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A Constructive Suggestion

On Feb 16, the CFTC released another update on the status of the delay in publishing COT reports on all markets (some seem to think the delay is only for gold and silver), as result of the cyber-incident at a key third-party service provider. The new announcement indicated that COT reports will commence starting next Friday, Feb 24, and will start with the first report delayed, namely, for the reporting week for positions held as of Jan 31. Then, the Commission intends to publish successive older reports in an expedited manner, with the goal of getting completely caught up and current by mid-March. This all assumes, of course, no unexpected data glitches.

Thus, the Commission intends to follow the precedent set in late 2018, when a US Government budget shutdown resulted in a month or so delay in the publishing of COT reports. Precedent, of course, has its place, but please allow me to offer what I feel is a better approach from an overall public service perspective. Instead of publishing the delayed COT reports in the order proposed, namely, starting with the first delayed report and progressively working up in a month or so to get current, I suggest the Commission reverse the order of publication and start with the most current reporting week and filling in the missing weeks thereafter.

Here's a copy of the email I sent yesterday (Feb 17) to the commissioners and those parties responsible for publishing the COT reports, under the subject heading “A Constructive Suggestion” –

Thanks for the COT report update of Feb 16.

What makes the COT report so valuable to those who follow it is its timeliness – it’s a marvel that positions are reported weekly with only a three-day delay.

Here’s a constructive suggestion that will only enhance the Commission’s standing if adopted – work to renew the publication of the report scheduled for Feb 24 starting with what would be the most recent  data, or the as of date of Tuesday, Feb 21, instead of the as of date of Jan 31.

I’m sure you would find universal agreement from those who rely on this data series that they would prefer getting the most current data, even if it involves a further delay in the publishing of older data. Anything speeding up the dissemination of the most current data should be the main mission.

Ted Butler

There’s no question in my mind that everyone interested in the COT report would agree that the most current data is the most important and desired. And as far as I can tell, there’s nothing to suggest the older data is more reliable than the newest data – all the data are valid or are compromised. I certainly agreed with the Commission’s decision to delay the publishing of data that might be compromised and subject to revision; the only thing I’m suggesting is the order of publication. Finally, I couldn’t have been more polite or respectful.

Still, I feel the odds of the Commission adopting my suggestion are quite low, for reasons unrelated to its specific merits. If the Commission responds at all, it will most likely offer some convoluted explanation about how it would like to adopt this publishing timetable but can’t – even though it would definitely be in the greater public interest. I believe that’s because of the person (me) offering the suggestion.

Unfortunately or otherwise, a curious relationship has developed over the decades between the Commission and myself in which it must disagree with everything I might hold to be true – I think out of the fear anything I say that might be credible as related to my allegations of the continuing COMEX silver manipulation.  Just for the record, the feelings aren’t mutual, as I have complimented the Commission on occasion – the most recent being it having prevailed against Monex in its decades-long epic legal fight against the purveyor of illegal leveraged precious metals contracts.

In fact, I even contemplated passing my suggestion to someone with less previous baggage in dealing with the CFTC, but quickly gave up because I couldn’t think of anyone. Besides, my suggestion has a short-shelf life because if all goes according to plan, the COT reporting will be current in a month or so. Still, like news or fish, data is best when it is freshest. Certainly, there is no one out there that wouldn’t prefer getting the most recent data first and if you read the background of the COT report on the Commission’s website, all it talks about is public service.

In sharp contrast to what I expect the Commission’s reaction to be regarding my current suggestion, where no prior animosity existed (I do admit to being a critic of the agency for decades – for well-deserved reasons), the results have been better. Some 15 years ago, back before Barclays Global Investors sold its ETF business to BlackRock, I made the public suggestion that BGI list all the bar numbers, hallmarks and weights for all the specific silver bars in its then-owned SLV, to match the practice in GLD, run by State Street Investors. This was no small undertaking as it would involve listing some 150,000 bars (today, closer to 500,000 bars). Yet Barclays did do the right thing, much to its credit.

What I’ve suggested the CFTC do in revising the order it intends to publish the delayed COT reports represents a true win-win, for it and the public it serves, so perhaps I shouldn’t be so pessimistic about the outcome. The darkness created by the delay in publishing COT reports can be lifted the moment the Commission lights a candle and publishes the most current data.

Ted Butler

February 19, 2023  

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