The Golden Truth: Comex Silver Intrigue Builds

Wednesday, July 21, 2010

Comex Silver Intrigue Builds

Surprisingly, the open interest on the Comex for both gold and silver declined again yesterday. This is unusual for a day in which the price of gold and silver rise like they did yesterday.   Once again it calls into question the Comex's reporting credibilty. There remains 719 open silver contracts - representing nearly 3.6 million ounces of silver. This is also an unusually high amount of open contracts this late into a delivery period. In fact, if you are a large holder of SLV who aspires to one day redeem your shares for silver, and given that JPM is the custodian and the absurd short in Comex silver, I would be very afraid to look in that cupboard for fear it might be bare.

In order to dispel any confusion over key expiration dates for the balance of July, as they apply to gold and silver trading, here is the Comex schedule: Options expiry for August contracts is July 27; Last trade day for July contracts is July 28; Last notice day for delivery is July 29; Last delivery day is July 30; First notice for August contracts is July 30 (anyone not funded for delivery must be out). All of this information can be found LINK.

Just for the record, I fully expect that this bulge of open silver contracts waiting for delivery will come and go with very little drama - at least for public inspection. Having said that, we have been on the waiting end of Comex silver several times, two of which HSBC was the delivering counterparty AND we did not receive our silver until well after the contractually specified last delivery day. In fact, last year we received our April silver on June 20th. I have also received reader emails detailing similar delays in receiving Comex silver. What this points to is extreme stress in Comex silver inventories and one of these months - although as noted I don't believe this month - the problems behind the scenes will become apparent to all.

                                          ...my single state of man that function
                                          Is smother'd in surmise, and nothing is
                                          But what is not. (Macbeth, Act 1, Scene 3)

5 comments:

HopiumWednesday, 21 July, 2010
Hey Dave as per usual great read.

http://abcnews.go.com/Business/gold-coin-dealers-decry-tax-law/story?id=11211611
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AnonymousWednesday, 21 July, 2010
this has been talked about for a long time. and it will go on as long as JPMorgan controls the paper market.
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Dave in DenverWednesday, 21 July, 2010
It will go until someone decides to go make a serious run on Comex silver like the Hunts did...OR, perhaps another big event will soon hit the tape...
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AnonymousWednesday, 21 July, 2010
I find it funny that if you take the Dodd-Frank bill, change it to Frank-Dodd Bill, shorted it to Fr-Odd it sounds more like what it is.

Just an afternoon observation from the Sofa.
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AnonymousSunday, 25 July, 2010
As I understand it the Hunts broker is still in prison and the indications are that he is going to die in prison. Nobody on the COMEX is going to take that kind of risk on the long side again. The COMEX will go down with a whimper on a milk bill not a fanfare on bull run.
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Why Gold?

Gold is the world's oldest currency. You exchange your fiat currency (dollars, euros, yen, yuan) into gold as an insurance policy against catastrophic Central Bank and Government policies which serve to destroy the value of fiat currencies and destroy democracy.

Gold can ONLY be considered an investment to the extent that it remains significantly and historically undervalued in relation to the fiat currencies against which its value is measured. Otherwise it remains the world's oldest currency and is completely free from the counterparty risk associated with currency by Government fiat (i.e. fiat currencies rely on a Government's "full faith and credit.")

Quote Of The Month Courtesy of "Jesse"

Unfortunately for Larry Summers, Ben Bernanke, and their friends at the BIS, they have not yet figured out how to print physical gold, silver, and other essential commodities, and the world is reaching the point where it might simply start ignoring the New York based markets with respect to essential commodities such as basic materials, oil, foodstuffs, and the like, as they become increasingly irrelevant, fraudulent, and Orwellian. And then where will the financial engineers be, except with no more excuses and no place to hide?

Here is the link to his entire commentary, well worth a read:

http://jessescrossroadscafe.blogspot.com/2010/07/gold-daily-chart-shock-and-awe-for.html

Great Quote From Jim Rogers On Govt CPI Reporting

JR: I mean, we have inflation now. If you go to the shop, whether it’s groceries, or education or insurance or health care, prices are going up for everything. The government lies about it in the US. Some countries lie, many countries don’t: Australia, China, India and Norway. Many countries don’t lie about it and acknowledge that we have inflation. Others lie about it, the UK and the US, but if you go shopping you know prices are up.

Q: Are you saying that the American Consumer Price Index (CPI) published by the US Bureau of Labor Statistics is a lie?

JR: In my opinion, yes, of course it is. Have you looked at it? They’ve changed their accounting several times in the past few decades. When housing was 20% to 25% of the CPI and housing was going up, they didn’t count it, saying rents weren’t going up, and then when home prices started going down, they counted it. It’s the same with many things. It’s staggering some of the tortuous reasoning that the BLS has used over the past 25 or 30 years. When the price of gasoline goes up, they say it’s not really going up because it’s better gasoline, better quality, therefore you’re getting more for your money. I mean, it’s endless, the stuff that they say and for some reason people sit there, although more and more people are catching on, and accept what the government says.

source: www.clusterstock.com

Quote of the Week

"The primary function of a Central Bank is to engage in the massive transfer of wealth from the middle class to the wealthy elite. The Federal Reserve was set up to do this with the blessing and support of Congress." - Dave in Denver

If you refuse to believe the above, please read "The Creature From Jekyll Island: A Second Look at the Federal Reserve" by G. Edward Griffin and then explain to me why the Senate voted down the Vitter Amendment and Congress refuses to pass a law requiring a full audit of the Fed, even though the Fed is using taxpayer-backed money to bailout Wall Street and Europe.