JPMorgan (JPM) to Deliver $4B Worth of Gold Bullion amid Tariff Fears
sm_delta
Posts: 38 ✭✭
"The total delivery notices amount to 30 million troy ounces of gold, which is the second-largest ever recorded."
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From your link:
"The bank’s decision is part of a larger trend that has seen several institutions announce plans to deliver bullion against expiring contracts on CME Group’s Comex."
This means paper players now want to trade the paper for the real stuff instead of new paper. Not a good sign for the future of COMEX.
Repetition of ignorance is ignorance raised to the power two.
Is that about 1,000 tons ? 1 ton = 32,000 ounces ?
It's not clear to me why they want actual gold. If they are short as a custodian, it would be easier to go long offsetting futures or other contracts to cover any exposure to potential tariffs.
The story doesn't really get into that.
30,000,000 troy ounces is approx. 933,100 kg or approx 933 metric tons or approx. 1028 US tons
So yes, it is about 1000 US tons. I hope they don't strain their backs loading their vault:)
I'm very curious about their reasoning for this action. Can anyone explain how they can profit from this? Are they just anticipating a price jump when tariffs hit, and then they will sell?
From what I've been reading, the LBMA is not set up for delivery and most deliveries take place off of Comex and someone rather large is taking a lot of deliveries off of Comex (in January as I understand it).
If that is truly the case, and if the custodian has a large short position, taking an offsetting long position in the futures market will only put more upwards pressure on the price.
I knew it would happen.
It's not clear to you, in the face of uncertainty/fear, why anyone would want physical gold in their hands rather than a paper promise to deliver gold? How many times have markets of any kind seen promises disappear like smoke?
Repetition of ignorance is ignorance raised to the power two.
It says in the article why it is happening. They can make money!
"Interestingly, tariff fears on imports have driven up gold futures prices on the Comex to the point where they surpassed the spot prices in London. As a result, this has created an arbitrage opportunity (risk-free profit) for a select few banks that can transport gold bullion between major trading hubs by buying in London and selling on the Comex."
It looks like they are taking physical delivery of a contract, and not selling on Comex. In other words, it is not clear to me how their action is consistent with this statement in the article. I admit that I'm not knowledgeable about commodities trading, so if you can clarify, that would be appreciated.
Who wants to take delivery of tons of gold and store it and watch over it ?
Better to just get a credit for the increase in the price of gold, if that's one's endgame.
Who wants to take delivery of tons of gold and store it and watch over it ?
Only if it belongs to me.
Better to just get a credit for the increase in the price of gold, if that's one's endgame.
Do you believe that the Fed has 8,200 tons of gold socked away? If they did, the results of a 3rd party audit would be made public annually, just like any other business that maintains an inventory.
I knew it would happen.
Ron Paul and John Ashbrook went on the audit in 1975. Yes, we have the gold.
Why is it that the FED is the only major central bank not buying/stockpiling gold? Do they really have that much faith in their Magic Money Tree (ability to indefinitely continue the money printing farce)? FED appears to believe that they know something that other central banks do not know. Or, are they just that stupid?
One thing for sure. With the game of gold musical chairs in play (paper promises, gold leases, etc.) if the music stops, gold in hand will not be pried from those hands unless the price is very, very high.
Repetition of ignorance is ignorance raised to the power two.
The reason is because our GOLD is not some stupid metal formed from the Big Bang 13.8 billion years ago, Derry.
Our GOLD is our deep, liquid, and transparent financial markets including bond and money markets that trade hundreds of billions EACH DAY whereas our next closest "competitor" might trade $50 billion combined.
We are the Shoehi Ohtani-Aaron Judge-Juan Soto of financial markets.
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But who holds title to that gold ? That part is unclear. It certainly isn't "we".
I wouldn't be successful in going to the Treasury or Federal Reserve asking for my share, even if I presented gold certificates.
So it doesn't really belong to "us".
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Yes, we have the largest financial market. That has encouraged activity leading to what we have now which is a finance-based economy rather than a production-based economy. That is not a good thing long-term.
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sounds like you're telling me that the FED has complete faith in the paper markets. Good luck wid dat.
Repetition of ignorance is ignorance raised to the power two.
Based upon the data shown in the website below, the approx available above ground world gold supply is 212,582 tonnes. If JPM takes delivery of 933 tonnes, they will have approx. 0.44% of the entire world's supply. Is that enough to have an impact? Is it possible that they will just sell their order before the delivery date?
https://www.gold.org/goldhub/data/how-much-gold
You're playing semantics. Who owns Yosemite National Park -- the people, right ? Doesn't mean you can sell a few acres as your share.
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I can go visit and enjoy Yosemite. The "ownership" of it is transparent. But I would not be allowed to go see the gold or audit the Federal Reserve or US Treasury.
Who benefits from the US gold reserves ?
You are probably going to write that it benefits all of us.
The reason for holding the gold is an implicit partial backing for the currency and US Treasury bonds.
But the currency is issued by the Federal Reserve.
So the US gold reserves benefit the Federal Reserve and their member/owner banks first and foremost.
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Have to agree with dcarr regarding the gold 'audit'. It's been a few years, but if I recall correctly... they were given a 'tour' and shown stacks of 'gold' bars. Assuming the 'gold' was real and not gold painted bricks of some sort.... I don't think any paper trail audit was allowed.... so who knows who really owned the gold.
It was a publicity show.
Ron Paul and John Ashbrook went on the audit in 1975. Yes, we have the gold.
"went on an audit"
Who was the outside auditing firm and where are the results of the audit? Getting a look inside a vault isn't an audit.
I knew it would happen.
The people “own” Yosemite and gold but we don’t control it. One of the major issues of this last election was accountability.
My question is why after the election was settled gold is still climbing. Uncertainty about the election was suppose to be the motivation for the price increases last year. What’s driving it even further now?
has the gold arrived?
Repetition of ignorance is ignorance raised to the power two.
The uncertainty wasn't the election, but rather the effects of the election.
Would you say things are more or less certain today than 6 months ago?
Knowledge is the enemy of fear
6 hours ago.
They don't benefit, and if it's so lucrative....go form a new bank and share the largesse.
Banks will be consolidating bigtime under this Administration since the sector's profitability stinks and they need to shrink the sector's players.
Conspiracy nuts never admit they were wrong. They're always right....we were lied to...it was an illusion....we never went to the Moon...we wuz tricked...we wuz lied to....wah wah wah.
The main naysayer's credibitlity was shot, some right-wing goldbug whose credibility went down the drain after saying Fort Knox was empty. Phil Crane, Ron Paul, and other "hard-money" types were there. They all said they saw and touched the gold. The clown -- whose name escaped me -- faded away.
Supply and demand, same thing that drove it last year. Gold FELL during the worst of Covid.
Gold is going higher, I've been saying $3,000 by 2030 (clearly we'll hit that well before) and $5,000 by 2035 (more likely for sure). Study the fundamentals. That's all you need to do.
Repetition of ignorance is ignorance raised to the power two.
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Banks don't "share", they milk what they can.
(Except maybe the state-run bank of North Dakota).
The Federal Reserve Bank (FRB) benefited enormously from their inception in 1913 to 1951. During that time, they distributed 100% of their profits to their member/owner banks. From 1914 to 1933 the FRB issued gold-clause currency notes equivalent to 56,000 metric tons of gold. They had no gold of their own but used the US Treasury's 6,000 metric tons as a fractional reserve, even though they had no title to it. And that relatively meager 6,000 metric tons held by the Treasury was already over-subscribed due to the 16,000 metric tons worth of Treasury Gold Certificates that had been issued.
All the currency the FRB issued should be reported on their balance sheet as a liability. And that liability was ultimately in the form of gold at $20.67 per troy ounce. So why would the FRB do that, especially when they had no gold of their own ?
When someone in the general public accepts a Federal Reserve Note, that becomes an interest-free loan to the FRB. The issued currency, totaling many billions of dollars, amounted to a gigantic interest-free loan to the FRB. The FRB then invested that money into anything that generated a return, such as US Treasury bonds. What a great deal for them. And when things started to go sour, in 1933 President Roosevelt relieved them of all their gold obligations.
I would absolutely start my own bank if I could:
1) issue currency at no cost to me or to my bank, and with no reserve requirements;
2) invest the equivalent amount in US Treasury bonds, and keep all the interest proceeds;
3) have the US government bail me out if things go bad.
The US Treasury is the custodian of a significant amount of gold.
The murky part is, who actually has title to that gold ?
Banks should be nationalized and the power to "coin" money and regulate the value of it should be returned to Congress where the Constitution says it should be. Once that is done, everything else becomes a truly free enterprise.
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I've been trying to obtain more information on commodity trading on Comex. For those interested, CME group has educational information on their exchange. I found it informative. Link below,
https://www.cmegroup.com/education/courses.html
Given trading is anonymous, how did the press find out about JPM's transactions? Was it through JPM? Also, it is not clear to me that there is sufficient "open interest" to account for the supposed 300,000 100 ounce February contracts that they supposedly possess. Perhaps I'm misunderstanding some details. Could this mean that they settled or extended their February contract? Note that Comex February gold contracts settle on the 26th.
https://www.cmegroup.com/markets/metals/precious/gold.calendar.html
SM, it is NOT a JPM Chase transaction, they are the custodian for other clients.
Bank regulators would not allow JPM to speculate on gold.
Off-floor transactions and privately-traded derivatives probably explain the discrepancy.
How about we nationalize your possessions and wealth -- would that be OK ??
The fact that someone in 2025 can believe in bank nationalization -- when the banks are the best-capitalized they've been since the 1960's -- and then wants 535 economic illiterates to control the money supply....is just nuts.
Even Congress doesn't want to "coin" money.
JPM is almost certainly acting as a custodian for clients. It is NOT a JPM Chase transaction.
Repetition of ignorance is ignorance raised to the power two.
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I just wrote "nationalize the banks and everything else would then be a truly free enterprise".
North Dakota has a state-owned bank that is run for the benefit of the people of North Dakota. They did not confiscate anyone's personal property or assets to establish that bank.
Congress would do a better job than the FED has. Even better would be an automatic (algorithmic) system tied to a digital currency that would be impartial and would take away the unfair benefits that banks get from manipulating the financial system.
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I use PNC for all my banking needs, not worried about the bank confiscating my assets. Exit bunker, breathe, live life. RGDS!
The whole worlds off its rocker, buy Gold™.
BOOMIN!™
Ive heard smoe funny stuff on this forum, but I think this is by far the funniest. Well done sir!!!
Knowledge is the enemy of fear
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Not funny at all.
The FEDs track record is abysmal.
But they certainly did all they could to help out their members/owners.
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Now you may have written the most ironic thing I've ever heard. Hahaha!!!
Knowledge is the enemy of fear
Is Someone Attacking the Comex?
January Sees $5.2B in Gold Deliveries.
"It’s very possible we are starting to see the initial cracks that could apply a ton of pressure to the Comex. If the Comex runs into any trouble over the coming months making deliveries… it will send shockwaves through the precious metals market. This might be why they have restocked to such high levels. The question is … will it be enough?"
Repetition of ignorance is ignorance raised to the power two.
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You sure are laughing a lot lately. Must be the gas in your mask.
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Precious metal market manipulation has occurred at JPM in the past. Of course, we know that they learned their lesson, so it will never happen again.
https://www.justice.gov/archives/opa/pr/former-jp-morgan-precious-metals-traders-sentenced-prison
Inconcruity theory.
Knowledge is the enemy of fear
Why don't you ask them if you're so sure of this nonsense ?
You obsess about member banks in the Fed. Meanwhile, your website and others repeat nonsense about the amount of money in circulation at the time of FDR's Gold edicts.
It's easily available data. You should really stop with the "Fed bailout" and "the U.S. was on the hook for 20,000 tons of gold" nonsense.
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I cite the real data. Of course you don't like it, so you dismiss it without any valid argument or evidence.
You obsess about defending the FED's awful record. You really should stop with the FED apology nonsense.
The Federal Reserve had an incentive to "manipulate" their published books and under-report the quantity of Federal Reserve Notes issued (among other things).
Regardless, the US Government Bureau of Printing and Engraving (BEP) kept records on the actual quantities of notes issued. The BEP has no reason or incentive to "adjust" their numbers. Those quantities are tabulated in at least two different catalogs for collectible US currency. Two that I have with this information are:
“The Standard Handbook of United States Paper Money”, 6th edition (1977), by Chuck O’Donnell;
and
“The Comprehensive Catalog of U.S. Paper Money”, 1981 edition, by Gene Hessler.
All of that data is compiled in the appendix to my article here:
moonlightmint.com/bailout.htm
What do you think FDR meant when he said in a speech in 1933:
"We have a reserve of gold and a small reserve of silver - neither of them anything like the total amount of the currency." ?
It is pretty obvious what he meant, and if you can not comprehend that, then you have no business being a financial commentator of any kind.
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$4B is not that much money in financial markets. It can't even buy a new bridge.
I read the 1933 Report of the Federal Reserve System. It says that the money supply in circulation was just under $7 billion.
Maybe FDR was referring to the 40% backing of FRN's with gold ?
Even if the oft-cited 4% figure was true...it doesn't justify the illegal confiscation of gold from the American public and there was no "bailout" of the Fed who OPPOSED (by and large) the gold edicts of FDR and Morgenthau.