Is JP Morgan Shorting Paper Metals While Acquiring Massive Physical Stockpiles?

As silver investors are likely aware, leading silver analyst Ted Butler has openly speculated whether JP Morgan’s alleged massive short silver position is held on behalf a client such as the Federal Reserve (with the intent to prop up the dollar by suppressing gold and silver) or the Chinese government (with the intent of acquiring physical gold and silver bullion at a discount due to their massive paper short position on the futures market).
The Doc has long privately wondered whether the bullion banks’ PM short positions could actually be leveraging their own physical bullion accumulation by artificially suppressing the paper futures price.
These thoughts originate in our following of Jim Sinclair, who has always maintained that the bullion banks will be the one’s making the lion’s share of the profits in this great secular gold and silver bull market.   One thing the bullion banksters are not is dumb, and they can see the writing on the wall for the US dollar as well as any SD or ZH reader.
New commentary from a bullion insider who claims to have personally managed the movement of 27 million ounces of gold from HSBC’s vaults into JP Morgan’s seems to substantiate Sinclair’s claims.

The industry insider has come forward claiming that JP Morgan’s paper short position is in fact a hedged trade (as Blythe Masters claimed here)- and claims that JPM is in fact MASSIVELY LONG PHYSICAL GOLD AND SILVER HELD IN THEIR OWN PRIVATE VAULTS while short the paper futures market. 
Is JP Morgan actually a double agent shorting the paper metals market for their own benefit?

The claim is not only rational, but it also would perfectly explain why the CFTC has opened three separate investigations into silver market manipulation, and has yet to charge anyone with manipulation of silver.
Clearly, if JP Morgan’s commodities desk was accumulating massive physical gold and silver inventories in their own personal vaults, they would be able to claim their paper short position is a legitimate hedge- essentially leveraging their physical position against the paper COMEX futures market itself.
Miles Franklin’s David Schectman states he has been in contact with the insider, who claims JPM is massively long physical gold and silver bullion stored in their own warehouses:
Whereas Ted Butler focuses on JP Morgan and “the Big Four Commercial Banks,” and their perpetual “short” position in silver (and gold), I don’t recall him ever suggesting that they actually own the physical silver to offset their short positions.
My friend Trader David R flatly states that this IS the case; he has seen the silver with his own eyes in London. In fact, he asked me to come with him last year and told me he would bring me to the vaults and personally show me the silver. Last winter he emailed me and said, “I will be going to London in May; if want to come along, I am sure I can get you a tour of a few of the major banks vaults (JPM included) and you can see all of the gold and silver for yourself ?”
 
For those inquiring minds wishing for a little background on this mysterious gold trader David R:
I worked at some of the largest bullion banks in the world over my career and I ran all types of books and did a lot of business with Central Banks around the globe.  I was involved in the largest gold hedge ever done in the history of the world back in 1996. This has been my life for the past 18 years. From 2000 to 2006 I was the gold trader at Barclays London. I have worked for AIG, Barclays, and UBS, some of the biggest bullion desks in the world.
I worked for three of the major bullion banks for 11 years and was in charge of Barkleys gold book and the hired 42 Brinks trucks to move our 27 million ounces of gold out of HSBC ‘s vault and into JPMs vault when HSBC raised storage costs on us, I am 100% positive that it’s there. I know we had 27 million ounces of gold on our daily balance sheet and the other big banks all had around the same amounts.
David R left Barclays and moved to Manhattan to work for one of the largest and most successful privately held hedge funds in NYC. He was in charge of the precious metals trading department, and supervised dozens of the most talented precious metal’s traders in NYC. I was told by a reliable source that every metals trader worth his salt would kill to work for that firm. The traders were not salaried, they worked on commission and they all made BIG money. That is where I met David. He gave me a personal tour of their trading department. His understanding of the gold and silver industry and his resume is as good as it gets.

The trader states that JPM is indeed massively long physical precious metals and set to vastly benefit from the coming mania, precisely as Jim Sinclair has long predicted:
They buy the physical silver at the same time they sell the future (on Comex) futures trade in contango (higher price than spot physical) they get zero interest rate cash from FED so borrow the money for free, they own the vaults to store the silver…. so as the future comes to maturity they can either settle against their physical long or roll the future to collect more free contango…. This is pure arbitrage paid for by the FED.  This has been going on for over 30 years and why shouldn’t they be allowed to have 25% of the Open Interest?  There is no manipulation because they are short the futures and long the physical and have “ZERO” price risk, but nice profits!  It’s brilliant trading and completely 100% legal and that’s why they will never be charged with manipulation because there is none going on. Sometimes it’s just that easy!

David R states there is no massive shortage of physical silver- it is just being hoarded by the bullion banks in their own private vaults ahead of dollar devaluation and collapse:
Let’s go and visit their vaults and you can see all the physical silver there… Lease rates are at full carry +.  There is no shortage what so ever and the banks are charging 40 bp for storage because they cannot find any more space to put it all, you can take all the physical you want!  The JPM manipulation is not a manipulation, but a way of trading that has been going on for years. JPM is short futures (due to contango) and long physical.  People need to understand that metals are just a derivative of the interest rate market and once people do, they will get a better understanding why the market moves the way it does.
I explained to you what HSBC and JPM do on the silver.  They get $ from the FED for free.  They own all the storage vaults, so they do not have to pay the fees for storage.  They then own the physical silver in their vaults and sell the futures contracts (which are in contango) at a much higher price than OTC price so then hold the both till delivery.  Since there is no cost for $ and no cost for storage, they made a fortune on earning the contango of the silver and gold market. It’s a brilliant strategy, which has made them a fortune.
If you sat with me for a day I could show you how this market really works.
Miles Franklin’s David Schectman states he has known David R for over four years, that he is legitimate and the real deal, and that although David states JPM’s short silver (and gold) positions are NOT naked, it is massively bullish for both metals, stating:
He is absolutely convinced that gold and silver are going MUCH, MUCH higher. He told me last week that with the Fed’s latest “open-ended” QE edict, the dollar and bond market are done, finished and the bull market in gold is guaranteed! As far as he is concerned, Bernanke has sold out our kids and grandchildren and it no longer makes any difference who occupies the White House!

As mentioned previously, if JPM is shorting gold and silver futures with the intent of eventually breaking the futures market/ physical price link to the metals, this would explain motive (pure profit- always the ONLY motive for a bankster), as well as the reason why the CFTC has been unable to charge JPM with manipulation of the silver market- even though they routinely fleece the specs using their algos and raids.

新興市場“QE3之痛”

謝國忠：

謝國忠在財新發表文章認為：

QE3不能替代結構性改革，QE3不會拉動美國經濟。工業品不會上漲，但金價可能會很高，油價和糧價的上升會將新興經濟體拖入滯脹。他認為熱錢此次不會流入新興經濟體，資本反而可能加速外流。中國急需減稅提高資本回報率，否則將面臨資本外逃的洪流。
 在文中，謝國忠的主要觀點如下:
 1. QE3的作用
 a. 房地產市場
 通過購買MBS，美聯儲對房地產市場和銀行提供直接支持。住房市場依然不穩定。沒有強勁的住房市場，就不可能有強勁的經濟復甦。美聯儲購買MBS將會縮小國債收益率和住房融資成本之間的利差。 10年期國債利率為1.8%。如果按揭利率降低到這個水平，就可以提供足夠的再融資機會，減輕負債累累的家庭部門的債務負擔。
 但美聯儲的貨幣政策不能替代結構性改革，QE3不會創造一個強勁的（美國）經濟。
 b. 實體經濟QE3的主要目標就是要說服企業部門相信美聯儲將通過不設限制的量化寬鬆政策推動經濟好轉。如果企業部門相信美聯儲能夠成功，它們現在就應當進行投資，從而創造良性循環。 QEIII某種程度上就是一個信心把戲，如果市場相信，就能達到目的。
 但對企業來說，持有現金可能就是最好的選擇。儘管投資可能會創造一個良性循環，但效果可能不會持續。美聯儲隨後的緊縮政策可能會引發大規模的衰退，給產能過剩的企業帶來損失。因此，儘管投資可能會給企業帶來短期利潤，但從長遠來看是毫無道理。
 c.金融市場投資者兩極分化。一些人持有的債券利息接近零，他們相信美聯儲會打擊通脹。一些人持有黃金，以對沖美聯儲可能會放任通脹所帶來的衝擊。因此，黃金價格代表了通脹，債券價格代表了通縮。
 2.新興經濟體滯脹
 a. 油價與糧價由於對QE3的預期，商品價格尤其是石油和農產品價格已經大幅上升。新興經濟體已經受到了增長放緩和持續通脹的衝擊。 QEIII可能會迫使新興經濟體國家在增長疲軟的情況下收緊貨幣政策。美國受益於頁岩氣革命及農產品淨出口國的地位，其通脹受影響相對較小，甚至受益於通脹。
 b. 熱錢QE3不可能導致熱錢大規模流入新興經濟體。原因在於新興經濟體的糟糕基本面。 QE1的熱錢在新興經濟體國家創造了巨大泡沫，已經削弱了其經濟基本面。通脹、壞賬以及破滅的房地產泡沫都在影響新興經濟體國家。熱錢不會流向有問題的經濟。
 c. 資本外流新興經濟體已經身處滯脹困境。 QE3把它們往深淵裡又推進了一步。這些國家的股票市場跟美國相比要差很多。這種差別在QEIII期間可能會持續。新興市場股票的糟糕表現可能會加速其資本外流，進而引發像1998年那樣的金融危機。
 3. 保護主義升級
 QE3可能會提高美國的內需，尤其是對住房相關產品的需求。然而，這部分需求可能會被主要來自中國的進口所滿足。況且，中國大部分行業都存在產能過剩的問題。很可能會大力推動出口。歐洲和美國對於中國出口的反應將會非常負面。
 跨國公司引領了全球化，因為它們可以影響各國政治。過去幾年的債務危機改變了西方經濟的政治格局。跨國公司的影響力正在減弱，保護主義將會隨之而來。
 4. 吹泡泡

全球經濟仍然疲軟。 QE3不會改變這一點。因此，工業產品不可能再次成為泡沫。實際上，工業產品可能會持續通縮。石油價格可能會上漲，黃金價格可能會很高，由於供大於求，競爭性商品的價格不太可能會大幅上漲，流向黃金的流動性可能就會比前兩次量化寬鬆期間大很多。
 QE3可能會將食品價格推向歷史高位。新興經濟體的基本面比QE1期間還要糟。食品價格高漲的影響可能會更大。如果非洲和南亞爆發糧食動亂，美聯儲難辭其咎。
 5. 中國與改革
 美國股票市場的持續良好表現，導致中國的資本外流加速。如果美國房地產市場再度回暖，資本外流就會變成洪流，引發中國的銀行危機。中國迫切需要提高對國際和國內資本的吸引力。
 中國的資本回報率很低，並且還在不斷下降。促進GDP增長的政策不會改變這種情況。在過去五年裡，土地升值已經成為利潤的主要來源。泡沫經濟正在收縮。三線城市的房地產市場正在崩潰。這種趨勢正在向二線城市蔓延。由於銷量過少，很多房地產商終止了項目建設，這是中國經濟疲軟的主要因素。政府和房地產行業竭力試圖掩蓋這種情況，這將會給它們自己帶來後患。
 中國迫切需要減稅以促進內需，提高資本回報率。美國很可能最終會通過資本從中國到美國的再分配而實現經濟復甦。如果中國不想承受資本外流的危機，就必須實施改革，變得比美國更能吸引投資。

黃金ETF總持倉量創新高

黃美斯

倫敦黃金周一下挫，自上周五所及近七個月高位回落，因油價和穀物價格全線走低，促使投資者鎖定利潤。金價於上周未能突破1790美元水平的關鍵技術阻力位，促使部分投資者開始削減多頭倉位。

德國數據加劇全球增長憂慮則提振了美元，進一步令黃金承壓。數據顯示，德國9月企業景氣判斷指數連續第五個月下跌，並觸及2010年初迄今最低水平，顯示出歐洲央行（ECB）買入歐羅區疲弱國家公債的計劃，未能讓企業相信危機最壞的時期已經過去。

不過，黃金交易所買賣基金（ETF）持倉則創下紀錄高位。全球最大的黃金交易所買賣基金SPDR Gold Trust表示，其持金量在9月24日觸及紀錄高位1326.808噸。黃金ETF總持金量也創歷史新高，達7376.5萬盎斯，或2294.348噸。

西班牙也使歐羅區的情況雪上加霜。西班牙政府公債收益率攀升，因有迹象顯示，西班牙政府在尋求市場預期的國際救助方面進展緩慢；意大利公債收益率也走高。另外，歐盟和國際貨幣基金組織（IMF）有關希臘債務是否可控的報告可能推遲發布，這使歐羅進一步承壓。從目前情況看，這份報告要到11月6日之後才能發布，最初的預期是下月發布。

預計西班牙政府將在本周提交2013財年預算計劃草案，並宣布新的結構性改革舉措；同時，西班牙銀行的壓力測試結果也將在本周宣布，這可能為該國請求全面救助鋪路。不過，西班牙經濟部長德金多斯周六表示，西班牙將不急於尋求外部援助來為其即將到期的債務籌資；同時，歐盟官員表示，在10月21日Galicia地區舉行選舉前，西班牙首相拉霍伊將不會尋求救助。

另外，部分市場人士預計，穆迪可能在本周把西班牙評級降至垃圾級，且該國下月底將有275億歐羅的債務到期，這加重了西班牙的壓力。

黃金方面，圖表走勢顯示，已見MACD出現利淡交叉，RSI及隨機指數亦維持向下，更重要的是9天平均線目前處於1767美元水平，價位在周一已見跌破此區，目前亦未能重新持穩上方，故短線仍見金價處於9天平均線下方，則沽壓將愈見明顯。下方亦可留意1752水平，為近日在高位盤整的底部位置，若然跌破，弱勢調整似乎已正式展開。

金價較近目標先下試1745水平，若以回吐浪計算，38.2%及50%的調整水平將為1712及1689水平。向上阻力方面，較近先參考9天平均線1768，之後將留意1773及1782水平，至於年內高位1790水平仍為重中之重。

倫敦白銀方面，周一出現明顯下挫，同時跌破9天平均線及下降趨向線，低見33.60美元；配合RSI及隨機指數亦見走低，短期預料白銀將繼續探低。較近支持在33.40及33美元，附近亦見重要支持在25天平均線32.70水平，要是此區亦見失陷，料弱勢亦隨之加劇，將衍生較急劇的下滑；以黃金比率計算，過去三個升幅的38.2%及50%調整水平為31.70及30.63美元。另一方面，上方較近阻力預估在34.50及35.00水平，下一級則為35.90美元。

金融抑制下 投資者為政府效勞

繼 美國聯儲局宣佈推出無明確限期的第3輪量化寬鬆政策（QE3）及歐洲央行啟動無上限購買短期主權債計劃後，上週日本央行也宣佈「加碼」量寬，增加資產購買 規模至80萬億日圓。成熟國家央行再度量化寬鬆，對刺激經濟的效果成疑，市場的反應也不及以往大。惟金融抑制（Financial Repression）時代已經開始，其對市場的潛在影響更大。

美國推出的QE3前，已 有不少論者預計刺激經濟的成效將每況愈下。而今次聯儲局較為驚人的舉動，是表示這次每月量化寬鬆400億美元，直至美國就業市場有明顯好轉。但其實，量寬 政策與美國就業市場兩者的關係並不明顯。聯儲局主席伯南克亦不諱言，QE的效用在於製造財富效應，紓緩金融市場緊張狀況，支持股票價格，也有助消費及投資 決定，從而支撑實體經濟，達至降低失業率的目標。故此，QE對降低失業率的效果相當間接，用就業市場情況衡量QE3限期的原因缺乏理據。我們認為，QE3 的更重要目的，是壓低名義利率，實行金融抑制以減低債務負擔。

「金融抑制」一詞早在 1973年出現，由史丹福大學經濟學者Edward S. Shaw和Ronald I. McKinnon提出。金融抑制是指政府將資金流入政府自己身上，作為減債的一種手段。任何國家干預自由市場活動，以及對債務或貨幣定價的政策，都可被視 為金融抑制的手段。具體的政策包括直接或間接為利率封頂、規定國內實體(例如銀行或退休金基金)直接向政府放款、管制跨境資本流動，以至政府和市場協調結 合，例如公營部門遊說或注資金融機構等。可以想像，金融抑制這個名詞原本用來形容60、70、甚至80年代的新興市場金融系統。

金融抑制的主要目標之一 是壓低名義利率，這有助直接降低政府的現有債務利息支出，削減赤字。若利率低至產生實際負利率，降低本國貨幣購買力及以本幣計價的債務價值，便可無形中將 債務減值。這等同於一項稅收，即政府等借款人向債權人轉嫁的稅收。對於投資者而言，金融抑制是一個不利因素。孳息被人為壓低，催逼投資者進行較高風險投資 以爭取回報。而投資環境卻因政治和貨幣政策轉變而變得波動，也影響了整個資產配置生態，投資者或只能獲得低於預期的回報。

美國推出的量化寬鬆政 策，理論上都是一項金融抑制的措施，透過購買債務計劃間接令利率封頂。近期美國國債孳息不斷下跌，部份原因也可歸咎於量化寬鬆政策。而歐洲、英國、日本等 推出的量寬政策也屬於金融抑制手段之一。這些國家的債務負擔沉重，但現時皆處於實際負利率，對債務有減值效果。

全 球化之下，成熟國家利用金融抑制減債可說是十分自私的政策。眼看息口低無可低，投資者將資金轉移至提供較高利息的新興市場，導致新興市場的貨幣、資產價值 上漲。事實上，今次聯儲局推出QE3已引起巴西和中國不滿。新興市場變相也需要使用資本帳管制和匯率控管的金融抑制措施。此外，由於金融抑制需要通脹配合 以營造負利率環境，我們預期未來通脹將持續上升。或許對於成熟國家政策制訂者而言，通脹升至雙位數水平並不可怕，這意味負利率愈嚴重；但對投資者而言，資 產更需要加強對抗通脹的效果！

The Cartel And Hedgies Are Short Paper, But Long Physical Gold

The following bulletin from Jim Sinclair explains where gold is headed and who will benefit.  In typical fashion, Sinclair’s information is superb but his writing style isn’t exactly clear.  In fact, after reading it, my wife asked me what he meant by “7 touches”?  (See following bulletin)  Half a dozen years ago it was fashionable within the gold community to point out that a few bullion banks (Goldman Sachs, JP Morgan and a few friends) were always “short” gold. Sinclair stated then, that the bankers weren’t stupid and as the bull market advanced, the same bankers that were “short” would be the ones who were “long” and they would make a fortune on their gold holdings.  That’s right, they would be “long,” not “short!”  At the time, not many people believed him – but here he is, in the bulletin below, once again pointing out who is accumulating gold.  Low and behold, it’s the very same bankers that are being blamed for being “short.”  Of course, they are “short,” short paper gold and “long” the physicals.  That is exactly what Sinclair is alluding to.  But it’s not just the bankers that are accumulating physical gold; it’s also “big money.”  They are starting to protect their wealth against the coordinated central bank (QE) money debasement from the Fed, the ECB and Japan.

READ THE FULL NEWSLETTER

Is Future Silver Supply at Risk?

跟據最新 Scientific American報告指出,

地下白銀可開採時間只剩下19年,

Wednesday September 5, 2012, 4:15am PDT By Michelle Smith - Exclusive to Silver Investing News 

Many silver mining companies are announcing rising silver production. Combined with reports of a silver surplus in 2011 and forecasts for another surplus this year, the possibility that silver may go into deficit has been obscured. As a result, predictions that the future of silver mining may be in jeopardy are flying below the radar of most silver investors.

In August 2010, Scientific American published an article with a map of resources plotted against time. Silver’s time as an exploitable resource is slated to end in 2029.
“At current production levels, about 19 years’ worth of silver remains in the ground,” the article states.

The relevance of this date was reiterated earlier this year when the BBC quoted Mansoor Barati, an associate professor at the University of Toronto, as saying that global reserves of silver are diminishing rapidly and could run out as soon as 2029. “That is, if we consume silver at the rate we are today and no new deposits are found,” he added.

However, Barati, who leads his university’s Sustainable Materials Processing Research Group, also said that new deposits are likely to be found and that rising silver prices will make exploration more cost-effective.

“Silver will last longer, but not beyond this century,” Barati told Silver Investing News in an interview.

Steve St. Angelo, an independent researcher, notes in an article published by The Market Oracle that the supply of silver has already increased significantly over the past few years. He points to data from the US Geological Survey (USGS), which in 2009 reported that the world contains only 270,000 metric tonnes of silver. In 2012, the USGS reported 530,000 metric tonnes.
“The world now has more than 22 years worth of silver reserves remaining,” he states.

Barati explained that reserves represent the part of deposits that can be economically exploited with today’s silver price and technologies.

“If we find cheaper ways to mine silver, the prices go up or new deposits are discovered, that 500,000 [his rough estimate without looking at the USGS data] tonnes increases. All of these scenarios are likely,” he said.

Though that increase in reserves and the likelihood of further increases may seem to tread upon the bullish prospects of silver depletion (in the form of higher prices), there are more factors to be considered.

Barati said the population is increasing, and all data points to increasing consumption. He pointed out that silver is strategic in many applications, such as jewelry, electronics, photography and photovoltaic applications.

Furthermore, St. Angelo’s research is a reminder that the existence of silver does not guarantee that metal will be extracted. He warns that energy complications also pose risks for the future of silver production.

Many miners of silver and other metals are dealing with declining grades, which means more energy is being consumed to produce smaller amounts of metal.

Rising energy costs in the mining industry are very much in focus, but generally affordability is the main issue. However, though it is discussed less often, the availability of energy poses a real risk for those in the mining business, according to St. Angelo’s research.
Chile is one of the countries contributing to the increase in USGS silver reserves, and silver is a by-product of copper production. While researching, St. Angelo found that from 2005 to 2010, Chile’s copper production was virtually flat, yet miners’ consumption of diesel and fuel oil increased by 50 percent.
Such energy consumption rates should be a major concern within the mining industry as crude is a finite resource.
“The world is currently experiencing a plateau in global oil production and will soon be heading down the slope of continued depletion,” explains St. Angelo.

When using a model that incorporates technological advances — that allow companies to tap into harder-to-reach places — global oil production is set to peak in 2014, according to Scientific American. “By the 2050s we will have pulled all but 10 percent of the world’s oil from the ground,” the magazine asserts.
Competition for access is expected to intensify, and it is anticipated that exporting nations will continually increase domestic consumption, reducing the supply available for export.
St. Angelo argues that growth in global silver production must predominantly take place in the base metal mining industry, which he believes is where 70 percent of silver production now comes from.

But declining net energy will crush global growth, he warns.
“As the global GDP declines, so will the supply of base metals such as copper, lead and zinc,” St. Angelo comments. “There are … some very large open-pit mining projects supplying silver that are [forecast] to go into production within the next several years as well as others by the end of the decade. It is astounding to see these 25-45 year extended forecasts by the mining companies without any consideration of what the energy environment will be like in 2015-2020 or later,” he explains in another article.

Says Barati, the U of T associate professor:  “One thing is obvious: the mineral resources are finite, and they will run out unless we rely on new technologies using renewable materials or recycle so much that there is no need to extract from the ground. Both scenarios are unlikely at present.”

Original Source