Scotia Mocatta Loses 60% Of Its Physical Silver In One Month To "Reclassification", Total Comex Registered Silver Now Under 30 Million Ounces

Tyler Durden's picture

About a month ago we indicated that Comex depository Scotia Mocatta "lost" 25% of its Registered (aka Physical) silver after the vault encountered a "reporting reclassification" which saw 5,287,142 ounces of silver moved from Registered to Eligible status, dropping the vault's true holdings from 11.8 million ounces to 6.5 million. Naturally, the response from the peanut gallery was that this was a tempest in a teacup and it was "temporary" and a-ha, any minute it would reverse, and all shall be well, everyone would live happily ever after, and the Comex would actually have silver available for delivery purposes. We decided to not hold our breath. Which after pulling today's most recent Comex warehouse data appears to have been a prudent decision, because for the first time ever total registered silver has dropped below 30 million ounces, after experiencing a 5% overnight drop across the board, primarily driven by yet another 1,456,488 ounce "adjustment" of warehoused silver from Registered To Eligible at Scotia Mocatta. As of last night, total Scotia physical silver was now 4,740,447 ounces, a 24% drop overnight, and a massive 60% drop from the total which we captured on April 20. Still think it's temporary?

Oh, and Scotia was not alone: there were comparable reclassifications at both HSBC and Delaware. But the kicker: total silver at Scotia Mocatta has barely budged. The only thing that has changed is the shift from real silver to "Eligible", or that which has no warehouse receipt issued against it, or as was described previously "a private arrangement" which has nothing to with the Comex. This is non-deliverable silver! Thus, starting with a ratio of 11.8MM to 8.8MM ounces of Registered/Eligible (or 57%/43%) a little over a month ago (on April 19), the most recent Scotia Moccata physical silver now just 23.4% of the "total."  And just as troubling is that the total amount of silver available for dlivery has just fallen to a fresh all time low. Luckily, we have margin call driven liquidations such as today which will probably buy a few more days before registered Scotia silver hits 0 (but don't worry: it's only temporary).

Source: Comex

As a reminder, here is the same chart from April 20:


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Terminus C's picture

Oooohhh, now I understand why silver flash crashed... there is hardly any demand for paper, people are only buying physical.

JW n FL's picture

look at the spike in gold today.. right up to $1,550.00 which is wayyyyyy to close to a new high! so! silver was punished!


the silver guys wont like me saying this.. and as well the gold guys will quote 400 years of whatever.. but in recent history.. if you beat the shit out of silver, gold comes down with it. now go ye all and quote how it aint so!

cossack55's picture

No bones, JW. It is what it is until it isn't. The manipulations will continue until the beasts are destroyed. Everyone knows it going in. Just bidin' my time. 

JW n FL's picture

We will be fine..


if the lights are on.. they keep printing, in secret or in the public view!


if the lights go out.. gold is still gold and silver helps treat my drinking water supply (for my nieghborhood, LOL!)..


but it works either way, pre / post crash call it.

DaddyO's picture


Berkey works just fine and does more than just disinfect.


DoChenRollingBearing's picture

JW, please send me a gmail (my moniker at gmail) to see my cool blog re PMs, firearms and perhaps othr topics of interest to you and other ZH people here.

Hey, can 110 ZH-ers be wrong?!?!

Check out my newest article "TEOTWAWKI -- Guns and Ammo Edition" mainly for beginers re weapons for what happens after the SHTF!

Michael's picture

Thank God my kids don't have to pay back a single penny of the national debt, assuming we're actually going to pay the national debt.

I don't have any kids.

Al Gorerhythm's picture

If you do (have kids) please don't enroll them in mommy's make up school.

Rynak's picture

I don't understand..... how will a reduction in silverprice amids a massive buying spree.... in the longterm result in reduced silver and gold prices? And i may add PHYSICAL gold and silver, not paper...... they can manipulate paper silver and gold until you die of old age..... the problem is just that once VISIBLE discrepancy between paper and physical is high enough, no buyer of physical will care anymore about spotprice!

So, in terms of paper, you may be right..... but who here cares about paper metals? What people around here care about, is physical..... and if physical reserves at exchanges deplete, this is the equivalent of an audit - meaning that when delivery issues arise, spot price will no longer be tied to delivery price! And when that happens, no one except of stupid bankers cares anymore about what happens to paper spotprice.

Again: Fundamentals are secondary..... all that matters is the method of price discovery. Or in other words: The biggest aspect of metal prices, is how much manipulation is respected.... if paper price seperates from physical price, then it's game over for manipulation. THAT is the biggest potential mover, not fundamentals.... fundamentals are just a nice bonus.

JW n FL's picture

Sorry Rynak.. I thought paper was inferred given the topic..


I am just saying.. to my very untrained eye.. that as of late.. when the price drop team cuts the legs out from underneath silver.. that gold as well takes a similar price cut.


in the paper market.


I am a physical person, wanna hug?

Rynak's picture

I am just saying.. to my very untrained eye.. that as of late.. when the price drop team cuts the legs out from underneath silver.. that gold as well takes a similar price cut.

Thats because whenever a "depression" mini-cycle happens, they use the panic as a smokescreen to flashcrash metals. It is one of the "patterns" why in another contributor thread, i no longer considered it "highly unprobable" that they would attack metals in case of a currency collapse. They seem to be hellbent on defending fiat and wallstreet to the last drop, even if that means cutting off all exit routes *they are aware off* and thus dooming everyone.: Fiat or scorched earth.

EDIT: This is why i consider "exotic fiat" (stable and indepentent fiat which the majority isn't considering) an interesting method to spread the risk - not as a replacement for metals, but a complentary method to spread risk and play whack a mole.

Goldenhands57's picture

Just before the Hunt Brothers event went down, and when it was time to cash out the physical metals, I was living in Little Rock Arkansas. Had a 3/4 full shoebox of all kinds of 18kt and up mostly piece jewelry, class rings and such, some Eagles and Double Eagles..another box half full of 64 and back halves and Washington Quarters, dimes..typical 90% stuff, all ready to have them weigh in. This was when Spot Gold was around $810 to $812..somewhere near that. A man was there to BUY a Double Eagle from the place..the price of which was $1200 under the glass!!! I about choked..$400 Premium? Mind you..this was a run of the mill, non key date St Gaudins. Nuthin special.  So it hit me listening to the guy go on and on about $2000 an ounce, maybe $2400...watching this comedy in progress...that there is a disconnect between open market exchange and presumed values in extream economic times. It gets a lot more out of whack as the panic (or greed) deepens. So, I told the guy "hey go get the cash and I'd hold one out of my sale here and sell ya one of the Liberty's I have at $20 over the buying price"..I'm thinkin I'm gonna help this guy and maybe get at least one coin sold a bit over Spot. You'd have thought I shit in his mess kit just for offering the deal. The Idiot bought the $1200 piece. So when this thing gets going and really crazy in a few months, or at the most 30 or so months from now, your going to see some stupid crap going on out there. Late to the party, eyes glazed over stuff!

I agree totally..Fed and the Fiat Demons have no choice except to crush anything and everything that may take paper down. They have to, because for them there is no way out except the digital printing press!!! I won't be at all surprised when this garbage fails that we see the Exec order issued after Bank Holidays same as 1933 on the front page of the local newspaper, only this time it is going to include coined Silver and probably the entire family of PM. FDR did it then and there is only ONE signature keeping it from happening again. One. And on that day the final "exit route" will be closed because these stupid bastards are blind to anything other than what they consider real..and after then we're Argentina re-deux and in spades.

Rynak's picture

Thank you for providing for free, one of the most valueable things that exists on current markets: honesty and information you don't get via the "approved" channels.

Rynak's picture

To that clown who junked that post: please junk all my other posts. After all, if you already junk honest thankfullness, then at least be consistent in junking integrity.

In other news: lol

OliverTwist's picture

Dont worry about idiots! You are one of the few in this world who still remember to say "thank you" and this is a great thing!!

Go on like this!!




JW n FL's picture

how many time have you seen me say "I'm Sorry"? here? Rynak was the 1st...


good people deserve a shot.. like Rynak! or Colonel Copper.. I should have handled my buddy a little different.. but I get so wound up! But God Bless Copper and Rynak both! now the idiots! burn them to the ground!


You Oliver, on the other hand have always been..


just kidding.. you polite people keep on! keepin on!! I have idiots to find!

OldPhart's picture

I kind of expect the same sort of confiscation to be coming.  Luckily I live in the Mojave Desert, and there are literally thousands of square miles here that are empty.  A relatively small hole in a non-descript part of this area would be a needle in a haystack.  And the expected aftermath of riots, robberies, home invasions, etc. will provide legitimate cover to say that all my hoard was stolen.

theMAXILOPEZpsycho's picture

Marc Faber is warning against this; at least some overseas PMs are a must.

Lord Koos's picture

There is some corellation but the demand for gold has been steady and strong.  Gold sailed through the last 2 months while silver went all over the place.

DaddyO's picture


Would it be more accurate to say "Silver was driven all over the place"?


tekhneek's picture

My mom talked to her insurance agent today. Asked her about insuring the silver in their house.

She said it went something like this:

Agent: "What can I help you with Ms. Doe?"

Mom: "I need to see about whether or not my insurance covers my silver investments."

Agent: "Such as jewelry?"

Mom: "Bullion bars. 100oz bars. Quite a bit of them, actually."

Agent: "Why...?"

Mom: "Why what?"

Agent: "Why buy pure bars of silver...?"

I shit you not. My mother doesn't blow hot air. The experienced (20+ years) agent had no idea why anyone would invest in silver bullion bars. They walk among us. I was lucky to have a family who taught me from very young that money is money, and paper is paper.

The ride's not over yet... and the top's not here either. You should welcome deflation at this point. That's the dip that causes hyperinflation in (my opinion) our situation.


Hephasteus's picture

He's right. Silver demand is transitory just like inflation.

PaperBear's picture

We are in the era of permanently transitory with the world run by private central banks and Ben Bernanke running the most powerful one and having major influence at the BIS.

Tedster's picture

Nobody is going to insure bullion at home!

It may be possible to insure bullion kept at a bank safe deposit box. This is commonly done with high value jewelry that is only worn infrequently, but am not sure about raw metals.

It's amusing to listen about fears of confiscation, because ultimately they are predicated on a world that is long gone. The raison d'etre in the 30s was to at least nominally maintain the "gold standard" or the illusion of it while inflating the money supply. The nominal debt outstanding, M1,2,3 and promised entitlement spending and off budget expenditures dwarf gold stocks both public and private. Fort Knox holdings represent a couple months of government spending! Who are they kidding? To be sure there are those who want the government to do this, and they will become more vocal if things come unglued. They are probably the same folks who laughed at everyone for loading up at $350 and $4; the difference now is that any sort of confiscation talk is counterproductive and at least tacit admission that their policies are utter failure, and "we were wrong" is not part of the Any such talk is likely to be met with FOAD.

tmosley's picture

You can insure bullion at home, but it is a pain in the ass, and expensive.  Lloyd's of London will write practically any policy.

GoinFawr's picture

GPS+shovel+1/4section+auger+quad; this method of 'insurance' has its own set of hassles and risks, I know

Missiondweller's picture

Good post. And I would just point out that the spot has already diverged from physical.


A quick look at APMEX shows silver coins about $6 over spot and will buy from you $1 over spot.

JW n FL's picture

the disconnect has been getting wider.. and widerrrrr.. and wideerrrrrrrrr. since December 2010.


yes you are correct in that the paper market does not match the physical market, except it does.. kind of.


if you buy a contract, then lease the metal to fill a real need.. then you will be paying spot prices(ish).. I would also mention that apex is pricey.. some times.. on most items.


being able to pay 10% less should give you 10% more buying power for more metal.. so please shop around, find a good dealer.. stick with them and after a while they should treat you like someone they want to keep.


just food for thought, take it or leave it.

mayhem_korner's picture

Physical price is whatever it takes to separate it from the holder.

I hold and wait.  $36 ain't gonna separate me from my silver maples.  Keep raisin' the margins I say; just separates the wheat from the chaff until physical drives the market (which won't be on Crimex!).


JW n FL's picture

people can NOT! buy Maples for $36.. anywhere.. and when they can.. it will be years from now or the bottom falling out from under everyones feet.

Piranhanoia's picture

probably been said better than I could, but today the lie is official. In the past, one could visit their inventory. Paper has made claims subject to fiction.  Today the price goes down, the supply goes way down.  This only makes sense when the lie is official.  My simpleton guess is that the lie is about to be revealed.

toothpicker's picture





From 1984

The Fonz's picture

Why does an entity with as many advantages as JPM risk their entire bank on controlling silver?


At first I thought, "well there must be a ton of derivatives that make it profitable". Then I considered all the other means they have to make money. Later I realized that the day that silver went to sell only during the hunt run up was also the high for gold. Illegality in silver broke golds back.


The purpose in breaking silvers back at any cost is that gold cannot be held down so easily.  In breaking silver's back so too is gold broken. The expense of breaking the silver bugs is the cheapest possible way to maintain the power of the status quo where PM's are concerned.  I think FOFOA has it wrong... gold cannot go without silver. Any price or illegality to control silver is merely the cheapest way to maintain control of PM's availible. Though the powers that be may be willing to risk anything, they are not foolish and will not pay a penny more than they are required to for a given task.


Confuchius's picture

(a) JPMorgue is a proxy for the bankrupt treasury dep't.

(b) No matter what the "paper price" may be; nowhere is it written that you may optain even one ounce at that phoney "price".

The Fonz's picture

Sure, the market can break. I cannot help but think the other paper markets will turn on the Comex once it fails. Comex is only 5% of investible silver (or so I have read). Many make the assumption that physical will be priced differently than the paper market and that may well be true, but consider this theory as well.

Comex goes to a point of failure, breaks contractual law to control the phony price. This however destroys the comex silver echange. Up until this level of Comex weakness other worldwide exchanges have played along... raising margins together and lowering them to raise them again later. (100% margins may be a fools game and I cannot help but wonder why the hell they would raise them to 100% when they can just back them off and reuse them later).  Now the world is changing, China is ready to show that it can go without the dollar and turns their silver exchange against the Comex, providing a "lagit" alternative. This would be a trump card for them, something to use to counter US military threat perhaps by bringing uncontrollable hyperinflation at their whim, or need.  In short I just cannot help but wonder at the assumptions about the financial behaviour not considering in the way the players will behave politically relative to one another. (this is a currency war) These exchanges compete and are backed by opposing sovernties that they ultimately serve. When the blood is in the water Comex I think will value UP to avoid the greater problem of losing control of the means to influence price relative to the powers that we are in a currency war with.  I cannot say I am certain of this theory, but I havn't heard anyone else provide this dialog in consideration of this matter so it my bear some small worth if only as a means to be prepared to see things another way.

jeff montanye's picture

interesting.  my portfolio hopes you're right.

calltoaccount's picture

"(a) JPMorgue is a proxy for the bankrupt treasury dep't."

vice versa

SilverDosed's picture

Their purpose is to keep prices low to both hide inflation and to keep people off the sidelines. You have to put your money somewhere and every dollar invested in silver and gold is money not put in the other markets.

dark pools of soros's picture

who are the private banks that own the FED??  follow that...

blunderdog's picture

I throw this out solely for consideration:

One some level, the financiers realize that "paper" and "physical" intersect somewhere.  No matter what their paper empire looks like, there are still real-live human beings who wake up in the morning and go to work and such-not so that people can buy shit with green-printed pieces of a paper.

Silver is an incredibly important industrial metal.  A great deal of the modern American lifestyle is *literally* influenced by the industrial use of silver.  (Consider the percentage of our population entertained by teevee and/or benefited by current health-care infrastructure.  Just for example.)

If the bankers can control global pricing of silver, they may be able to defend the current social fabric in the US (and a few other major Western economic powerhouses) by ensuring that our unemployed masses have enough luxury to justify their inaction. 

There may be financier concern about the day when a teevee can't be replaced, and granma doesn't get her insulin pump. 

These guys aren't stupid.

Founders Keeper's picture

[Why does an entity with as many advantages as JPM risk their entire bank on controlling silver?]---The Fonz

Hi Fonz.

Consider flipping the question around to get your answer. Why does an entity with as many DISADVANTAGES as JPM PREFER THE SURCURITY of controlling FIAT?

You see, PMs are not primarily the enemy of banks; PMs are primarily the enemy of fiat currency, and enemy to the banks as a consequence.

It's FIAT that gives JPM its "advantages" not PMs.

Expect the banks will protect FIAT to the bitter and bloody end.


The Fonz's picture

Hi Keeper :)

I agree, and the tool of fliping a question is always a good thing to give a moments thought to :)  

Founders Keeper's picture

Fonz. Have read many of your posts.

Best wishes.



Urban Redneck's picture



Flip the question another way - what is the carrying cost of all of JPMs PM positions in comparison to the interest rate positions (and the risk profile and exposure of those positions in the event of uncontrolled movements in the PM market)?



PaperBear's picture

While we may see a sell only for silver contracts on the futures market, "out of silver" notifications or a buying ban on the physical silver market would send a worldwid signal and then these paper games would be over and physical would rule.

Smiddywesson's picture


Correlations and rules of thumb don't matter when the rules change.  I don't care if you have ten millenia of data showing gold plunging hand in hand with silver like Thelma and Louise driving off a cliff, the central banks are all buying gold now.  Those ancient truisms are done.  The fiat currencies of the world are backed by the true faith and credit of bankrupt nations.  Let it go.  Tech analysis, fundamental analysis, and cycle analysis don't work in a hurricane.  Buy gold or go bye bye.

IH10's picture

I completely agree.  Everyone is going to the charts for direction, and there is none.  It's over people.  Charts are very useful until the paradigm fails.  We are in one of those once in a lifetime economies, and who knows what will emerge when we get to the other side of this transformation.  If we don't solve our energy problems we could be living in the real life Mad Max Beyond Thunderdome.  Large insitutions are going to take refuge in gold and silver at the 11th hour on top of the gold revaluation that has already begun.  If you stay in paper assets you're going to get fleeced...period. 

European American's picture

I wish more attention would be given to your point. Even here, at ZH, I think very few care to travel, even if on the mental plane, to the "other side" of this transformation. Really, this is what it's all about now. Those "charts" will no longer have relevancy attached to them. It will be a whole new world. And I think it will be based on truth and honesty. It's clear the present corrupt systems don't support and uphold life. But so very few have the experience and understanding of how living according to, let's say, the Golden Rule, really works. 

It will truly be a "Phase Transition" where entropy will rise dramatically, and then, when the dust settles, balance and stability will finally reign. 

Lately I've been finding myself savoring all the great wholesome, organic foods still available in the local stores. Foods from the other side of the planet. Just sitting there appreciating their unique flavors. Wondering what it might be like never to taste an exotic fruit again. Kinda got a sentimental past tense associated with it when I'm chewing.

It's going to be an exciting opportunity to truly feel what being alive is all about. I just wonder how many will live to see it.