COMEX Registered Silver Bullion Inventories Fall Sharp 38.5% in Two Weeks – Risk of COMEX Silver Default Remains

Tyler Durden's picture

From GoldCore

COMEX Registered Silver Bullion Inventories Fall Sharp 38.5% in Two Weeks – Risk of COMEX Silver Default Remains

Spot gold and silver prices rose slightly again this morning after hitting a one-month high yesterday as equity markets internationally came under selling pressure. The Moody's downgrade of Greece and worryingly poor US economic data again pushed investors to seek the safe haven of bullion. Gold reached new record nominal highs in sterling yesterday (£945.62/oz) as the pound fell on concerns about the UK economy.

Silver Prices and Rates

Markets await key U.S. data on nonfarm payrolls Friday, while ongoing concerns over Greek sovereign debt and contagion in the Eurozone also affected market sentiment and supported the precious metals.


COMEX Silver Bullion Registered Inventories – January 1996 to May 31st 2011

Friday's U.S. payrolls is likely to show that the world's largest economy is weakening and may be on the verge of a double dip which will likely lead to further safe haven demand.

Seeing as the extent of the recovery was always exaggerated, this is not a surprise to us.

The supply situation in the silver market gets more interesting by the day.

Registered COMEX  silver inventories have fallen to multiyear lows at 29,631,268 ounces. In the last 5 days they fell from 32,132,903 ounces to Tuesday’s holdings of 29,631,268 ounces. As can be seen in the table below registered silver inventories fell every single day last week leading to a sharp fall of 8.4% in 5 days.

Registered metals are those metals which meet the standards for delivery under the silver futures contracts and for which a receipt from an Exchange-approved depository or warehouse has been issued. Eligible metals are those which meet the delivery standards as stated in the rules for which no receipt from an Exchange-approved warehouse has been issued.

This is a long term trend that has been seen since the early 1990’s when total COMEX silver stockpiles were over 101.45 million ounces.

However, the scale of the drop in inventories since early 2008 is significant and the trend has accelerated in recent weeks.

Registered silver inventories are down a sharp 38.5% in just two weeks – from 41,044,280 to 29,631,268.


COMEX Silver Bullion Registered Inventories – June 2009 to May 31st 2011

The record nominal highs near $50/oz, seen 31 years ago and again at the end of April, are likely to be seen again sooner rather than later due to the increasingly delicate supply demand balance.

The scale of current investment demand and industrial demand, especially from China and the rest of Asia, is such that it is important to keep monitoring COMEX warehouse stocks.

The Hunt Brothers were one of a few dozen billionaires in the world in the late 1970’s when they attempted to corner the market. Today there are thousands of billionaires in the world, any number of whom could again attempt to corner the silver market.

Also, today unlike in the 1970s, there are sovereign wealth funds and hundreds of hedge funds with access to billions in capital.

COMEX Silver Bullion Stockpiles – 05/31/11

The possibility of an attempted cornering of the silver market through buying and taking delivery of physical bullion remains real. However it would be very difficult to corner the silver market due to the very small nature of the silver bullion market.

A COMEX default remains a risk as does a massive short squeeze which could see silver surge as it did in the 1970s and again recently leading to silver targeting the inflation adjusted record high of $140/oz.

As ever price predictions from gurus should be take with a pinch of salt and diversification remains of paramount importance.

NEWS

(MarketWatch) -- Gold, silver futures drop as dollar rises
http://www.marketwatch.com/story/gold-silver-futures-drop-as-dollar-rises-2011-06-02?link=MW_latest_news

(Wall Street Journal) -- PRECIOUS METALS: Gold Marginally Down In Asia; Silver Up
http://online.wsj.com/article/BT-CO-20110602-701855.html

(Bloomberg) -- Gold May Advance as Economic Slowdown, Greece's Debt Turmoil Spur Demand
http://www.bloomberg.com/news/2011-06-02/gold-may-advance-as-economic-slowdown-greece-s-debt-turmoil-spur-demand.html

(Reuters) -- Gold steady on weak US data, Greek crisis
http://www.reuters.com/article/2011/06/02/markets-precious-idUSL3E7H202820110602

COMMENTARY

(Zero Hedge) -- Why Gold Is Still a Good Long-Term Investment
http://www.zerohedge.com/article/why-gold-still-good-long-term-investment

(David McWilliams) -- There is life after default, take a look at Argentina
http://www.davidmcwilliams.ie/2011/06/01/there-is-life-after-default-take-a-look-at-argentina

(ZeroHedge) -- Scotia Mocatta Loses 60% Of Its Physical Silver In One Month To "Reclassification", Total Comex Registered Silver Now Under 30 Million Ounces
http://www.zerohedge.com/article/scotia-mocatta-loses-60-its-physical-silver-one-month-reclassification-total-comex-registere

(National Review) -- Keynesians vs. the Entrepreneurs
http://www.nationalreview.com/articles/267555/judge-jury-and-economist-kevin-d-williamson

(Reuters) -- Gold crash: What could trigger the inevitable (Comments are more astute than column)
http://blogs.reuters.com/reuters-wealth/2011/05/30/gold-crash-what-could-trigger-the-inevitable/#commentform

(Wall Street Journal) -- Double Fear: Gold and Dollar Rising Today
http://blogs.wsj.com/marketbeat/2011/06/01/double-fear-gold-and-dollar-rising-today/ 

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Michael's picture

OT

TSA Stuck Their Fingers Up Miss America's Vagina at a Dallas Airport, Last Straw!


This is crossing the line. I don't care what the perceived threat is. Government thugs don't get to stick their fingers up Miss America's Vagina ever, PERIOD!

The Department of Homeland Security TSA stuck their fingers up Miss America's Vagina at a Dallas Airport recently and they knew who she was. I don't get it. Are we in North Korea now?

If you personally enjoy being treated that way, then please move to China or Cuba. I will personally buy you a free one way ticket there.

TSA agents must feel like the most humiliated employees on the planet. Too bad. This is how we must show it to make them quit their jobs and make them realize, IT'S NOT WORTH IT.

I just want to hear one TSA employee standing up for themselves, SCREAMING AT THE TOP OF THEIR LUNGS ON FILM saying; I DON'T WANT TO FEEL UP INNOCENT PEOPLE AS A PREREQUISITE FOR MY PAYCHECK!

http://www.youtube.com/watch?v=oe6mqI-x1CI

duo's picture

The TX house passed a bill to make this molestation a crime, but then a few letters got sent to TX senators (from the TSA) and the bill died.  Threats were made of flights leaving Texas not being allowed to land in other states.

Now that gov. Rick Perry is looking to run in 2012, he's starting to kiss-ass with Washington.  Maybe he can replace Biden on the ticket with BHO.

Hephasteus's picture

You keep thinking government is a something logical. It's not it's a violence and religous cult. Go to court get sworn in. They use a bible. That bible is full of lies. Yet they demand you tell the truth the whole truth and nothing but the truth.

Enjoy some corporate CULTure.

Oh my bad they make you raise your right hand.

The ministry in the right hand of control of Jesus are an annointed ministry - set apart by the sanctifying blood of Jesus and the annointing of the Holy Ghost. In the Old Testament the right hand of the High Priest (who then was Aaron and his sons after him) was annointed with the blood of the sacrifice of consecration. Today our spiritual High Priest is Jesus, and he has the blood of the sacrifice also in his right hand. Today, Jesus is also the lamb that was sacrificed for us, so it is his blood (in his own right hand) that is also on the door of the true ministry's heart. They are blood washed servants of the Lord, that is why they are in his right hand of control.

MassDecep's picture

Hey Hep

Go spew your religion of hate elsewhere. You really make me vomit with your ignorance. While your at it, why don't you condem the Jews, and the Satanist, and what ever else your sorry ass mind can think of. What a waste of atoms.

Hephasteus's picture

"Go spew your religion of hate elsewhere. You really make me vomit with your ignorance."

http://www.youtube.com/watch?v=jG36OjxQWRg

Did I just get a morality check by a guy named Mass Deception.

 

 

MassDecep's picture

No, I am a Female, and I conform to your beliefs. Thank you for showing me the RIGHT way to believe. I would have been lost without you. Now I am at peace...... silver shortage anyone.

Michael's picture

Hep speaks a modicum of truth. The Christianity people follow today is a false Christianity, bastardized throughout history and subverted for political gain in which the flock now follows Babylonian pagan rituals.

I support Christianity pre Council of Nicaea 325AD.

SilverRhino's picture

Christianity pre Council of Nicaea 325AD.

Find us a Bible from that time and people might listen.

Raymond Reason's picture

The church existed before bible and put the bible together, and the gates of hell have not prevailed against it, and has preserved the correct doctrine and interpretation of scripture, as was it's charge.  Christian Orthodoxy my friend.  A foreign concept to an American. 

FeralSerf's picture

"Religion is regarded by the common people as true, by the wise as false, and by the rulers as useful." -Lucius Annaeus Seneca (4?BCE - 61CE)

Raymond Reason's picture

Truer words were never spoken.

Raymond Reason's picture

Christianity has been co-opted in America, the heart of Protestantism, by Zionists and the industrial complex.   You don't need to go back to pre Nicean Council.  Christian Orthodoxy since Nicea had been preserved (mostly) uncorrupted, and is still being persectuted.  Did you ever think it odd that we support Sunni Muslims against the Christian Serbs in Kosovo, Bosnia, Croatia?  Why do we hate the Russians so much, although they are no longer the Soviets?  Because Orthodox Christianity IS the ancient enemy of the elitists, not Protestantism, Catholisism, or even Islam. 

spanish inquisition's picture

So now they are changing the slogan to

"Don't Mess With TEXAS! (Unless you are TSA wanting to molest women and children)"

Arnolds Love Child's picture

I'd ride a burro before I let one of Jerkoff's thugs touch me.

Sean7k's picture

How does someone junk this? It is a very disturbing video. 

AUELOX's picture

Although his comment does not pertain to the article, why would you folks "junk" this?  Thanks for the post Michael.

Oh regional Indian's picture

Off to the dealer in a bit. Very strange energy in the silver market this last week. Waffling. Or more like in irons, for the sailors out there.

Perhaps action awaits over the weekend? Who knows, eh? It will be a weekend, that we know well.

ORI

http://aadivaahan.wordpress.com/2011/05/26/the-video-trailer/

Hephasteus's picture

Yep we got 7 planets in cardinal signs right now so place is getting flooded with all the authority. So people are doing things but there's a lot of reluctance. Which is like inductance with resistance added.

Oh regional Indian's picture

Interesting Heph.

Inductance + Tunable resistance = Resonance

Perhaps a big wave is coming to a stand-still soon.

ORI

FeralSerf's picture

When was the change made from tunable capacitance?  I didn't realize the laws of physics were legislated.

Oh regional Indian's picture

You are right and I stand corrected. A tunable capacitence indeed.

ORI

Hephasteus's picture

We got hundreds of millions of induced bullshit sheeple here. We will resonate the bullshit well in this country.

Lone Mad Minute Medic's picture

Yawn! Yeah sure! This silver thing has been a big bust. Stuff is posted here to get you all riled up and the big man comes in and takes all your money. Best to ignor all this hype about silver.

pupton's picture

Hmmm, up 100% in a year does suck...WTF was I thinking?

StychoKiller's picture

"Well, you act as if you don't remember,

the way it all used to be.

Now, one man locks up the money, another man holds the key!

A million dollar reserve note, is right there in my hand...and I can't stand the thing." -- Montrose, "Paper Money"

PaperBear's picture

HOLY S**T, I thought it was only 10% down in 2 weeks.

Come on people, empty the COMEX of registered silver.

I have a purchase for next Monday.

WOOHOO

f16hoser's picture

Let the FED's suck on that! YIPEEEEEEEEEEEEE!

Henry Chinaski's picture

As ever price predictions from gurus should be take with a pinch of salt and diversification remains of paramount importance.

make that your signature

Sean7k's picture

Great little piece on the Argentinian default above. Please send to your greek, irish, portuguese and spanish friends. For Americans, please post on telephone poles and other message boards.

gwar5's picture

Argentina has turned default into an art form. If they could just get rid of their crony corrupt government they could make one of them work.

Sean7k's picture

Yeah, unfortunately all government is corrupt. We just need to get rid of government in general.

NotApplicable's picture

All external government, that is. Social harmony relies on self-government.

Voluntaryism, FTW!

PaperBear's picture

Using naked shorts on the futures market to knock the fiat dollar price down is only draining it quicker than would otherwise be the case.

There may be a default before the end of July.

UnRealized Reality's picture

The crimex are probably creating this shortage, just to suck everybody in and BAM, down she goes

Rynak's picture

Now THAT is some more clever psyops than the usual crap: Appeal to conspiracy.

UnRealized Reality's picture

Yea and your so smart. They use to bring in trucks to empty the wheat inventory at the end of the month to show a shortage so they could manipulate it. Trucks, to PHYSIALLY remove it. NOW it is as easy as a book entry, from one column to the other. Good luck, load up on that silver

tmosley's picture

lol, sure, they have been carrying out this "operation" for the last three years straight.

lulz

UnRealized Reality's picture

LOL, Silver only broke above 20 on 9/2010, hardly three years. Before that it was FLAT the proir 2 years. Who's the Troll now. LOLOLOL

tmosley's picture

You are, or you're fucking retarded.  We are talking about COMEX silver inventories, not the price.

UnRealized Reality's picture

Check your Facts, Shortage only became an issue when the price broke above 20. But your right, who the hell am I, you make your own deluded decision.

tmosley's picture

You are spouting random crap.  Why don't you try reading and understanding what people are talking about?

Go pull a chart of COMEX silver inventory.  It has been declining at a 45 degree angle for three years.  The price has been all over the place during that time.

And I never asked "who the hell are you", or any such crap, so stop trying to play the "I'm so oppressed" role.

UnRealized Reality's picture

You are really thick headed, I said it only became an issue when the price broke above 20.

 

"And I never asked "who the hell are you", or any such crap, so stop trying to play the "I'm so oppressed" role".

You implied it and would it sound better if I said "go fuck yourself" so you wouldn't think I was oppressed or maybe showing some respect to somebodies opinion. So here goes, Fuck you and your Mother!!

tmosley's picture

Sorry, kid, respect has to be earned.  You can't even stay on topic.  The topic is COMEX INVENTORIES.  Not the price.  The price doesn't matter, save to the extent that a much higher price might save the COMEX.  Only the open interest and the COMEX inventory matter.

Also--U mad.

Monedas's picture

My little hoard is not in play....because I'm playing with it right now ! Well, a small amount of it I keep in the house like Linus' security blanket ! Monedas 2011 Hoarders have more fun ! Let me entertain you : http://trololololololololololo.com/

jesse livermoore's picture

who or where are these everyone that is getting sucked in. besides myself nobody i know ownes,cares, or thinks about silver.   So i guess everyone really means the zero hedge community??   so the comex is trying to suck in .001 percent of the population?

Weimar-eddie's picture

It's those gullible Chinese. Imagine, they're so dummmm they have fallen for the classic trick - we've fooled them into buying up PMs as the world's reserve currency gets devalued, dumped, and printed into oblivion. And we thought they were stupid back in the days when they were buying up all our bonds. Who knew it ran that deep??

Libertarian777's picture

well you know, we do control the opium fields in Afghanistan, maybe we can pull a 'Hong Kong' on China again and see how it goes this time.

Opium in exchange for their silver. We still have a bigger navy than them.

Those commies, they have kinetic military action against many countries, they have a centrally planned economy, a centrally planned currency, a single party government, corruption is endemic to the congress, there is no middle class, they execute prisoners, and hold people without trial.

Wait...what country was I talking about again? I got confused.