19 October 2015

A Manipulation Smoking Gun?

Dave Fairtex, writing for Peak Prosperity, claims he has The Smoking Gun Proving Silver & Gold Manipulation. In identifying all of the 0.5% or greater one minute price spikes over the past 6 years I’d argue he has proven how infrequent it is.

Dave’s main result is that there were a total of 135 gold events and 869 silver events where the price moved up or down more than 0.5% within a minute, with 66% of the gold events, and 54% of the silver, being downward moves. While the data shows a bias to the downside, Dave doesn’t put any of the results into context, undermining I think what is a worthwhile analytical approach. Read More >

16 October 2015

China will save us

I have a lot of respect for Michael Kosares of bullion dealer USAGOLD but his recent commentary has a bit of the “China will save us” meme which has been around for many years and had its fullest expression in the Pan Asian Gold Exchange farce. READ MORE >

14 October 2015

The Gold Warrior

“Fourty four years after the end of the Bretton Woods System global central banks have manipulated the cost of risk in a competition of devaluation leading to a dangerous build up in debt and leverage, lower risk premiums, income disparity, and greater probability of tail events” says Chris Cole of Artemis Capital in his recent paper titled Volatility and the Allegory of the Prisoner’s Dilemma: False Peace, Moral Hazard, and Shadow Convexity.

Izabella Kaminska at FT Alphaville, praised it as “rare glimpse into his imaginarium” but I wonder if this was also a way to downplay its talk about tail event risks which are “equated with a loss of faith in the entire dollar system”. Precious metal investors will consider it far from imaginary and find much to agree with [read more]

09 October 2015

Bundesbank publishes gold bar list

On Wednesday Deutsche Bundesbank published “a list detailing its holdings of gold bars in custodian storage in Frankfurt am Main, London, Paris and New York”. While I welcome this move towards transparency and accountability on what is an important (and often controversial) public asset, it was disappointing that the Bundesbank did not think it necessary to produce a bar list that conformed to the usual standards that apply in the bullion market, which is to supply refinery, bar number, gross and fine weight, purity, and year of manufacture (where available). [read more]

07 October 2015

OCC precious metal derivatives fat finger

Back in July I reported on some unusual figures in the US Office of the Comptroller of the Currency’s (OCC) quarterly report on precious metal derivatives. In the OCC’s 2015 Q1 report they had a figure of $75.62b, which was a huge increase from the 2014 Q4 figure of $22.42b. However, in the latest OCC report, the 2015 Q1 figure has been revised down to $26.94b. I have cut and pasted the two figures from the previous report (in green) and the new report (in red) below [read more]

05 October 2015

Sucking silver through a straw

On Friday there was a big move in precious metals, with gold up $25 to around $1135 and silver up $0.70 to around $15.20. In percentage terms the silver move was much more dramatic, approximately 4.8% compared to gold’s 2.3%. The move was in reaction to US non-farm payroll numbers, but in this recent post, Keith Weiner at Monetary Metals goes behind the headline grabbing move and looks a little deeper into what it tells us about scarcity in the silver market. [read more]

02 October 2015

Yet another precious metal manipulation investigation

The announcement that Switzerland’s Competition Commission has opened an investigation into some bullion banks for precious metal prices fixing created a bit of excitement in the gold blogosphere. I find it hard to get excited. Consider this recent history of precious metal manipulation investigations and lawsuits [read more]