This is from Friday's Midas and it screams for us to make sure we have the positions we are contemplating, before it is too late.

internal adjustments at COMEX

I was intrigued by Adrian's comment on the Thursday COMEX stockpile changes silver.

There were once again only paltry movements of gold into or out of the Comex. It’s hard to reconcile the pathetically low movements with 2 million ozs standing for delivery. In silver the massive drain of inventories continues, 0.6 Mozs of silver were withdrawn from the dealer inventory. Furthermore an internal "adjustment" transferred 0.14 Mozs of silver from te dealer inventory to the customer inventory making the total withdrawal from the dealer inventory 0.75 Mozs for the day. 0.3 Mozs of silver were deposited into the customer inventory. On June 16th the total silver inventory stood at 119.58 Mozs while today just 6 trading days later it stands at 114.94. This is a withdrawal of 4.6 Mozs or 0.77 Mozs per day. This rate, if it continues, will deplete the silver inventory to zero in 29 trading weeks or 7 months. You don’t have to be a rocket scientist to see that the price action and the inventory action are totally incongruous. Silver is heading to a default and the price is capped or knocked down! Where are the regulators?

The "internal adjustments" that transfer silver back to the client's (investor) stockpile suggest to me that the bullion banks have been borrowing silver from the privately owned stockpiles at COMEX and using the silver to make good on deliveries. Yet, there is no record of the silver leaving either the registered or the eligible stockpiles in the first place. These curious, movements of metal do not generate confidence in COMEX published data, or in the administration of this 'market'. What these adjustments do suggest is that the bullion banks (like Scotia Mocotta) who own silver on COMEX may not be doing the massive shorting that is capping the price. I strongly suspect that all or most of the 51 Moz of silver in the registered (dealer) stockpile is actually owned by refiners, mining companies, and fabricators, and not by the bullion banks who short down the market. Some bullion banks may hold stockpiled silver too, but not the ones doing the massive shorting. That's all naked. These mega shorts can't do this sort of thing year after year without many people realizing they are naked short. Every time they borrow metal to make good on their naked short exposes the eligible stockpile owners to risk of default too. Maybe the silver was removed from accounts without informing the owners, and then backfilled in later as an "internal adjustment". If this was being done to my bullion holding at COMEX, I would be very upset, particularly if my silver was borrowed without my knowledge or consent. I would pull my silver out, as removal of private metal to make good on naked shorts by banks suggests that COMEX does not recognize property rights in their bullion stockpiles. This appears to be exactly what is happening as now the eligible stockpiles are rapidly declining.

Bullion is not like an equity, where naked shorting is facilitated by brokers who allow stocks in unallocated portfolios to be borrowed to facilitate shorting the stock. The customer bullion stockpiles at COMEX are supposed to be allocated and therefore not for lending.... I think the shortage of silver is so dire, and the naked short position so large that COMEX is allowing allocated stockpiles to be pillaged to bail out the bullion bank shorts. The owners will not be pleased when they find out about this practice and many will pull their metal.....which is the pattern we see.

Where are the regulators? The CFTC is facilitating this sham! As an arm of the U.S. Government, their goal is to facilitate the suppression of precious metal markets. The futures markets in gold and silver were set up for this express purpose in 1974. The futures market is NOT manipulated. The futures market IS the manipulation.
Regards, Rhody.