Post by unlawflcombatnt on Aug 6, 2015 23:41:21 GMT -6
from the Examiner.com
www.examiner.com/article/gold-market-so-tight-that-banks-are-manipulating-data-to-show-more-inventory?CID=examiner_alerts_article
Gold Markets So Tight That Banks are Manipulating Inventory Numbers
to Keep Prices from Rising
Aug 6, 2015
by Kenneth Schortgen
Earlier this week, a Comex gold inventory report showed that availability of the precious metal was down to its lowest levels ever for eligible gold to be used to back futures contracts in the paper metals market. And as every indicator points towards a vast shortage of both physical gold and silver worldwide, on Aug. 5 bullion bank J.P. Morgan attempted to quell the run on metals not by delivering actual gold to the Comex, but by performing an accounting trick and manipulating data to change registered gold into eligible gold on inventory ledgers.
In fact, the accounting change used to boost inventory in the Comex was so egregious, it nearly doubled the available number of ounces from from 362,000, to 643,000 without delivering a single ounce of physical gold to the institution to help cover the soaring number of buy contracts that have accumulated over the past several months.
Earlier this week, when observing the most recent drop in Comex registered gold as a result of a reclassification by the gold vaults of JPM and Brink's of 25,386 ounces of registered gold into eligible (alongside the withrawal of 200,752 ounces of eligible gold from JPM), we wondered if Comex "may be on the edge" since after the adjustment, Comex registered gold had dropped to a never before seen low of just over 10 tons, resulting in record high gold coverage ratio of 124 ounces in outstanding gold open interest for every ounce of physical.
And after our report, the Comex once again succeeded in sweeping default fears under the rug by boosting its eligible gold by a whopping 78% overnight, from 362K ounces to 643K, thereby pushing deliverable gold from its all time lows.
However, this was not achieved with an infusion of actual new gold into the Comex, but thanks to JPM reclassifying 276,000 ounces of gold from the Eligible into the Registered category, even as actual eligible gold continues quietly hemorrhaging out of the Comex. - Zerohedge
In reality, the Comex is no longer used as a true futures market for delivery of physical precious metals as it has not made an actual delivery in over two and a half years. And instead the Comex presides over a paper and derivatives market, even allowing the use of naked short selling of futures contracts to protect the dollar and the derivatives tied to the reserve currency.
For years there has been much speculation on just how much the Comex is used to manipulate the price of gold and silver by allowing the Fed through bullion banks like J.P. Morgan to manipulate prices through the futures market. And as long as the Comex is recognized as the standard for determining price discovery through control over the spot price of metals, it remains likely that both gold and silver will continue to be extremely undervalued, and that their manipulation will eventually open the door for markets like China to wrest control over determining prices, which is something that they are right now hinting at doing before the end of the year."
www.examiner.com/article/gold-market-so-tight-that-banks-are-manipulating-data-to-show-more-inventory?CID=examiner_alerts_article
Gold Markets So Tight That Banks are Manipulating Inventory Numbers
to Keep Prices from Rising
Aug 6, 2015
by Kenneth Schortgen
Earlier this week, a Comex gold inventory report showed that availability of the precious metal was down to its lowest levels ever for eligible gold to be used to back futures contracts in the paper metals market. And as every indicator points towards a vast shortage of both physical gold and silver worldwide, on Aug. 5 bullion bank J.P. Morgan attempted to quell the run on metals not by delivering actual gold to the Comex, but by performing an accounting trick and manipulating data to change registered gold into eligible gold on inventory ledgers.
In fact, the accounting change used to boost inventory in the Comex was so egregious, it nearly doubled the available number of ounces from from 362,000, to 643,000 without delivering a single ounce of physical gold to the institution to help cover the soaring number of buy contracts that have accumulated over the past several months.
Earlier this week, when observing the most recent drop in Comex registered gold as a result of a reclassification by the gold vaults of JPM and Brink's of 25,386 ounces of registered gold into eligible (alongside the withrawal of 200,752 ounces of eligible gold from JPM), we wondered if Comex "may be on the edge" since after the adjustment, Comex registered gold had dropped to a never before seen low of just over 10 tons, resulting in record high gold coverage ratio of 124 ounces in outstanding gold open interest for every ounce of physical.
And after our report, the Comex once again succeeded in sweeping default fears under the rug by boosting its eligible gold by a whopping 78% overnight, from 362K ounces to 643K, thereby pushing deliverable gold from its all time lows.
However, this was not achieved with an infusion of actual new gold into the Comex, but thanks to JPM reclassifying 276,000 ounces of gold from the Eligible into the Registered category, even as actual eligible gold continues quietly hemorrhaging out of the Comex. - Zerohedge
In reality, the Comex is no longer used as a true futures market for delivery of physical precious metals as it has not made an actual delivery in over two and a half years. And instead the Comex presides over a paper and derivatives market, even allowing the use of naked short selling of futures contracts to protect the dollar and the derivatives tied to the reserve currency.
For years there has been much speculation on just how much the Comex is used to manipulate the price of gold and silver by allowing the Fed through bullion banks like J.P. Morgan to manipulate prices through the futures market. And as long as the Comex is recognized as the standard for determining price discovery through control over the spot price of metals, it remains likely that both gold and silver will continue to be extremely undervalued, and that their manipulation will eventually open the door for markets like China to wrest control over determining prices, which is something that they are right now hinting at doing before the end of the year."