The Physical Demands for Au/Ag, Blow Out The Paper!

Posted at 9:32 AM (CST) by & filed under General Editorial.

Great and Wonderful Wednesday Morning Folks,

      We start the day with a green price for Gold (3 days in a row) with the trade at $1,472.00 up 4 bucks and right there at the high of $1,472.30 with the low at $1,466.90. Silver was giving “the signal” but now has turned to green with the trade at $16.705 up 3/10ths of a penny with the high at $16.745 and the low at $16.650. The US Dollar, under the artificial support from a basket of other nations currencies, is now trading at 97.530, up 14.5 points with the high at 97.575 and the low at 97.530. Of course, all of this was done before 5am pst, the Comex open, and the London close.

      In Venezuela, Gold’s price is now trading at 14,701.60 showing an 11.90 Bolivar gain with Silver at 166.841 Bolivar proving a nickel gain in the overnight. In Argentina, the Peso has Gold’s value at 87,948.98 proving a loss of 169.99 Peso’s taking away most of yesterdays gains with Silver at 998.001 Peso’s dropping 2.409 in A-Peso value as their currency swings higher (for now). Over in the lands of Turkey, Gold is trading at 8,551.59 Lira, confirming a gain of 23.47 in value with Silver at 97.0507 showing a gain of 0.2188 T-Lira’s.

     December Silver’s Delivery Demand numbers still do not jive with anything logical, as we reported during yesterday’s missive the increase in count during the day. The end of the day count went to 919 fully paid for contracts waiting for physical with the last Volume count of 188 inside the trading range between $16.610 and $16.555 as the price slowly increased during the day.

      Today’s Demand Count for physical now stands at 811 fully paid for contracts waiting for receipts and with a Volume of 10 up on the board so far this morning with a trading range high/low/last at $16.545. So far today, ten contracts traded at the lower numbers yet the seller refuses to take the higher price of $16.600 with a 26-lot order Bid? This seller is trying to drive the prices lower when a normal seller of product, would be taking the higher offers. In my opinion, this physical seller is forcing the prices lower. Yesterday’s activities proved 157 contracts settled out either taking the receipts into delivery at the Comex, or sending the papers over to London, or? It is my belief this seller is not selling real physical but squaring out a trade for the end of the year, playing it out in the delivery system. Silver’s Overall Open Interest is now at 202,913 Overnighters confirming 1,747 more shorts left the field of play and as the prices went higher.

      As a reminder, all of this activity is happening just before the Triple Witch Week, the Winter Solstice, the Religious Celebrations of Life, and the New Year. With all the 100’s of billions being printed every week since Sept 17th, in order to keep liquidity up, when the Velocity of Money is collapsing, we pose the question; where is the money going if it’s not showing up anywhere? Each year’s close has this squaring of positions, yet it seems there are those “very few” who can simply scream they need more money creation or the world will end, and they get it! If I tried to do that to my credit card company or bank, I would be laughed at, and hard! Yet these clowns, who (the media) claim to be the world’s best profiteers, who also have control over everyone else’s credit, do just that, scream at the Fed window, and they get their cash needs printed, every time! In short, these friends of the centrals, have unlimited credit to go against our limited and earned money that is in trade!

     All we’ve ever wanted was a fair playing field! If I’m on a Margin Call in the Futures Market, I am required to either put my hard-earned cash into my account to “stay” in the trade, or I have to clear the trade and get off “Call”. Why are the banks offered another way out, getting cash that is freely printed for them, instead of having to clear out their trades to get off Call? This is our point of contention! They are allowed to go to the print window when their trades go awry. This is what we see happening in precious metals now! They are on the “losing money” side of the trade, and yet they can stay on the wrong side as long as they are allowed to go to that free money window to add more paper against the deliveries. This is when the physical demands can blow out the paper!

      Fair trade is what the world’s investors want. If they don’t see fair trade, they leave the investment arenas, and buy Silver, Gold, and wait things out till the investment ship gets righted, or sunk. We may be at the point now when we observe the velocity of money, at the same time money is being printed yet is still nowhere to be seen. It is those that hold the physicals, that are prepared for the change of seasons. Enjoy the day, keep that smile on your face no matter what, and please remember, we are all Patriots under One Flag and One Nation, and All Under God! It is this that allows us to …

Stay Strong!

J. Johnson