The primary pressure on gold and silver is managed-money (aka slinger), speculative, paper-short attacks — period! We will get another read on the hole these actors have dug themselves into from the CoT later today. With China’s new international exchange open, its premium there has gone up to around $4 to $5; in Hong Kong, it’s about $1 to $2; in Singapore, it’s about $1.70 to $2; and in India, it’s about $6 to $7. Deliveries in Shanghai continue at a rate of 8 tonnes daily. This suggests that gold will arbitrage toward those locales — that’s if the western gold can even be rounded up. Paper doesn’t count in these Asian markets. There are now huge gold vaults throughout the region that will need to be accommodated.

In what is probably yet another attempt to obfuscate the gold market, starting Monday, Sept.22, the LBMA will not publish GOFO rates.

source: Morris Hubbart

Silver Comex open interest rose once again by 1,766 contracts as silver was flat yesterday. The silver OI complex rests at 176,966 contracts. In ounces, this represents 865 million ounces, or 124% of silver annual production. Nao combinem. Here we have a prime example of a Ponzi scheme in paper contracts and an anti-Ponzi setup in the actual asset.

With the Scottish independence referendum not surprisingly dispensed of, the algos automatically piled into the futures overnight.

Friday we also have the $21.8 billion Alibaba Ponzi units (BABA) — ahem, I mean IPO — that will need to be paid for. There’s no lockup on $8 billion of these shares; and as many of these early investors are Chinese, it’s unlikely it will be rerouted into other American Ponzi units. This is a classic financial mafia pump and dump with the pressitudes pulling in the marks by calling the $68 offering “conservatively priced”.  So it could suck cash out of other areas and create whipsaw conditions to destroy the latecomers. Typically IPOs start trading 15 minutes after the open.

Ponzi-unit QE support for the remainder of the month is nearly nonexistent until Wednesday. In October, this will drop to less than $2.5 billion per week before disappearing entirely.  Note that Treasury supply tends to get heavier toward the end of the month.

Maybe a prop stick on the leaning side will support it?

Chinese QE is a desperate attempt to support already existing inflated Ponzi units in trouble not to further inflate them elsewhere in the world. Ditto for the poorly received ECB borrowing program.

Also, watch JNK. It seems to weaken in advance of equities. It rallied back some since Janet’s happy talk for the computers. If it starts to fade again, that is a further signal that Ponzi-unit support is on a weak foundation. Stealing from Aunt Millie via junk to finance Ponzis is essential to the whole scheme.

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