Archive for the ‘JPMorgan’ Category

A Wild Week

Posted by on May 24th 2017 in Federal Reserve, General Economy, JPMorgan, Monetary Policy, Short Sellers, Silver, Ted Butler, Uncategorized | Be the first to comment!

 

by Theodore Butler

Despite what you may have read, the big banks did not sell gold and silver to depress the price on the big drop recently. The data will show, just as they have always shown that the managed-money traders (computer-driven hedge funds) were the big sellers and the commercials (big banks) were the big buyers. In that fashion, JPMorgan and the big banks successfully closed out a large portion of their profitable short positions. The commercials rig prices lower through the magic of spoofing and other computer scams, but they do so only to generate managed-money selling, so that the commercials can then buy. And this week, the managed-money traders sold COMEX gold and silver in droves, while the commercials bought every contract sold. That’s the game. With record trading volume, this past week was among the best financially for the commercials and worst ever for the managed-money traders in gold and silver. Including the extraordinary price turnaround on Tuesday evening into Wednesday, I’d estimate that JPMorgan and the other commercials made more than $3 billion in gold and silver this week and the managed-money traders lost the same amount.

That’s a far cry from the near $4 billion the commercials were in the hole for during the summer price highs. This is the money game that drives gold and silver prices. The good news is that the market structure is nowhere near as bearish. We have taken a large step towards getting most of the downside price damage behind us. The commercials whacked huge chunks off the price and there seemed to be an urgency in getting the job done.

When the selloff is done, it is likely to be the final selloff in silver. JPMorgan is in the best position for a silver blastoff than it has ever been, particularly after this week, with its largest physical position ever and a sharply reduced paper short position (the whole point of the selloff). It is impossible that the commercials aren’t tuned into the managed-money traders’ behavior, especially considering how few in number are the large commercials. Earlier this year, the commercials were in the hole $4 billion in gold and silver, only to have made that back and $3 billion more over the decline. These are stakes guaranteed to get attention.

The reason for the $4 billion loss was that the commercials miscalculated in allowing themselves to sell short to the managed-money longs at too low gold and silver prices earlier in the year. The reason the commercials miscalculated is that they misjudged the extent to which managed-money traders have attracted investor money. It was large investor inflows that created the much larger positions the managed-money traders put on this year.

Better than anyone else, the commercials and in particular JPMorgan now fully appreciate the tremendous buying and selling power that the managed-money traders possess. Armed with this knowledge, the commercials will never sell as aggressively at low prices when the prospects are for much more managed-money buying to come. It will be to the commercials’ advantage to lay back and hold off when the managed-money traders begin to buy, rather than rush to sell too soon as was the case earlier this year. This would result in much sharper price moves for silver than we’ve witnessed to date.

The right time to buy silver is after it has fallen sharply in price. That’s true with many investments, but buying silver at the right price can make you more money than just about anything else. The good news is that silver has fallen sharply from its summer price highs; making it a better buy now than it has been in many months.

GET STARTED WITH OUR $99 FIVE-PIECE SILVER SAMPLER

 Click on coins to view offer.

A Wild Week

Posted by on May 15th 2017 in General Economy, Gold, JPMorgan, Monetary Policy, Short Sellers, Ted Butler | Be the first to comment!

A WILD WEEK

By Theodore Butler

Despite what you may have read, the big banks did not sell gold and silver to depress the price on the big drop recently. The data will show, just as they have always shown that the managed-money traders (computer-driven hedge funds) were the big sellers and the commercials (big banks) were the big buyers. In that fashion, JPMorgan and the big banks successfully closed out a large portion of their profitable short positions. The commercials rig prices lower through the magic of spoofing and other computer scams, but they do so only to generate managed-money selling, so that the commercials can then buy. And this week, the managed-money traders sold COMEX gold and silver in droves, while the commercials bought every contract sold. That’s the game. With record trading volume, this past week was among the best financially for the commercials and worst ever for the managed-money traders in gold and silver. Including the extraordinary price turnaround on Tuesday evening into Wednesday, I’d estimate that JPMorgan and the other commercials made more than $3 billion in gold and silver this week and the managed-money traders lost the same amount.

 

That’s a far cry from the near $4 billion the commercials were in the hole for during the summer price highs. This is the money game that drives gold and silver prices. The good news is that the market structure is nowhere near as bearish. We have taken a large step towards getting most of the downside price damage behind us. The commercials whacked huge chunks off the price and there seemed to be an urgency in getting the job done.

 

When the selloff is done, it is likely to be the final selloff in silver. JPMorgan is in the best position for a silver blastoff than it has ever been, particularly after this week, with its largest physical position ever and a sharply reduced paper short position (the whole point of the selloff). It is impossible that the commercials aren’t tuned into the managed-money traders’ behavior, especially considering how few in number are the large commercials. Earlier this year, the commercials were in the hole $4 billion in gold and silver, only to have made that back and $3 billion more over the decline. These are stakes guaranteed to get attention.

 

The reason for the $4 billion loss was that the commercials miscalculated in allowing themselves to sell short to the managed-money longs at too low gold and silver prices earlier in the year. The reason the commercials miscalculated is that they misjudged the extent to which managed-money traders have attracted investor money. It was large investor inflows that created the much larger positions the managed-money traders put on this year.

 

Better than anyone else, the commercials and in particular JPMorgan now fully appreciate the tremendous buying and selling power that the managed-money traders possess. Armed with this knowledge, the commercials will never sell as aggressively at low prices when the prospects are for much more managed-money buying to come. It will be to the commercials’ advantage to lay back and hold off when the managed-money traders begin to buy, rather than rush to sell too soon as was the case earlier this year. This would result in much sharper price moves for silver than we’ve witnessed to date.

 

The right time to buy silver is after it has fallen sharply in price. That’s true with many investments, but buying silver at the right price can make you more money than just about anything else. The good news is that silver has fallen sharply from its summer price highs; making it a better buy now than it has been in many months.

GET STARTED WITH OUR $99 FIVE-PIECE SILVER SAMPLER

Click to view offer

 

Taking Stock: Metals Gain on Equities’ Pain

Posted by on December 12th 2014 in CFTC, China, CME Group, Federal Reserve, General Economy, Gold, Goldman Sachs, Interest Rates, JPMorgan, Middle East, Monetary Policy, Short Sellers, Silver, U.S. Congress, USD, Wall Street | Be the first to comment!

MetalsGainOnStocksPain

Despite falling a fraction of a percent on Friday, spot silver and gold added 4.4% and 2.6% respectively on the week, as the Dow ended its worst week since 2011, reports Bloomberg, finishing Friday’s session “with a 100-point lurch in the final half-hour of trading, as equities tumbled around the world after crude extended declines below $58 a barrel.”

Summing up the week, a Commerzbank analyst tells Reuters that “When the equity markets dropped quite sharply, precious metals soared, so there is definitely still the link between equities and gold in particular (due to) risk appetite among market players. Some of the equity markets had a decent run this year. We don’t expect this to be continued to the same extent next year, so this might give some tailwind to gold prices.”

See also:

GoldMoney/Jesse’s Café Américain: Market report – Gold was the safe-haven this week; Gold and silver charts & commentary

CNBC/USA Gold: Oil has world markets over a barrel as Fed meet looms

Zero Hedge/Bullion Star: Austria considers repatriating its gold; WGC notes 2014 Chinese gold demand could reach 1,700 tonnes

GoldCore: New York Times on benefits of gold in currency wars

Politico/Confounded Interest: How Wall St. got its way in spending bill

David Stockman/New Yorker: Memo to Citigroup CEO Michael Corbat: Does your crony capitalist plunder know no shame?; The winner of the spending-bill vote: JPMorgan Chase CEO Jamie Dimon

Swiss Gold Vote Coverage Ramps Up

Posted by on November 26th 2014 in CFTC, China, CME Group, ECB, Federal Reserve, General Economy, Gold, Goldman Sachs, JPMorgan, Media, Monetary Policy, Quants, Short Sellers, Silver, U.S. Congress, USD, Wall Street | Be the first to comment!

ClockIsTicking

As the non-financial mainstream media begin focusing on Sunday’s Swiss gold referendum, USA Today reports a Bank of America prediction that “the price of gold could jump to more than $1,350 an ounce — an increase of 18%,” if the “yes” vote prevails. And a Guardian article, headlined “Fears that ‘dangerous’ Switzerland referendum could spark gold rush,” refers to a quote by the chairman of the Swiss National Bank, who said during a ‘sermon’ he delivered at a Swiss church, “The initiative is dangerous because it would weaken the SNB.”

But the lion’s share of the Guardian‘s quotes come from precious metals analyst and blogger Koos Jansen, who calls the Swiss initiative “merely part of a increasing global scramble towards gold and away from the endless printing of money,” adding that “While those behind the Swiss initiative have often been portrayed as crazy, they’re merely acting out of fear that their central bank is losing control of its monetary policy, and of the Swiss franc being sucked into this currency war and losing its value.”

SwissGoldCoverageRampsUp

Coin News/SilverSeek:  Precious metals rise as dollar dips, U.S. coin sales gain; Silver – what COT analysis tells us

Gold Silver Worlds:  Algos gone wild?  Gold price went ballistic to $1,450 in less than 20 minutes

Bloomberg/Mineweb:  China’s gold imports rise for a third month on jewelry sales; China 2014 gold demand heading for 2,100 tonnes

SafeHaven/Financial Post  Can gold extend its rally?; 6 reasons to be bullish on gold

Bloomberg:  Platinum & Pallidum – HSBC, Goldman rigged metals’ prices for years, suit says

GATA/WSOP: U.S. Senate report shows how easily banks can rig gold, copper, and other markets; Scale of Wall Street’s commodity holdings are “unprecedented in U.S. history

Metals Hold; Silver Eagles Go For Gold

Posted by on November 25th 2014 in CFTC, China, CME Group, ECB, General Economy, Gold, JPMorgan, Short Sellers, Silver, USD, Wall Street | Be the first to comment!

SilverEaglesGoForGoldFollowing Friday’s surge, spot silver and gold ended up and down 0.2% respectively on Monday, with trading said to be quiet ahead of Thanksgiving, and with “investors awaiting news from the OPEC meeting this week and Swiss referendum on Sunday on how the country manages its gold holdings.” And even though the U.S. Mint is still limiting how many Silver Eagles are sold, Coin News reports that the “2014-dated Silver Eagle just hit 41,217,000 for the year and reclaimed a record pace. Silver Eagle sales in record year 2013 reached 40,675,000 through Nov. 24, 2013. The coins last year ended at 42,675,000 in sales.”

See also:

SRSrocco Report/Seeking Alpha: Significant drawdown of U.K. silver inventories due to record Indian demand

SilverSeek: Is COMEX silver being cornered?

Fx Empire/MarketWatch: Hedge funds increase long gold positions; Gold may see ‘decent recovery‘ to $1,400

Gold 321/SafeHaven: The stealth bull market in gold; Why gold is headed much higher

Bullion Star: Total Chinese gold reserves approaching 16,000 tonnes

Zero Hedge:  Deutsche Bank to central banks: “Purchase the gold held by private households“; Ukraine central bank admits gold outflow, calls it “Optimization of reserve structure

Metals Gain as China, Netherlands Surprise

Posted by on November 22nd 2014 in CFTC, CME Group, ECB, Euro, Federal Reserve, General Economy, Gold, Goldman Sachs, Interest Rates, JPMorgan, Short Sellers, Silver, U.S. Congress, USD, Wall Street | Be the first to comment!

ChinaRateCutSuprise

Spot silver gained 1.5% on Friday and gold added 0.9% “after a surprise rate cut by China fueled expectations demand could rise in the world’s biggest consumer” of gold, reports Reuters. “Any measures that accelerate the spending power of the Chinese public are bound to be positive for gold,” said a Mitsubishi analyst, suggesting that it could lead Chinese consumers to “buy more jewelry and investment products.”

DutchGoldSurpriseAlso, or perhaps primarily, boosting gold on Friday was news that the Dutch central bank has repatriated 122 tonnes of gold from the New York Fed’s vaults, with a spokesman for the bank saying that “It is no longer wise to keep half of our gold in one part of the world. Maybe it was desirable during the Cold War, but not now.”

“What’s particularly interesting about this surprise,” according to USA Gold, “is that little-ol’ Holland somehow managed to jump in front of Germany in extracting their gold from the Fed. You may recall that Germany requested back in 2013 that 300 tonnes of gold be repatriated. After nearly two-years, a disturbingly small percentage has actually been returned.”

See also:

Bloomberg/WSJ: Gold, silver rise to three-week highs on China interest-rate cut; Bring on the currency wars

Dan Norcini/Telegraph: China news, ECB roil commodity markets; Mario Draghi – ECB must now raise inflation ‘as fast as possible’

GoldMoney/CNBC: Market report – Better tone for volatile gold; Central banks – The new gold bugs?

Bullion Star:  Switzerland net exports 100 tonnes of gold in October

Zero Hedge/GoldCore: Everything you need to know about the Swiss gold referendum; Swiss gold vote likely tighter than polls suggest

Bloomberg/Jesse’s Café Américain: Fed may limit Wall Street role in commodities; Sen. Carl Levin – Fed enabled banks to elbow way into commodities, manipulate prices

Metals Seen Riding ‘Wave’ Higher

Posted by on November 21st 2014 in CFTC, China, CME Group, Federal Reserve, General Economy, Gold, Goldman Sachs, JPMorgan, Quants, Russia, Short Sellers, Silver, Wall Street | Be the first to comment!

AnalystsSeeMetalsRidingWaveHigher

In a Mineweb article published earlier this week, by Lawrence Williams and headlined “Elliott Wave analyst sees big gold and silver price surge ahead,” Williams reference’s Wikipedia’s definition of Elliott Wave as “a form of technical analysis that some traders use to analyze financial market cycles and forecast market trends by identifying extremes in investor psychology, highs and lows in prices, and other collective factors.”

In addition to the analyst cited by Mineweb, Peter Goodburn, another prominent Elliott Wave adherent is Avi Gilburt, whose articles are regularly published on Seeking Alpha.

Gilburt, who is more an analyst of, than advocate for precious metals, takes up their cause in his latest missive. “I do not often write about the metals on MarketWatch,” he begins, “but have seen too many bearish articles calling for the death to the metals, so I felt compelled to speak up. While many are now saying it is time to sell metals, I will have to disagree. The time to sell your metals was several years ago. Now is the time to start looking to buy them back.”

See also:

Reuters/Coin News: Spot gold rises as price drop tempts physical buyers; Gold futures dip for second day, U.S. Mint sales rise

Bloomberg: Gold heading for longest stretch of weekly increases since July

Sharelynx/Contra Corner: : Chart – Russia adds another 600,000 ozs of gold to its reserves in October; As “sanctions war” heats up, will Putin play his ‘gold card’?

Reuters: Unusual gold moves in Asian hours puzzle jittery traders

Barron’s/MarketWatch: Jeremy Grantham – S&P 500 could gain another 10% before “crashing as it always does“; Man who called last stock crash — Peter Schiff — is already blaming the Fed for the next

The Real News/Time: The power to create money in the hands of the banks; Study suggests banking industry breeds dishonesty

Metals ‘Creep Back’ After ‘Leaky’ Poll

Posted by on November 20th 2014 in CFTC, China, General Economy, Gold, Goldman Sachs, India, JPMorgan, Russia, Short Sellers, Silver, Wall Street | Be the first to comment!

SwissGoldPollDoubt

A poll indicating a drop in support for the “yes” vote in the Swiss gold initiative was initially cited for gold futures falling 1.5% Wednesday morning. But as the above chart shows, investors bought the news and futures ended off only 0.3%, as it was observed that “The clearly leaked results sparked considerable weakness in gold and silver, but once the data was released, markets began to creep back – perhaps questioning the plausibility of such a big swing in such a short amount of time.” And while gold ended slightly down, silver futures added 0.7%.

See also:

SRSrocco Report: U.S. Mint reports on Silver Eagles: Huge demand & weekly rationing

Bullion Star/Peak Prosperity: India precious metals import explodes in October; Eric Sprott – Global gold demand is overwhelming supply

Zero Hedge: How central banks use “gold swaps” to boost their holdings

GoldCore/Sprout Money: Unusual Russian central bank gold buying announcement fuels gold’s rise; Gold Wars – Putin’s mining buddies are stepping up to the plate

NY Times:  U.S. Senate report criticizes Goldman and JPMorgan over their influence in commodities market

ProPublica/NY Sun: Secret tapes hint at turmoil in New York Fed team monitoring JPMorgan; “Too-big” banks – Finally time to break ’em up?

Wall Street on Parade: Book claims stark parallels between JPMorgan & Gambino crime family

Marc Faber: Physical Gold Trumps Mining Shares

Posted by on November 14th 2014 in CFTC, CME Group, Federal Reserve, General Economy, Gold, JPMorgan, Monetary Policy, Russia, Short Sellers, Silver, Ted Butler, USD, Wall Street | 1 comment

BuyGoldYouCanHold

In a subscriber-only ETF.com interview, excerpted by Hard Assets Investor, Marc Faber weighs in on where gold’s headed and why he prefers the end product over the companies that mine it:

Q:  Gold plunged immediately after the [Oct. 31] BoJ announcement [that it would expand its asset purchases], which came only days after the Federal Reserve announced the end of QE. Where do you see gold headed in 2015?

Faber: I think it will go up. But can it go down first? Yes. In general, I would say the game that central bankers are playing is very clear: They start out with QE1 in the U.S., and then that forced essentially other central banks to do the same, to also go QE. They’re kind of passing each other the ball. One stops, the other one starts. It’s basically a game designed to kill the purchasing power of paper money. I’m not sure they’re aware of it, but in my view, this is the beginning of the end of paper money in this century.

And asked about physical gold vs. mining shares, Faber says: In general, my advice to investors is to own physical gold and not gold mining shares. Because in a disaster scenario, you don’t know what financial assets will be worth, whereas physical gold is in your possession.”…Read more>>>

See also:

Bloomberg/24/7 Wall St.:  Gold inches up, silver flat, as jobless claims rise more than forecast

Dan Norcini/WGC:  World Gold Council issues its latest report

Acting Man:  Gold market sentiment – A contrarian’s dream?

Forbes/TradePlacer:  Are small investors right about silver?; Ted Butler to silver miners – COMEX is responsible for low silver prices

Telegraph/RBTH:  Putin stockpiles gold as Russia prepares for economic war

Gold Market Macro: Eastern physical demand versus Western financial supply – who will win out?

Silver Bears Melting Away? Swap Gold for Silver?

Posted by on November 13th 2014 in CFTC, CME Group, General Economy, Gold, India, JPMorgan, Quants, Short Sellers, Silver, Wall Street | 1 comment

SilverBearsMeltingAwayAs it’s argued that the silver bears are running out of steam, or already have, but with the gold/silver ratio still above 74 as of Wednesday, Numismaster‘s Patrick Heller raises the prospect of swapping your gold for silver. He points out that the ratio “has been in the 50s much of the time over the past few years,” and he expects “a long-term equilibrium to hit somewhere around 35:1 to 40:1 between the two metals.” That said, Heller presents a number of well thought-out factors to consider, and comes down on the side of “a definite maybe,” depending on the circumstances of the trade and your current holdings. And he concludes by emphasizing that the swapping question “is different than asking if one should own any precious metals at all. A decision to own physical gold or silver is what I think of as buying insurance against the risk of calamities with paper assets such as stocks, bonds and currencies.”

See also:

SilverSeek: Gold and silver end slightly lower; Gold loses luster as retail investors look to silver

Bloomberg/GATA/Jesse’s Café Américain:  Six banks to pay $4.3 billion in first wave of currency-rigging penalties

Reuters/Arabian Money:  Swiss regulator flags attempt to manipulate bullion benchmarks; UBS fined for silver price manipulation, so this is now a matter of fact not speculation

BullionVault/Bullion DeskGood news for gold bulls from the LBMA’s near bears; Fragmentation of precious metal markets could lead to some headaches

Bloomberg/WSJ:  Swiss franc cap tested as gold bugs push referendum; Swissie close to crunch point in runup to gold referendum

Resource Investor/Mineweb:  India’s gold import bill triples to $3.5 billion in October; Scottia-Mocatta – India gold imports to rise into 2015

Gold Rebound? GOFO It!

Posted by on November 12th 2014 in CFTC, China, General Economy, Gold, Iraq, JPMorgan, Russia, Short Sellers, Silver, Syria, USD, Wall Street | Be the first to comment!

GofoGold

With gold said to be “surprisingly volatile, with sweeps up and down this week,” Tuesday was an up day, as spot gold and silver added more than 1.5%, with the gains attributed to a falling dollar and increased physical demand. “Retail demand is very strong since prices came off,” according to one trader quoted by Reuters, who added that “Asia is also showing steady buying interest.”

This as Bloomberg reports that gold “should find solace after rates at which bullion is lent for dollars turned negative, signaling tighter supply.” It’s Chart of the Day, above, “shows the three-month gold forward offered rate has turned negative on a weekly basis. Prices rose in three of the past four times this occurred since last year.”  Last week it was reported that the gold forward, or GOFO rate, was the most negative since 2001.

See also:

Coin News:  U.S. Mint to resume Silver Eagle sales on November 17

Reuters/AJA:  Russian central bank buys up domestic gold output as sanctions bite; Putin goes for the gold

AP/GoldCore:  Obama, Putin circle each other warily in China; New currency wars cometh – Gold to be “last man standing”

The Gold Report/Daily MailGold vs. fiat currency – A conversation with Alan Greenspan; ISIS wants to introduce its own currency – Plans to bring back solid gold and silver dinar coins

MarketWatch/Gold Silver Worlds:  Gold will signal when stocks have peaked; The Dow to gold ratio: Will 2015 be the turning point?

Bullion Bulls Canada/Zero Hedge:  The next crash in 2016; Former Goldman banker reveals the path to next depression & stock market collapse

Salon/Wall Street on Parade:  JPMorgan’s $9 billion witness puts government testimony by her boss into question

Sorry, For the Moment

Posted by on November 8th 2014 in CFTC, CME Group, Gold, JPMorgan, Media, Quants, Short Sellers, Silver, Ted Butler, Wall Street | Be the first to comment!

By James Cook

President/Investment Rarities

It’s hard to extoll the virtues of silver in the face of a price decline. We anticipate gains for our clients and are disappointed in the recent results. A lot of people rely on our advice and we don’t want to let them down. We all do better when our clients experience gains.

That said, are we ever going to get to the promised land? Right now the byword is patience. A clear understanding of what’s causing the recent decline will be helpful in plotting the future. As you know, we rely on silver analyst Theodore Butler to chart our course and fashion our advice. I happen to know that all his personal investments are in silver so he is definitely eating his own cooking. Because of his all-out bullishness on silver we have to stress that he operates with a care and cautiousness befitting of a mature and shrewd analyst. He understands the futures market like few others. Despite his profound and pioneering analysis of silver, surprisingly few gold and silver editors have embraced his breakthrough opinions. Either because of ego or stubbornness other precious metals analysts are invariably barking up the wrong tree. Mr. Butler has for years been the sole purveyor of the truth about silver….Read More »