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World Gold Council
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27 марта, 02:41

Dustin Johnson defeats Jon Rahm to win WGC Match Play

• American world No1 in ominous form before Masters• Spaniard puts up brave fight and takes Johnson to final holeDustin Johnson’s only danger is associated with peaking too early. Even that seems a negative leap of faith. With little over a week to the Masters the world No1 secured a third victory in as many starts by seeing off Jon Rahm in what developed into a thrilling final of the WGC Match Play.Johnson remains in the form of his life, to the point where this week’s Shell Houston Open might be a minor inconvenience; he would surely rather be heading straight to Augusta National. In the early throes of this tournament Johnson was asked whether he thought he intimidates fellow players. “You had better ask them,” was the characteristically low-key reply. There really is no need; Johnson did not trail for so much as a single hole en route to this Austin triumph. Continue reading...

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26 марта, 01:21

Jon Rahm demolishes Soren Kjeldsen to reach WGC Match Play semi-final

• Spaniard wins quarter-final 7&5 and will face Bill Haas in semis• Phil Mickelson says 22-year-old is ‘real deal’ and can reach world top 10Spain’s illustrious conveyor belt of golf talent means Jon Rahm was always destined to be subject to comparison. Here is the most uplifting one: not since a 19-year-old Seve Ballesteros finished second in the Open Championship of 1976 has a player from that country arrived on the scene with such statements of intent.Rahm’s star continues to rise at such a pace that, on Saturday, bookmakers slashed his odds to win the Masters in a fortnight’s time. The 22-year-old has not even played competitively at Augusta National before. Continue reading...

24 марта, 16:54

Новости рынка драгметаллов: 24 марта 2017 г.

Рынки серебра и палладия сегодня показывают прирост, а золото и платина остаются на отрицательной территории, несмотря на активное ослабление курса доллара США. Запасы в золотых ETF-фондах подросли...

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24 марта, 02:38

Rory McIlroy out of Match Play Championship without playing a shot

• Gary Woodland’s withdrawal resulted in McIlroy being knocked out• Slimline Bubba Watson finding form again as Masters loomsRory McIlroy must hope his quota of 2017 misfortune has now been used up. The rib injury which disrupted the initial stages of his Masters preparation might be consigned to history but there was further cause for McIlroy to question whatever happened to the luck of the Irish on Thursday, as Gary Woodland’s withdrawal from the WGC Match Play Championship coupled with the later victory for Soren Kjeldsen meant the four-time major winner was eliminated without hitting a single shot in anger. Related: Jason Day withdraws mid-round as his mother prepares for cancer surgery Continue reading...

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22 марта, 23:21

Rory McIlroy beaten by Soren Kjeldsen in WGC Match Play opener

• World No2 loses 2&1 to Dane but says ‘I played well’• ‘If I had played anyone else I might have won’The good news for Rory McIlroy relates to the WGC Match Play format. The bad? A year ago only one player, Dustin Johnson, succumbed to an opening-day defeat and recovered sufficiently to progress to the knockout stage.McIlroy’s 2&1 humbling by Soren Kjeldsen, the world No68, was no disgrace given the inspired performance of the Dane. The pair would have produced a better ball score of 11 under par through 17 holes, with Kjeldsen minus six on his own. Continue reading...

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21 марта, 14:15

Jordan Spieth wants Masters to be over so people stop asking about meltdown

• Spieth blew back-to-back chance in 2016 with seven at 12th• Rory McIlroy puts the pressure on: ‘The questions will still be there’For 12 months, Jordan Spieth has played questions relating to the Masters with such a straight bat you had cause to wonder whether he was a professional in the correct sport.That stance changed on the eve of the WGC Match Play, with Spieth admitting he will be delighted when the 2017 version at Augusta National is over – if only because it means people will stop talking about his nightmare last year. Continue reading...

19 марта, 18:43

Текст: Спрос на физическое золото рушится ( Саймон Блэк )

Я занимаю кресло в Совете директоров одной крупной компании, зарегистрированной в Сингапуре, которая ведет бизнес, связанный с золотом и серебром. Вчера вечером во время нашего ежеквартального заседания менеджмент компании предоставил большое количество новой интригующей информации. Продажи физического золота и серебра рушатся во всей индустрии. Продажи американских золотых орлов Монетным двором США, например, в феврале этого года были на 67% ниже соответствующего периода прошлого года. А продажи американских серебряных орлов снизились на 75%. Статистика, представляемая Всемирным советом по золоту, также показывает значительный спад спроса на физический металл в 2016 году, особенно на слитки, монеты и ювелирные украшения. Поставщи...

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19 марта, 13:01

Dustin Johnson grows into No1 role and sets sights on WGC Match Play

American hopes to follow victories in Genesis Open and WGC Mexico Championship with another this week in AustinDustin Johnson is chasing a treble that would once have looked impossible for one of the great underachievers of this age. Building on last year’s maiden major he has risen to world No1 and is now threatening to develop a stranglehold on the top of the rankings.Johnson’s success at the Genesis Open in the middle of last month catapulted him to the summit for the first time. At 32, given the widespread and legitimate view that Johnson is the most naturally gifted American player of his generation, the undertone related to his earlier struggles in matching expectation with outcome. Continue reading...

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18 марта, 04:05

Demand For Physical Gold Is Collapsing

Authored by Simon Black via SovereignMan.com, I serve on the Board of Directors of a large Singapore-based company that’s in the gold and silver business. And, last night during our quarterly conference call, the management team gave me a lot of intriguing information. Sales of physical gold and silver are collapsing across the entire industry. At the US Mint, for example, sales of US Eagle gold coins fell by 67% between February 2016 versus February 2017. And sales of US Eagle silver coins are down 75% over the same period. The World Gold Council’s data also shows a substantial decline in physical precious metal demand in 2016, particularly with bars, coins, and jewelry. Suppliers and refiners in the precious metals business are echoing these numbers, lamenting that sales are extremely slow and margins are falling. For our Singapore company, this decline is irrelevant. They have their own proprietary, state-of-the-art storage facility and a number of cutting-edge service like bullion-backed peer-to-peer loans, so business is great. But I would expect that a number of other bullion dealers will probably go bust if this downturn lasts much longer. The one conundrum is that this trend does NOT correlate with the price of gold. In US dollar terms, the gold price is up 16% since the beginning of 2016. So it would be reasonable to conclude that sales of physical bars and coins are up as well. But they’re not. The reason is because there’s a HUGE difference between physical gold and “paper” gold. When people talk about the gold price, they’re really quoting the price of gold contracts at exchanges around the world in London, Shanghai, Chicago, etc. Traders aren’t actually buying and selling physical gold. These gold contracts are merely paper financial instruments, like stocks and bonds, that traders use for speculation. When some conflict breaks out in Africa, the knee-jerk reaction is for traders to buy gold contracts. And when central bankers announce that the economy is totally awesome, traders dutifully dump their gold contracts. But they’re really just buying and selling highly leveraged paper assets. Nothing physical changes hands. It’s the same with gold ETFs; these are merely financial instruments to gamble on the paper price of gold. Investors who truly understand the benefits of owning gold, and don’t simply want to speculate on the price, buy physical bars and coins from a dealer. And quite often there’s a massive difference in fundamentals between the demand for physical coins and the paper price. During the 2008 financial meltdown, the paper price of gold and silver plunged. Speculators and traders were hit by margin calls and forced to sell their contracts. But demand for physical coins was incredibly strong; savvy investors were looking for a safe haven. There was a total disconnect between the paper price and physical demand. That’s now happening again, but in reverse. The paper price is rising, but physical demand is falling. Management told me last night that they’ve been invited to speak at several investment conferences attended by family offices and high net worth individuals. But they told me that there’s very little interest in owning physical precious metals among these wealthy investors. Everyone seems to want to dump all of their money in US stocks or real estate, expecting that they’ll easily make 20% despite both markets being at all-time highs. This strikes me as total madness. Few people ever prospered buying what was popular and expensive. There seems to be no fear in the market… no regard for sense or safety. And my contrarian instincts tell me that this complacency is a great reason to own physical gold and silver right now. Remember that gold is primarily a form of savings. You could hold your savings in a bank account, denominated in paper currency like dollars or euros or renminbi. Or you could hold savings in physical cash. You could even own government bonds. Each of these is a form of savings. But so is gold and silver. (And cryptocurrency, for that matter.) The difference is that gold and silver cannot be conjured out of thin air by a central bank. And unlike cash, or money in a bank, precious metals actually keep pace with inflation over time. I remember having a conversation once with a famous investor who told me that he didn’t know what was going to happen in the future… … and THAT’S why he owned gold– for the “I don’t knows.” Will there be a trade war with China in the next few years? A shooting war? A major debt crisis? Another terrorist attack? “I don’t know.” Gold and silver are fantastic insurance policies against the “I don’t knows” due to the metals’ 5,000 year history of value and marketability. There’s no need to go overboard and keep 100% of your net worth in precious metals. But given the obvious risks on the horizon that we discuss regularly, and these bizarre demand trends, it’s a great time to consider adding to your physical precious metals savings. Do you have a Plan B?

15 марта, 14:14

Что случилось с золотым запасом Мексики?

Центральный банк Мексики может подтвердить владением только 74% своего золотого запаса. Об этом стало недавно известно после расследования. Общественность в Мексике обеспокоена ситуацией с золотом...

12 марта, 21:35

"Hey Google: How Do I Become An International Gold Smuggler?"

Harold Vilches, a 23-year-old Chilean, exported $80 million in contraband gold. As Bloomberg Businessweek details, it all started with a Google search... In just two years he had rapidly risen in the ranks of Latin American gold smugglers. Although he was barely old enough to order a beer in Miami, he’d won a $101 million contract to supply a gold dealer in Dubai. That hadn’t exactly worked out—the Dubai company was after him for $5.2 million it says he misappropriated—but still, in a brief career he’d acquired and then resold more than 4,000 lb. of gold, according to Chilean prosecutors. U.S. investigators and Chilean prosecutors suspect almost all of it was contraband. In the past decade and a half, global gold consumption has risen by almost 1,000 tons a year, to about 4,300 tons, according to the World Gold Council, a London-based industry group. Legal mining operations haven’t kept up with demand, so illegal mines controlled by criminal gangs, from the Amazon to central Africa, help cover the deficit, according to Verité, a nonprofit group in Amherst, Mass., that’s researched the illegal gold trade. A 2016 Verité study found that five countries in Latin America shipped 40 tons of gold from illegal mines to the U.S. in one year, almost twice the legal exports from those countries. South America’s illegal gold mines, most of them in the Amazon basin, are toxic pits in which mobs of laborers use fire hoses and mercury to extract nearly pure gold nuggets from the red earth. According to a finding by the United Nations, the industry thrives on child labor, devastates the environment, and enables prostitution at ramshackle camps around the mines. The gold moves from smuggler to smuggler, then into a network of refiners and traders, all feeding the world’s voracious demand. Vilches, a city kid, never saw any of this, but he did grow up around gold. His father, Mario, owns a jewelry shop; his uncle Enrique, an evangelical preacher, built Joyas Barón, a chain of 18 jewelry stores. Enrique has more than once attracted the attention of the authorities. In 1998, Chilean prosecutors caught Ecuadorean smugglers with 18 ingots of gold at the airport, and they claimed to be delivering it to Enrique. (He was cleared of all criminal charges after arguing that police set him up.) In March 2015, Enrique was sentenced to five years’ probation for tax fraud by an appeals court in Santiago. Last year tax authorities filed further charges alleging that Enrique had organized an enormous accounting scam and owed an estimated $18 million in back taxes. Speaking on Chilean TV, Enrique Vilches denied all connections to his nephew’s gold smuggling. “I don’t have any commercial relationship with what’s being investigated,” he said. “[There’s] no situation that involves me, therefore I want to remain absolutely separated from this situation.” By 15, Harold was working for his father’s business. Within a year, his dad was stuffing his backpack with up to 50 million pesos ($78,000) in cash and sending him to the bank to make deposits. In 2013, Vilches entered college at the Universidad Mayor in Santiago to study business administration. He hadn’t been there long when his father had a stroke, and he cut back his classwork to focus on the family business. If he was going to be doing that, he decided, he wanted to do more than buy and sell trinkets. He intended to make some real money, and that meant getting into the bulk gold business. His first move was to persuade Gonzalo Farias, a metals exporter in Santiago, to take him on as a supplier. In September 2013, Vilches made his first delivery to Farias—6.6 lb. of gold legally acquired in Chile. He made several more such deliveries. But he wanted to be bigger. He went around Farias and cut a deal directly with Fujairah Gold, a Dubai-based company that Farias supplied. In June 2014, Vilches signed a contract to deliver 6,000 lb. of gold over the next 12 months to Fujairah’s head office. The contract began with 90 lb. the first month, then ratcheted up. He didn’t have the money to buy that much gold, so the company gave him access to an account holding $5.2 million. This was his big break—the contract was potentially worth more than $100 million. He stood to make $2 million to $6 million in profit. This was beyond ambitious for Vilches—there weren’t enough available gold coins and jewelry in Chile to fill Fujairah’s orders. So Vilches decided to become a smuggler. It was easy: He Googled gold dealers in Peru. He found Rodolfo Soria Cipriano, one of the country’s most prolific exporters, according to Peruvian newspaper El Comercial. An answer came quickly. Vilches told investigators Soria promised to set him up with all the gold he wanted if he showed up with the cash. Vilches said he didn’t ask where the gold came from. Whatever its source, he evaded export controls and moved the gold into Chile without paying taxes or duties, prosecutors say. ... The net began to close in early 2016, when banks in Chile and Miami began filing suspicious-activity reports on Vilches’s huge cash transactions and shutting down his accounts. Then came the criminal complaint involving the Fujairah Gold contract. Finally, police arrested Vilches and seized $300,000 in cash and a small amount of gold from the bunker. Facing a multiyear jail sentence for money laundering and tax evasion, Vilches agreed to cooperate with law enforcement in both the U.S. and Chile. He also dropped out of college. Today, Vilches and NTR Metals are at the center of a sweeping criminal investigation by the U.S. Justice Department, Chile’s National Economic Prosecutor’s office, and law enforcement in Peru and Ecuador, according to Pérez, the Chilean prosecutor. Sarah Schall, a spokeswoman for the U.S. Attorney’s Office in Miami, declined to comment, citing policy against confirming or denying the existence of an investigation. In October 2016, FBI agents and prosecutors with the U.S. Attorney’s Office in Miami traveled to Chile to interview Vilches. After becoming convinced his information was legitimate, they told him he might get immunity in the U.S. from prosecution in exchange for his sworn testimony, people with knowledge of the probe say. As Vilches spent hour after hour in interrogation, FBI agents and Chilean detectives were both fascinated and entertained. Upwards of 15 law enforcement professionals crowded into a meeting room at Santiago 1, a sprawling prison complex, and Vilches fed off the attention. He laughed and seemed to shrug off the seriousness of his situation. His confessions took on the air of a performance, according to one of the investigators present. “All you lacked was the popcorn,” he says with a laugh. FBI agent Lourdes McLoughlin, the assistant legal attaché at the U.S. embassy in Santiago, declined to comment, citing a policy of not commenting on active investigations. In December the U.S. Attorney’s Office and FBI brought Vilches to Miami, where he told a federal grand jury that he was coached by NTR Metals Miami on how to set up his corporate structure in the U.S. to handle smuggled gold and then launder the proceeds, people familiar with the U.S. probe say. Elemetal and NTR Metals Miami didn’t respond to questions about an investigation. ... Vilches lived large only briefly. He’s traded down to an apartment along Gran Avenida, a thoroughfare in a tough Santiago neighborhood. Because of his cooperation, he’s unlikely to face additional jail time for smuggling. He still faces multiple criminal charges, including tax evasion. Chilean export regulations have been beefed up in the wake of the Vilches case. One gold dealer describes the new export process as similar to “being told to stand up against the wall and put your hands up.” Customs officials from Ecuador, Bolivia, and Peru have visited Chile to exchange information and compare notes. Pérez approves, but he has no illusions. If Vilches, without any particular advantages except his boldness, could get this far in the illegal gold trade, who else could? “I think there are 100 Vilcheses across Latin America,” he says. “It’s easier than it looks.” Read the full story here...  The question is, why would powerful people around the world go to such lengths to get their hands on a yellow rock? Tradition?

10 марта, 16:30

More Bad News for the LBMA Silver Price provides Opportunity for Overhaul

On Friday 3 March 2017, in a surprise announcement with implications for the global silver price, the London Bullion Market Association (LBMA) informed its members that the current administrator and calculation agent of its recently launched LBMA Silver Price auction, Thomson Reuters and the CME Group respectively, will be pulling out of providing their services to the problematic London-based silver price benchmark within the near future. Thomson Reuters and the CME Group also issued statements on 3 March identical to that of the LBMA. The exit is surprising because Thomson Reuters and the CME Group only began administering / calculating the LBMA Silver Price auction two and a half years ago in August 2014, when, amid much hubris, the duo were awarded the silver price contract after a long-drawn-out and high-profile tender process. Notably, the Thomson Reuters  / CME contract with the LBMA was for a 5-year term running up to and into 2019. So the duo are now pulling out mid-way through a contract cycle. More surprisingly, in their statements on 3 March, the LBMA / Thomson Reuters and CME allude to a new European Benchmark Regulation being in some way responsible for the hasty departures. However, given that the units of CME and Thomson Reuters that are parties to the LBMA contract are the benchmark subsidiaries “CME Benchmark Europe Limited” and “Thomson Reuters Benchmark Services Limited”, which specialise in administering and calculating benchmarks, this excuse about a European Benchmark Regulation makes no sense. In essence, the exit of CME and Thomson Reuters is a major embarrassment for all concerned, and could lead to further reputational damage for the parties involved. It also now re-focuses market scrutiny on an area which the LBMA and its associates could well wish to forget, i.e. the former London Silver Fixing run by the infamous London Silver Market Fixing Limited, a company which itself is still one of the defendants, along with HSBC, Bank of Nova Scotia and Deutsche Bank, in a live New York class action suit that is scrutinizing what plaintiffs describe as manipulation in in the London silver market. LBMA Silver Price: A Regulated Benchmark Note that the LBMA Silver Price benchmark is now a “Regulated Benchmark” under United Kingdom HM Treasury Legislation, and is one of 8 financial market benchmarks regulated by the UK’s Financial Conduct Authority (FCA). So this is not some backwater obscure benchmark that we are talking about. This is a benchmark with far-reaching effects on the global precious metals markets and is a sister reference price to the LBMA Gold Price benchmark. The reference prices from these benchmarks are used from everything from valuing Exchange Traded Funds (ETFs) to being the price reference points in ISDA swaps, and bullion bank structured products such as barrier options. According to the LBMA’s usual public relations mouthpiece Reuters, which relayed the CME - Thonson Reuters news to the broader market on 3 March, the LBMA will be: “looking to identify a new provider in the summer, and have the new platform up and running in the autumn” This dramatic “exit stage right” by Thomson Reuters and the CME Group is a far cry from their initial and persistent corporate spin of being "committed" to the silver price auction, which they claimed both at auction launch in August 2014, and also as recently as 2016 when they grovelled with promises of process improvement and wider participation in the auction in the wake of the silver price manipulation fiasco in the LBMA Silver Price auction on 28 January 2016. It was on 28 January 2016 that the midday silver auction took a whopping 29 rounds to complete and the price derived in the auction was manipulated down by a massive 6% under where silver spot and silver futures prices were trading at that time. See the beginning of BullionStar blog “The LBMA Silver Price – Broken Promises on Wider Participation and Central Clearing” for further details about the 28 January auction fiasco. Where is the Commitment? On 15 August 2014, the day the LBMA Silver Price auction was launched, the CME professed its long-term commitment to the silver markets, with William Knottenbelt, MD at CME Group stating: “Through our existing relationships with market participants and the broader silver marketplace we are uniquely positioned to provide a seamless transition for the spot silver benchmark in London.”  “CME Group has a long and successful history of offering benchmark risk management and price discovery solutions for the global precious metals markets.”  More recently, on 22 March 2016, when CME and Thomson Reuters introduced changes to the silver auction in the wake of the 28 January 2016 auction price manipulation, both parties released more spin about their continued commitment to the auction. Thomson Reuters’ Head of Benchmark Services, Tobias Sproehnle, in a statement that now looks to be hollow, said: “these changes together with a comprehensive consultation with the broader silver community - producers, intermediaries and consumers - are a further demonstration of Thomson Reuters and CME Group’s commitment to providing innovative, market leading benchmarks for the Silver market.“ While Gavin Lee, the head of CME Benchmark Services, led with an equally hubristic statement that: “in consultation with Silver market participants, we are always looking for new ways to develop this benchmark further“ These statements from CME and Thomson Reuters, less than a year ago, run totally contrary to the fact that they are now going to abandon the LBMA Silver Price auction ship, which will necessitate the appointment of a replacement administrator and calculation agent. Where is the continued “commitment” to the silver benchmark that they were we eager to espouse last March? Even last October 2016, less than 5 months ago, when Morgan Stanley joined as a handful of other bullion banks as the only direct participants in the auction, CME and Thomson Reuters were out in force with a press release espousing their continued commitment to the LBMA Silver Price benchmark,with Head of Benchmarks for Thomson Reuters, Tobias Sproehnle, professing that: “we continue to welcome new participants to this essential mechanism for the markets" Why the Hasty Departure? The Reuters News report last Friday 3 March was short on information about the rationale for the departure : “A spokesman for Thomson Reuters confirmed the company was stepping down from the process. CME could not immediately be reached for comment.” Not very informative or cooperative from either party,when one of the providers was not even available to explain its exit rationale, and the other merely confirms a known fact to its in-house news arm. However, if you look at the CME Group website, a short announcement was added to its website on 3 March 2017, which stated that: “The forthcoming European Benchmark Regulation, due to be implemented in January 2018, prompted a review of the existing LBMA Silver Price administration arrangements and, in consultation with the LBMA, CME Group and Thomson Reuters have decided to step down from their respective roles in relation to the LBMA Silver Price auction.“ This statement was also added to the Thomson Reuters website on 3 March. Before briefly looking at the relevance of this “European Benchmark Regulation”, which the Reuters news article even failed to mention, its notable that the CME / Thomson Reuters early withdrawal was also covered on 3 March by the MetalBulletin website. According to MetalBulletin (subscription site): “CME is looking to streamline its precious metals division, with contracts in this area being its fastest growing asset. The exchange wants to focus on its core products, Metal Bulletin understands.” What MetalBulletin means by this I don’t know. The logic doesn’t make any sense, and the sentence doesn’t even make sense. Benchmarks are a core product of CME group. CME even states that it offers: “the widest range of global benchmark products across all major asset classes” CME Benchmark Europe Limited was specifically set up in 2014 to provide the calculation platform for the LBMA Silver Price. Furthermore, CME has just launched a suite of silver and gold futures contracts for the London market (launched in late January 2017), the silver contract being the “London Spot Silver Futures (code SSP)“. Even though these CME contracts have had no trading interest so far, the CME claims that it is currently “working with major banks to synchronize their systems to start trading” these contracts (London Spot Silver Futures and London Spot Gold Futures). So why would CME want to voluntarily ditch the provision of a high-profile London silver benchmark, when it could attain trading synergies between the LBMA Silver Price and its new London silver futures contracts, or at the very least improve brand recognition in the market?  And not to forget that CME and Thomson Reuters claim a”commitment to providing innovative, market leading benchmarks for the Silver market“.  News agency Platts, in a story dated 8 March 2017, touches on what are likely the real reasons for the CME / Thomson Reuters departures:  “CME and [Thomson] Reuters opted to give up their respective duties of the price management due to internal differences" "many have called for the LBMA Silver Price to be centrally cleared to boost participation" "A producer source recently said steps were being taken by CME to clear the price discovery mechanism centrally before the announcement to step down" "Sources agreed the main issue was the lack of participation in the number [auction]" "A senior source agreed 'I don't think anyone would want it [silver price] in its current form. It needs a minimum to be cleared to attract further participation" The topic of central clearing and wider participation is briefly explained below. European Benchmark Regulation Turning to the new “European Benchmark Regulation”, what exactly is it, and why would it be relevant for the LBMA and CME and Thomson Reuters to mention the European benchmark Regulation in the context of them pulling out of the LBMA Silver Price auction? At its outset, the European Benchmark Regulation was proposed by the European Commission. The Commission’s proposal was also issued in coordination with a range of entities and initiatives such as MiFID, the Market Abuse Directive, the benchmark setting processes of the  European Securities and Markets Authority (ESMA) and European Banking Authority (EBA), and also the IOSCO financial benchmark principles. According to law firm Clifford Chance: ” The new [EU] Regulation is a key part of the EU’s response to the LIBOR scandal andthe allegations of manipulation of foreign exchange and commodity benchmarks“ “The Regulation imposes new requirements on firms that provide, contribute to or use a wide range of interest rate, currency, securities, commodity and other indices and reference prices.” “Most of the new rules will not apply until 1 January 2018″ “The new Regulation imposes broad ranging and exacting requirementson a wide range of market participants. It may reinforce the trend to discontinue benchmarks and reference prices“ According to law firm Simmons & Simmons: The Regulation seeks to: improve governance and controls over the benchmark process, in particular to ensure that administrators avoid conflicts of interest, or at least manage them adequately improve the quality of input data and methodologies used by benchmark administrators ensure that contributors to benchmarks and the data they provide are subject to adequate controls, in particular to avoid conflicts of interest protect consumers and investors through greater transparency and adequate rights of redress. The Regulation aims to address potential issues at each stage of the benchmark process and will apply in respect of: the provision of benchmarks the contribution of input data to a benchmark, and the use of a benchmark within the EU. All of these goals aspired to by the legislation of the European Benchmark Regulation seem reasonable and would benefit users of the LBMA Silver Price auction, so given the above, it seems very bizarre that CME and Thomson Reuters and the LBMA stated last Friday 3 March that: “The forthcoming European Benchmark Regulation, due to be implemented in January 2018, prompted a review of the existing LBMA Silver Price administration arrangements…“ Remember that the CME and Thomson Reuters service providers to the LBMA Silver Price are their specialist benchmark units “CME Benchmark Europe Limited” and “Thomson Reuters Benchmark Services Limited”. That is what these units do, administer and calculate benchmarks. That is all that they do. The European Benchmark Regulation has been on the radar of the markets for a few years now, especially on the radars of the benchmark units of CME and Thomson Reuters. The Regulation didn’t suddenly appear out of nowhere last week, as the above statement is appearing to hint at. The statement from CME, Thomson Reuters and the LBMA was also bereft of any explanation as to what their "review of the existing LBMA Silver Price administration arrangement" found. Why so? Why not share this review with the global silver market instead of keeping it secret. Assuming that is, that there actually was such a review undertaken. Is this European Benchmark Regulation just an excuse being thrown out to distract from other issues that might really be behind CME and Thomson Reuters stepping down. Or perhaps CME and Thomson Reuters are aware of issues within the current administration of the LBMA Silver Price that would make it difficult to comply with the new legislation or that would make it too onerous to comply? But such rationale doesn’t make sense either because why are CME and Thomson Reuters not bailing out of the all the benchmarks that they are involved in? Furthermore, if the European Benchmark Regulation is a factor, why would any other benchmark service provider such as ICE Benchmark Administration (IBA) or the London Metal Exchange (LME) bother to take part in the LBMA’s forthcoming tender process to find a replacement for Thomson Reuters and CME? Perhaps CME and Thomson Reuters are worried about future reputation damage of being associated with the LBMA Silver Price due to some brewing scandal? Or perhaps the powerful bullion banks within the LBMA wanted to scupper any change that there will ever be wider participation or central clearing in any future version of the auction? I will leave it to readers to do their own research on this and draw their own conclusions. A Banking Cartel vs. Wider Auction Participation A major issue that has dogged the LBMA Silver Price auction since launch is that it never gained any level of “wider participation” or market representative participation. There are only 7 bullion banks authorised by the LBMA to be direct participants in the silver auction, and there are zero direct participants from the silver mining, silver refineries, and silver users sectors. This is despite the LBMA, CME and Thomson Reuters all misleading the global silver market on this issue on many occasions, and claiming that there would be very wide participation in the auction after it was launched. See BullionStar blog “The LBMA Silver Price – Broken Promises on Wider Participation and Central Clearing” for a huge amount of factual evidence to back up this statement, including webcasts by CME, Thomson Reuters and the LBMA, and an interview by Reuters with LBMA consultant Jonathan Spall, formerly of Barclays. Here are a few examples: The LBMA’s Ruth Crowell was claiming back in July and August 2014 that they were interested in having at least 111 direct participants: “clear demand for increased direct participation, and we had 25% of those 444 coming back saying they would be interested, and we’re still interested in having all of those participants on board” “The advantage with centralised clearing, particularly for the pricing mechanism, is that we can really exponentially grow the amount of direct participants“ Jonathan Spall, LBMA Consultant stated that: “The hope of course is that we get many more participants in the new benchmark process….while it is likely that we will start by having banks involved it is ultimately hoped that the wider market will participate, be they refiners, miners etc.“ “Ultimately – and as I said before – the intention is that there is much wider participation. So yes, refiners, miners etc.“ Harriett Hunnable, then of the CME Group, stated: “So this is really the new world, this is not the old fixing…..this is wider participation…and the London bullion market is really encouraging that…this is the new world, or the LBMA Silver Price!”. According to the CME / LBMA / Thomson Reuters presentations, there was supposed to be a “phase 3 introduction of centralised clearing” “Central counterparty clearing will enable greater direct participation in the London Silver Price“ In summary, central clearing would allow direct participants to participate directly in the auction without the need for bi-lateral credit lines. Currently, only large banks that can set up bi-lateral credit lines with each other can even begin to think of being direct participants. However, after the initial spin in July and August 2014 prior to the benchmark being launched, the plan for central clearing was quietly dropped by the LBMA / CM and Thomson Reuters. The CME and Thomson Reuters have now had 32 months in which to introduce central clearing into the silver auction and it hasn’t happened. Nor will it now. The fact of the matter is that the LBMA banks do not want wider participation and they don’t want central clearing of auction trades either. These banks, which at the end of the day are just costly intermediaries, essentially want to monopolise the silver auction and prevent wider participation, and prevent true silver price discovery. Could it be the banks through their LBMA front that have sabotaged the contract with CME and Thomson Reuters so as to reset the contract and re-start another tender process (choosing ICE or LME) that will ensure that no wider participation can ever see the light of day? It’s also important to note that there is no way for miners and refiners to be direct participants in the silver auction. This is because the LBMA has designed the auction participant rules to keep out refiners and miners (and anyone else that is not a bullion bank). The rules are specifically designed so that only bullion banks can satisfy the LBMA’s Benchmark Participant criteria. See section 3.13 of the LBMA Silver Price auction methodology document accessible here. Currently only 7 bullion banks are direct participants in the auction, namely HSBC, JPMorgan Chase, Bank of Nova Scotia (ScotiaMocatta), Toronto Dominion, UBS, Morgan Stanley, and China Construction Bank.  Most of these banks are very influential on the LBMA Management Committee. HSBC, Scotia and Mitsui were in the auction from Day 1 on 15 August 2014. UBS joined the auction on 26 September 2014, JP Morgan Chase Bank joined on 14 October 2014, Toronto Dominion Bank joined on 6 November 2014. Mitsui left in either late 2015 or January 2016 (the exact date is unclear). China Construction Bank only joined the auction on 6 May 2016. As mentioned above, Morgan Stanley only joined the LBMA Silver Price auction on 25 October 2016 (which is just 4 months ago), at which point the LBMA / CME and Thomson Reuters had the audacity to spin that 7 LBMA bullion banks trading in a shadowy auction of unallocated silver accounts in London somehow represents the global silver market: CME: “The addition of another member brings greater depth and diversity to the market and underlines the ongoing globalisation of the Silver Price as a leading, liquid precious metals benchmark.” Thomson Reuters: “With the addition of Morgan Stanley to the panel, the LBMA Silver Price provides even deeper insight into the global silver market. We continue to welcome new participants to this essential mechanism for the markets.” LBMA: “They [Morgan Stanley] add depth and liquidity to the auction and I look forward to other market participants joining in the future.” LBMA Silver Price is NOT Representative of Silver Market But, to reiterate (and as was stated previously in this blog), the LBMA Silver Price auction is not representative of the global Silver Market whatsoever, and it does not meet some of the simplest IOSCO benchmark requirements: “IOSCO benchmark principles state that a benchmark should be a reliable representation of interest, i.e. that it should be representative of the market it is trying to measure. Interest is measured on metrics such as market concentration. In the Thomson Reuters methodology document (linked above), on page 11 under benchmark design principles, the authors estimate that there are 500-1000 active trading entities in the global silver market.” The Thomson Reuters methodology document from August 2014 also admitted that “volumes in the LBMA Silver Price are a fraction of the daily volume traded in the silver futures and OTC markets”. Why then are 7 LBMA bullion banks allowed to monopolize the representation of 500 – 1000 active trading entities from the global silver market within the auction, an auction that its worth remembering generates a silver reference price which is used as a global silver price reference and pricing source? Refiners and Miners Based on the current LBMA Silver Price auction rules, the vast majority of the world’s silver refiners cannot directly take part in the silver auction since only Full Members of the LBMA can even think of becoking a direct participant. However, only 8 precious metals refiners are even Full Members of the LBMA, while there are another 25 refiners that are Associates of the LBMA. Of the 8 full members, 5 of these refiners are on the LBMA refiner Referee panel, namely, Argor-heraeus, Metalor and PAMP from Switzerland, Rand Refinery from South Africa, and Tanaka Kikinzoki Kogyo from Japan. These refiners were added to the panel as LBMA Associates in 2003, and were only made Full Members in 2012. The only reason they happened to be fast-tracked as Full Members of the LBMA was due to their status as Referees for the LBMA good delivery list. Even the other major Swiss based refinery Valcambi is still not a Full Member of the LBMA. Based on the current participant criteria of the Silver auction, where only full LBMA members could conceivably become direct participants, 25 of the refiners that are LBMA Associates cannot directly take part in the auction even if they wanted to. Candidates for Full LBMA Membership also have to jump through a number of hoops based on sponsorship by existing members, business relationships, due diligence, and involvement in the precious metals markets. For a refiner to even become a LBMA 'Associate', the refinery must have already attained Good Delivery Status for its silver or gold bars. There are about 80 refineries on the LBMA’s current Good Delivery List for silver, most of which are not even Associates of the LBMA The chance of the vast majority of these refiners taking part in the LBMA silver auction is nil since not only are they not LBMA Full Members, they are not even LBMA Associates. Based on the current auction criteria, it’s without doubt literally impossible for nearly all silver producers / silver miners on the planet to directly participate in the LBMA Silver Price auction. Precious metal mining companies are not normally officially connected to the LBMA, and would more naturally be members of the Silver Institute or World Gold Council or another mining sector organization. Mining companies cannot be silver auction participants since there are no mining companies that are Full Members of the LBMA. The only mining companies that are even “Associates” of the LBMA are Anglogold Ashanti and Coeur Mining. In 2014, Coeur Mining’s treasurer, referring to the LBMA Silver auction said: “We hope to have the opportunity to become a direct participant down the road and look forward to working with the LBMA, CME and other silver producers to drive the evolution of this market.” The unfortunate Coeur Mining now looks like it has been strung along by the LBMA with empty promises that it can somehow someday participate in the silver auction, but this is literally a fiction given the way the auction rules are currently set up. Conclusion In its announcement on 3 March, the LBMA said that it will shortly launch a tender process to appoint a replacement provider. The LBMA told Reuters News: “We would be looking to identify a new provider in the summer, and have the new platform up and running in the autumn” However, given the abysmal track record of the LBMA Silver Price, the question that should really be asked at this time is why the bullion bank controlled LBMA is even allowed to be in charge of such an important “Regulated Benchmark” as a global silver price benchmark, a benchmark that has far-reaching effects on global buyers and sellers of the physical metal silver. Take a brief look back at how the last tender process run by the LBMA for the London silver price was handled. A Silver Price Seminar held by the LBMA on 19 June 2014 was not even open to the wider bullion market. As Ruth Crowell, CEO of the LBMA, told the publication MetalBulletin in an October 2014 interview: “Not just our members, but ISDA members, and any legitimate members of the market were invited to the seminar. We also had observers from the FCA and the Bank of England. We wanted to keep [attendance] as wide-ranging as possible but to avoid anyone who perhaps would be disruptive“ What is this supposed to mean? To prevent anyone attending the seminar who might have a different view on how the global silver price benchmark should be operated that doesn’t align with the view of the LBMA? The actual process of selecting the winning bid from the shortlist of tender applicants was only open to LBMA Full members and Seminar attendees via a 2nd round voting process. The independent consultant review that was part of the selection process, was conducted by someone, Jonathan Spall, who was not independent of the former fixings and so should not have been involved in the process. Promises of wider participation involving refiners and miners were abandoned by the CME, Thomson Reuters and the LBMA. Promises of central clearing of auction traded were thrown out the window by these same people. Prior to launch, the auction platform was hastily built by Thomson Reuters and CME without an adequate market-wide solution for clearing silver trades. Another of the bidders, Autilla/LME, had a working auction solution which would have allowed wider market participation at August 15 2014 go-live, but this solution was rejected by the LBMA Management Committee, LBMA Market Makers and the LBMA Data Working Group at a closed meeting in July 2014 These groups had the ultimate say in which applicant won the tender. There were only 3 participants in the LBMA Silver Price auction (all of them banks) when it was launched in August 2014, and two of which, HSBC and Scotia, were parties to the former London Silver Fixing. The LBMA Silver Price auction was therefore an example of same old wine in a new bottle. The same 2 banks, HSBC and Scotia are now defendants in a silver price manipulation class action suit in New York. There are now only 7 direct participants in the LBMA Silver Price. These are all bullion banks. Ludicrously, this is 32 months after the auction has been launched. The LBMA accreditation process specifically prevents refiners and miners from joining the auction. Since there are 500 – 1000 trading entities of silver globally, even a village idiot could see that the LBMA Silver Price mechanism is totally unrepresentative of the global silver market and that it cannot faciliate proper silver price discovery. The defection of CME and Thomson Reuters now provides a one-off opportunity for the global silver market to insist that the current scandal ridden current auction be scrapped and taken out of the hands of the bullion bank controlled London Bullion Market Association (LBMA). It is also an opportunity to introduce a proper silver price auction in its place that is structured to allow direct participation by hundreds of silver trading entities such as the world’s silver refiners and miners, an auction that employs central clearing to allow this wider participation, and an auction that is based on trading real physical silver and not the paper credits representing unallocated claims that the participating London bullion banks shunt around between themselves each day. This could help lead to real silver price discovery in the global silver market. However, the chances of this happening with the LBMA still involved in the new tender process are nil, and either the London Metals Exchange (LME) or ICE Benchmark Administation (IBA) will probably ride to the rescue of the LBMA bulion banks in the not too distant future and pick up the pieces from CME / Thomson Reuters. 

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07 марта, 18:00

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07 марта, 14:50

Китай к 2020 г планирует увеличить производство золота на 11%

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06 марта, 03:03

Dustin Johnson holds off rising star Jon Rahm to win WGC event in Mexico

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05 марта, 02:56

Justin Thomas leads but Rory McIlroy in touch at WGC event in Mexico

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04 марта, 02:52

Rory McIlroy leads WGC event in Mexico at halfway after round of 65

• Ross Fisher, Justin Thomas and Phil Mickelson all two shots behind• World No1 Dustin Johnson sits three off the paceThe prospect of Rory McIlroy being restored as the top ranked golfer in the world by Monday morning is suddenly a live one.A stunning performance from the Northern Irishman in recording 65 on the outskirts of Mexico City on Friday assured him of a two-stroke lead at the first WGC event of 2017. This, indeed, was done with McIlroy still feeling the effects of the food poisoning which had first surfaced in the early hours of Thursday morning. Continue reading...

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03 марта, 03:04

Rory McIlroy battles food poisoning to stay in Mexico contention

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