Nothing more can be said about this trade reporting fiasco other than it must be obvious to everyone that the LBMA and its bullion bank members do not want the transparency that gold and silver trade reporting would provide. Otherwise they would not have spent 4 years on a project which any individual investment bank could start and complete within less than 3 months.

CME lowers gold margins by 21.3% to $3500 & silver margins by 23.1% to $4000

Comex drops gold margins by 9.2% & silver margins by 11.9%

New rules from regulators, on top of uncertainties over the U.K.’s future relationship with the European Union, are denting the city’s position as the biggest center for gold trading in the world. The changes threaten to push up costs, a key competitive advantage of London’s over-the-counter market.

Even before the regulations come in, the average net daily volume of gold settled by London Precious Metals Clearing Ltd. fell 12 percent in two months to 18.5 million ounces in August. In New York, the British capital’s biggest rival, trading in gold contracts jumped more than 25 percent in the third quarter from the previous three months, with activity during European hours surging 32 percent.

Adding further clearing members is a top priority for the exchange as it looks to expand volumes on LME precious, the suite of gold and silver spot and futures it launched in July, Chamberlain said.

The two new gold futures has over 29,074 contracts in their first seven weeks of trading, which has helped stock brokers to diversify their income source.

The most important number in all of this is how much gold do the LBMA bullion banks in London own and control. It cannot be more than about 1500 tonnes on the high side and less than 1000 tonnes on the low side. But still the London gold market trades over 6000 tonnes of gold equivalent each day, which is over 143,000 tonnes per month or 1.6 million tonnes per year. This is only possible because the London gold market is a giant fractional-reserve system of paper gold trades with very tiny physical gold underpinnings.

New data has revealed that around 7,500 tonnes of gold was held in London in March of this year – the equivalent of 596,000 gold bars, or £227bn-worth of gold.

The data also revealed that London’s vaults held 32,078 tonnes of silver in March, worth £14.5bn.

The London Metal Exchange said on Monday that 2.6 million ounces (79.6 tonnes) of gold and 12.8 million ounces (397.5 tonnes) of silver was traded through its LMEprecious contracts in their first week of trading.

LMEprecious, which includes spot, daily and monthly futures, launched on July 10 with backers including banks Goldman Sachs and Morgan Stanley who committed to provide liquidity as part of a 50:50 revenue-sharing deal with the LME.

The Shanghai International Gold Exchange can be viewed in a number of ways. Organizationally, the SGEI it is a fully-owned subsidiary of the SGE and is registered in the Shanghai Pilot Free Trade Zone (FTZ)1. The SGEI’s offices are also located in the Shanghai Pilot FTZ in the Bank of China Tower, 200 Yincheng Road Central, Pudong, in Shanghai.

From a trading perspective, SGEI refers to the “International Board” of the Exchange. On this Board, a number of physical gold contracts (products) specifically designed for international gold investors are listed and traded. Since these products are physically delivered gold contracts, the SGEI infrastructure also encompasses a certified precious metals vault where the physical metal backing this gold trading is stored. This SGEI certified vault is also located in the Shanghai Pilot FTZ and is ring-fenced from the SGE’s network of gold vaults that serve the domestic Chinese gold market. The gold in the SGEI vault can be freely imported into and exported from the FTZ since the FTZ is deemed to be outside of China for customs purposes.