Short New York Silver, Long Leveraged London Silver - Are Bullion Banks Really Net Neutral?
No Mulligans - If Your Longs Fail, You Still Have To Cover Your Shorts
“Yes, the CME is a futures exchange, however, it is backed up by physical. For all those that are saying CME is just paper and claiming all other absurd theories like banks are short the world's supply of gold and silver and need to cover, please stop talking your position and spreading disinformation. Banks are short the CME against being long London otc and otc forwards. They are NOT outrite short metals.”
Robert Gottlieb, precious metals analyst and industry veteran (LinkedIn), March 21, 2025
The above view expressed today by Robert Gottlieb is widely held in the precious metals trading industry.
Short NY CME COMEX / Long London physical OTC spot/forward contracts - what could go wrong?
So here is a question: what if bullion banks and other market participants are recognizing that the London Bullion Market, where 2.4 billion oz. of silver spot and forward promissory note contracts for physical silver delivery are traded every day in total turnover, has a serious physical silver (and gold) shortage problem from leverage where London delivery cannot be met. Net claims for physical silver for immediate London market delivery are estimated at 5 billion (B) oz.
As of March 11, 2025 (latest data), Swap Dealers (bullion banks) were short 64,041 x 5,000 oz. silver contracts or 320 million (M) oz. of silver in the CME COMEX market in the U.S. These same bullion banks were long 21,925 silver contracts or 110M oz. of silver on the COMEX. This yields a net short position of 42,116 silver contracts or 210 M oz. of silver on the part of the bullion banks.
Now the 210M oz. of the silver net short position held by bullion banks in the COMEX is theoretically covered by an offsetting long position of the same size in London.
But The Leveraged Claims For Vast Amounts Of Physical Silver And Gold In London Appear To Have A Serious Problem…
As silver is now moved to New York from London, the silver lease rate in London continues to surge indicating that London vault silver is not being replenished adequately despite London being a relatively short truck trip away from Switzerland where silver is theoretically available to back London silver claims.
And as some market participants have begun to see this, others are also recognizing this fact further increasing the demand for London physical silver delivery. This may be the trigger in the leveraged London silver and gold market.
Further, the quality of the 110M oz. long position held by bullion banks on the CME COMEX is unknown - that bullion bank long position may also be ‘backed’ by promissory notes in London.
What we do know is that the bullion banks alone have a 320M oz. short position in the CME COMEX market.
Given that the bullion banks often have the best market intelligence because of their reach, it would be interesting to know exactly which entities are moving the large quantities of gold and silver into the US over the last 3 months.
Do bullion banks increasingly recognize that, in reality, their net positions in the silver and gold markets are not net neutral?
What is common knowledge can turn on a (silver) dime.
Best regards,
David Jensen
I posted the above article in Robert Gottlieb's LinkedIn comment section.
3 minutes later, Robert Gottlieb's LinkedIn page returns a 404 Error message.
Let's see if the page has been taken down or if it is a temporary glitch.
https://www.linkedin.com/in/robert-gottlieb-519275319/
Let’s get curtains pulled back on the metal market manipulator’s and get a real look see at the great and powerful CME Group, LBMA, Bank fraudsters and the “other’s” trying to act like wizards of Ag & Au and send them back to the Emerald City of Oz. Then we can have a glorious bonfire of all the worthless paper contracts to smelt the actual remaining metals and finally get tru price discovery of god’s money, the real real, the actual precious metals. Once the worthless fake paper proxy manipulated contracts are no longer able to “physically deliver the goods” this decades long aberration since 1987 will finally end in spectacular failure and implode itself.