Gold And Silver Shortages Become Acute – GLD Is Being Looted Again

A client of mine, a jeweler just called.  His refiner called him – looking to buy gold or silver. The refiner has very tight stock. My client buys “shots” to melt and builds into rings etc. His refiner volunteered info on the selling this am – says the system is manipulated, which shocked the client only in that it was openly admitted. When my client’s refiner needs product you know there is a shortage. This is the first time in 10 years this refiner said there were shortages.  – A colleague and friend of mine who manages high net worth accounts

GATA was the first in this country to warn, based on a historically very reliable source from London, that there would be acute shortages of gold and silver this fall at refiners in Europe.  A few weeks later the mint announces that it is suspending sales of one ounce silver eagles until at least August.   And it now looks like GLD is being looted.

At the same time, both gold and silver eagle sales in June went vertical in June.  Last week the amount of gold withdrawn from the Shanghai Gold Exchange – 61.8 tonnes – was the 8th largest weekly withdrawal on record.

This is Gresham’s Law in motion.  Bad money chases good money out of the system. Above-ground stocks of physical gold and silver are disappearing because people “in the know” are converting their fiat Monopoly money into many different forms of gold and silver that is being safekept outside the corrupted and criminal banking custodial systems.

Gold has worked down from Alexander’s time. When something holds good for two thousand years I do not believe it can be so because of prejudice or mistaken theory.  – Bernard Baruch, as hypothecated from Jesse’s Cafe Americain

While anti-establishment analysts try to decipher and explain the ongoing asset bubbles that have reappeared since the Central Banks emarked on the mission of re-inflating the bubbles that led to the defacto financial collapse of the western banking system in 2008, perhaps the biggest bubble of them all is the one that has been blown in paper gold and silver.

As I have been documenting on this site, the amount of open interest in paper Comex gold contracts has gone parabolic in the last few weeks – here and here.  The open interest in gold went up again on Friday by 274 contracts to 474k.  This is 47.4 million ounces or 1,378 tonnes of paper gold – an amount of paper gold that exceeds the amount of physical gold held by most countries globally.

But more significantly, this amount of paper gold is 98x greater than the actual amount of physical gold held in Comex accounts that is classified as “available to be delivered.”  In other words, the amount of paper gold outstanding on the Comex is 99% fraudulent.  In relation to the underlying fundamentals and in relation to the actual amount of physical product available, the bubble in Comex paper gold is the largest in history.  Then add to this the amount of paper vs. physical in London, estimated conservatively to at least 100:1 – right Jeff?  (Jeffrey Christian of CPM Group).

I find it quite amusing that bullion market professionals like John Hathaway – Tocqueville Gold Fund Manager – Bron Suchecki – Perth Mint – have finally come out of the woodwork and admitted what has been obvious for over 15 years:   Hathaway manipulation confessional;   Suchecki manipulation confessional.    GATA was much more gentle and diplomatic in its assessment of Hathaway’s “mea culpa”  than I am, to quote Big Bill:   “Cowards die many times before their deaths;  the valiant never taste of death but once,”  William Shakespeare.

Here’s what blatant manipulation of any market looks like when the paper version of the same is allowed to trade unchecked by those who are in charge of applying the laws already in place to prevent this:


I guess when the market intervention becomes this obvious, even people like John Hathaway and Bron are forced into admitting the obvious, but only out of fear of being branded idiots by the truth.   As John Brimelow of JB’s Gold Jottings puts it:  “The scale and brazenness of these raids is increasingly looking like April and June of 2013.”  

As for GLD, a startling 11.63 tonnes was removed on Friday, taking the total reported tonnage down to 696 tonnes.  It’s the lowest since September 19, 2008, when the price of gold closed on the Comex at $860.   I have written about this in the past and will do so more going forward, but it is likely that GLD does not even have 696 tonnes of gold sitting in its vaults that is unencumbered by hypothecation or lease agreements.  Or is just outright not there.

The prospectus of GLD – which I have gone over line by line several times over the years – makes it clear that GLD is nothing more than another derivative form of gold. Furthermore, I know of big players who have requested redemption of the gold from GLD in exchange for their shares – as prescribed by the prospectus – but who were denied – as is also prescribed in the prospectus.   In other words, GLD is nothing more than a device used by the bullion banks – acting on behalf of the western Central Banks – to source gold when needed due to extreme shortages in order to make deliveries to parties who they can not deny.  Like China, India and Russia. Or the OPEC States.

The global economy and financial system are collapsing, including and especially the United States.  While the powers that be can resort to outright criminal behavior to continue kicking the “collapse can” down the road for a while longer, it is imperative that they prevent the price of gold from signalling to the world that something is wrong.  What is happening now strikingly similar to what occurred starting in March 2008, right before Bear Stearns et al began to fall like a house of cards in a wind tunnel.

The amount of effort and degree of criminality involved in this latest effort to push down the price of gold with Ponzi paper is directly proportional to the severity of the economic and financial problem winding its way toward us still hidden behind fraudulent bookkeeping and propaganda.  But if 2008 was the equivalent of a small roadside bomb in Afghanistan,  what will soon hit our system will be like a nuclear bomb detonating in Times Square.

26 thoughts on “Gold And Silver Shortages Become Acute – GLD Is Being Looted Again

  1. Since the CEO’s of the major Gold and Silver mining co’s are going to act like nothing is wrong with the price discovery process of their primary product (except for K.N. from FMR) … might as well take the price of paper Gold and Paper Silver to zero to clean out all the physical inventory and bankrupt the Gold stocks at the same time.

  2. It´s incredible that people like Hathaway,Jim Rogers, Dan Norcini and Doug Casey deny that there is a precious market manipulation.
    I wonder why they do that because they make complete fools of themselves in the gold/silver community.
    Are they afraid of nailguns or “falling down” from rooftops?

    I must say that Keith Neumeyer is like a fresh breeze when you think of the cowards above.

    1. you answered your own question.

      they lose their top jobs, or they and/or their families are threatened if they speak out about the truth. in a crime syndicate, whether you join voluntarily or forced, you do what you are told. haven’t people worked out that governments are controlled by the biggest crime syndicate in the history of mankind?

  3. With the Chinese Stock Market in such a precarious position the authorities needed to signal clearly that gold was not a valid alternative to stocks before any such move could gain momentum. How such transparent tactics can fool anyone is beyond me but they do work – time and time again.

  4. Amazing, XAU within spiting distance of 2001 lows. Got to hand it to the goons for the brutal lesson. Invest in state approved vehicles and get reward. Invest in alternatives and get financially wiped out.

  5. The earth is given into the hand of the wicked: he covereth the faces of the judges thereof; if not, where, and who is he? JOB 9:24..Just my thought after reading your article…

  6. GDX traded 160 million shares today. That’s a record. IMO one of the biggest mistakes PM investors have made, my included, is not understanding earlier how locked down these markets are.

    Complain about manipulated markets but try to make money from those markets? I don’t believe there were any day traders in the old USSR.

  7. It would be nice to KNOW the NAMES of the traders that smash the price of gold and silver every night at the same time….this would be the only way to stop the criminals…..imho

      1. No Disrespect Dan, but JPM, HSBC, Scotia, Goldman, Citi, etc. have never nor will they ever in the future be stopped. According to some very knowledgeable people, these criminals will profit the most once they begin to manipulate precious metal prices to the upside. Until then, your options are limited. Accumulate like the criminals or move to the side.

    1. No it wouldn’t. Everyone including the regulators are in on the game. Have to protect King Dollar and the general equity casino so the top of the food chain stays feed. Besides the general public has no clue about this. 401ks are going up and it’s time to watch Dancing with the stars. They could outlaw gold ownership tomorrow and the general public wouldn’t blink an eye, but why outlaw it when you can use paper gold to separate gold investors from their dollars.

  8. A bit off topic but this just out – reported earlier today in the Chicago Tribune.
    When In a hole – stop digging.

    Cash-strapped Chicago schools propose $1.16 bln more debt
    Reuters 7/20/2015 3:53 PM ET
    Print Article
    CHICAGO, July 20 (Reuters) – Chicago Public Schools on Monday proposed selling up to $1.16 billion of bonds despite the district’s falling credit ratings, big budget deficit and lack of an approved plan to ease escalating pension costs.

    The board of education for the nation’s third-largest public school system will vote on the general obligation bonds at its meeting on Wednesday.

    Proceeds would be used to improve school facilities, refund outstanding bonds, and pay banks to terminate swaps used to hedge interest-rate risk on variable-rate debt, according to documents posted on the CPS website.

    CPS representatives did not immediately respond to questions about the swaps and other details about the proposed bonds.

    Downgrades by Moody’s Investors Service and Fitch Ratings in March triggered about $228 million in termination payments by CPS to bank swap counterparties. Moody’s cut the district’s rating to junk in May. Earlier this month, Standard & Poor’s dropped its rating two notches to BBB, while warning another downgrade could come without a “credible” fiscal 2016 budget.

    School officials have not yet unveiled a complete budget, announcing last week the spending plan will rely on $500 million in pension savings that have yet to be enacted by the Illinois Legislature and will incorporate a $106 million cut in state funding.

    CPS has projected a $1.1 billion deficit in its fiscal 2016 budget, largely because of an approximately $675 million pension payment.

    The school system made its $634 million fiscal 2015 pension payment to the Chicago teachers’ retirement system on June 30 by tapping borrowed money, including $200 million of tax anticipation notes and spending cuts.

    The school board last month approved those notes, as well as up to $935 million of notes in anticipation of the district’s 2015 property tax revenue. Debt sales by the district in March and May resulted in hefty yields.

    (Reporting by Karen Pierog; Editing by Richard Chang)

  9. BTW lower oil prices and lower Canadian dollars help the bottom line of Canadian producers making up for at least part of the gold price decline. Not suggesting they are a buy given fundamentals are not driving the price.

  10. Wouldn’t be surprised if the precious-metal content of retail jewelry falls while prices stay stagnant, if not rise. At this rate, Americans will be paying hundreds just to wear a silver-PLATED ring.

  11. Well if you have not bought in metals yet, now is definitely a good time to start building a position. It could go much lower but supply will certainly be the big problem from here on. This will be the mother of short sqeeze’s. Unless you still believe in the fairytale of dollar scarcity.

  12. They have to do all these bad things before the shamitah boils their sorry asses.
    They know they are going down for the count very soon and are pulling off
    All this criminal activity along with government backing but before it’s over
    there will be a cleansing and they won’t get away. They apparently know this
    but refuse to give up. They know who they are for I hear they are on list .

  13. I would have commented earlier but my “captcha” took me forever: “6 – 1” Gee whizz, cut me a little slack, if this type of test is not stopped immediately, I know where it will lead; I will have to take off my socks. Then even my goldfish will be in danger. You are a cruel and feckless man.

    Seriously, thank you so much for all your incredible commentary! I genuinely appreciate it!


  14. I for one am tired of seeing sites like this that like to quote “friends”, “clients”, “brokers”, and “traders” without ever revealing a real name or anything that can be sourced or fact-checked. There is no credibility to this kind of “reporting”. This hearsay/sloppy journalism is not doing the precious metals community any favors.

    1. Koos Your majesty,
      Are you suggesting there is a conspiracy here? what is it with you “tin Hatters” everything has to be a conspiracy. Duck over to that Suchecki link and warn the investing public.

  15. Tuesday, July 21, 2015

    White House Names Well Traveled Establishment Professor for Fed Board

    She is also a Research Associate at the National Bureau of Economic Research.

    She has in the past taught at Harvard Univeristy’s Kennedy School of Government, Princeton’s Woodrow Wilson School of Public and International Affairs, the London School of Economics, and the Goldman School of Public Policy at UC Berkeley and worked as a research consultant for the Federal Reserve System, the International Monetary Fund, the World Bank and the Bank for International Settlements.

    She received a PhD from Yale.

    Dominguez is a dual citizen of the United States and Ireland.

    She appears to be a specialist in foreign exchange interventions,
    Traders note well, she has written in a paper titled,

    The Market Microstructure of Central Bank Intervention,

    where she comments on the best time for central banks to intervene in foreign exchange markets:

    {T]he evidence suggests that the timing of intervention operations matter – interventions that occur during heavy trading volume and that are closely timed to scheduled macro announcements are the most likely to have large effects.

    She also seems to be aware that central bank interventions are a crooked business.

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