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Message: etf's still owed 20 million oz of silver, 1 million oz of gold

etf's still owed 20 million oz of silver, 1 million oz of gold

posted on Feb 21, 2009 06:24AM

this is from ed steer of casey research. it is well worth signing up for their free daily reports:

The Commitment of Traders report [for positions held at Feb. 17] was not as bad as either Ted or I had expected...although there was deterioration in both gold and silver once again. In silver, as always, the bullion banks went short against all longs. They increased their net short position by 1,014 contracts. Everyone else in the other two categories went net long. The Non-Commercials went net long another 595 contracts while the small traders in the Nonreportable category went net long 419 contracts...[419+595=1,014]. In gold, the bullion banks went net short 7,648 contracts...against the Non-Commercials and the Nonreportables...who went net long 2,299 contracts and 5,349 contracts respectively.

So, as of Tuesday, the bullion banks were net short 180,255,000 ounces of silver...and in gold, the same bullion banks were also short 19,636,000 ounces of gold. Since the Tuesday cut-off, these net short positions have probably increased in size. The most obscene thing about these two numbers is that the lion's share of them is held by '2 or less' U.S. bullion banks...certainly JPMorgan, and probably HSBC USA. The current COT can be found by clicking here.

Here's what Ted Butler had to say about the COT report issued yesterday..."With gold COTs negative and silver positive...[relatively speaking! - Ed]...it would appear it would take a gold sell-off to knock silver down. Interestingly, the only time I remember a similar set up, was the fall of 2007, where gold didn't sell-off for six more months and silver added 8 bucks or so before topping. But having said that...anything can happen here."

February deliveries in gold continued, with another 680 contracts delivered yesterday. The two big issuers were Deutsche Bank and Bank of Nova Scotia...with the big stopper being Goldman Sachs.

I neglected to report Thursday's happenings with the SLV and GLD ETFs. There were increases in both. GLD was up 157,000 ounces to a bit over 33 million ounces...and SLV was up 591,000 ounces to 253.7 million ounces. Yesterday, there were no additions to GLD, but the SLV reported receiving another 4.3 million ounces, bringing the grand total up to 258.0 million ounces...now over 8,000 tonnes! Ted Butler feels that the SLV is still owed at least 20 million ounces...and the GLD another million ounces.


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