report called to your attention by GATA:
Williams writes: "The last time an effort was made to manipulate the price of gold lower than the market wanted it to be, it ended in a quick 25 percent spike in the price, followed over the next decade by the manifestation of those market forces in no uncertain terms and ending in a blow-off top some 2,332 percent higher than the price at which gold had been held for two decades.
"If anything were to come of the supposed investigation into the gold price fixing and if charges were filed similar to those laid at the feet of the banks that admitted no fault in the Libor rigging, it would start a mad dash by owners of physical gold to take custody of their assets. The problem with that eventuality is that currently there are almost 70 claims on every ounce of gold in the Comex warehouse and serious doubts about the physical metal available for delivery at the London Bullion Market Association. …
"Gold is moving to ever-stronger hands, and when the dam does inevitably break again, the true price will be discovered by natural market forces, free of interference."
May we all live so long, and, in the meantime, may we all do what we can to break the dam.
The section of Williams’ letter about gold market manipulation is titled "Twisted (By the Pool)" and the whole letter is posted in PDF format at the Mauldin Economics Internet site here:
For gold to make it a 12th straight year of rising prices, the yellow metal would need to add $US427 an ounce between now and December 31.
Fat chance, you might say. And you would probably be right. For 11 consecutive years the yellow one was worth more (a lot more in some years) on December 31 than it had been the previous January. On January 1 this year trading closed at $US1,678/oz. To get back to that over four weeks would require a market miracle.
While you can still find analysts who believe the gold price will stage a meaningful recovery, there might be quite a different story to tell. Perhaps we should stop being too fixated on price (a suggestion that will fall on deaf ears with every punter reading this) and look instead at demand for physical metal (and leave aside the $US250 billion — $274.4 billion — in daily trading of various gold instruments).
First, though, Puru Saxena on price. This Hong Kong-based wealth fund manager and familiar talking head on cable business channels says precious metals are in a secular downtrend and this is not the time to swim against the tide. The party ended in 2011, he adds. Both gold and silver topped out two years ago and prices have fallen since.
"Unsurprisingly, this downtrend has stunned most gold bugs as well as their cheerleaders and these folk are still in denial," Saxena says in his latest note. And blind faith is not a sound investment strategy. Gold is now trading below the 40-week moving average, a bearish omen.
The other news concerns demand. ANZ Bank commodity strategist Victor Thianpiriya forecasts softening demand for gold and a 2014 average of $US1,269/oz. This involves a drop to $US1,150 in the March quarter, followed by slow recovery.
Part of his forecast is based on Chinese demand falling. ANZ is expecting total gold imports of 1,050 tonnes this year, which would be a 80 per cent increase on last year. He sees it dropping back to 900 tonnes in 2014, which is roughly one-third of world mine output and in addition to the 420 tonnes China is expected to mine this year.
China may be the biggest producer of gold, but still has to import 70 per cent of its needs. Thianpiriya, in concluding imports will drop next year, argues there are signs that much of the overall consumption for this year was front-loaded to the first half.
No doubt that was written before Wednesday’s Reuters report that "China’s net gold imports from Hong Kong climbed to their second-highest on record in October" at 131.19 tonnes, the sixth straight month of imports over 100 tonnes.
Not much sign of "front-loading" there: If that October figure was annualised, that would make 1,574 tonnes, or half the world’s mined production.
But we also know that unknown tonnages of gold enter China through Shanghai and Singapore.
Then there’s China’s own mine production. Plans have been announced to lift national output by 10 per cent next year, even though at one of its main producing areas, Zhaoyuan in Shandong province, mines are showing marked declines in production grades.
So here’s the latest Pure Speculation gold theory: There will be no gold surplus in 2014 (as there never has been, unlike with most metals), China will keep taking advantage of the subdued price to buy both metal and the foreign mines that produce it, and one day, probably too late, Western investors will wake up to the fact that China controls so much of the world’s gold and is using it to back the yuan as a reserve currency.
Jim Sinclair’s Commentary
Wall Street’s income comes from market manipulation, not trading.
To call what the banks do trading is an insult to those of us who have made our living on our wits.
If the game was not totally rigged with the Fed’s blessing, Wall Street could not trade their way out of a brown paper bag.
Wall Street Sweats Out Volcker Rule Impact on Revenue By Michael J. Moore & Dakin Campbell – Dec 4, 2013 9:24 AM ET
Wall Street banks, which already shut proprietary trading units that helped fuel record profits, are girding to learn next week how much revenue the Volcker rule may cut from the $44 billion they say comes from market-making.
With U.S. regulators scheduled to vote Dec. 10, the largest firms are getting little detail about the final terms of the Volcker rule’s ban on proprietary trades, and still have basic questions about what kind of market-making will be allowed, said three senior U.S. bankers. They’re also wondering whether they’ll have to change practices or curtail business in some less-liquid markets, the bankers said.
The answers could threaten their revenue and affect transaction costs for clients of firms such as JPMorgan Chase & Co., Bank of America Corp. and Goldman Sachs Group Inc. The Volcker rule is close to being adopted more than three years after it became a centerpiece of the 2010 Dodd-Frank Act, designed to prevent a repeat of the global credit crisis.
“Everything in the Volcker rule that defines what is permitted market-making, and what is not, is by far the most important part of the rule,” said David Hilder, an analyst at Drexel Hamilton LLC in New York. Regulators probably have been silent on the specifics to preserve agreements they’ve made, he said. “Outside input in the late stages of a negotiation tends to blow apart consensus.”
Australia to ‘abolish phony debt ceiling’, continue spending-spree Published time: December 04, 2013 13:10
Australia will dive further ‘Down Under’ into debt, as lawmakers reached a deal to do away with a limit. The government can now borrow as much as it wants, and will avoid a shutdown when it reaches the AU$300 billion debt limit on December 12.
Federal Treasurer Joe Hockey won over the Greens who had previously supported the Labor Party cap of AU$400 billion (about $373 billion). Earlier, the upper house blocked a motion to raise the debt ceiling to AU$500 billion.
The government must justify any increase in debt up to AU$50 billion Greens leader Christina Milne told reporters in Canberra.
“This, I think, will return some maturity to the debate around debt and get rid of what has become a phony debate every time the government has wanted to raise the debt ceiling,” Milne said Wednesday.
In return, Hockey promised the Greens that the budget will include comprehensive debt figures on how much the government is spending on climate change.
If lawmakers didn’t strike a deal by December 12, Australia’s $1.5 trillion economy would have gone ‘down under’ with its government forced into a shutdown.
A Hard Lesson from Motown: They Will Steal Your Pension By David Cay Johnston / December 04 2013 12:27 PM
Anyone in a public-sector job looking forward to retiring in comfort should look carefully at what is going on in Detroit and Springfield, Ill. Sherlock Holmes would call it the case of the missing pension money.
News leaking out this week from the Motor City tells how the enormous gap between the pensions workers earned and the money set aside to pay for them will be closed. By stealing from the workers.
Courts, legislatures, and corporations are all working in concert not to pay the full benefits owed. For decades, political and business leaders failed to set aside the right amount of money each payday to cover the pensions workers earned and, in some cases, covered up the mismanagement of pension fund investments.
This is nothing short of theft, as pensions are simply deferred wages, that is, money that workers could have taken as cash in their regular paychecks had they not opted to set it aside.
In Detroit, a federal bankruptcy judge handling the city’s Chapter 9 case held Tuesday decided he could safely ignore a Michigan Constitution provision barring any reduction in pension benefits to already retired public sector workers. Judge Steven W. Rhodes went beyond asserting the supremacy of federal law over state regulations, ruling that the pensions workers earned were a mere “contractual obligation,” no different from any other bill the city owes but lacks the money to pay.
I have been following the December Deliveries and posted the following on a Precious metals message board. I thought you might appreciate the potential situation right now on the COMEX that I see…
CIGA Liambert
COMEX DEC GOLD UPDATE:
Still 597K ounces outstanding in position to issue delivery (Tuesday Final).
109K ounces have stood for delivery so far (Including another 35K today), JP Morgan has been the long side on 90% of these ounces, so they are acquiring even more gold.
Outstanding registered gold in the warehouses increased from 590K to 655K. This increase is essential because, as discussed in another post, there wasn’t enough registered ounces to actually assign all the potential deliveries in December.
The shorts at the COMEX have or had a problem for sure. The problem is this – there is not enough registered gold to cover all the warrant transfers. That means shorts must be scrambling to find registered gold, or to find eligible gold they can transfer into register gold. IMO, this is indicated by how few of the outstanding futures have actually been issued for delivery after 3 days into the delivery period (~20%).
This problem does not mean that COMEX has no gold left, it means that there is so little left that it is starting to impact the basic issue for delivery process of COMEX during their biggest month. The cupboard is pretty bare of registered gold to satisfy the December party that is going on. Now, AFTER the issue for deliveries are executed (109K so far) and all the DEC warrants are transferred to the longs, IF these longs start pulling the gold out of the registered category, and the registered ounces drop way down, then I think we can say COMEX is in actual trouble – potentially having this problem again and again for ANY delivery month, not just the big December delivery month. But that is a big IF.
Dear CIGAs,
It’s time to fish. It’s time to buy – get your fishing lines ready…
Boston University Economics Professor, Laurence Kotlikoff, says, “The country is in worse fiscal shape by many miles than Detroit. So, the country is essentially bankrupt.” Dr. Kotlikoff estimates the long term debt and liabilities of America are more than $200 trillion! He is spearheading a bill in Congress called The Inform Act. It is an attempt to wake up the nation to our dire financial situation so something can be done to fix this enormous problem. Dr. Kotlikoff explains, “The bill has been endorsed by over 1,000 economists, including 15 Nobel Prize winners in economics . . .Never in the history of this country have this many top economists from all political persuasions endorsed a piece of legislation like this.” Dr. Kotlikoff and his fellow economists all contend, “The country needs to do honest accounting.” The professor charges the government is “disguising the true problem.” Dr. Kotlikoff says, “The government is printing mountains of money to pay its bills. The Fed is printing 29 cents of every dollar that Uncle Sam is spending.” What happens if this continues? Dr. Kotlikoff says, “Eventually somebody recognizes this and starts dumping the bonds, and interest rates go up, and inflation takes off, and were off to the races.” In closing, Dr. Kotlikoff warns, “This is going to crash, but there are different ways for cancer to kill you. It can be very gradual . . . or it can attack some organ and you can die overnight. Either of those outcomes can happen.” Join Greg Hunter as he goes One-on-One with Professor Laurence Kotlikoff.
