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Silver: The Manic and Frantic Movements Accelerate


 -- Published: Sunday, 6 March 2016 | Print  | Disqus 

By Ed Steer

05 March 2016 — Saturday


YESTERDAY in GOLD, SILVER, PLATINUM and PALLADIUM

The gold price was sold down five bucks in the first two hours of trading in the Far East on their Friday morning—and it gained half of that back within an hour or so before trading flat until shortly after the London open.  The rally that began at that point was capped on the back of absolutely monstrous volume—and then it traded more or less flat until 11 a.m. GMT.  It began to head lower from there, culminating in a vicious spike low that came about two minutes after the job numbers were released in New York.  It blasted higher from there, but ran into selling pressure at 9:00 a.m. EST, before getting capped for good at the London p.m. gold fix.  After that, every rally, no matter how small, got turned aside before it could develop into anything, plus they peeled 10 bucks off the price at the COMEX close for good measure as well.  ‘Da boyz’ made sure that gold closed down on the day.

The low and high ticks were reported as $1,250.10 and $1,280.70 in the April contract.

Gold was closed in New York yesterday at $1,259.10 spot, down $4.80 from Thursday’s close.  Net volume was the biggest number I can ever remember seeing in the last fifteen years at just over 324,000 contracts.  Even I was taken aback by how vicious JPMorgan et al were in their price-capping operations yesterday.

160305gold

Here’s the 5-minute gold chart courtesy of Brad Robertson once again.  You can see the big volume shortly after the London open where the powers-that-be stopped that rally cold—and then big 16,000 contract volume spike on the low tick of the day around 6:35 a.m. Denver time on this chart.  Volume really didn’t dissipate until the last hour of trading in the after-hours market in New York.  The vertical gray line is midnight in New York—add two hours for EST—and I’m sorry, but the ‘click to enlarge’ feature still isn’t working.  I can’t believe that the folks at WordPress.com haven’t got this fixed yet.

160305 5-minute gold

It was very similar in silver, except that the price managed to struggle higher once the London p.m. gold fix was in—and silver’s high came at 11:45 a.m. in New York.  After that ‘da boyz’ sold it down just like they did in gold, taking over half the day’s gains with it.

The low and high tick in this precious metal was reported as $15.15 and $15.84 in the May contract.

The silver price was closed in New York on Friday at $15.505 spot, up 29 cents from Thursday’s close—and it could just have easily closed up $29 if JPMorgan and ‘da boyz’ hadn’t been standing in the way.  Not surprisingly, net volume was very heavy at a hair over 77,000 contracts.

160305silver

It was more or less the same pattern in platinum as well, the only difference being that ‘da boyz’ were so busy keeping gold and silver in place that they let platinum [and palladium] run a little higher and longer.  But you can tell from the saw-tooth price pattern that even this precious metal was not allowed to run freely, either.  Platinum finished the day at $978 spot, up 30 dollars.  But without question it would have blasted through $1,000 the ounce like a hot knife through butter if it had been allowed to so, which it obviously wasn’t.

160305platinum

Palladium was similar to platinum, except there was no sell-off on the release of the job numbers like there was in the other three precious metals.  But it’s also obvious from its saw-tooth rally, that it was being kept in check as well, with the price being capped for good at the $560 spot mark shortly before noon in New York, which was also the high tick in silver.  Palladium was closed at $554 spot, up an even $15 from Thursday but, like the other three precious metals, would have closed materially higher if allowed to do so.

160305palladium

The dollar index closed late on Thursday afternoon in New York at 97.65–and didn’t do a thing until it jumped 15 basis points in the first thirty minutes of trading in London on their Friday morning.  Then it sold off about 25 basis points going into the job numbers.  At that point the index went vertical, with the high tick being recorded at 98.03 within a minute.  Then some heavy selling pressure appeared—and a not-for-profit buyer showed up at 9:00 a.m. EST on the dot in an attempt to catch the proverbial falling knife.  That rescue attempt lasted for fifteen minutes before the sell-off renewed—and ‘gentle hand’s once again appeared, this time at precisely 10:00 a.m. at the 97.02 mark.  It chopped higher from that point until just after the COMEX close—and then edged lower from there.  The dollar index finished the Friday session at 97.25—down 40 basis points.  But it could have just as easily closed down 400 basis points [or more] if the powers-that-be hadn’t been vigilant.

As I’ve been saying for over a week now, the dollar index want’s to curl up in a corner and die, but the PPT won’t let it.

160305intraday

And here’s the 6-month U.S. dollar chart so you can see the wild price action of the world’s ‘reserve’ currency—-if you wish to dignify it with that name.

160305 6-month USD

The gold stocks blasted higher right from the open, with their respective high ticks coming at the London p.m. gold fix when ‘da boyz’ capped the price.  It was all down hill from there, with the real sell-off coming once the COMEX closed at 1:30 p.m. EST.  They finished the day down 0.80 percent.

160305HUI

The silver equities soared—and at their 11:45 EST high tick, which is when the high tick of the day was printed, they were up about 9 percent.  However, once it became apparent that JPMorgan and their HFT buddies had capped the price at that point, the gains began to melt away—and Nick Laird’s Intraday Silver Sentiment Index closed higher by only 1.98 percent.

160305Silver 7

For the week, the HUI closed higher by 6.45 percent—and Nick’s ISSI closed higher by 10.58 percent.  Year-to-date the HUI is up 55.9 percent—and the ISSI is up by 42.7 percent

The CME Daily Delivery Report for Day 5 of the March delivery month in silver showed that 54 gold and only 5 silver contracts were posted for delivery within the COMEX-approved depositories on Tuesday.  ABN Amro and Morgan Stanley were the two big short/issuers of note with 28 and 25 contracts respectively out of their client accounts.   There were seven stoppers in total—and JPMorgan picked up 10 of those gold contracts for its own in-house [proprietary] trading account, and all 5 silver contracts as well—2 for its clients and 3 for itself.  The link to yesterday’s Issuers and Stoppers Report is here.

The CME Preliminary Report for the Friday trading session showed that March gold open interest actually rose 21 contracts.  Since 16 gold contracts were reported in Thursday’s Daily Delivery Report, there had to have been a total of 21+16=37 contracts added to March o.i. in gold yesterday to make that change work out.  In silver, March open interest plunged by another 555 contracts—and once you subtract out the 102 contracts shown in yesterday’s preliminary report, it appears that JPMorgan gave out ‘Get-Out-of-Jail-Free’ cards to one or more COMEX short/issuers to the tune of 555-102=453 contracts.

There was a small decline in GLD yesterday, as an authorized participant took out 6,898 troy ounces, which certainly represented a fee payment of some kind.  And I was thunderstruck to see that there was another enormous deposit in SLV yesterday, as an authorized participant [read JPMorgan] added a further 2,855,886 troy ounces of the stuff.  That makes 11.0 million troy ounces added to SLV in the last three business days!

When I was talking to Ted on the phone yesterday, the two big deposits into SLV that we knew about already, were part of our conversation—and he suspects that at least part of those deposits had to do with the phenomenal volume activity he reported in SLV on Tuesday.  It’s an excellent bet that he will have lots more to say about this in his weekly column to his paying subscribers this afternoon.

The U.S. Mint had a tiny sales report yesterday.  They sold only 2,000 troy ounces of gold eagles—and that was all.

Month-to-date the mint has only sold those 2,000 troy ounces of gold eagles, plus 263,500 silver eagles.  March is off to a very slow start, but I doubt that will last long, as I expect the Monday sales report to be a biggie, as JPMorgan’s appetite knows no bounds.

There was decent in/out activity in gold over at the COMEX-approved depositories on Thursday.  There was 30,126 troy ounces reported received—and 2,025.450 troy ounces/63 kilobars were shipped out.  All of the ‘in’ activity was at Brink’s, Inc.—and the ‘out’ activity was at Canada’s Scotiabank.  The link to that is here.

It was another monster day in silver—and although only 316,657 troy ounces were reported received, there was 2,108,993 troy ounces shipped out the door.  Of that amount 652,908 troy ounces came out of JPMorgan’s warehouse.  The link to that action is here.

The amount of silver on the move in the last couple of weeks is unprecedented in the history of this precious metal—and it’s another topic that I know Ted Butler will be spending a lot of time on in his weekly review later today.

It was a reasonably quiet day over at the COMEX-approved gold kilobar depositories in Hong Kong on their Thursday.  Only 3,196 kilobars were reported received—and 29 were shipped out.  All of the activity was at Brink’s, Inc. as per usual—and the link to all that, in troy ounces, is here.


The Commitment of Traders Report, for positions held at the close of COMEX trading on Tuesday, was pretty much as I said it might be, so I got it right for once—an increase in the Commercial net short position in gold, plus a decline in the short position in silver.

In gold, the Commercial net short position increased by 8,282 contracts, or 828,200 troy ounces of paper gold.  They did this by selling 5,283 long contracts—and adding 2,999 contracts to their short position.  The total Commercial net short position now stands at 17.14 million troy ounces.

All three categories of traders, the Big 4, the ‘5 through 8’—and the raptors, the Commercial traders other than the Big 8, increased their collective short positions during the reporting week.  The Big 4 by 4,400—the ‘5 through 8’ by 1,900—and the raptors by 2,000 contracts.  That makes up the 8,300 contract weekly change, give or take.

Under the hood in the Disaggregated COT Report, the Managed Money traders only accounted for 4,727 contracts of that weekly change.  They did this by selling 7,550 long contracts, which was a strange thing for them to be doing in a rising price environment—and they also covered 2,823 short contracts.  The balance of the weekly change was accounted for in the ‘Other Reportable’ and Nonreportable/small trader categories.  But that’s where the surprise was as the ‘Other Reportables’ increased their net long position by a whopping 12,162 contracts—and the small traders added to their net long positions by 847 contracts as well.  [12,162+847-4,727=8,282 contracts]  Ted may or may not have something to say about that, as we didn’t talk about it on the phone—and I only discovered it when I was doing the math on it just now.

160305COT Gold

In silver, the Commercial net short position declined by 8,440 contracts, or 42.2 million troy ounces of paper silver.  They accomplished this by adding 2,985 long contracts, plus they covered 5,455 of their short contracts.  The Commercial net short position now stands at 326.2 million troy ounces.

The Big 4 traders actually covered about 2,000 of their short positions—and they ‘5 through  8’ covered around 200 contracts as well.  Ted’s raptors, the Commercial traders other than the Big 8, added 6,600 contracts to their long positions.  With the new Bank Participation Report in hand, Ted says that JPMorgan’s short position is 20,000 contracts or less—and maybe much less.  He said he was going to think about it overnight—and I look forward to reading his final thoughts on this later today.

Under the hood in the Disaggregated COT Report, the Managed Money traders only accounted for 4,466 of this week’s 8,440 contract change, as they sold 4,466 long contracts net.  Like in gold, the balance of the activity came from the ‘Other Reportables’ who increased their net short position 1,981 contracts—and the Nonreportable/small traders who decreased their long position by a net 1,993 contracts—[4,466+1,981+1,993=8,440 contracts]

160305COT Silver

But despite what this report says, it’s another case where what’s been reported here is already ‘yesterday’s news’—because what happened on Thursday and Friday now makes this COT Report almost irrelevant.  Of course there are still two more trading days left in the upcoming reporting week, so I’ll reserve judgment on this until the COMEX close on Tuesday of next week.  But as it stands as of the close of trading yesterday, we are nosebleed levels once again in the Commercial net short positions in both silver and gold.

Here’s Nick Laird’s “Days to Cover” chart updated with yesterday’s COT data.  It shows the days of world production that it would take to cover the short positions of the Big 4 and Big 8 traders in each physically traded commodity on the COMEX.

160305Days to Cover

As I say in every Saturday column—the short positions of the Big 4 and 8 traders in silver continues to redefine the meaning of the words ‘obscene’ and ‘grotesque.’  This week the Big 4 are short 128 days of world silver production—and the ‘5 through 8’ traders are short 54 days of world silver production—for a total of 182 days, more than 6 months of world silver production, or 430 million troy ounces of paper silver.

And as an aside, the two largest silver shorts on Planet Earth—JPMorgan and Canada’s Scotiabank—are short about 90 days of world silver production between the two of them—and that 90 days represents about 70 percent of the length of the red bar in silver.  The other two traders in the Big 4 category are short, on average, about 19 days of world silver production apiece.


The Bank Participation Report [BPR] data is extracted directly from the above Commitment of Traders Report Report.  It shows the COMEX futures contracts, both long and short, that are held by all the U.S. and non-U.S. banks as of Tuesday’s cut-off.  For this one day a month we get to see what the world’s banks are up to in the COMEX futures market, especially in the precious metals—and they’re usually up to quite a bit.

In gold, 5 U.S. banks are net short 72,867 COMEX gold contracts in the March BPR.  In February’s Bank Participation Report [BPR], that number was 45,014 contracts, so they’ve increased their collective short positions by a chunky 27,853 contracts during the reporting period.  This is a huge amount.  Three of the five banks would include JPMorgan, Citigroup—and HSBC USA.  As for who the fourth and fifth bank might be—I haven’t a clue, although Goldman Sachs comes to mind as one of them.  And if they are in that group, my guess is that they would be long gold.

Also in gold, 20 non-U.S. banks are now net short 52,263 COMEX gold contracts.  In the February BPR they were net short only 20,350 COMEX contracts in gold, so the month-over-month deterioration is huge as well.  As I’ve stated for years, it’s reasonable to assume that a goodly chunk of this short position in gold is owned by Canada’s Scotiabank, but it’s also a good bet that a decent number of the remaining 19 non-U.S. banks are now net long gold in the COMEX futures market.

Here’s Nick’s chart of the Bank Participation Report for gold going back to 2000.  Charts #4 and #5 are the key ones here.  Note the blow-out in the short positions of the non-U.S. banks [the blue bars in chart #4] when Scotiabank’s COMEX gold positions [both long and short] were outed in October of 2012.  The ‘click to enlarge’ still doesn’t work—and there’s not a thing I can do about it.

160305BPR - Gold

In silver, 5 U.S. banks are net short 20,794 COMEX silver contracts—and it was Ted’s back-of-the-envelope calculation from yesterday that JPMorgan holds virtually all of that net short position on its own, so it’s a mathematical certainty that at least one of the other U.S. banks is also net short the COMEX futures market in silver.  My money is on HSBC USA.  But it’s also a very safe bet that several of these U.S. banks are net long the COMEX silver market as well.  The short position of these U.S. banks was 20,040 contracts in the February BPR, so there’s been virtually no change in the net short positions of the U.S. banks over the reporting month.  That was astounding—and the moment I saw that, I knew that Ted would have lots to say about this later today.

Also in silver, 14 non-U.S. banks are net short 30,831 COMEX contracts—and that’s a huge increase from the 21,446 contracts that these same banks held net short in the February BPR.  I’d be prepared to bet big money that Canada’s Scotiabank is the proud owner of a goodly chunk of this short position.  That means that a decent number of the other 13 non-U.S. banks are net long the COMEX silver market.  In the last two months, the net short position of the non-U.S. banks in COMEX silver [Scotiabank?] has increased by 19,000 contracts.  This is something else that Ted will be talking about today.

Here’s the BPR chart for silver.  Note in Chart #4 the blow-out in the non-U.S. bank short position [blue bars] in October of 2012 when Scotiabank was brought in from the cold.  Also note August 2008 when JPMorgan took over the silver short position of Bear Stearns—the red bars.  It’s very noticeable in Chart #4—and really stands out like the proverbial sore thumb it is in chart #5.

160305BPR -Silver

In platinum, 4 U.S. banks are net short 8,904 COMEX contracts—but their long position [in total] is a laughable 174 contracts!  In the February BPR, these same banks were short 6,548 COMEX platinum contracts, so they’ve increased their short position by a considerable amount—2,356 contracts, or 26 percent.

I’d guess that JPMorgan holds the lion’s share of that 8,904 contract net short position.

Also in platinum, 18 non-U.S. banks are net short 9,288 COMEX contracts, an increase of 1,282 contracts, or about 14 percent more than they were net short in the February BPR.

If there is a large player in platinum amongst the non-U.S. banks, I wouldn’t know which one it is.  However I’m sure there’s at least one big one in this group.  The reason I say that is because before mid-2009 when the U.S. banks showed up, the non-U.S. banks were always net long the platinum market by a bit—see the chart below—and now they’re net short.  The remaining 17 non-U.S. banks divided into whatever contracts are left, isn’t a lot, unless they’re all operating in collusion—which I doubt.  But from the numbers it’s easy to see that the platinum price management scheme is an American show as well, with one big non-U.S. bank involved.  Scotiabank perhaps?

160305BPR - Platinum

In palladium, 4 U.S. banks were net short 2,298 COMEX contracts in the February BPR, which isn’t much of an increased from the 2,152 COMEX contracts they held net short in the February BPR.

Also in palladium, 14 non-U.S. banks are net short only 681 palladium contracts—which is absolutely unchanged from the 681 COMEX contacts they held net short in February’s BPR.  So their positions, divided up more or less equally, are immaterial, just like they are in platinum.

For the second month in a row it should be noted—and it’s obvious in the chart below—that the banks, both U.S. and foreign, appear to be heading for the exits in the palladium market, as their net short positions haven’t been this low since back in mid 2009.

Here’s the BPR chart for palladium.  You should note that the U.S. banks were almost nowhere to be seen in the COMEX futures market in this metal until the middle of 2007—and they became the predominant and controlling factor by the end of Q1 of 2013.  But as I mentioned in the previous paragraph, their footprint is pretty small now, as, collectively, they are only net short 11.8 percent of total open interest in that metal—which is immaterial.  However, I would still be prepared to bet big money that, like platinum, JPMorgan holds the vast majority of the U.S. banks’ remaining short position in this precious metal as well—and they’ve been riding shotgun over the both platinum and palladium this past week, regardless of “all of the above”.

160305BPR - Palladium

As I say every month at this time, the three U.S. banks—JPMorgan, Citigroup, HSBC USA—along with Canada’s Scotiabank— are the tallest hogs at the price management trough.  Until they decide, or are instructed to stand back, the prices of all four precious metals are going nowhere—supply and demand fundamentals be damned!

JPMorgan and Canada’s Scotiabank still remain the #1 and #2 silver shorts on Planet Earth in the COMEX futures market.  However, their positions may have reversed during the last month based on what the numbers were in the Bank Participation Report above.


Here are two charts that Nick Laird passed around on Thursday—and because of time and space constraints, I didn’t have room for them in Friday’s column.  They show the official import numbers for gold and silver into India during the month of December.

160305India gold

160305India silver

And one more chart that Nick sent around last night.  It shows the now-monthly withdrawals from the Shanghai Gold Exchange updated with February’s data, if any of this data can be believed anymore.  It was a pretty quiet month, as only 107.603 tonnes were reported taken out—and I apologize for the fact that the ‘click to enlarge’ feature still doesn’t work.

160305SGE

I don’t have all that many stories for you today, but quite a few of them are ones that I’ve been saving for my Saturday column because of length and/or content reasons.


CRITICAL READS

Over 80% Of Jobs Added in January Were Minimum Wage Earners

Jobs were good; earnings were a disaster – that’s the best summary of today’s jobs report.

As we noted earlier, February suffered the biggest ever monthly drop in average weekly earnings, because not only did hourly earnings drop but so did hours worked, resulting in far lower overall weekly wages.

What caused this? Nothing our readers don’t already know: recall that in January, “70% Of Jobs Added In January Were Minimum Wage Waiters And Retail Workers.

February was even worse: most of the jobs that were created, if only on a goalseeked, seasonally adjusted basis, were of the lowest paying, worst possible quality as has been the case for the past 7 years as the BLS desperately seeks to “pad” its political mandate of providing proof in a recovery which however is impossible if it were to tell the truth.

As a result, as the BLS itself admitted, “job growth occurred in health care and social assistance, retail trade, food services and drinking places, and private educational services” – all of which are the lowest-paying wage groups.

This Zero Hedge piece appeared on their Internet site at 10:00 a.m. on Friday morning EST—and it’s worth reading.  Another link to this story is here.


“It’s a Recession Stupid” – U.S. Factory Orders Tumble For 15th Month in a Row

In 60 years, the US economy has not suffered a 15-month continuous YoY drop in Factory orders without being in recession. Today’s -1.9% YoY drop may suggest the slide is decelerating, but off the weakness in December (-2.9% MoM), January’s bounce +1.6% MoM missed expectations (+2.1%) notably (and Ex-Trans decline MoM).

Recession…?  Or is it different this time.

This tiny 1-chart Zero Hedge article appeared on their website at 10:15 a.m. EST on Friday morning—and I found it on David Stockman’s website.  The chart is definitely worth a look.  Another link to this short commentary is here.


U.S. trade deficit widens as exports hit five-and-a-half-year low

The U.S. trade deficit widened more than expected in January as a strong dollar and weak global demand helped to push exports to a more than five-and-a-half-year low, suggesting trade will continue to weigh on economic growth in the first quarter.

The Commerce Department said on Friday the trade gap increased 2.2 percent to $45.7 billion. December’s trade deficit was revised up to $44.7 billion from the previously reported $43.4 billion. Exports have declined for four straight months.

Economists polled by Reuters had forecast the trade deficit widening to $44.0 billion in January. When adjusted for inflation, the deficit increased to $61.97 billion from $60.09 billion in December.

Trade subtracted a quarter of a percentage point from gross domestic product in the fourth quarter, helping to hold down growth to a tepid 1.0 percent annual rate.

This Reuters article, filed from Washington, was posted on their Internet site at 3:32 p.m. yesterday afternoon—and I found it on Doug Noland’s website.  Another link to this news item is here.


James Grant: ‘Something is Going to Go Wrong

James Grant needs no introduction. The chief editor of Grant’s Interest Rate Observer has been an eloquent observer and astute analyst of markets since he started his Barron’s column “Current Yield” in the late 1970s.

Grant recently won the Hayek Prize of the Manhattan Institute for his most recent book “The Forgotten Depression,” and the Gerald Loeb Lifetime Achievement Award.

Epoch Times spoke to Mr. Grant about the spotty track record of central bankers, deflation, gold and the gold standard, as well as negative interest rates and a ban on cash.

This 40-minute video interview is embedded in an article that appeared on the seekingalpha.com Internet site at 2:50 p.m. EST on Thursday afternoon—and I thank Richard Saler for sending it our way.  Another link to this interview is here.


Beware of bankers bearing gifts — Dennis Miller

What happens when a retiree can’t pay his bills? The tragic photo of the Greek pensioner in the Express Tribune still haunts me. What a horrible feeling it must be to work hard your entire life, save your money, play by the rules, and then have your retirement hopes and dreams pulled right out from under you.

Could Americans end up in the same situation?

In 2008, the government passed the TARP (Troubled Asset Relief Program) bailing out the insolvent banking system. It was supposed to be a one-time event resulting in a quick recovery leading to a booming economy. It didn’t happen and has spiraled out of control. The Federal Reserve instituted several Quantitative Easing (QE) measures resulting in what is now labeled ZIRP (Zero Interest Rate Policy).

Safe, good interest bearing investments no longer exist. The impact on retiree’s income, 401 (k)’s, IRA’s, annuities and pension plans has been well documented.

The result has been devastating for retirees counting on safe, fixed returns,” says Michael Rubin, founder of Total Candor, a financial planning education firm based in Portsmouth, New Hampshire. “They’re earning a lot less on their savings than any other time in recent history.

This commentary appeared on the milleronthemoney.com website on Thursday—and is the first of many stories that had to wait for today’s column.  It’s worth reading.  Another link to this article is here.


Machiavelli Would Love This Plot Twist From Banks’ Washington Book Club

U.S. Representative Jeb Hensarling seems to have been brushing up on his Machiavelli when he set the agenda for his book club this year.

The private event, which is run by the chairman of the Financial Services Committee, is a little-known fundraising vehicle where lobbyists for Wall Street banks, insurance companies and accounting firms gather monthly to discuss literature with a Republican panel member. The designated lawmaker picks the book and pulls in the day’s haul, which attendees estimate is often in the $60,000 to $80,000 range.

While the club is usually low-key, tensions arose recently between the donors and Hensarling when he front-loaded this year’s events with two lawmakers whose involvement in scandals have made corporate contributors shy away, according to people with knowledge of the meetings. A number of lobbyists felt the schedule was no accident, the people added.

First up was New Hampshire Representative Frank Guinta, who days before leading his February talk on “The Conservative Heart” had repaid $355,000 in improper campaign donations from his parents. Surveying the crowd of 15 or so — about half the regular size — Hensarling declared he was taking note of who showed up and who did not, according to the people.

The corruption of Washington by Wall Street and vice versa is now over the top.  This disgusting story was posted on the Bloomberg website on Monday—and it’s something I found in Tuesday’s edition of the King Report.  For obvious reasons it had to wait for today’s column.  It’s worth reading.  Another link to this article is here.


How America Made Donald Trump Unstoppable — Matt Taibbi

He’s no ordinary con man. He’s way above average — and the American political system is his easiest mark ever.

The presidential election campaign is really just a badly acted, billion-dollar TV show – and Donald Trump is making a mockery of it.

The first thing you notice at Donald Trump’s rallies is the confidence. Amateur psychologists have wishfully diagnosed him from afar as insecure, but in person the notion seems absurd.

Donald Trump, insecure? We should all have such problems.

At the Verizon Giganto-Center in Manchester the night before the New Hampshire primary, Trump bounds onstage to raucous applause and the booming riffs of the Lennon-McCartney anthem “Revolution.” The song is, hilariously, a cautionary tale about the perils of false prophets peddling mindless revolts, but Trump floats in on its grooves like it means the opposite. When you win as much as he does, who the hell cares what anything means?

Matt Taibbi gives Trump the once over in this very long article that appeared on the rollingstone.com Internet site way back on February 24—and this is one I found in the Wednesday edition of the King Report.  Another link to this essay is here.


From Whitewater to Benghazi: a Clinton-Scandal Primer

All of Hillary Clinton’s e-mails are out there. Now, how bad will the fallout be?

On Monday, the State Department released the last batch of Clinton’s messages when she was secretary of state—a total of around 30,000. And late Wednesday, The Washington Post reported that the Justice Department has granted immunity to a former Clinton staffer to work with investigators, an indication of progress in the criminal case over the emails. Bryan Pagliano, the staffer, helped Clinton set up a server in her home in New York, which she used for her emails while running the State Department. Pagliano previously invoked his Fifth Amendment right against self-incrimination when called to testify by congressional committees. A spokesman said the Clinton campaign was “pleased” that Pagliano was cooperating, though what else are they going to say?

Clinton herself is likely to be questioned by the FBI sometime in the next few weeks.

This commentary showed up on theatlantic.com Internet site on Thursday—and for obvious content and length reasons, had to wait for my Saturday column.  I thank reader ‘Zoey’ for bringing it to my attention.  Another link to this essay is here.


Real Soars to 6-Month Highs After Former Brazilian President Lula Detained

Brazil’s federal police detained former president Luiz Inacio Lula da Silva for questioning on Friday in an anti-corruption and money laundering operation and said that illegal gains had financed campaigns and expenses of the ruling Workers Party.

Police said they had evidence that Lula received illicit benefits from the kick-back scheme at state oil firm Petroleo Brasileiro SA (Petrobras) in the form of payments and luxury real estate.

Ex-president Lula, besides being party leader, was the one ultimately responsible for the decision on who would be the directors at Petrobras and was one of the main beneficiaries of these crimes,” a police statement said.

There is evidence that the crimes enriched him and financed electoral campaigns and the treasury of his political group.

This very interesting Zero Hedge piece is centered around a Reuters story that was co-filed from Sao Paulo and Brasilia yesterday.  It was posted on the ZH website at 7:48 a.m. on Friday morning EST—and it’s another contribution from Richard Saler.  Another link to this article is here.


The Ukraine/Turkey/Syria/Russia Imbroglio: John Batchelor Interviews Stephen F. Cohen

The “intermission” in the Syrian war continues, but like in all good theatre, a lot of the important action is behind the scenes. The ceasefire is holding somewhat in that, as Batchelor states, “the killing is somewhat reduced.”  But the diplomacy heats up as Russia requests Turkey to cease bringing its heavy artillery up to its border in order to shell the Kurdish YPG forces in Syria. Cohen states that Turkey has moved, 100,000 troops, a lot of tanks and high calibre (150 mm) artillery and self-propelled guns up to its border and is shelling YPG (Kurdish) forces (in and around Kobane in Syria). At the same time the War Party in Washington headed by the usual culprits, Ash Carter, Sec Def., and NATO’s Breedlove have come out very vocally against the ceasefire. How the War Party functions, its members, and its contribution to the NCW is one of the important offerings of this podcast. Cohen compares the Washington group with its counterpart in Russia and comes to the conclusion that the American version is more dangerous: “as the American political class are lying to themselves” and the “war party is out and out lying” (ludicrously so). And it is strongly opposed to the Syrian ceasefire. One example sees NATO’s general Breedlove attempting to deflect responsibility for the refugee crisis in Europe to Putin’s “weaponizing the refugee stream”. Russians see this as just another reason to distrust Washington. Cohen emphasizes that “there are two Washingtons”, the War Party, probably headed by presidential candidate Clinton, and Sec. Def., Ash Carter, and the moderates by Sec. State, Kerry. I presume that if Obama is at all visible he is seen sitting precariously on the fence separating them.

The other very major point that Cohen has made is to add to Turkey to the list of flash points for World War 3 along with Ukraine and Syria. The War Party in Washington is quietly siding with Turkey, and those who distrust the United States so vehemently in the Kremlin know this. From my point of view the act of placing 100,000 troops (five to 6 full divisions) supported by tanks and massive artillery units is extremely worrisome in that this is just under 1/3 of the Turkish Army – much too large a force for just a provocation statement.  Although the military would likely not support President Erdogan in a direct assault on Syria, it may be more open to assaulting the Kurdish YPK forces there. It may do so if it avoids exchanging fire with Russians or the Syrian Army. But the likelihood of this would be remote unless the operation was very limited and brief. Please recall that Turkey has a budding civil war with its Kurdish population within Turkey and it is desperate to weaken Kurdish aspirations for its own state – and, of course, to continue its illicit oil business with ISIS. Turkey is now a major concern for all its neighbours. Clearly Russia sees the danger of the Turkish build up and is protesting strongly about it. Europe is very worried by Turkey’s duplicity with ISIS and the refugee crisis, and Washington is trying to maintain good relations with Turkey while supporting the YPG. The only good aspect to all this is that NATO has stated no interest in supporting a militarily aggressive Turkey; it is not yet prepared to go to war with Russia.

This 40-minute audio interview was posted on the audioboom.com Internet site on Tuesday.  This interview was posted in my Thursday column—and as I said then, I’d be posting it on Saturday’s column as well, so here it is.  I thank Ken Hurt for sending along the link, but the big THANK YOU goes out to Larry Galearis for the extensive ‘executive summary’ that you see above.  If you don’t have time for the audio interview, you should at least read the summary.  This is a must listen for any serious student of the New Great Game—and another link to this interview is here.


Iraq’s Mosul dam engineers warn it could fail at any time, killing 1 million people

Iraqi engineers involved in building the Mosul dam 30 years ago have warned that the risk of its imminent collapse and the consequent death toll could be even worse than reported.

They pointed out that pressure on the dam’s compromised structure was building up rapidly as winter snows melted and more water flowed into the reservoir, bringing it up to its maximum capacity, while the sluice gates normally used to relieve that pressure were jammed shut.

The Iraqi engineers also said the failure to replace machinery or assemble a full workforce more than a year after Islamic State temporarily held the dam means that the chasms in the porous rock under the dam were getting bigger and more dangerous every day.

The engineers warned that potential loss of life from a sudden catastrophic collapse of the Mosul dam could be even greater than the 500,000 officially estimated, as they said many people could die in the resulting mass panic, with a 20-metre-high flood wave hitting the city of Mosul and then rolling on down the Tigris valley through Tikrit and Samarra to Baghdad.

This amazing story appeared on theguardian.com Internet site on Wednesday morning GMT—and I thank Larry Galearis for sharing it with us.  Another link to this article is here.


Gold Demand Trips Up BlackRock as ETF Halts Share Creation

BlackRock Inc. on Friday temporarily stopped issuing new shares in its $7.7 billion iShares Gold Trust, as surging interest in the precious metal caught the world’s largest money manager off guard.

Investors had piled into the fund so fast that BlackRock didn’t register in time with the U.S. Securities and Exchange Commission to issue more shares. The suspension means that the share price of the fund may deviate from the price of its underlying assets — the physical gold — until issuance resumes, probably within two or three business days, according to a person familiar with the matter.

The misstep by New York-based BlackRock comes as providers of exchange-trade funds face mounting concern that the products may pose risks that investors aren’t always aware of. Cracks in the system were revealed on Aug. 24, when many equities didn’t open for trading, yet the ETFs that hold them did, causing confusion among investors about their value.

One would suppose this would be something they would be monitoring more carefully,” said Ben Johnson, director of global ETF research for Morningstar Inc.

This Bloomberg news item put in an appearance on their Internet site at 1:32 p.m. Denver time yesterday afternoon—and if found it embedded in a GATA release.  It’s certainly worth reading, as is the news release from Blackrock itself—and that’s linked here.   Another link to the above Bloomberg story is here.


Rob McEwen calls Bank of Canada ‘idiots’ for selling gold at market bottom

McEwen Mining Chairman Rob McEwen, founder Goldcorp, tells Business News Network in Toronto that the executives of the Bank of Canada are “idiots” for having sold the country’s last gold reserves just as the Bank of England did from 1999 to 2002 — at the bottom of the market.

We’re supposed to be a country built on resources, and we give away gold,” McEwen tells BNN‘s Andrew Bell.

McEwen also describes the unusual way he runs McEwen Mining — with a huge stake of his own money in the company, a 25 percent ownership, drawing no salary and receiving no options. McEwen also criticizes “streaming” by gold and silver mining companies, their sale of a share of their production to royalty companies, the equivalent of hedging.

The interview from yesterday is 7 1/2 minutes long and can be seen at the bnn.ca Internet site.  Another link to that is here.  It’s another gold-related news story that I found the gata.org Internet site.


Gold prices highest in a year after ‘golden cross’ — Ross Norman

Ross Norman, Chief Executive Officer at Sharps Pixley discusses gold closing at a one-year high after producing a “golden cross” pattern this week. He also discusses what’s driving gold prices.

This 5:32 minute video interview was posted on the bnn.ca Internet site at 7:30 a.m. in Toronto yesterday morning—and it’s something I found, not surprisingly, on the Sharps Pixley website.  It’s worth watching.


The PHOTOS and the FUNNIES

The first photo is of North Island brown kiwi.  The second is of a coconut crab trying to get into a garbage can—and yes, it really is that big.

160305Kiwi

160305coconut-crab

160305Staying warm

160305Dennis-Donald

160305Ramirez 3


The WRAP

It is a theme that has recurred for decades that when gold and silver prices are driven higher by concerted technical fund buying in COMEX futures contracts, sooner or later the commercial traders—which have sold to the technical funds on the price move higher—succeed in engineering lower prices, which induces technical fund selling. In fact, this is the mechanism by which gold and silver prices have been artificially manipulated—and what makes it manipulation is that purely paper derivatives trading between speculators should not be how prices are set to the rest of the world. 

On the price rally so far this year, the recurring theme of the commercials engineering the technical funds has been fully in force, as COT data have borne out to date. The technical funds have bought 130,000 net COMEX gold contracts (13 million oz) since year end—and the commercials have sold an even more (15 million oz). In silver the technical funds have bought 40,000 net silver contracts (200 million oz) with the commercials selling even more. (The commercials sell to other speculators apart from the technical funds).
 
The technical fund buying has included both short covering and the buying of new long contracts. In gold, the technical funds bought back close to 70,000 short contracts at a realized loss that I would estimate at more than $600 million and have added more than 60,000 new long contracts that are currently slightly ahead in mark to market terms. In silver, the technical funds bought back 30,000 short contracts at a collective realized loss of around $150 million. Up until now, it looks like the snookering of the technical funds by the commercials appears to be playing out same as it ever was.
 
With so many COMEX gold and silver contracts having been bought by the technical funds and causing prices to rally, the risk has grown for a sell-off at some point. This is the essence of the market structure analysis, at least as I see it. At the very least, should gold and silver prices decline sharply, there will be no other reason for the decline away from the technical funds being induced to sell by the commercials at lower prices. The COMEX market structure is the only potential bearish factor. Let’s face it – if silver prices drop sharply, it sure won’t be because investors are rushing to dump their metal to raise funds to deposit into zero interest rate bank deposits. It will occur because of futures position manipulation on the COMEX; period.Silver analyst Ted Butler: 02 March 2016


Today’s pop ‘blast from the past’ is one that popped into my head on Friday afternoon—and when I found it on the youtube.com Internet site just now, I’m sure it’s the first time I’d heard it since it was released in 1967.  I was 19 years young—and living in Ottawa at the time.  Here’s Andy Williams—and the accompanying video is a trip down memory lane for all of us of a certain vintage.  The link is here—enjoy!

Today’s classical ‘blast from the past’ was premiered in Vienna in February 1807.  It was Beethoven’s Piano Sonata No. 23 in F minor, Op. 57.  Here’s the incredibly gifted Ukrainian-born Valentina Lisitsa tearing up the keyboard with the 3rd movement.  The link is here.


And as bad as Ted says it is in his quote above, a lot has changed since he wrote those words on Wednesday morning, as no one could foresee the over-the-moon volumes in COMEX precious metals paper that was churned out on both Thursday and particularly Friday.  Without doubt we are at a new Commercial net short position in silver—and not far away in gold, going back to very early in 2013.

The stunning volume in gold on Friday—and to a lesser extent in silver—should leave no doubt in anyone’s mind that the powers-that-be, JPMorgan et al, ‘Da boyz’—whatever name you wish to use, were at battle stations across the board again yesterday.  That included the equity markets and dollar index, both which would have melted down if allowed to do so—and in the precious metals as well, which have blown sky high.

Of course with both of these events occurring simultaneously, the U.S. financial and monetary system would have been a smouldering ruin before the close of trading on Friday—and the rest of the world would have followed on Monday.

Here are the 6-month charts for the Big 6 commodities once again—and with the COT structure being what it is, the hurricane warning flags are snapping in the wind in the four precious metals.  Copper as well, perhaps.  But the question has to be asked—can they pull it off under the current conditions, or will they finally get over run?  We’ll find out soon enough I would think.

160305 6-month gold

160305 6-month silver160305 6-month platinum160305 6-month palladium160305 6-month copper160305 6-month NG160305 6-month WTIC

The war against the collapse of the monetary system that British economist Peter Warburton wrote about so succinctly back in April of 2001 is on its last legs.  The Frankenstein economic and financial system that is currently being supported by the assorted sociopaths and psychopaths in Washington, Wall Street—and at the Federal Reserve et al, is about to die, regardless of the fact that it’s now on continuous and frantic life support.

The situation in the precious metals has now gone beyond the wire—and sooner or later something has to give—and that’s notwithstanding the situation that cropped up with Blackrock’s iShares Gold Trust yesterday.  That was just a harbinger of things to come.

The situation is most dire in the silver market, as the manic movement of silver in and out of the New York depositories, piled on top of the 11.0 million troy ounces of silver deposited in SLV during the last three business days, indicates that critical mass is probably not too far off.

I know that Ted is watching the mismatch in the March delivery month in silver like a hawk—and so am I.  The fact that JPMorgan is giving the short/issuers these ‘Get-Out-of-Jail-Free’ cards the last two days, indicates that not only do these entities not have the silver to deliver to the long/stoppers—principally JPMorgan for its clients and it’s own account—any attempt to secure it in the open market in order to make delivery, would drive the silver price to the moon—and that’s presuming that the physical metal is available at all.

And as I said in Friday’s column, that quote by Daniel Drew—“He who sells what isn’t his’n, must buy it back or go to pris’n.“—is de rigueur over at JPMorgan as they keep passing out those cards to the hapless short/holders in the March delivery month.

The powers-that-be have painted themselves into very dangerous corners in no matter which financial and monetary theatre you care to look—and their thrashing about as they try to prevent the inevitable, is a threat to anyone or anything that gets in their way.

A current passport—and money/precious metals held outside your country of domicile, or at least outside the banking system, is the smart move as this beast breaths it last.

How did it come to this?

I’m done for the day—and the week.

See you on Tuesday.

Ed

http://www.edsteergoldandsilver.com/


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