Gold $1252.50 down $0.50
Silver 17.42 up 12 cents
I will be back on Monday and I will bring you my normal commentary. I will
a short version on Tuesday night and then report to you very late Wednesday night
As for gold, we will see a rise in the gold and silver price starting Monday as China will be back from their one week holiday and they will have a feast on the low price
THE DAILY GOLD FIX REPORT FROM SHANGHAI AND LONDON
Shanghai fix closed this week for holiday
The Shanghai fix is at 10:15 pm est and 2:15 am est
The fix for London is at 5:30 am est (first fix) and 10 am est (second fix)
Thus Shanghai’s second fix corresponds to 195 minutes before London’s first fix.
And now the fix recordings:
Shanghai morning fix Oct 3 (10:15 pm est last night): $ holiday
NY ACCESS PRICE: $
Shanghai afternoon fix: 2: 15 am est (second fix/early morning):$ holiday
NY ACCESS PRICE:
London Fix: Sept 30: 5:30 am est: $1255.40 (NY: same time:1255.40 $: 5:30AM)
London Second fix Sept 30: 10 am est: $1258.55 (NY same time: $1258.55 , 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.
Also why would mining companies hand in their gold to the comex and receive constantly lower prices. They would be open to lawsuits if they knowingly continue to supply the comex despite the fact that they could be receiving higher prices in Shanghai.
For comex gold:
the total number of notices filed today : 3 for 300 oz
for the Oct contract month: 9 notices for 45,000 oz.
Let us have a look at the data for today
In silver, the total open interest fell by 2974 contracts down to 191,837. The open interest fell as the silver price was down 25 cents in yesterday’s trading .In ounces, the OI is still represented by just less THAN 1 BILLION oz i.e. .9590 BILLION TO BE EXACT or 137% of annual global silver production (ex Russia &ex China).
In silver for October we had 9 notices served upon for 45,000 oz
In gold, the total comex gold FELL by a whopping 12,059 contracts as the price of gold fell by $9.00 yesterday . The total gold OI stands at 511,340 contracts. The bankers have done a great job fleecing longs and as usual the entire gold comex OI obliterates
With respect to our two criminal funds, the GLD and the SLV:
LAST NIGHT WE HAD NO CHANGES OUT OF THE GLD//
Total gold inventory rests tonight at: 949.65 tonnes of gold
we had no changes at the SLV
THE SLV Inventory rests at: 360.292 million oz
First, here is an outline of what will be discussed tonight:
1. Today, we had the open interest in silver fell by 2974 contracts down to 191,837 as the price of silver fell by 25 cents with yesterday’s trading.The gold open interest FELL by 12,059 contracts DOWN to 511,340 as the price of gold fell $9.00 IN YESTERDAY TRADING.
2.a) The Shanghai and London gold fix report
2 b) Gold/silver trading overnight Europe, Goldcore
and in NY: Bloomberg
SOMEBODY BIG IS GOING AFTER PHYSICAL GOLD AT THE COMEX
Let us head over to the comex:
The total gold comex open interest FELL BY 12,059 CONTRACTS to an OI level of 511,340 the as price of gold fell by $9.00 with yesterday’s trading.
The contract month of Sept is now off the board. The next delivery month is October and here the OI lost 135 contracts down to 251. We had 252 notices filed on yesterday so we gained 117 notices or an additional 11,700 oz will stand
The next delivery month is November and here the OI rose by 53 contracts up to 2988 contracts. The next contract month and the biggest of the year is December and here this month showed an decrease of 13,241 contracts down to 392,481.
And now for the wild silver comex results. Total silver OI FELL BY 2974 contracts from 194,811 down to 191,837 as the price of silver fell to the tune of 25 cents yesterday. We are moving further from the all time record high for silver open interest set on Wednesday August 3: (224,540). The next non active delivery month is October and here the OI rose by 11 contracts up to 96. We had 27 notices filed on yesterday so we gained 38 contracts or 190,000 additional oz will stand for delivery.The November contract month saw its OI rise by 7 contracts down to 365. The next major delivery month is December and here it FELL BY 3224 contracts DOWN to 159,493.
today we had 9 notices filed for silver: 45,000 oz
|Withdrawals from Dealers Inventory in oz||NIL|
|Withdrawals from Customer Inventory in oz nil||
|Deposits to the Dealer Inventory in oz||nil oz|
|Deposits to the Customer Inventory, in oz||
|No of oz served (contracts) today||
|No of oz to be served (notices)||
|Total monthly oz gold served (contracts) so far this month||
|Total accumulative withdrawals of gold from the Dealers inventory this month||oz|
|Total accumulative withdrawal of gold from the Customer inventory this month||96.45 oz|
Today, 0 notices were issued from JPMorgan dealer account and 0 notices were issued form their client or customer account. The total of all issuance by all participants equates to 3 contract of which 1 notices were stopped (received) by jPMorgan dealer and 0 notice(s) was (were) stopped received) by jPMorgan customer account.
|Withdrawals from Dealers Inventory||NIL|
|Withdrawals from Customer Inventory||
|Deposits to the Dealer Inventory||
|Deposits to the Customer Inventory||
|No of oz served today (contracts)||
|No of oz to be served (notices)||
|Total monthly oz silver served (contracts)||353 contracts (1,805,000 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||420,010.27 oz|
|COT Gold, Silver and US Dollar Index Report – October 7, 2016|
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first rumour denied: no Qatar investment
second: margin call of 1.2 billion to DB
Rumor Of Qatar Investment In Deutsche Bank Denied; Speculation Of A $1.2 Billion Margin Call Remains
Update: and rejected
- QATAR SAID UNLIKELY TO RAISE STAKE IN DEUTSCHE BANK: REUTERS
* * *
Last Friday a fake Deutsche Bank headline saved the market. Can they do it again? It appears that just like a certain Saudi prince took a bath in Citi sevearl years ago, a greater fool has been found again, according to Spiegel:
- *QATAR SAID TO CONSIDER RAISING STAKE IN DEUTSCHE BANK TO 25%
Remember when Korea’s SWF was going to take a stake in Lehman?
For now it’s working…
Although it may not last long. First, the story is 4 hours old..
Qatari investors who own the largest stake in Deutsche Bank do not plan to sell their shares and could consider buying more if the embattled German bank decides to raise capital, sources familiar with Qatari investment policy told Reuters.
Funds controlled by Qatar’s former Prime Minister Sheikh Hamad bin Jassim al-Thani bought 6.1 percent of Deutsche in mid-2014 and increased their stake to just under 10 percent, including options, in July this year.
Second, what DB needs is to raise capital; it can only do that by selling shares to Qatar directly, and not for the Qatari investors to buy stock in the open market, of which DB would see precisely zero in proceeds.
Third, by announcing their intentions to buy the stock ahead of actually doing so, Qatar guarantees it will pay much more for the same “25% stake”. Brilliant.
Fourth, and final, as Reuters reports, the Qataris have so far lost, on paper, over $1.2 billion on their investments in the bank. It is therefore far more likely that Qatar is using first Reuters, then Spiegel, to get the price as higher as possible – just like the rumor spreaders last week used AFP – to that they can sell into the bid.
Especially, when one considers the following story from 2014:
The man who is providing Deutsche Bank AG with a 2.1 billion-euro ($2.9 billion) cash infusion, and a vote of confidence, held talks with banks about getting a loan to finance the investment and to hedge it. Former Qatari Prime Minister Sheikh Hamad Bin Jassim Bin Jabr Al Thani was approached by banks offering loans to fund the purchase as well as derivatives to protect him from losses on the shares he purchased, said four market participants who asked not to be identified because they weren’t authorized to speak publicly. Two of the participants said they were told Qatar National Bank agreed to provide a $2 billion margin loan.
An official at Sheikh Hamad’s office in Doha declined to comment on the talks, as did representatives for Qatar National Bank and Frankfurt-based Deutsche Bank. If Sheikh Hamad’s investment turns out to have been structured to limit his financial risk in the stock, that would be a red flag, according to Peter Hahn, a finance lecturer at London’s Cass Business School.
“That should be a concern for all Deutsche Bank shareholders,” Hahn said. “What sounded like a vote of confidence may be a hedged bet.”
In a margin loan, a borrower pledges an asset to obtain money and typically agrees to hand over cash to the lender if the value of the collateral declines. The lender typically can sell some of collateral if the borrower is unable to post cash.
“There’s a growing trend among sovereign wealth funds to buy on margin,” said Bernardo Bortolotti, director of the Sovereign Investment Lab, a research unit at Bocconi University in Milan. “An investment of this magnitude is rare, and it’s likely to attract significant interest for financing from banks seeking fees.”
Instead of “voicing confidence” in DB, is Qatar just just trying to find a way to get rid of what may be a rather pesky $1.2 billion margin call?
this is a big miss and no doubt we will not have a Nov or Dec rate hike.
Payrolls Rise 156K, Missing Expectations, Unemployment Rate Rises To 5.0%
With Wall Street all bulled up on the economy, expecting a print of 175K while the whipser number was decidedly higher, and closer to 200K thanks to Goldman’s optimism, moments ago the BLS reported that in September the US created only 156K jobs, missing expectations, and down from the upward revised 167K in August, leaving the question of whether the Fed will hike imminently, unanswered.
However, offsetting the September miss, last month’s disappointing print of 151K was revised to 167K. At the same time, the change in total nonfarm payroll employment for July was revised down from +275,000 to +252,000. With these revisions, employment gains in July and August combined were 7,000 less than previously reported. Over the past 3 months, job gains have averaged 192,000 per month.
The household survey employment number of 151.968MM was 354K bigger than last month, and pushed the annual increase higher by 2.0%, the biggest since March 2016.
The unemployment rate, at 5.0%, and the number of unemployed persons, at 7.9 million, changed little in September, up 0.1% from August and the highest in 6 months. Both measures have shown little movement, on net, since August of last year.
The participation rate rose by 0.1% t 62.9% as people not in the labor force declined by 207K.
However, while the headline print may have been disappointing, which would be good news for the market, what may have prompted the market to reassess a delay in Fed hikes is that average hourly wages rose 0.2% sequentially, in line with expectations, and with average weekly hours worked rising also as expected at 34.4, up from 34.3 in August, this means that Average weekly earnings rebounded strongly from 1.5% to 2.3% in September.
More details from the report:
Total nonfarm payroll employment rose by 156,000 in September. Thus far this year, job growth has averaged 178,000 per month, compared with an average of 229,000 per month in 2015. In September, employment gains occurred in professional and business services and in health care.
Professional and business services employment rose by 67,000 in September and has risen by 582,000 over the year. Over the month, job gains occurred in management and technical consulting services (+16,000), and employment continued to trend up in administrative and support services (+35,000).
Health care added 33,000 jobs in September. Ambulatory health care services added 24,000 jobs over the month, and employment rose by 7,000 in hospitals. Over the past 12 months, health care has added 445,000 jobs.Employment in food services and drinking places continued to trend up in September (+30,000) and has increased by 300,000 over the year.
Retail trade employment continued to trend up over the month (+22,000). Within the industry, job gains occurred in clothing and clothing accessories stores (+14,000) and in gasoline stations (+8,000). Over the year, employment in retail trade has risen by 317,000.
Mining employment was unchanged in September after declining by 220,000 from a peak in September 2014.
Employment in other major industries, including construction, manufacturing, wholesale trade, transportation and warehousing, information, financial activities, and government, changed little over the month.
The average workweek for all employees on private nonfarm payrolls increased by 0.1 hour to 34.4 hours in September. In manufacturing, the workweek increased by 0.1 hour to 40.7 hours, while overtime was unchanged at 3.3 hours. The average workweek for production and nonsupervisory employees on private nonfarm payrolls was unchanged at 33.5 hours.
In September, average hourly earnings for all employees on private nonfarm payrolls rose by 6 cents to $25.79. Over the year, average hourly earnings have risen by 2.6 percent. Average hourly earnings of private-sector production and nonsupervisory employees increased by 5 cents to $21.68 in September. (See tables B-3 and B-8.)
The change in total nonfarm payroll employment for July was revised down from +275,000 to +252,000, and the change for August was revised up from +151,000 to +167,000. With these revisions, employment gains in July and August combined were 7,000 less than previously reported. Over the past 3 months, job gains have averaged 192,000 per month.
One reason why stocks may not be soaring on this weaker report is that as Loretta Mester says, speaking live on CNBC, is that this number is precisely what the Fed was looking for and in line with a labor force tha keeps growing.
the wonderful “recovery” in the USA!!!
Part-Time Jobs Soar By 430,000 As Multiple Jobholders Surge To August 2008 Levels
While today’s headline jobs print was somewhat disappointing, with the Establishment Survey missing the expected print of 175K, and growing by 156K, it was offset by a far higher 354K jump in the household survey which offset last month’s weakness. But while the quantitative headline aspect is open to interpretation, the qualitative component of the September jobs print was clear beyond a doubt: it was ugly.
First, looking at the reported composition of jobs, while full-time jobs actually declined by 5,000 to 142,296K part-time jobs soared by 430,000…
… the biggest monthly jump since February.
Curiously, if only looks at the unadjusted data, the spread between part and full-time jobs explodes, with some 1.2 million full-time, unadjusted, jobs lost in September, offset by a surge in 1.3 million part-time jobs.
But perhaps even worse than the breakdown in September job quality, was another seldom-touted series: the number of Multiple jobholders, or people who are forced to hold more than one job due to insufficient wages or for other reasons. It was here that the red flashing light came on because as a result of the 301K monthly surge in Americans holding more than one job, the 5th highest monthly spike in the past decade, the total number of Multiple jobholders soared to 7.863 million, the highest number since the financial crisis, and a number surpassed just once in the past decade: in August of 2008, just before all hell broke loose.
It also begs the question how many of the 156K jobs “added” were double counted as a result of a number of multiple jobholders that was double this amount.
So yes: overall job growth continues to chug along, if at a modestly disappointing pace, at least in September, the quality of the added jobs was absolutely woeful.
More garbage from the BLS:
Since 2014 The US Has Added 547,000 Waiters And Bartenders And Lost 32,000 Manufacturing Workers
As another month passes, the great schism inside the American labor force get wider. We are referring to the unprecedented divergence between the total number of high-paying manufacturing jobs, and minimum-wage food service and drinking places jobs, also known as waiters and bartenders. In September, according to the BLS, while the number of people employed by “food services and drinking places” rose by another 30,000, the US workforce lost another 13,000 manufacturing workers.
The chart below puts this in context: since 2014, the US had added 547,000 waiters and bartenders, and has lost 32,000 manufacturing workers.
Yet while we would be the first to congratulate the new American waiter and bartender class, something does not smell quite right. On one hand, there has been a spike in recent restaurant bankruptcies or mass closures (Logan’s, Fox and Hound, Bob Evans), which has failed to reflect in the government report. However, what we find more suspect, is that according to the BLS’ seasonally adjusted “data”, starting in March of 2010 and continuing through September of 2016, there has been just one month in which restaurant workers lost jobs, and alternatively, jobs for waiters and bartenders have increased in 78 out of the past 79 months.
Putting this divergence in a long context, since the official start of the last recession in December 2007, the US has gained 1.7 million waiters and bartenders, and lost 1.5 million manufacturing workers. Worse, while the latter series had been growing, if at a slower pace than historically, it has now clearly rolled over, and in 2016, some 58,000 manufacturing jobs have been lost.
Like last month, we remain curious what this “data” series will look like after it is revised by the BLS shortly after the NBER declares the official start of the next recession.