[thoughts] On Predicting when Bullion will Return to GLD (FAILED PREDICTION) PLUS a new permanent spreadsheet resource

A number of months ago I predicted the return of some specific GLD bars, and I'm sorry to say they haven't yet returned and statistically there is now less than a 5% chance that they will. So that is a FAIL; my method for detection of unusual GLD withdrawals did not create an accurate prediction. I'm disappointed and it's back to researching that area. I will of course update this article if I ever see them back on the ledger, but because it's outside the three to four month range expected, I'm admitting defeat.

[thoughts] On Predicting when Bullion will Return to GLD (premise)

[just a quick post] I've been chasing a lot of things lately, but primarily I've been trying to unlock patterns in the GLD bars list data. The 'dark bullion effect' is easy to measure but difficult to understand. Below is an infographic that I've been meaning to release regarding the 2013 calendar year. It is significant because for the most part of the year, most of the new 'additions' came from bars which had already been seen in the inventory. This is not specifically surprising by itself considering that so much had been removed, but it just demonstrates there is a really large stock of gold in London and that it doesn't necessarily all vanish instantly to China. In terms of visibility, interpreting the gold market through the ETF volumes alone is like trying to figure out how a department store operates by studying it through the retail window display.

GLD Added 7½ Tonnes in January 2013

A quick follow-up to the GLD bar list, which had a large 600-bar addition last week, I wanted to shed some light on the inner mechanics. Inventory additions in GLD are noteworthy because the trend is currently inventory removal. This is a followup from this post when 6½ tonnes got added late last year.

The inventory addition on 17th January 2014 from the SPDR GLD trade spreadsheet finally showed up in the bars list data on 23rd January 2014 (delayed because of the US holiday). I was mildly surprised to see that all the bars added (i.e. 100%), had been seen before, i.e. they were dark bullion for a time before being 'added' back to the ledger. The average rate for dark bullion discovery is typically 30% of added gold so this is unusual. For most of the time, these bars have been sitting in the vault, from as far back as 2009, this is the breakdown by refiner:

Below is a method I am developing for GLD inventory visualization, sorry for the crudity - bear with me, I will explain it.

The Earliest Known GLD Bar Lists

This article will only be of interest to fanatic bullion bar list historians - I am pleased to announce that with the help of some great individuals, we now have copies of some of the earliest known bar lists for the GLD ETF.

I am grateful to the collective efforts of FOFOA and Ro' on this one - they knew I had an interest and applied a better approach to researching the topic than I did. Prior to this discovery our earliest bar list was from October 2009. As a quick reminder : we're interested in the GLD bar list because it is the biggest and best data source for public weight lists - it constitutes 80% of the bullion bar information we have in the database (currently over 54 million rows of data).

A different view of GLD (part 2 of 4) updated

This is part 2 of a perspective on GLD's inventory you won't find anywhere else on the internet; an edutainment series using the ETF bar list data as a base. In Part 1 we looked at what occurs when we look at a specific set of inventory, here is the updated graph (using the data from July 2013). This time I have added some extra data points to help accentuate that the line indicates the measurement between two chosen points only. The additional measurements show bullion for a shorter 2-year range.

The last few months of removals has started cutting into GLD stock originally accumulated more than two years ago (i.e. this is shown where the corner meets the inventory curve), whereas that wasn't the case in February. For our 'overall' measurement, the dark yellow line has moved DOWN (from dotted line) since last month, so we can say that over 1,000,000 ounces of gold removed in the last month, was taken from stock present prior to June 2011. But while this is interesting, it is no particular conspiracy as it just reflects the fact a lot of gold is being de-listed.

Also bear in mind this chart summarizes a lot of detail. Don't read into the figures too much.

A different view of GLD (part 1 of 4)

GM has charts sewn up nicely, but in the land of the bar list, what's new? Everyone knows about the decline in GLD inventory but not much attention is given to increases in inventory, so let's talk about it some. There were only three 'Add Events' in GLD during June 2013, with the largest add (214 bars) on the 13th June. In my bid to make the information more digestible, here is the summary as a handy info-graphic (yeah, I've got a new version of photoshop):

A quick GLD Dark Bullion Post (updated)

During the last week we mapped the Dark Bullion in GLD, similar to our SLV study. I've always been curious about what was happening with the inventory during August 2011 during that magnificent price peak, and here is an interesting look at that month. If you haven't already seen the mechanic and terminology, please have a read of SLV Database #5. The black band is bullion which was removed from the bar list, but which we confirm has been added back at a later time. Additionally, there is some color to show which of the inventory has a 'history' of being dark, for both visible and lost. The scale (measured in Fine Oz) has been adjusted to highlight the movements, but bear in mind the dark band only represents a small percentage of the total inventory held.

August and September 2011, clearly showing that the inventory from
the big million-ounce removals were actually returned to the GLD
inventory at a later date.

SLV Database 5 - Dark Bullion

Dark, I'm feeling Dark. Go ahead, bite me.

This is the fifth major article in the series of SLV bar list data analysis. I've become so obsessed with this bizarre niche topic that between the pills and the lingering after-effects of the last round of mystery drinks at GM's country mansion, not an hour goes by where my reprehensible soul* is not pondering what mysteries can next be pulled from the darkness of the void.

The concept of dark bullion was first written about in analysis #2 where it was noticed from the SLV data that some of the bars appearing as 'new' inventory had actually been listed some time prior. In analysis #3 and #4, we progressed the investigation and now we know that bars can go dark and resurface, sometimes reappearing in different vaults (and we can track their movement from London to Australia, for example). Hidden, juicy secrets! Exactly what are those bars are doing when they are not represented on an ETF's bar list? While we will never know, at least we can describe what we can't see!!

Let's start with a premise. The "Dark Inventory" concept in commodities is not a new one ¹ but it is fair to say the area is difficult to study because of the general lack of quality information. However, the silver and gold inventories provide an interesting opportunity to track inventory because (conveniently) each bar has a serial number. So ... what is available to find, and how do we find it?

An example of the Dark Bullion Effect (GLD)

The GLD inventory the other week had a small uptick of inventory - just 96 gold bars - not much in the scheme of things but enough to do an analysis of 'where did those bars come from?'.

I consider the dark bullion effect significant because it invalidates more than one general thesis out there (about the metals). For anyone new to the discussion, I am defining dark bullion as 'A bar previously known and registered, re-appearing on a list after an absence.' I stand resolute on this topic simply because the signal (of the dark bullion effect) is unmistakeably clear and provides a different view of metal inventories - I have been pursuing this ever since I first detected the effect in 2011, and I want to talk about it more, with the hope that with enough discussion we might be able to squeeze some secrets out of the data.