NAV Premiums of Certain Precious Metals Trusts and Funds

As you may recall, The Sprott Trusts continue to add units outstanding in order to acquire more physical bullion under their 'At the Market' Program with Cantor Fitzgerald which was announced on May 6 of this year.

It is certainly was a smart move and a nice change from their prior arrangement with Morgan Stanley which was restrictive and prone to manipulation and arbitrage.

As we have noted many times this year, Sprott is taking affirming action in the markets to add to their bullion position opportunistically.

"The Trust has entered into a sales agreement with Cantor Fitzgerald & Co. (“Cantor”) whereby the Trust may, at its sole discretion and subject to its operating and investment restrictions, offer and sell trust units through an “at-the-market” offering program (the “ATM Program”).

The Trust intends to use the proceeds from any sales to acquire physical bullion in accordance with the Trust’s objectives and subject to the Trust’s investment and operating restrictions. Under the trust agreement governing the Trust, the net proceeds from the sale of any trust units pursuant to the ATM Program must be not less than 100% of the most recently calculated net asset value per trust unit prior to, or upon, determination of pricing of any sales (the “Accretion Condition”).

Given this Accretion Condition, the Trust expects that any sales pursuant to the ATM Program will be accretive to the Trust’s unitholders on a net asset value per trust unit basis and will increase the physical bullion attributable to each trust unit. Sprott also believes that the Trust may realize other secondary benefits from any sales made pursuant to the ATM Program including enhancing the trading liquidity of the Trust and decreasing the Trust’s operating expenses on a per unit basis."

As we all can see, today is certainly a 'risk asset' day with stocks soaring and the metals giving back some of their recent gains.  The financiers and their markets seem to be betting that they get what they want from the upcoming Presidential election.

Gold Daily and Silver Weekly Charts - Inside that 'Great Wage Growth Number' - Election Jitters

"The wealth of another region excites their greed; and if it is weak, their lust for power as well. Nothing from the rising to the setting of the sun is enough for them.

Among all others only they are compelled to attack the poor as well as the rich. Robbery, rape, and slaughter they falsely call empire; and where they make a desert, they call it peace."

Tacitus


"He who makes a beast of himself gets rid of the pain of being a man."

Samuel Johnson

In our artificial economy real things do not matter so much, but politics and managing the perceptions of the public are of paramount importance.

And so the 'Goldilocks' Jobs Report, which is how the business TV channels described that lukewarm piece of dreck, did little to rally the markets except fleetingly intraday.

In the first chart below I take a look inside that 'average hourly earnings growth' number.

The headline includes ALL employees, but if you take out the top 15-20% of managers, the average hourly earning growth showed a pronounced downward divergence to a lower growth rate.

The BLS switched to this number including all employees a few years ago from the non-supervisory number.

As a rule of thumb, when someone shows you the 'average' number, find out the median number for the same sample.  Especially in these days of historically high inequality.

Be that as it may, the markets overall were in a flight to safety as the financiers bowed to their fears of the upcoming presidential election, that something might happen that will upset their status quo.

 Not the status quo— theirs.

Gold therefore rallied along with the Swiss franc, while the VIX climbed and stocks continued to extend their streak of weakness along with la douleur du monde.

The result that the market wants to see next week is a decisive win by Hillary, but with a Republican dominated Congress.

I think the reason that the financiers and their ruling elite would like to see this outcome is fairly obvious.

And the rest of the world, with a shudder, turns to find safe havens from this madness.

Chris Christie's minions were thrown to the wolves over Bridgegate, being found guilty today.

But despite their testimony implicating him, the governor is continuing to claim that he knew nothing of what his closest aides were doing in a signature act of petty political revenge that resulted in massive traffic snarls in a very key bridge carrying all the traffic of Interstate 80 between NJ and NY.

Well, at least NJ voters can move on and select a replacement in the next election in 2017.  But alas, Christie has a top position with the Trump transition team.

Have a pleasant weekend.

SP 500 and NDX Futures Daily Charts - Goldilocks Does Wall Street

Stocks rallied a bit in the early day from the 'Goldilocks' jobs report, which is how it was characterized on the extended Wall Street infomercials known as the business channels.

That did not last, since the big overhang is still the election next week, and despite the cheerleading the jobs report was not all that good, being lukewarm at best.

Well, their hypocrisy knows no bounds. So stop whining.

Have a pleasant weekend.

Gold Daily and Silver Weekly Charts - Markets Flight to Safety From Election Overhang

Gold was up while silver and the US dollar were lower.

Looks like a pretty clear 'flight to safety' globally, sparked no doubt by the shadow being cast by the US elections next week.

The delivery reports and warehouses were largely quiet, with the exception of Hong Kong CME warehouses which showed a continuing drain of gold inventory.

Non-Farm Payrolls tomorrow may move markets, but I suspect that the US elections will be casting a bigger footprint.

Congrats to the Chicago Cubs fans for the World Series win. Viewership for the seventh game was amazingly high, and the game held plenty of 'tension' in a back and forth struggle from two seemingly exhausted teams.

And a shout out to Cleveland for making it to the series in such a convincing manner. I think both teams will bear watching next year, within the wider range of uncertainty from trades and injuries.

Next week's election may be equally compelling, but somehow I suspect that the election will be captured again by the status quo, perhaps with a twist or two.

Paul Krugman was a special guest on Bloomberg TV today. He is a nice study in the credibility trap.  I must admit he is getting better at speaking politically, and weaving his observations and talking points together on the domestic political front.

At the end of the day, however, he is still off on domestic policy, perhaps not as a badly as some of his counterparts who are plainly ideologically captive, but rather captive to his 'reputation' and desire for political positions which is the primary currency and asset in the areas where economic becomes a pseudo-science overreaching itself in public policy prescriptions.

Have a pleasant evening.

SP 500 and NDX Futures Daily - Holy Volatility!

The upcoming election seems to be setting a chill on the financial class.

Today was the eighth consecutive down day for US stocks, the most since 2008.

The declines, however, have been relatively modest, with the indices showing what appears to be a normal correction of less than 10%.

Volatility as measured by the VIX, which might be better called 'uncertainty,' continued rising as can be seen from the chart below.

Non-Farm Payrolls tomorrow may move the markets, but I suspect that the bigger overhang is the upcoming US elections next week Tuesday.

Have a pleasant evening.

Gold Daily and Silver Weekly Charts - Much Ado About Nothing

There was a posting on the NAV of some of the precious metal trusts and funds intraday here.

And there was also a short piece on the competing crime families that are our two established political parties here.

Gold and silver had a nice spike higher earlier in the day on a lower dollar as you can see in the charts below.

The metals gave back some of their gains into the close.

The FOMC did not seem to affect them much despite its dovish waffling and wistful desire to raise rates at least once before the end of the year in December.

The clearing (delivery) reports were brisk for gold and meh for silver.   And the reverse for the warehouse reports as silver keeps moving metals in and out, and the gold bullion sits there and looks pretty while the punters swap a pyramid of IOUs per ounce for it.

Let's see if the metals can keep the move going higher.

Have a pleasant evening.