Gold closed at $1302.10 down $4.70
silver closed at $18.38 or down 28 cents.
Access market prices:
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 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 Nov 3 (10:15 pm est last night): $ 1303.24
NY ACCESS PRICE: $1299.20 (AT THE EXACT SAME TIME)
Shanghai afternoon fix: 2: 15 am est (second fix/early morning):$ 1306.66
NY ACCESS PRICE: 1301.25.70 (AT THE EXACT SAME TIME/2:15 am)
HUGE SPREAD TODAY!! 5 dollars
London Fix: Nov 3: 5:30 am est: $1293.00 (NY: same time: $1292.90: 5:30AM)
London Second fix Nov 3: 10 am est: $1301.00 (NY same time: $12.95 , 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.
No wonder gold and silver were hit: The CME raises maintenance margins
the bankers must be in deep trouble
.BRIEF-CME raises Gold, Silver maintenance margins
* CME raises COMEX 100 Gold futures (GC) maintenance margins by 11.1 percent to $6,000 per contract from $5,400 for Nov. and Dec. 2016
* CME raises COMEX 5000 Silver futures (SI) maintenance margins by 10.5 percent to $5,800 per contract from $5,250 for Nov. and Dec. 2016
* CME says the rates will be effective after the close of business on Nov. 3
For comex gold:
NOTICES FILINGS FOR NOVEMBER CONTRACT MONTH: 26 NOTICES FOR 2600 OZ TONES
NOTICES FOR NOVEMBER CONTRACT MONTH FOR SILVER: 0 NOTICES OR nil OZ
Tomorrow is the jobs report and you all know what that means. The bankers generally try to raid as soon as the report is released. Pay no attention to these crooks.
Let us have a look at the data for today
In silver, the total open interest FELL by 1599 contracts DOWN to 195,313. The open interest ROSE AS the silver price was UP 47 cents in yesterday’s trading .In ounces, the OI is still represented by just less THAN 1 BILLION oz i.e. .965 BILLION TO BE EXACT or 138% of annual global silver production (ex Russia &ex China).
In November, in silver, 0 notice(s) filings: FOR nil OZ
In gold, the total comex gold ROSE by 12,602 contracts WITH THE RISE in price of gold ($20.40 YESTERDAY) . The total gold OI stands at 534,108 contracts. The bankers supplied the necessary non backed paper trying to quell gold’s advance.
In gold for November: we had 26 notices filed for 2600 oz
With respect to our two criminal funds, the GLD and the SLV:
TODAY WE HAD A BIG CHANGE AT THE GLD OUT OF THE GLD/A DEPOSIT OF 4.43 TONNES OF GOLD INTO THE GLD
Total gold inventory rests tonight at: 949.69 tonnes of gold
we had ANOTHER BIG CHANGE at the SLV/
A WITHDRAWAL OF 2.807 MILLION OZ
THE SLV Inventory rests at: 358.435 million oz
SOMEBODY MUST HAVE BEEN IN URGENT NEED OF SILVER SO THE SLV WAS ROBBED.
First, here is an outline of what will be discussed tonight:
1. Today, we had the open interest in silver FELL by 1,599 contracts DOWN to 195,213 despite the fact that the price of silver rose by 47 cents with yesterday’s trading.The gold open interest ROSE by 12,602 contracts UP to 534,108 as the price of gold ROSE $20.40 in YESTERDAY’S TRADING.
2.a) The Shanghai and London gold fix report
2 b) Gold/silver trading overnight Europe, Goldcore
and in NY: Bloomberg
3. ASIAN AFFAIRS
i)Late WEDNESDAY night/THURSDAY morning: Shanghai closed UP 26.20POINTS OR 0.84%/ /Hang Sang closed DOWN 126.99 OR 0.56%. The Nikkei closed FOR HOLIDAY/ Australia’s all ordinaires CLOSED DOWN 0.04% /Chinese yuan (ONSHORE) closed DOWN at 6.7631/Oil FELL to 45.66 dollars per barrel for WTI and 47.30 for Brent. Stocks in Europe: ALL IN THE GREEN EXCEPT LONDON Offshore yuan trades 6.7706 yuan to the dollar vs 6.7631 for onshore yuan.THE SPREAD BETWEEN ONSHORE AND OFFSHORE WIDENS QUITE A BIT AS MORE USA DOLLARS LEAVE CHINA’S SHORES / CHINA SENDS A MESSAGE TO THE USA TO NOT RAISE RATES IN DECEMBER.
REPORT ON JAPAN SOUTH KOREA NORTH KOREA AND CHINA
b) REPORT ON JAPAN
c) REPORT ON CHINA
We have been pointing out to you that massive amounts of USA dollars are leaving China despite capital controls. One way to circumvent this is the use of Bitcoins. Now China is imposing curbs on its use moving money from within China to outside
( zero hedge)
4 EUROPEAN AFFAIRS
i)The Government of the UK loses and must hold a parliamentary vote/the pound rises
( zero hedge)
ii)Rates are kept unchanged and now the B. of E drops its guidance for further rate cuts as they say rates can go up or down from here: the pound rises:
5. RUSSIAN AND MIDDLE EASTERN AFFAIRS
Egypt just devalued their currency to 14 pounds per dollar. The market was anticipating 11 to one. Bonds soared and their stock market also went higher but if you adjust the currency it is in utter collapse. This will be the next nation to hyperinflate as over 30 million citizens in Egypt are below the poverty line.
( zero hedge)
WTI plunges back into the 44 dollar handle. Spread btw Brent and WTI widens are that worries our bankers;
( zero hedge)
i)What gold will do if trump might actually win:
( John Rubino/DollarCollapse.com)
The real story behind the premiums in silver in Shanghai vs London
(courtesy Koos Jansen)
iii)How China wishes to overtake London with their daily fixes:
( China Daily)
iv)Russia added 16.55 tonnes to its arsenal last month. So much for the story that they may unload some of their precious bullion
( Jonathan Garber/Business insider)
10.USA STORIES WHICH MAY INFLUENCE THE PRICE OF GOLD/SILVER
i)Unbelievable: the FBI according to Fox is moving to a likely indictment of the Clinton Foundation as it’s “Play for Pay” formula is without a doubt criminal. However we have a civil war with the two warring factions: the Dept of Justice and the FBI
( Fox news/zero hedge)
ii)Last night: Wikileaks exposes collusion between the Clinton campaign, the state dept. and the New York times:
Let us head over to the comex:
The total gold comex open interest ROSE BY 12,602 CONTRACTS to an OI level of 534,108 as the price of gold ROSE $20.40 with YESTERDAY’S trading.The bankers were on full alert supplying the necessary non backed gold paper keeping the gold price contained.In the front month of November we had 118 notices standing for a LOSS of 376 contracts. We had 381 notices served upon yesterday so we GAINED 5 contracts or 500 ADDITIONAL oz will stand for delivery in November. The next contract month and the biggest of the year is December and here this month showed a increase of 5,434 contracts up to 375,079.
And now for the wild silver comex results. Total silver OI fell by 1,599 contracts from 196,912 up to 195,313 despite the fact that the price of silver ROSE to the tune of 47 cents yesterday.I guess we had considerable shortcovering by the bankers. We are moving further from the all time record high for silver open interest set on Wednesday August 3/2016: (224,540). The front month of November had an OI of 46 and thus a loss of 5 contracts. We had 12 notices filed upon yesterday so we gained 7 contracts or an additional 35,000 oz will stand for delivery. The next major delivery month is December and here it FELL BY 4,917 contracts DOWN to 134,747.
In silver had 0 notices filed for nil oz
VOLUMES: for the gold comex
Today the estimated volume was 229,256 contracts which is good.
Yesterday’s confirmed volume was 263,312 which is very good
today we had 20 notices filed for 2000 oz of gold:
|Withdrawals from Dealers Inventory in oz||NIL|
|Withdrawals from Customer Inventory in oz nil||
|Deposits to the Dealer Inventory in oz||1199.99 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||nil oz|
|Total accumulative withdrawal of gold from the Customer inventory this month||35,678.3 oz|
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 26 contract of which 0 notices were stopped (received) by jPMorgan dealer and 0 notice(s) was (were) stopped/ Received) by jPMorgan customer account.
March 2015: 2.311 tonnes (March is a non delivery month)
|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)||350 contracts (1,750,000 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||1,612,941.3 oz|
NPV for Sprott and Central Fund of Canada
Major gold/silver stories for Thursday
Early morning physical stories/Goldcore
The London Gold Market – ripe for take-over by China?
Will the London Gold Market Self Destruct?
- London Gold Market has been unchallenged for nearly 100 years
- So opaque that quotes of its $5 trillion size are estimates
- Five new offerings are set to appear in the market in the next six months
- Increased fragmentation set to reduce liquidity
- A share of gold price discovery is ripe to be taken by China
- Disruption in the London Gold Market gives opportunity to the East to take more control of the market.
As markets go the London Gold Market has to be one of the oldest and most unchallenged markets there is. With its roots in the 17th century it has been through a series of makeovers but for much of the last century the OTC market has hardly changed.
But now it is having an identity crisis. In the last year we have seen a barrage of news about changes that are coming, and the last few weeks seem to have been busier than ever.
For some the $5 trillion London Gold Market is under serious threat and there are a number of reasons as to why including regulation, gold price discovery and a lack of transparency all items that have haunted players in the London gold market.
Now, the threats that face it are driving many to address these problems and attempt to disrupt the market. We take a quick look at the new offerings set to arrive in the coming months, and ask if they will weaken, rather than strengthen, the London Gold Market and thereby open up an opportunity for China.
The LBMA, a fintech start-up and transparency
Right now there is no data on how much gold is traded each day. The LBMA who currently runs the joint have accepted that this lack of transparency has long been a major criticism, by both market participants and the regulators.
With this in mind it has seen the light that ‘fintech’ offers and has opened itself up to disruption before it is disrupted. Earlier this year it announced Boat Services Ltd. and Autilla Inc. had been chosen to create transparency in the market by building a trading platform.
The 149 LBMA members will report their trades to the new platform.
When the LBMA announced the initiative with Boat Services, it was made clear that the new arrangement would “go beyond UK and global regulators’ demands for data on derivatives trading [and showed] a commitment to transparency.”
London Metals Exchange, World Gold Council, ICE, CME and blockchain all want in
- The LME along with the World Gold Council has launched ‘LME Precious’ as their route to the highly attractive London Gold Market. For this group it is about clearing for spot and managing risk.
‘The new contracts are designed to complement London’s over-the-counter gold and silver market’ reports Bloomberg.
In the first-half of 2017 centrally cleared gold and silver contracts are set to be introduced. The new contracts will “include contracts for spot, daily and monthly futures, options and calendar spread contracts.”
- The Intercontinental Exchange took over the London gold auction in 2015, replacing the gold-fixing by phone ritual with an electronic platform. Now it wants to play a further role and announced last month that as of February it would start a new loco London futures contract use this to clear its daily auction.
- Earlier this week CME Group announced that as of January it will start to offer gold and silver contracts listed on COMEX, “to offer a spread between spot prices and benchmark U.S. futures.”
As you can see from the graph, COMEX and London offer the largest pools of liquidity. The 100 ounces of gold and 5,000 ounces of silver contracts have “the potential to create an even stronger link between the world’s two largest pools of precious metals liquidity,” Miguel Vias, CME’s head of precious metals, stated upon the announcement.
Using transparency to disrupt the gold market
Much of the regulation brought in since the financial crisis has called for increased transparency. The move by many of the players looking at changing things up, has this in mind.
However for all of the projects mentioned above, there are none that are truly disrupting how gold markets currently work. Costs, efficiencies and current practices are not changing that dramatically. Instead layers are being added either around the sides or on top.
In a financial world that is finding itself upended by disruption and fintech startups one would think there is an opportunity here. And we’re not the only ones who think so.
In the first real attempt at disruption in the gold market, blockchain is coming to the fore. Paxos (formerly itBit) is working with both EY and Euroclear on a projects that will bring “brings instant settlement and true delivery versus payment (DvP) to the gold market for the first time.”
The project between Paxos and Euroclear will take “Its innovative tokenization process turns physical gold into digital gold tokens, reducing capital charges and opening new opportunities for market participants.” reports the EconoTimes.
With all this fragmentation will London remain a centre of price discovery?
In recent years both London and COMEX’s monopoly of the gold market has come under pressure from the East. And, with all this fragmentation revealing itself in the London Gold Market, one wonders if it can keep its crown.
To us, it seems the role of price maker is becoming increasingly up for grabs. In April the SGE announced a new benchmark price for gold bullion, modelled on the same process currently used in the London gold market. The “base price will fully reflect supply and demand…representing the whole Chinese gold market.”
As we reported at the time, David Marsh as quoted by the official China Daily, Managing Director and Co-Founder of OMFIM, said the yuan-denominated gold benchmark offered by SGE was a necessary addition to the international gold market and should make the pricing of physical gold more open to the play of actual market forces.
Will the London Gold Market self-destruct?
As Mark O’Byrne told Bloomberg earlier this year, “It’s a pretty big moment for London, and it’s time to choose. Everybody wants to bring more players to the table, but there is a risk that through the failure to work together, liquidity is diluted and the market weakened.”
Every industry and marketplace faces challenges from time-to-time, more often than not these things shake-themselves out as the market decides what it does and doesn’t want. No one wishes to see countless liquidity pools and so it is highly likely the majority of users will focus on one exchange.
The question is, in the time it takes for the London gold market to come through its disruptive phase, will the Chinese have taken a bigger piece of the pie for themselves? Without doubt China’s pricing influence will take time, but it seems the timing is right given the fragmented and disjointed efforts of various parties to take advantage of London’s weak moment.
Gold and Silver Bullion – News and Commentary
Gold Prices (LBMA AM)
03 Nov: USD 1,293.00, GBP 1,040.61 & EUR 1,165.90 per ounce
02 Nov: USD 1,295.85, GBP 1,056.51 & EUR 1,169.76 per ounce
01 Nov: USD 1,284.40, GBP 1,048.58 & EUR 1,167.52 per ounce
31 Oct: USD 1,274.20, GBP 1,046.25 & EUR 1,163.22 per ounce
28 Oct: USD 1,265.90, GBP 1,042.47 & EUR 1,160.96 per ounce
27 Oct: USD 1,269.30, GBP 1,038.29 & EUR 1,162.93 per ounce
26 Oct: USD 1,273.90, GBP 1,043.45 & EUR 1,166.13 per ounce
Silver Prices (LBMA)
03 Nov: USD 18.07, GBP 14.50 & EUR 16.32 per ounce
02 Nov: USD 18.54, GBP 15.05 & EUR 16.70 per ounce
01 Nov: USD 18.24, GBP 14.91 & EUR 16.54 per ounce
31 Oct: USD 17.76, GBP 14.59 & EUR 16.22 per ounce
28 Oct: USD 17.61, GBP 14.51 & EUR 16.13 per ounce
27 Oct: USD 17.66, GBP 14.41 & EUR 16.16 per ounce
26 Oct: USD 17.66, GBP 14.46 & EUR 16.17 per ounce
Recent Market Updates
– Diwali, Gold and India – Is Love Affair Over?
– Silver Krugerrands By South African Mint Coming Soon – Massive Clearance Sale on Gold Krugerrands
– Trump “Will Probably Win” and Gold “May Rise $100” Overnight – Rickards
– World Is Out of Weapons
– Gold Is The “Kardashian of Commodities” – Herbert & Keiser Interview Skoyles
– Value of Gold – Unlike Paper Currency Gold Maintained Value Throughout Ages
– Fed Risks Lehman Crisis As US Recession Storm Gathers
– Silver Eagle Demand ‘Returned with a Vengeance’
– Cashless Society – War On Cash to Benefit Gold?
– “Higher Gold Prices” On Global Trade Slowdown – HSBC
– Euro “Will Collapse” As Is “House of Cards” Warns Architect of Euro
– Property Bubble In Ireland Developing Again
– “Gold Is A Great Hedge Against Politicians” – Goldman
The real story behind the premiums in silver in Shanghai vs London
(courtesy Koos Jansen)
Bloomberg came out on October 28 with an article about Chinese silver hitting a premium of 17 % this month.
Regular readers know I’m one of the few that reports on the pure price of silver in China being cheaper than in London, because all Chinese commodity exchanges quote silver including 17 % VAT. If we subtract 17 % from the quoted prices, the pure price of silver in China is currently trading at a 4 % discount to London, not at a premium like Bloomberg states. As we can see in my chart below the premium is negative.
By the way, silver is still trading in backwardation on the Shanghai Futures Exchange (SHFE), since August 6. This has caused the discount to decline to 4 %.