08 August 2014

JPM's 18 tonne Comex fat finger

In Ed Steer's August 7th Gold & Silver Daily, he commented that:

"Ted pointed out something that I'd missed in Tuesday's column on Comex gold inventories---and that was the fact that the 595,102 troy ounces that the report showed withdrawn from JPMorgan on Friday was, with the exception of a few ounces, totally reversed in Monday's report from the Comex."

This big adjustment was also noted by "Pirocco" on the SilverStacker forum here. When questioned by Pirocco, Comex’s response was that "the adjustment column allows the depository or warehouse to make changes to their inventory in either of the categories for various circumstances as needed", which as Pirocco notes, just avoids answering the question because "various circumstances" says nothing.

Well I’ve worked out what one of those "various circumstances" is. If you subtract the 594,506.898 Monday adjustment from the Friday figure of 595,102.000 you get 595.102. That is not a coincidence. In other words, the Friday figure was a fat finger keying error, where someone at JPM keyed in "595 comma 102" instead of "595 point 102"! Hence JPM had to do an adjustment of 594,506.898 to turn 595,102.000 into the correct figure of 595.102.

I do wonder if the fat finger extended to the paperwork sent to the receiver of the erroneous 595,102 ounce withdrawal - perhaps a temporary bit of excitement that they were getting an unexpected 18+ tonnes?

What is surprising is that this sort of data transfer between warehouses and the CFTC isn't automated. Worryingly, this is not an isolated incident:
  • CFTC charging JP Morgan $650k for repeatedly submitting "large trader reports that contained hundreds of errors"
  • Screwtapefile's Warren finding discrepancies between the numbers in the GLD trade settlement spreadsheet and the GLD bar list
  • Rand Refinery losing 87,000 ounces ($113 million) of gold
  • Canadian Mint's 2009 $15 million gold inventory "discrepancy"
It makes you wonder if the whole gold industry is held together with spreadsheets. Be afraid, be very afraid.


  1. Some more errors https://www.bullionstar.com/article/hmrc%20and%20eurostat%20alter%20historic%20uk%20gold%20trade%20data

    Ah well, were all humans...

  2. We sure are all humans, Koos: do we all get to advertise on his blog, or is that a special privilege?

  3. Its a bit cheeky, but I'm not a moderator nazi - just see how long I let Jake go for.

  4. it's just, I have this Bridge I am trying to sell, you see.....

  5. Zhang Lan is apparently sprinkling old vendettas onto new pastures - if his previous interaction with K Jansen on that persons old site is any indication...

    KJ "Great to see you launched your own website. Will you be publishing market analyses, or is your website just a bilboard for your business and you were dropping a little ad here?"

    Tit for tat? Rather tacky what? Our man seems a 'prickly' sort, unwilling to turn a fresh page, even when on another fellows site!

    Even the mildest of rebukes here seems to turn him towards coarse vulgarities and/or feeble insinuation. Yet he can write rather well when he chooses? Zhang Lan, we're all friends here

    ///aren't we?

    http://treasuryriskpartners.asia - there you see> free ads for all today! Don't feel left out - We do appreciate you!

  6. As to your complaint - can't see what's wrong with providing a link if it broadens the discussion - as long as it stays on theme. Which his did... if your read it!

    While I'd much rather Koos had stuck to it on his own site, rather than do an Alistair MacLeod, we each must hoe our own row.

    Oh, and since that theme is indeed 'mistakes' n such...my dear esteemed ZL - still waiting for your REASONED rebuttal of my deliberated mistakes on gold certificates precis... or have you ceded the field on that one?

  7. what a very odd chap you are. very odd indeed. be gone, already

  8. If you follow Koos at all, I believe you will find he really does not need to advertise on this site. I know of no one who follows PM's that does not check his site weekly if not daily.

  9. Bron, any thought regarding the commentary popping up the last couple months about Shanghai silver stocks?

  10. I have seen a bit of that commentary but haven't had the time to look at it in depth.

    There certainly isn't any tightness in silver in Australia and indeed a combination of strong refining volumes and weakish demand means we are on the borderline of shipping some silver to London.

    So maybe this is just reflecting local unique supply/demand issues.