Sept 6/A Monstrous 14.25 tonnes of “paper gold” added into the GLD/Strangely no change in silver at the SLV/Huge advance in both gold, silver and the gold/silver equity stocks/China may be nearing the end of its purchases of SPR oil/Troika playing hardball with Greece as they withhold latest bailout money/Two bad USA economic reports tonight: i)Service ISM dismal and ii)The Fed’s own job indicator tumbles/

Gold:1349.30 up $27.30

Silver 20.05  up 77 cents

In the access market 5:15 pm

Gold: 1350.05

Silver: 20.06

THE DAILY GOLD FIX REPORT FROM SHANGHAI AND LONDON

.

The Shanghai fix is at 10:15 pm est and 2:15 am est

The fix for London is at 3 am est (first fix) and 10 am est (second fix)

Thus Shanghai’s second fix corresponds to 45 minutes before London’s first fix.

And now the fix recordings:

First the Shanghai fix Sept 5

Shanghai morning fix (10:15 pm est last night):  $1325.32

NY ACCESS PRICE: $1325.68 (AT THE EXACT SAME TIME)

Shanghai afternoon fix:  2: 15 am est (second fix/early  morning):$1327.81

NY ACCESS PRICE: 1326.96 (AT THE EXACT SAME TIME)

London Fix: Sept 5: 3: am est:  $1328.30   (NY: same time:  $1326.20:    3 AM)

London Second fix Sept 5: 10 am est:  $1326.35  (NY same time: $1326.34 ,    10 AM)

Shanghai fix Sept 6

Shanghai morning fix Sept 6 (10:15 pm est last night):  $1328.74

price in NY on access at the exact same time:$1325.68

Shanghai afternoon fix  Sept 6(2:15 am this morning: $1329.36

price in NY on access at the exact same time: $1326.80 

The two London fixes:

First fix:Sept 6 2016 am:$1330.35 (3 am est) vs Shanghai (2:15 am): 1328.74

New York access price as the same time (3 am):  $1328.10

 Second fix: pm Sept 6:$ 1337.25 (10 am est)  1334.70 USA gold price at 10 am

It seems that Shanghai pricing is higher than the other  two , (NY and London). The spread has been occurring on a regular basis and thus I expect to see arbitrage happening as investors buy the lower priced NY gold and sell to China at the higher price. This should drain the comex

For gold:The front September contract month we had 0 notices filed for nil oz

For silver:  the month of September we have a total of 253 notices filed for 1,265,000 oz

Generally after a 4 day weekend, the bankers always whack.  This has been going on for many years. It looks like our paper gold/silver boys are in some sort of trouble e.g. Deutsche bank.

Let us have a look at the data for today

.

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In silver, the total open interest rose by 4094 contracts up to 193,359. The open interest rose as the silver price was up 24 cents in Friday’s trading .In ounces, the OI is still represented by just LESS THAN 1 BILLION oz i.e. .967 BILLION TO BE EXACT or 138% of annual global silver production (ex Russia &ex China). the crooks are doing a great job fleecing unsuspecting longs

In silver we had 191 notices served upon for 955,000 oz

In gold, the total comex gold rose by 5064 contracts as price of gold ROSE BY $9.90 yesterday . The total gold OI stands at 561,865 contracts

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With respect to our two criminal funds, the GLD and the SLV:

GLD

we had a monstrous deposit tonight into the GLD/ 14.25 tonnes was added into  the GLD

Total gold inventory rest tonight at: 952.14 tonnes of gold

SLV

we had no changes with respect to inventory at the SLV /

THE SLV Inventory rests at: 359.585million oz

.

First, here is an outline of what will be discussed tonight:

1. Today, we had the open interest in silver fell by 4095 contracts up to 193,359 as the  price of silver ROSE by 42 cents with Friday’s trading.The gold open interest rose 5,064 contracts up to 561,865 as the price of gold ROSE $9.90 IN FRIDAY’S TRADING.

(report Harvey).

2.a) The Shanghai and London gold fix report

(Harvey)

 

2 b) Gold/silver trading overnight Europe, Goldcore

(Mark O’Byrne/zerohedge

and in NY:  Bloomberg

end

Silver is advancing a little faster than gold

(courtesy zero hedge)

Silver Surge Continues For 5th Day – Strongest To Gold Since Fed Minutes

Silver is up almost 8% from last week’s lows, surging back towards $20 and above its 50-day average ($19.70). Gold is also rising but we note that the post-Fed-Minutes outperformance of gold over silver (as both fell) has been erased…

Silver has outperformed Gold (back under 68x) in the last 2 weeks, erasing the shift after the Fed Minutes…

As Precious metals are bid post-payrolls…

end

Trading in everything else including gold rise as rate hike odds collapse:

(courtesy zero hedge)

Gold Leads Post-Payrolls Panic-Buy-Everything-Palooza As Rate-Hike-Odds Collapse

As rate hike odds tumble post-payrolls (and extend lower after ISM/PMI Services plunge), so the ‘bad news is good news’ buy-everything bonanza continues.

Everything is green post-payrolls…with precious metals leading the way…

But how long can this last?

As rate hike odds collapse…

Another Fed fail!

end

3. ASIAN AFFAIRS

i)Late  SUNDAY night/MONDAY morning: Shanghai closed UP 18.61 POINTS OR 0.61%/ /Hang Sang closed UP 138.13 points or 0.58%. The Nikkei closed UP 44.35 POINTS OR 0.26% Australia’s all ordinaires  CLOSED DOWN 0.29% Chinese yuan (ONSHORE) closed UP at 6.6785/Oil ROSE to 44.91 dollars per barrel for WTI and 47.42 for Brent. Stocks in Europe: IN THE GREEN EXCEPT LONDON  Offshore yuan trades  6.6894 yuan to the dollar vs 6.6785 for onshore yuan.THE SPREAD BETWEEN ONSHORE AND OFFSHORE NARROWS SLIGHTLY AS  MORE USA DOLLARS ATTEMPT TO  LEAVE CHINA’S SHORES

REPORT ON JAPAN  SOUTH KOREA NORTH KOREA AND CHINA

i)This is getting get worrisome:  North Korea fires 3 ballistic missiles landing in Japan’s air space.  Japan condemns the action as they issue a stern warning to North Korea.

Not good..

( zero hedge)

a) REPORT ON JAPAN

 none today

b) REPORT ON CHINA

China released it secret data as of the first of Jan 2016 and it is much higher than expected:  at 32 million tonnes or 31 to 36 days worth of supply.  China wants at least 100 days of storage.

( Irian Slav/OilPrice.com)

4 EUROPEAN AFFAIRS

GERMANY

i)Merkel’s party lost to an anti immigration party in her home state vote in provincial elections

( Donahue/Bloomberg)

ii)Since the Greek-Turkish lanes have been blocked, we now see that the Mediterranean lane crossing is the new passage for the refugees as they head to Italy:

( Mish Shedlock/Mishtalk)

GERMANY AND FRANCE

(courtesy zero hedge)

iv)GREECE

With no money due to the Troika as of this minute, Europe has decided to play hardball against Athens to pass reforms that they promised.  So far in the past year only two out of 15 have passed and the most stringent like huge government people layoffs have not been implemented yet. And yet, Greece continues to be mired in a deep depression as mounting attacks by citizens is a daily occurrence

( zero hedge)

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

i)ISIS will not be on its last legs as Turkey has sealed off all territory along the Syria and Turkey border.  ISIS has so way to rearm itself:

( Bloomberg/Associated Press)

ii)This morning, Turkey strikes 12 targets not in Syria but Iraq where the Kurds are located:

(courtesy Reuters)

6.GLOBAL ISSUES

none today

7.OIL ISSUES

i)Zero hedge’s conclusion is without a doubt the key to this story: the huge increase in fracking! Oklahoma has a big 5.6 earthquake:

zerohedge..

“Owing to Oklahoma’s dramatic rise in earthquakes and a now-undisputed link between the seismic events and oil-and-gas disposal wells, the issue has gained political prominence that it didn’t have in 2011.”

( zero hedge)

ii)Oil futures soar ahead of a surprising joint Saudi Russian statement.  However they fail to freeze oil production:

(courtesy zero hedge)

iii)That did not last long! Oil retreats Monday afternoon:

( zero hedge)

iv)Oil this morning: down badly

( zero hedge)

v)It seems that China is nearing capacity in its SPR.  Not only that but the government is going to take a substantial amount of oil demand off line due to tax problems with Chinese “teapots”. This would be the equivalent of 400,000 barrels per day of demand ceasing.All in all oil is heading south!

( zero hedge)

8.EMERGING MARKETS

VENEZUELA

Things are getting quite violent in Venezuela as they are trying to remove Maduro. This is what happens to a nation that embraces a socialist utopia.  Venezuela has the world’s largest oil reserves and yet they cannot feed their people:

( Bloomberg)

9.PHYSICAL STORIES

i)According to Reggie Middleton, Deutsche bank is preparing for an avalanche of fraud charges including its gold derivative products.  Reggie is writing for a paid subscription called Veritaseum and he will be releasing is finding to them this week.  One section is a huge fraud on gold where he states that it should be referred to the UK Fraud Squad as one particular investment was sold to UK investors:

( Reggie Middleton)

ii)Barrick is now ready to focus on a scaled back Pascua Lama project in Argentina.  It still doubt that they will get this going

( Reuters/GATA)

iii)Craig Roberts and John Embry on Goldseek ratio

( Goldseek/Craig Roberts/John Embry)

iv)GATA is holding a gold conference in New Orleans:

( Chris Powell/GATA)

v)Lawrie Williams discusses the possibility of gold flow reversals now that the holiday season is however.  Discover why?

(Lawrence Williams/Sharp Pixley)

10.USA STORIES WHICH MAY INFLUENCE THE PRICE OF GOLD/SILVER

i)The story on Hillary as to how 960 emails were not wiped out until after a subpoena was issued by Congress.  The order was received to everybody connected to her servers including the “PRN” firm who forgot to delete emails as instructed by Hillary’s staff in 2014. The undisclosed PEN staff member has a “OH Shit Moment”

here is the background on this issue:

a must read…

(COURTESY ZERO HEDGE)

ii)And now Karl Denninger describes in detail how Hillary is grossly incompetent is she had to replace 8 Blackberries in 4 years. Denninger is really upset as to why nobody has been charged get with obstruction of justice and evidence tampering which is a criminal offence. Either Hillary is grossy incompetent or is liar!

( Karl Denninger/Mac Slavo)

iii)Poor Barrack Obama: he was snubbed at the least G20 meeting. The leaked documents conclude that more monetary stimulus is on its way:

( zero hedge)

iv)After a disappointing manufacturing PMI/ISM data, the service side of things also printed a 6 month low at 50.9.  Remember that the service sector is 70% of USA  GDP:

( zero hedge)

v)The Fed’s own jobs indicator tumbles again. It has fallen for 7 out of the last 8 months.

And Janet and Stanley see the economy booming?
( zero hedge)

vi)This is going to hurt:  40,000 students and 8,000 employees are now in limbo as  the “for profit” ITT Education Services just shut down this morning(COURTESY ZERO HEDGE)

Let us head over to the comex:

The total gold comex open interest ROSE to an OI level of 561,865 for a GAIN of 5,064 contracts as the price of gold ROSE by $9.90 with Friday’s trading. We are now in the NON active month of SEPTEMBER/

The contract month of Sept saw it’s OI fall by 52 contracts down to 514. We had 47 notices filed yesterday so we LOST 5 contracts or 500 additional oz will not stand for delivery.  The next delivery month is October and here the OI fell by only 221 contracts down to 44,147. This level is extremely high and no doubt many of these will wait it out and take delivery at the end of the month. The next contract month of December showed an increase  of 4496 contracts up to 419,667.The estimated volume today at the comex: 269,955 excellent  Confirmed volume on Friday: 251,938, which is excellent.

Today we had  0 notices filed for  nil oz of gold.
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And now for the wild silver comex results.  Total silver OI ROSE by 4094 contracts from  189,265 up to 193,359  with the rise in price of silver to the tune of 42 cents yesterday.  We are moving away from the all time record high for silver open interest set on Wednesday August 3:  (224,540).  We are now into the next active month of September and here the OI fell by 180 contracts down to 2019. We had 191 notices filed on Friday so we gained 11 contracts or 55,000 additional oz will stand for delivery in this active month of September.  The next non active delivery movement of October hardly moved RISING by 17 contract up to 238 contracts.  The next big delivery month will be December and here it rose hugely , up 3892 contracts  to 168,211. The volume on the comex today (just comex) came in at 103,573 which is gigantic.  The confirmed volume yesterday (comex and globex) was huge  at  71,832 . Silver is not in backwardation.  London is in backwardation for several months.

today we had 191 notices filed for silver: 955,000 oz

INITIAL standings for SEPTEMBER
 SEPT 6.
Gold
Ounces
Withdrawals from Dealers Inventory in oz  

NIL

Withdrawals from Customer Inventory in oz  nil
NIL
Deposits to the Dealer Inventory in oz NIL

 

Deposits to the Customer Inventory, in oz 
NIL
No of oz served (contracts) today
0 notices 
0 oz
No of oz to be served (notices)
519 contracts
(51,000 oz)
Total monthly oz gold served (contracts) so far this month
1904 contracts
190,400 oz
5.922 tonnes
Total accumulative withdrawals  of gold from the Dealers inventory this month   192.90 oz
Total accumulative withdrawal of gold from the Customer inventory this month   22,794.35 oz
 Today: tiny activity at the gold comex and 0 kilobar entries
Today we had 0 dealer deposit:
total dealer deposit:  NIL oz
 Today we had 0 dealer withdrawals:
 total dealer withdrawals;  nil oz
 We had 0 customer deposits:
Total customer deposits:nil   OZ
 Today we had 0 customer withdrawals:
Total customer withdrawals;  nil
Today we had 1 adjustment:
i) Out of Brinks:  28,881.17 oz was adjusted out of the dealer into the customer and we will deem that a settlement:  .(8983 tonnes)
Note:
If anybody is holding any gold at the comex, you must be out of your mind!!!
since comex gold storage is unallocated , rest assured any gold stored at the comex will be compromised!
I also urge all of you do not place any option trades at the comex as these gangsters will gun you down.
If you are taking delivery of gold/silver please remove it from comex banks and place it in private vaults 
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Today, 0 notices were issued from JPMorgan dealer account and 0 notices were issued from their client or customer account. The total of all issuance by all participants equates to 0 contracts of which 0 notices were stopped (received) by JPMorgan dealer and 0 notices were stopped (received) by JPMorgan customer account.
To calculate the initial total number of gold ounces standing for the SEPT  contract month, we take the total number of notices filed so far for the month (1904) x 100 oz  or 190,400 oz , to which we  add the difference between the open interest for the front month of SEPT  (514 CONTRACTS) minus the number of notices served upon today (0) x 100 oz   x 100 oz per contract equals 241,800  oz, the number of ounces standing in this NON active month. 
 
Thus the INITIAL standings for gold for the SEPT contract month:
No of notices served so far (1904) x 100 oz  or ounces + {OI for the front month (514) minus the number of  notices served upon today (0) x 100 oz which equals 241,800 oz standing in this non  active delivery month of SEPT  (7.5209 tonnes).
we lost 5 contracts or an additional 500 oz will not stand. We are almost back to our original standings on first day notice.
Since the comex allows GLD shares to be used for settling, it may take quite a while for the physical gold to enter the comex vaults.  So far I have seen little evidence of any settling of contracts but I will continue to monitor it for you. 
 
We now have partial evidence of gold settling for last months deliveries We now have  +  6.889 TONNES FOR MAY + 49.09 TONNES FOR JUNE +  21.452 TONNES FOR JULY + 12.3917 + 44.348 tonnes Aug +7.5209  tonnes SEPT, (April) +2.2311 tonnes (March) + 7.99 (total Feb)- .940 (probable delivery on March 1) tonnes -.0434 tonnes (March 11,12,17,18) + March 31: 1.2470 and then  April 1,2: – .0006 tonnes  and last week April 16.3203 and April 22 .(0009 tonnes) + april 29  .205 tonnes + May 5:  3.799 and May 6: 1.607 tonnes –MAY 12  .0003- May 18: 1.5635 tonnes-May 19/   2.535 tonnes-May 27 .0185 – .024 TONNES MAY 31 -jUNE 4: .5044 ; june 10 -.0008 / June 22:0.48 tonnes /June 23: 0489 tonnes, June 24..018; june 29 .036 tonnes; JUNE 30 2.49 /july 1 1778 tonnes, JULY 28 .089 TONNES / JULY 29 .128 TONNES/ aUG 10// 0.219 TONNES/August 11: .3619 TONNES/ AUG 12/.05878/ aug 17. 6418, aug 23: .1756 tonnes/aug 25.2115/aug 26: 1.3530/ AUG 29 .126 TONNES/Sept 6: .8983 tonnes/THEREFORE 98.254 tonnes still standing against 75.487 tonnes available.
 Total dealer inventor 2,426,910.472 or 75.487 tonnes
Total gold inventory (dealer and customer) =10,933,828.789 or 340.08 tonnes 
 
Several months ago the comex had 303 tonnes of total gold. Today the total inventory rests at 340.08 tonnes for a  gain of 37  tonnes over that period. 
Ladies and Gentlemen:  the comex is beginning to lose some of its gold.
 

THE GOLD COMEX IS AN ABSOLUTE FRAUD. THE USE OF KILOBARS AND EXACT WEIGHTS MAKES THE DATA TOTALLY ABSURD AND FRAUDULENT!!

To me, the only thing that makes sense is the fact that “kilobars” are entries or hypothecated gold sent to other jurisdictions so that they will not be short in their derivatives like in England.  This would be similar to the gold used by Jon Corzine. If this is the case, this would be the greatest fraud perpetrated on USA soil.

 
 end
And now for silver
 
SEPT INITIAL standings
 SEPT 6.2016
Inventory movements not available today from the CME/
Silver
Ounces
Withdrawals from Dealers Inventory NIL
Withdrawals from Customer Inventory
522,029.08 oz
BRINKS
HSBC
Deposits to the Dealer Inventory
 nil OZ
Deposits to the Customer Inventoryxxx
 1,215,851.410 oz
DELAWARE
SCOTIA
No of oz served today (contracts)
191 CONTRACTS
(955,000 OZ)
No of oz to be served (notices)
2008 contracts
(10,040,000 oz)
Total monthly oz silver served (contracts) 725 contracts (3,625,000 oz)
Total accumulative withdrawal of silver from the Dealers inventory this month  NIL oz
Total accumulative withdrawal  of silver from the Customer inventory this month  2,436,319.3 oz
today, we had 0 deposit into the dealer account:
total dealer deposit:   NIL oz
we had 0 dealer withdrawals:
 total dealer withdrawals: NIL oz
 we had 2 customer withdrawals:
 i) Out of BRINKS  399,743.1  OZ
ii) out of HSBC:  122,285.900 OZ
Total customer withdrawals: 522,029.08  oz
We had 2 customer deposit:
i) Into DELAWARE: 2001.11 oz
ii) Into SCOTIA: 1,213,850.300 OZ
total customer deposits:  1,215,851.410   oz
 
 
 
 we had 1 adjustments
OUT OF CNT:
We had a HUGE transfer 581,417.200 oz from the customer CNT into the dealer CNT
The total number of notices filed today for the SEPT contract month is represented by 191 contract for 955,000 oz. To calculate the number of silver ounces that will stand for delivery in SEPT., we take the total number of notices filed for the month so far at (725) x 5,000 oz  = 3,625,000 oz to which we add the difference between the open interest for the front month of SEPT (2199) and the number of notices served upon today (191) x 5000 oz equals the number of ounces standing 
 
Thus the initial standings for silver for the SEPT contract month:  725(notices served so far)x 5000 oz +(2199 OI for front month of SEPT ) -number of notices served upon today (191)x 5000 oz  equals  13,665,000 oz  of silver standing for the SEPT contract month.
we gained 11 contracts or an additional 55,000 will stand as these guys were bought out for cash plus a fiat bonus.
 
Total dealer silver:  28.204 million (close to record low inventory  
Total number of dealer and customer silver:   162.925 million oz (close to a record low)
The total open interest on silver is NOW close to its all time high with the record of 224,540 being set AUGUST 3.2016.  The registered silver (dealer silver) is NOW NEAR  multi year lows as silver is being drawn out at both dealer and customer levels and heading to China and other destinations. The shear movement of silver into and out of the vaults signify that something is going on in silver.
end
 
And now the Gold inventory at the GLD
Sept 6/a monstrous addition of 14.25 tonnes into the GLD/with London in backwardation in gold I wonder how these guys found so much “gold”/Inventory rests tonight at 952.14 tonnes/
Sept 2/no change in inventory at the GLD/Inventory rests at 937.89 tonnes
SEPT 1/another montrous withdrawal of 5.34 tonnes/Inventory rests at 937.89 tonnes
August 31/ a monstrous 13.36 tonnes of gold leaves the GLD/inventory rests at 943.23 tonnes
august 30/no change at the GLD/Inventory rests at 956.59 tonnes
August 29/no changes at the GLD/Inventory rests at 956.59 tonnes
August 26./no changes at the GLD/inventory rests at 956.59 tonnes
August 25/a withdrawal of 1.78 tonnes at the GLD/Inventory rests at 956.59 tones
August 24/NO CHANGE  in gold inventory at the GLD/inventory restsw at 958.37 tonnes
August 23/no change in gold inventory at the GLD/Inventory rests at 958.37 tonnes
August 22/ a deposit of 2.38 tonnes of gold into the GLD/Inventory rests at 958.37 tonnes
August 19/no changes at the GLD/inventory resets at 955.99 tonnes
August 18/a withdrawla of 6.24 tonnes of gold from the gLD/Inventory rests at 955.99 tonness
August 17/no change in gold inventory at the GLD/inventory rests at 962.23 tonnes
August 16/ a deposit of 1.78 tonnes of “paper gold” into the GLD/Inventory rests at 962.23 tonnes
August 15/what a farce!! a huge “paper gold’ withdrawal of 12.17 tonnes/inventory rests at 960.45 tonnes
August 12/no change in gold inventory at the GLD/Inventory rests at 972.62 tonnes
August 11/no changes in gold inventory at the GLD/Inventory rests at 972.62 tonnes
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SEPT 6/ Inventory rests tonight at 952.14 tonnes

end

Now the SLV Inventory
Sept 6/Strange: no addition of silver at the SLV. You mean they cannot find any paper silver?/Inventory rests at 359.585 million oz
Sept 2/a small withdrawal of 158,000 oz at the SLV probably to pay for fees/Inventor  rests at 359.585 million oz.
SEPT 1/no change in inventory at the SLV/Inventory rests at 359.743 million oz/
August 31/we had a monstrous addition of 1.899 million oz into the SLV/this would be a paper addition/inventory rests at 359.743 million oz//why the difference in gold and silver: one reduces dramatically and the other increases dramatically
August 30/no change in silver inventory/inventory rests at 357.844 million oz/
August 29/we had a good sized deposit of 950,000 oz at the SLV/Inventory rests at 357.844 million oz/
August 26/no change in silver inventory at the SLV/Inventory rests at 356.894 million oz
August 25/a withdrawal of 1.899 million oz from the SLV/Inventory rests at 356.894 million oz
August 24/no change in silver inventory at the SLV/Inventory rests at 358.793 million oz
August 23/no change in silver inventory at the SLV/Inventory rests at 358.793 million oz.
August 22/a huge addition of 3.324 million oz into the SLV/Inventory rests at 358.793 million oz
August 19/no change in silver SLV/Inventory rests at 355.469 million oz/
August 18/ a massive paper deposit of 2.185 million oz into the SLV/Inventory rests at 355.469 million oz
August 17/ we had a huge deposit of 1.519 million oz into the SLV/Inventory rests at 353.284 million oz/
August 16/no change in inventory/rests tonight at 351.765 million oz
August 15./amazing, we have a huge withdrawal in gold and yet nothing moves out of silver: no change in silver inventory at the SLV/Inventory rests at 351.765 million oz.
August 12/no change in silver inventory at the SLV/Inventory rests at 351.765 million oz
August 11/no change in silver inventory at the SLV/Inventory rests at 351.765 oz
.
SEPT 6.2016: Inventory 359.585 million oz

NPV for Sprott and Central Fund of Canada

1. Central Fund of Canada: traded at Negative 3.3 percent to NAV usa funds and Negative 3.1% to NAV for Cdn funds!!!!  (the discount is starting to disappear)
Percentage of fund in gold 59.4%
Percentage of fund in silver:39.4%
cash .+1.2%( SEPT 6/2016).
2. Sprott silver fund (PSLV): Premium rises to +0.65%!!!! NAV (SEPT 6/2016) 
3. Sprott gold fund (PHYS): premium to NAV  rises TO  0.70% to NAV  ( SEPT 6/2016)
Note: Sprott silver trust back  into POSITIVE territory at +0.65% /Sprott physical gold trust is back into positive territory at 0.70%/Central fund of Canada’s is still in jail.
 
 
 

end

And now your overnight trading in gold,FRIDAY MORNING and also physical stories that may interest you:

Trading in gold and silver overnight in Asia and Europe
Mark O’Byrne/David Russell
Big story today!

LAWRIE WILLIAMS: Gold Flow reversals – will they continue after U.S. holiday season over?

SEP 5

The U.S. holiday season effectively gets into full swing on the Independence Day weekend around July 4th, and comes to an end after Labor Day, which is today.  These holidays can represent major turning points in investment sentiment.  Gold investors will have Labor Day 2011 writ on their hearts as that was effectively the day the gold bull market ended, and a four and a half year bear market in the precious metal began.  This year saw the big SPDR Gold Shares (GLD) gold ETF reach its interim peak at 982.72 tonnes.  Currently its holdings stand at 937.89 tonnes – a fall of 44.83 tonnes in only two months.  Gold investors will thus be nervous at what the post-holiday period will bring this year and sentiment indicators, like the GLD holdings, will thus be followed with particular interest for the next few days to see where the market is possibly headed.

But the GLD figures, which tend to be a strong indicator of North American gold investment sentiment, particularly from the institutional viewpoint, will not be the only indicators being viewed with huge interest by gold investors.  As we have pointed out here beforehand there have been some hugely relevant reversals in gold supply and demand patterns this year.  Asian demand has been seen as weak with the two largest markets, China and India, taking in less gold that previous years, while Swiss gold import and export statistics have reversed with respect to some key nations which usually export gold to Switzerland for re-refining, becoming significant gold importers from the Alpine nation – notably the UK and the US – while on the other hand some key nations which had been significant importers of Swiss gold to meet their own trading needs have in turn become the largest exporters of gold back to Switzerland – notably the United Arab Emirates (UAE) and Hong Kong.

We have speculated here that this remarkable change in gold flows has been for two main reasons.  The first is that physical gold availability in the West has been becoming tight – particularly due to the big first half of the year needs of the major gold ETFs to maintain their gold balances in the light of big money flows into them by gold-focused investors.  The second reason, we have suggested, is that the big gold fabricators and traders like the UAE and Hong Kong have been suffering from a severe downturn in gold demand from their traditional purchasers, mostly in Asia, and have been liquidating excessive inventories built up in the expectation of continuing high Asian demand levels.  With the substantial rise in the gold price so far this year this has been a profitable trade.

But is all this about to change and will Labor Day be the trigger?  The return of fund managers and traders to their desks may prompt a serious rethink in terms of gold investment policy and this could take the gold price in either direction depending on consensus.  This makes the past two months’ gold price mostly range-bound movements perhaps the calm before the storm.

So what is changing which could affect the price scenario?  By all accounts Indian and Chinese demand is beginning to pick up again, while on the other hand gold ETF inflows have been replaced by outflows.  Net central bank gold buying appears to have fallen off, although as we pointed out in our recent article: Central bank gold buying – what the media reports don’t really tell you , perhaps not too much should be read into this yet given there are only three significant central bank gold buyers – Russia, China and, to a lesser extent, Kazakhstan and month by month announced reserve increases by the first two of these can be somewhat variable.  On the gold production front, we may, or may not, have reached peak gold, although evidence suggests we are now there or thereabouts.  The Australians may be bucking the trend and increasing production to maximise returns (See: Australian Gold Output Hits 15-Year High, but in other nations undoubtedly new mined gold output is beginning to slip.

So gold fundamentals are somewhat mixed in outlook, but close to balance and the markets could move it in either direction.  We remain gold positive as even when price weakness has appeared with some big technical sales on the COMEX futures market driving the price down, such raids have tended to prove shortlived in duration and effect suggesting there are plenty of buyers out there in the $1,300 – $1,330 range where gold is currently trading.  But it could be a whole new world for gold from tomorrow when the traders and fund managers are fully back on track.  With the U.S. futures market still effectively setting the gold price, although Shanghai seems to be having an increasing mitigating influence, this is all vitally impotrtant for the gold price direction from here on.  We shall see.

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