Tuesday, December 17, 2013

Absolutely Shocking Developments In The War On Gold

"Kaye:  “Despite yesterday’s strength in the paper gold price, the Spyder GLD lost another 1.05% of their inventory.  So they are down now to just a little over 800 tons, Eric.  To put that into perspective, in December of 2012, the inventory of GLD was a little over 1,350 tons....

“So GLD has lost 550 tons of gold in one year.  There are a few anomalies here:  One is that the paper price of gold peaked in September of 2011, and yet in spite of a sustained price decline through last year, the inventory and the number of shares of GLD continued to sustainably increase.

That itself is interesting in view of the fact that the explanation which has been given in the mainstream media and occasionally by representatives of the ETF industry, is that because of the bear market in gold in gold we have had investors looking to sell.  Well, that’s an interesting explanation because it goes against the prior experience when gold was under pressure from 2011 through 2012, when GLD inventories actually grew.

It is also against the experience of the sister trust SLV, which is an identical structure for holding physical silver in an ETF format.  As everybody knows, the price of silver has been whacked far worse than gold, and yet they’ve lost virtually no inventory in SLV.

So if there is a connection between having a bear market in the paper price of a given precious metal and a reduction in the inventory of that metal then it’s certainly a curious one.  Meaning, it hasn’t been consistent in both GLD and SLV, as there has been no knock-on effect in SLV.

This anomaly is of considerable interest to us and it does further support the idea that the Spyder GLD Trust and the other exchange-traded products have been and are continuing to be used as feedstock for the prosecution of the raids that you and I have been talking about since April, Eric.”

Eric King:  “Did the loss of inventory in GLD surprise you?  The last time we saw that was in April during the time frame when gold was under enormous pressure, and gold is now just kind of wallowing in a range.”

Kaye:  “We’ve been in a reasonably tight range, as you said, so the key question you are asking is, why the loss of inventory all of the sudden when gold is just in a range?  Why is an entity, or why are various entities redeeming shares and drawing down the physical gold inventory in GLD?

There is not a lot of rationale this drawdown in physical gold inventories absent the possibility that the gold market is being set up for one last takedown or smash in the paper price.  As we’ve talked about several times, in order to orchestrate a smash in the paper price of gold, the powers that be need to have access to physical gold inventories.  Certainly GLD would appear to be one of the feedstocks which have been utilized for that purpose.  

I’m saying that I am extremely suspicious about what is taking place with regards to the further draining of GLD inventories, especially ahead of tomorrow’s Fed decision.  But the other thing I have been watching is that Comex inventories, which continue to be very low, in recent days have been somewhat replenished.  Both JP Morgan and to a lesser extent HSBC have been seeing increases in the inventory that is being made available to the Comex.  This reduction in the inventory of the Spyder Gold Trust and some of the other exchange-traded products could be partly responsible for that. 

The bottom line here is gold is being looted out of GLD for one reason or another, meaning, the central planners may very well be up to something here, and KWN readers around the world should be aware of this fact, particularly ahead of tomorro’s Fed announcement.”

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