Market Curiosity: Exploring Markets And Systems

September 9, 2012

LBMA SIFO from November 2006 to September 2012 (update1, Dec 2012)

Filed under: Systems — Tags: , , , — Jeff Fitzmyers @ 3:16 pm

The last update a year ago noted:

James Turk’s Sep 17 2011 trading comments: …the LBMA’s GOFO is no longer a reliable rate. I think the banks are just making it up to paint a picture that has some semblance of normalcy. But things in Europe are anything but normal. Abnormal relationships in short-term currency vs. gold interest rates make that point clear.

Turns out this was correct. So I put zero weight on SIFO. But, here is the chart for the record. LBMA current stats.

Update December 2012: Guest Post: “Smelly Smoke Signals” by NN-L

Our pal, Ned, has cranked out a very interesting piece regarding the recent suspension, by the LBMA, of the publication of silver forward rates (SIFO)… The most interesting and compelling part of all this is the timing. The LBMA decided to suspend SIFO reporting at the close of business on Friday, November 2. At that exact same moment, some newly-created measures of backwardation such as Sandeep Jaitly’s “Basis/Co-Basis” were literally screaming of extreme backwardation and physical tightness.

Turk – The LBMA Is Moving To Cover Up Silver Manipulation

“The reason they (the LBMA) gave is they said it is just an indication and you can’t really trade at that price anyway. So what that does is prove the point that I’ve been making, that these are artificial rates which are just there to paint the tape and to mislead people into thinking the silver market is actually in a normal contango. But in reality it (silver) is actually in backwardation.”

+ The last LBMA SIFO update for a while

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