NAV Premiums of Precious Metal Trusts and Funds - First Gold Halt of 2014

Nanex documents the first trading halt in gold, and the first smash-and-grab bear raid of 2014, here.

"On January 6, 2014 at 10:14:13, Gold futures plummeted $30 on heavy volume. About 4,200 contracts send gold futures prices tumbling $30 and trigger a 10 second trading halt. "

1. February 2014 Gold (GC) Futures

Comex Warehouses: Potential Claims On Deliverable Bullion at Historically High 80 to 1

“When you can measure what you are speaking about, and express it in numbers, you know something about it, when you cannot express it in numbers, your knowledge is of a meager and unsatisfactory kind; it may be the beginning of knowledge, but you have scarcely, in your thoughts, advanced to the stage of science.”

William Thomson Lord Kelvin

I think we can stipulate that the lack of real transparency in the precious metals markets, among too many other markets, is appalling. But that is the nature of our fraudulent times.

January is a non-active month for the metals, and overall inventories are adequate for the meager deliveries on the Comex.

Those who hold bullion will need some incentive to move it to the deliverable, registered category for February, which is often a significant physical delivery month for the New York paper markets.

But all in all, the Comex is now the tail wagging the dog, a paper sideshow to the real bullion markets which are moving East.

This is something that very few economists have yet to internalize.

Weekend Reading

"...Surely, there is at this day a confederacy of evil, marshalling its hosts from all parts of the world, organizing itself, taking its measures, enclosing the church of Christ as in a net, and preparing the way for a general apostasy from it. Whether this very apostasy is to give birth to Antichrist, or whether he is still to be delayed, we cannot know; but at any rate this apostasy, and all its tokens, and instruments, are of the Evil One and saviour of death.

Far be it from any of us to be of those simple ones, who are taken in that snare which is circling around us! Far be it from us to be seduced with the fair promises in which Satan is sure to hide his poison!

Do you think he is so unskillful in his craft, as to ask you openly and plainly to join him in his warfare against the truth? No; he offers you baits to tempt you. He promises you civil liberty; he promises you equality; he promises you trade and wealth; he promises you a remission of taxes; he promises you reform.

This is the way in which he conceals from you the kind of work to which he is putting you; he tempts you to rail against your rulers and superiors; he does so himself, and induces you to imitate him; or he promises you illumination, he offers you knowledge, science, philosophy, enlargement of mind. He scoffs at times gone by; he scoffs at every institution which reveres them.

He prompts you what to say, and then listens to you, and praises you, and encourages you. He bids you mount aloft. He shows you how to become as gods. Then he laughs and jokes with you, and gets intimate with you; he takes your hand, and gets his fingers between yours, and grasps them, and then you are his."

J.H.Newman, The Times of Antichrist

Gold Daily and Silver Weekly Charts - Release from the Year End Clamp Down

There was quiet trading as the northeastern US was digging its way out of Winter Storm Hercules.

Gold and silver have been rallying since the end of the December clamp down, but they most certainly have not yet broken out on the charts.

About 2700 ounces found their way out of the deliverable Comex inventory, bringing it back down to the 480,440,000 ounce level which is historically quite low.  This ought not to be an issue until the February delivery period arrives.  

There is sufficient gold in the Comex, but it might require higher prices to shake it loose.  As for the overall global supply situation for bullion, that is another story altogether.

See you next week.  Once again, Happy New Year!

SP 500 and NDX Futures Daily Charts - Low Volume

Very low volume and somewhat boring day, as the end of year exuberance continued to drip off the tape.

One area of interest was the minor divergence between the SP and Big Tech. The SP is the locus of stock market
propping by the ESF, so we'll have to see how it deals with key support levels next week.

Have a pleasant weekend.

Ted Butler: 2013 – The Year of JP Morgan in the Precious Metals

Here is a very brief excerpt from Ted Butler's summary look at the precious metals market in 2013.

I find it interesting in particular because Ted watches all the Comex data closely, and builds his thesis on that.

Although his commentary is normally by subscription, he has made the entire piece for free here.

As a bullion bank and market maker JPM may have some explanations for what they are doing, and it may be perfectly innocent. If they provide them to the CFTC, I think it would be something that could well be made public.

I do not mean to be rude, but a mere reassurance that they are doing no wrong is hardly sufficient, given the many recent instances in which they have been found to be doing things that are wrong, even if they are able to settle them for money and technically admit no guilt. I believe Matt Taibbi recently referred to them as "a global criminal enterprise."

But the CFTC makes an unresponsive silence their usual policy on far too many market particulars. And that undermines market confidence. And it is an arrogance of government power that makes it clear why only a small minority of people have a favorable view of the current government in Washington for both parties.

The people should be able to have confidence in markets for them to operate efficiently, and it is the role of government to provide this oversight. This is what they are paid to do, and the taxpaying public, not the Banks, are their customers.

And that may be at the heart of our dilemma, a credibility trap. No credible action will be taken to reform because the excesses and abuses implicate the power elite, and their courtiers and enablers.

"From the very beginning of the year to the last two days of 2013, JPMorgan has dominated and controlled the price of silver and gold. Here are the documented facts. At the start of 2013, with gold at $1650 and silver at $30, JPMorgan held short market corners in COMEX gold and silver futures. JPM was short 75,000 gold contracts (7.5 million oz) and 35,000 silver contracts (175 million oz).

JPMorgan’s short market corners at the start of 2013 amounted to a 21% net share of the entire COMEX gold futures market (minus spreads) and an astounding (but typical) 35% of the entire COMEX silver market. No single entity had ever held such outsized and anti-competitive shares of any important regulated futures market. It is unreasonable not to associate such extreme market corners with what followed in price."