Massive Drain of Silver from Comex Vaults/tiny silver deliveries

Harvey Organ, Wednesday, May 18, 2011

Massive Drain of Silver from Comex Vaults/tiny silver deliveries

 

 

Building Your Financial Storm Shelter
By: Gary North

 

 

CME Hikes Intraproduct Crude, RBOB Margins, Lowers Gold, Silver And Copper Interproduct Margins 

Submitted by Tyler Durden on 05/18/2011 18:54 -0400

Following various outright margin hikes in commodities such as precious metals and crude, the CME is now moving on to swaps and other interproduct and intraproduct contract pairs. As of a few minutes ago, the CME just hiked the CL intraproduct spreads Tier 1 through 6 for both New and Initial Margins by about 33.3%, and assorted other CL pairings by a lower amount. It also did the same for a variety of RBOB contract intraproduct spreads by a comparable amount. Curiously, intercommodity spreads actually declined between gold, silver and copper pairings by anywhere from 10% and 20%. For now the market appears not to be reacting to this latest margin move by the CME. 

 

 

 

 

 

Goldman Downgrades The USD 

Submitted by Tyler Durden on 05/18/2011 16:19 -0400

And just as everyone was starting to bet on the great USD renaissance, here comes Thomas Stolper to spoil the party, by not only refusing to close out his EURUSD trade reco after losing 800 pips in two weeks (and still being profitable), but by actually doubling down: "We have changed our forecasts to project more Dollar weakness."The reason is that the US apparently has a thing called a massive trade deficit that has to be normalized: "Since the last revisions to our forecasts, the Dollar decline has roughly tracked the expected path. Large structural imbalances in the US are highlighted by weakness in the tradable goods sector.The outlook for monetary policy differentials and BBoP trends remains USD-negative. Dollar weakness is common during periods with slowing GLI momentum." The bottom line: "We now see EUR/$ at 1.45, 1.50 and 1.55 in 3, 6 and 12 months, and $/JPY at 82, 82 and 86". Oddly enough, there is no mention of the real reason to position for a USD plunge. (Hint: Hewlett Packard). On the other hand, this may be the time to go balls to the wall long the USD, as it appears that Goldman is doing another USD fundraising campaign courtesy of its clients. Oh, and speaking of Goldman's clients, it's best to baffle them with bullshit. Here is Goldman's Jim O'Neill with a blurb from his Sunday note on why China is going down (among other things): "it seems to me that a bigger risk premia is still necessary for the Euro. I can’t see how it can remain at about 1.40." Yes. From Sunday. If your head didn't go boom yet, that's ok. It will soon enough. And way to cover your bases there Goldman...

 

 

 

 

Deutsche Bank Downgrades The Economy After It Finally Realizes That The Japan Earthquake Will Not Boost Growth 

Submitted by Tyler Durden on 05/18/2011 18:10 -0400
When we discussed yesterday's miss in April Industrial Production, and noted the plunge in the vehicle assembly rate, we merely said what anyone with half a brain would have seen as glaringly obvious ever since the Japan earthquake in March. "The immediate impact: the drop in the industrial production already seen, but the bulk of it due to delayed aftereffects, will likely impact the May number, as the follow through from the Japanese supply chain halt starts ringing a loud alarm bell across Wall Street. Of course, this is another thing that all those calling for a 4% H2 GDP could have absolutely not foreseen (and in fact it was originally supposed to be positive for the economy, eh Deutsche Bank?). Expect to see drastic downward cuts to May Industrial Production and next, to Q2 GDP." Fast forward to today when we read in Reuters precisely what was predicted less than 24 hours ago: "here are fears auto production, which added 1.4 percentage points to growth in U.S. gross domestic product in the first three months of the year, may now be a drag." And irony of ironies: "Some financial institutions, including Deutsche Bank, are already trimming their second quarter GDP estimates." But, but, wasn't it Deutsche Bank's very own Joe LaVorgna who first said that the disaster would actually be beneficial for world GDP, and subsequently that the world is "overreacting." Guess not: "Before Tuesday's industrial production data, Deutsche Bank had been expecting economic growth to accelerate to a 3.7 percent annual pace during this quarter after a sluggish 1.8 percent rate in the January-March period. "We lowered it by half-a-percentage point to 3.2 percent. We are going for a more conservative narrowing because other manufacturing activity is still expanding despite the supply disruptions in the auto sector."  And there you have that very dirty NC 17 three word phrase: "Wall Street Strategi

Is Gold Back "In Play" - An Update From FMX Connect 

Submitted by Tyler Durden on 05/18/2011 17:28 -0400

The market was called to open $13 higher today, entering back into the meat of the trading range for the last two weeks. One would think that this retracement of a down move would be accompanied by a retracement of the volatility but we’ve come to learn from this market that skew and its implications are more volatile than volatility itself. Volatility should have been lower today. Calls should have been slammed today. Having attained break-even for the day, one wouldn’t expect back-month options to be of interest when the gamma lies with the shorter-dated months. If you thought any of those things you would be wrong. Here’s what happened: The market opened at 1493 and a buyer of the June 1500 Call came in, purchasing approximately 1000 lots. The market absorbed the balance as there is plenty of two-way business at the strike. Subsequently, a buyer surfaced in the December 1600 Call. The MO of the buyer was very similar to the MO of the August 1600 Call buyer we saw two months ago. As a quick review, between 10,000 and 15,000 August 1600 Calls were bought over the course of roughly a week and afterwards the market went to 1570. Today, 4,000 of the December 1600 Calls traded and it was this option that single-handedly changed the term structure of volatility. By the end of the day the front months were down, the back months were up and October served as the fulcrum (see chart below). Who is this buyer? We don’t know. Its most likely a fund or a dealing bank executing an order for a fund. We can’t tell you the market is definitely going to go higher from here but we can tell you that if it does volatility will firm up. 

 

 

 

 

The Coming Great Inflation
By: Michael J. Kosares

Gross Uses Sly Semantics to Hide Shorts on Government Securities
By: Dr. Jeffrey Lewis




International Forecaster May 2011 (#5) - Gold, Silver, Economy + More
By: Bob Chapman, The International Forecaster





The Golden Rule
By: Warren Bevan