Gold Slammed For Second Day As 'Someone' Panic Dumps $3 Billion Notional Ahead Of London Fix

Tyler Durden's picture

Yesterday, ahead of the London Fix, Gold was monkeyhammered lower on yuuge volume, only to rip back higher.

 

Today, having failed to keep the precious metal down (25,000 contracts dumped in a minute), they went for it again with a $3 billion notional pummeling in futures...

And the dollar is deja vu-ing too...

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Pinto Currency's picture

'notional' is too kind.
Dumped $3B of SFA is more accurate.

Haus-Targaryen's picture

Only Andy Hoffmann's meltdowns make these manipulations bearable. 

BaBaBouy's picture

Surprize ...

Deepe Statist Twump...

Meet the new Boss, same as the old Boss ...

J S Bach's picture

During this infamous era of monetary deceit, it's nice that they're at least using an honest term - "London Fix".

BaBaBouy's picture

If anyone is still wondering ...

Just look at the COTTS / Commercials / Short / Changes From -- Column ...

http://www.cftc.gov/dea/futures/deacmxsf.htm

Troy Ounce's picture

 

Too many numbers for me. Can you explain?

NoDebt's picture

Here are the numbers:  It now takes $3 billion of notional paper gold trades to slam the price down "X" amount.  It used to take only $1 billion to accomplish the same thing.  A year from now it will take $5 billion to smash it down that much.

 

manofthenorth's picture

Just like $2 of new debt used to get $1 of GDP growth and now it takes $8 of debt to do the same job.

At some point I suspect (I hope) the entire mechanism will fail. 

Killtruck's picture

anyone have a good figure on the ratio of paper to physical gold out there today?

NoDebt's picture

No, I don't but please realize that the size of a futures contract market is literally unlimited.  It can be thousands of times larger than the underlying commodity in trade.

It's a SIDE BET.  If you can find somebody who is willing to take the other side of that trade, you have a contract.  It's the no-limit table at the casino.  You can see the problem when you know the money to make those contracts could be coming from central banks throughout the world who have unlimitede money creation capability.

 

fbazzrea's picture

and unlimited market manipulation capability.

it's truly amazing that specs continue to take the other side. talk about eternal optimists.

seek's picture

Given how rigged the market is, I wouldn't assume it's just specs. It could be the same players taking the other side, with no real money exchanged for settlement, just for the purpose of controlling the market and preventing price discovery. While some of the contracts might fall into the hands of non-rigging participants, if they control a big enough part of the market, odds are in their favor. As for the contracts that fall to non-rigged players, any money lost to them is the cost of controlling the market.

That's where the stats in the messages above get interesting, as the costs of controlling the market are increasing. That tells me either there's more non-rigged participants/volume, lower rigged volume, or some other market pressure that out of the control of the exchanges.

Pinto Currency's picture

Killtruck

There are an estimated 400M to 600M oz claims for paper spot gold on the LBMA and an estimated 1.6B oz of claims for paper silver on the LBMA.

Total above-ground stocks of refined silver globally is ~ 900M oz.

Oldwood's picture

Markets are supposed to be defined in some way by supply and demand, but that obviously doesn't work in any obvious way today as prices are defined by demand for something that in reality does not exist. We could price in world peace based on demand even though it has never existed and likely never will. At this point I don't understand why we waste time worrying about gold or dollars or bitcoin, when none of it exists in any physical way to define demand. We simply "create" in our imaginations what we think we want and how much we are willing to pay. Fantasy markets. It would seem the smart person would simply create another fantasy "commodity", offer it to the market in "limited" supply and then let the wealth roll in. Nobody wants to own it physically...not oil, not even gold, and for sure not bitcoin as it has no physical presence at all. The more arcane and ridiculous the better. Beanie Babies, pet rocks, stocks?

Luc X. Ifer's picture

'Someone' like we don't know who's that 'someone', one of the puppets of the master puppeteer aka Soros.

Scuba Steve's picture

Nice post, exactly what is happening ...

I laugh when you couple that with DoucheBank shenanigans, 47% Americans paid no tax, BRexit maybe FRexit, IMF Bullshit about GDP, Putin over there playing chess, Chinese owning manufacturing to date, Silicon Valley and MSM censoring, ....

"She's a shitshow Captain and she's gonna blow .... '' 

ParkAveFlasher's picture

Correct me if I'm wrong but $3B yesterday + $3B today = $6B and price barely blinked.  Am I going crazy or is the end game here?

wren's picture

Already back to $1,278.67 and going back up.

ArthurDaley-OldieTimeTrader's picture

Bastiat, ParkAve isn't going crazy. The deal is that this behaviour has been going on a long time. Don't you all recall when we'd get the overnight $3billion smash downs and $50/oz would get wiped off the price of gold about 18 months ago? Now its taking 2 tranches of $3billion and the price is / hasn't really gone south. That's the facts over time. Now can gold and silver really sell off again sure but TPTB are running out of room and as each day goes by we are one day closer to Armegddon of the USD no longer being a "Reserve currency"..

skipweston's picture

For the year 2016 the ratio for Gold was over
3300 contracts to 1 oz of Gold. The Gold Cartel is losing control, thanks to the Shanghai Gold Exchange. go to www.Didthesystemcollapse.com to see the west vs the east gold pricing.

actionjacksonbrownie's picture

It's just keystrokes on a computer so the numbers are pretty irrelevant in this (con)fidence scheme.

Fester's picture

“gold and silver will, in the long-run, revolt against depreciation (of paper), and separate from the value of paper; for the progress of all such systems appears to be, that the paper will take command in the beginning, and gold and silver in the end.”
William Corbett 1834

man from glad's picture

I brought this up yesterday. The COTR is the most useful indicatior for PM's imo. Seems the "smart" money is still shorting. "Dumb" money long, with both camps about even in positions. But who will win? Right here we are going to see the battle begin. I expect many more of these big sells soon if gold tries to go higher.

Pairadimes's picture

Eventually the longs will win, because all fiat currencies die. The question is how much wealth will be stolen from the holders of said currency before it dies.

NoDecaf's picture

Eventually they are going to run out of "paper" to dump as the weakest hands get shaken off and the strongest players scoop up the discounts, creating a ratcheting effect...or diminishing returns from their point of view.

Keep dumping away mofos.

Keep stacking bros.

NugginFuts's picture

Sorry, what? Run out of paper? Do you hear yourself? 

The shit show will continue until the end game arrives.

NoDecaf's picture

Read the "diminishing returns" part

It'll be analagous to fake news, they will keep churning it out but more and more wont buy it.

Thats where they will get over run.

The phyzz premium will hockey stick away from the paper price.

So it just wont matter anymore.

You see these moves as a sign of strength on their part?
Looks like panic to me.

NugginFuts's picture

I'm not convinced that those in power who are playing for control are all that concerned about "diminishing returns", especially where paper is concerned. If it's control of the physical asset they are after, then they can do this all day every day until their goal is accomplished. Paper is merely the means to an end. 

As for my part, I also enjoy having the physical asset on hand - because I want the physical asset. Why else am I trading paper dollars for it? So I can trade it back later for more paper dollars?

If personally holding the physical asset is your end goal, as it is mine, you should be thanking whoever is giving you the discount. 

sinbad2's picture

It already is moving away from the paper price. It's $20 more an oz in Shanghai than London/New York.

When it hits a hundred an oz more in China than London/New York, the vaults in the west will empty very quickly.

Raffie's picture

Its like the USD printing press can print paper gold as well.

6billion in 2 days is a lot of money.

Scuba Steve's picture

Its a marker, as long as they are playing both sides of the fence in order to "relatively" control price ... is there really any dollars created?

 

These SOB's have Cart-Blanche to do whatever they want and have been doing it for a very long time

youngman's picture

Even after the end game arrives..just think how wierd the gold market will be when everyone in the world wants it.... margin changes....all kinds o games will be played to get your gold and silver...governments will make it illegal too I bet...

NugginFuts's picture

Been there, done that. They've confiscated before. If they do this time, I'm sure they will only be successful in accumulating lead.

Scuba Steve's picture

No doubt about it, the cat is out of the bag on a pretty big scale when you factor globally.

 

83_vf_1100_c's picture

Even then only a few dumbasses turned in their AU. I'll melt down my bars and learn jewelry making or stard making trips to a more PM friendly country before giving it up. Or, just bury it and forget it.

assistedliving's picture

agreed.  my money 'costs' me.  Alt P costs how much?

NoDebt's picture

"Eventually they are going to run out of "paper" to dump"

I bet you regretted saying that just after you clicked the "save" button.

They will NEVER stop.  If they have to dump $50 billion of fake paper gold trades every morning, they will do it.

 

NoDecaf's picture

Sure they will, but who is going to sop that up? And what will the premium on physical be then?

Yeah a small amount of regret only because I am too lazy to be more descriptive or write longer posts to articulate what I, and an increasing number of people are starting to realize.

Its a finite world.
And gullible people are a limited resource also.

Pairadimes's picture

The problem the paper pushers have is the pressure they put on physical every time they hammer the price. Eventually they destroy the relationship between the exchange-traded paper price and the shiny stuff that people decide they don't want to sell anymore. I see a few cracks in the foundation with this back-to-back $3 billion hammer.

sinbad2's picture

Yes, but as the value of the paper trades increase relative to the change in price of real gold, it is an admission that the dollar is in decline.

A year from now there will be no real gold in the US to trade, and all transactions will be paper.

NoDebt's picture

You just described what the Federal Reserve would call nirvana.

 

Azannoth's picture

Have been hearing this line for the past 10years and how far have we gotten thus far? This is gonna end when everything ends good luck exchanging your gold at Barter Town

Bay of Pigs's picture

Gold was $681 ten years ago.

Nice try but some of us pay attention to this.

MrBoompi's picture

Only an idiot would believe Trump has any control over bankers.  

gdogus erectus's picture

We should sue! Oh wait. That's been done. Several times. Same ending. "It's a national security issue." Yeahhhhh.

SoilMyselfRotten's picture

Looks like GLD flash crashed down $10-12 at the same time. Nothing to see here, move along...