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GLD 10-K omits critical gold holdings data, as GLD CFO leaves 1 day before financial year-end
by BullionStar Thursday, Dec 17, 2020 - 12:11
The latest SPDR Gold Trust (GLD) annual 10-K financial report and statement has recently been submitted to the US Securities and Exchange Commission (SEC) by GLD Sponsor, World Gold Trust Services (WGTS), the fully-owned subsidiary of the World Gold Council.
Alarm Bells
Covering the financial year to 30 September 2020, this GLD 10-K should be raising alarm bells at the SEC given that the Principal Financial and Accounting Officer (CFO) who signed off on it, Brandon Woods, had only been in the CFO position at the GLD Sponsor for one day prior to GLD’s financial year-end. Woods was appointed on 29 September 2020.
To put it another way, the GLD Trust Sponsor’s previous Principal Financial and Accounting Officer (CFO), Laura Melman, resigned from her CFO role at WGTS on 29 September 2020, one day prior to GLD’s 30 September financial year-end.
If anyone knows of a CFO joining a high-profile listed ETF Trust one day prior to financial year-end and then signing off on the annual accounts, please let us know. Likewise, for a CFO of a high-profile listed ETF Trust leaving one day prior to financial year-end and not waiting for financial year-end. None of this, to say the least, is normal.
The World Gold Council would have you believe that everything was hunky-dory, with the 8-K (departure and appointment) form submitted by WGTS to the SEC on 29 September 2020 stating that Melman’s “departure did not arise from any disagreement on any matter relating to the operations, policies or practices of the SPDR® Gold Trust”. However, it also said that Woods’ appointment on 29 September was “effective immediately”, i.e. one day before GLD’s financial year end.
Why did the CFO resign one day before financial year end and not put her name to the annual 10-K submission to the SEC? That fact that the 8-K form was rushed out on 29 September appointing the new CFO “effective immediately” shows that the departure of Melman was abrupt, and that it triggered the rushed appointment of Woods on the same day “effective immediately”.
---- Perhaps in the world of fly-by-night companies, CFOs depart and appear a day before financial year-end, but this is not the norm when applied to the world’s largest gold-backed Exchange Traded Fund (ETF), a Trust which as a reminder, on 30 September 2020 claimed to hold 40.8 million ounces of gold worth US$ 77 billion with custodian HSBC Bank plc in London, and a Trust whose only asset is “allocated gold bullion”.
---- Conclusion
Wow! Why would KPMG add in this “Critical Audit Matter" to the GLD 10-K now in 2020 and never before, not once since it began as auditor of the GLD in 2010? This is therefore another question to add to the list of questions about GLDs latest 10-K, a list which would include the following:
• Why did the GLD Sponsor CFO resign on 29 September 2020, one day before financial year end of 30 September?
• Why did a new CFO arrive on 29 September, one day before financial year end, and then sign off on annual financial statements for an entire year covering a period during which he wasn’t the CFO?
• Why does the latest GLD 10-K withhold quantity data on how much gold the GLD held at the Bank of England between 15 April and 13 August, and only use the word ‘some’ which is contrary to the Full Disclosure Principle of accounting?
• Why does the latest GLD 10-K blank out the use of XBRL data tags for “Gold Held by Subcustodian" that would show precisely how much GLD gold was held by GLD at the Bank of England between 15 April and 13 August?
• What is GLD gold doing at the Bank of England for 121 consecutive days if the custodian HSBC is obliged to use “commercially reasonable efforts promptly to transport the gold from the subcustodian’s vault to the Custodian’s vault “?
• Why has the GLD auditor KPMG (New York) suddenly added a Critical Audit Matter to its audit statement about evaluating “the evidence pertaining to the existence of the gold holdings“, when KPMG has been the Trust’s auditor since 2010 and has never done so previously?
Enquiring minds would like to know.
Now back to that story of Tesla. (All the action was probably near Friday’s close in preparation for Monday’s opening, but we shall see.)
On Monday, Tesla Will Join The S&P500: Here's What Happens Next
by Tyler Durden Thursday, Dec 17, 2020 - 20:20
One of the most anticipated and material changes to the S&P500 is set to take place in just hours, when Tesla - a $615 billion company that has barely generated any GAAP profits in its operating history - is set to join the world's most important market index.
What happens then? Well, as with every other thing in the market, there are two schools of thought.
According to one, which Bloomberg affectionately calls the Wall Street smart beta data nerds - Tesla will be a drag on the index. These "smart beta" quants believe that market-weighted indexes suffer by chaining their fortunes to big and bloated companies. As such, Tesla’s imminent entry into the S&P 500 is stirring their passions by framing the debate in particularly stark terms. According to Bloomberg, index pioneers such as Rob Arnott are making the rounds and publishing studies in the run-up, "trumpeting data that purports to show that megacap companies have the potential to harm passive returns." Their pessimistic view coincides with that of the smart-beta folks who say many stock indexes stumble when the massive companies that dominate them run out of room to grow.
In a recent paper titled "Tesla - The Largest-Cap Stock Ever to Enter S&P 500: A Buy Signal or a Bubble?”, Arnott and a colleague at Research Affiliates looked at 31 years of data and found that when a company is big enough to enter the index as one of its 100 largest members, it falls 7% over the following year, on average. Meanwhile, the average deleted company beats the gauge by 20% after being kicked out (in this case, Tesla is replacing Apartment Investment and Management which is down 46% YTD).
---- To Arnott, Tesla's addition is a case in point of indexes chasing performance: "This Tesla addition is a beautiful illustration of that,” Arnott told Bloomberg in a phone interview. "It’s run up 800% from the March lows. Now you want to add it?" Ironically, the stock surged by about 50% precisely on the news of the S&P addition, begging the question if there is any good news left.
---- To be sure, the overriding concern among quants and most fundamental traders, is the gaping valuation mismatch between Tesla - currently trading at 20 times sales or almost 10 times the S&P 500’s valuation - and the rest of the S&P.
An attempt to ease investor concerns with a far more sanguine take was published overnight by Goldman's chief equity strategist, David Kostin, who wrote that "when Tesla joins the S&P 500 next week it will lift the index P/E ratio by just 0.4 multiple turns, much less than most investors expect." According to Kostin, Tesla currently trades at (only) 170 times consensus 2021 earnings with a $600 billion market cap and $480 billion float cap.
More
https://www.zerohedge.com/markets/monday-tesla-will-join-sp500-heres-what-happens-next
Why you shouldn't buy a Tesla Wall Connector
QuantumScape’s Solid-State Battery vs. Tesla, QS Stock Analysis, Tesla China November Sales
Challenging Tesla: TOP 10 Most Anticipated Electric Vehicles in 2021
https://www.youtube.com/watch?v=9M-xvB6_fEI
Covid-19 Corner
This section will continue until it becomes unneeded.
How Science Beat the Virus
And what it lost in the process
Story by Ed Yong January/February 2021 Issue
In fall of 2019, exactly zero scientists were studying COVID‑19, because no one knew the disease existed. The coronavirus that causes it, SARS‑CoV‑2, had only recently jumped into humans and had been neither identified nor named. But by the end of March 2020, it had spread to more than 170 countries, sickened more than 750,000 people, and triggered the biggest pivot in the history of modern science. Thousands of researchers dropped whatever intellectual puzzles had previously consumed their curiosity and began working on the pandemic instead. In mere months, science became thoroughly COVID-ized.
As of this writing, the biomedical library PubMed lists more than 74,000 COVID-related scientific papers—more than twice as many as there are about polio, measles, cholera, dengue, or other diseases that have plagued humanity for centuries. Only 9,700 Ebola-related papers have been published since its discovery in 1976; last year, at least one journal received more COVID‑19 papers than that for consideration. By September, the prestigious New England Journal of Medicine had received 30,000 submissions—16,000 more than in all of 2019. “All that difference is COVID‑19,” Eric Rubin, NEJM’s editor in chief, says. Francis Collins, the director of the National Institutes of Health, told me, “The way this has resulted in a shift in scientific priorities has been unprecedented.”
Much like famous initiatives such as the Manhattan Project and the Apollo program, epidemics focus the energies of large groups of scientists. In the U.S., the influenza pandemic of 1918, the threat of malaria in the tropical battlegrounds of World War II, and the rise of polio in the postwar years all triggered large pivots. Recent epidemics of Ebola and Zika each prompted a temporary burst of funding and publications. But “nothing in history was even close to the level of pivoting that’s happening right now,” Madhukar Pai of McGill University told me.
That’s partly because there are just more scientists: From 1960 to 2010, the number of biological or medical researchers in the U.S. increased sevenfold, from just 30,000 to more than 220,000. But SARS-CoV-2 has also spread farther and faster than any new virus in a century. For Western scientists, it wasn’t a faraway threat like Ebola. It threatened to inflame their lungs. It shut down their labs. “It hit us at home,” Pai said.
More, Much, much, more.
Germany and Europe Could Fall Short on Vaccine Supplies
The EU and Berlin have insisted there will be sufficient vaccine available, but delays in signing purchasing contracts mean that the elixir will arrive late and there might not be enough. The EU even declined an option that would have allowed for the purchase of hundreds of millions of extra doses.
By Markus Becker, Veronika Hackenbroch, Martin Knobbe, Christoph Schult und Thomas Schulz
Such are images of hope: Nurses getting vaccinated. Pallets of packaged vaccines distributed on special flights. Mayors exulting over "the beginning of the end of the pandemic.” A president who is preparing the country for better times.
These images are from the United States.
In Germany, on the other hand, you see desolate shopping streets, shuttered restaurants and a government that is preparing its population for long, dark days.
The contrast is unmistakable. On the one hand, there is the supposedly incompetent Trump administration, which will provide vaccines to 20 million Americans in the next two to three weeks alone. By the end of March, the plan is for around 100 million Americans to have received the two vaccine injections they need.
On the other hand, there is the supposedly well-prepared Europeans, who continue to have to wait for a vaccine that was developed in Germany. And who still don’t know exactly how much of the vaccine they will be getting in the coming months.
Initially, Germany’s health minister has announced, there will probably only be 400,000 vaccine doses for Germany, with another 11 to 13 million to follow by March -- a fraction of the amount the Americans are getting.
It’s a politically dangerous situation that has now been recognized by the German government. Since last week, it has been taking hectic countermeasures. The European Medicines Agency (EMA) now wants to approve the vaccine a week earlier than planned, and vaccinations are slated to begin in Europe on Dec. 27. Negotiations are also underway with manufacturers to obtain more doses.
----That realization has come too late, however. For months, it has been clear that other countries would have more doses of the vaccine, would start vaccinating sooner and, as a result, would be able to take more effective action against the pandemic.
But in Berlin and at European Union headquarters in Brussels, too little action was taken for too long, and it was often justified with complacent arguments: In Europe, medicines are tested better and more precisely than elsewhere in the world, and vaccines are available in abundance thanks to good planning.
----And the late approval of the active ingredient in the BioNTech and Pfizer vaccine by the European Medicines Agency (EMA) appears to be the least of the problems. The bigger issue is that if the situation remains as it is now, there will not be enough vaccine available to get the pandemic under control in Germany before next autumn. The EU appears to have bought too little, too late and at times from the wrong producers. And it appears that it turned down hundreds of millions of vaccine doses that are now lacking.
More
International Journal of Antimicrobial Agents
Available online 28 November 2020, 106248
A COVID-19 prophylaxis? Lower incidence associated with prophylactic administration of ivermectin
ABSTRACT
As COVID-19 (coronavirus disease 2019) continues to rapidly spread throughout the world, the incidence varies greatly among different countries. These differences raise the question whether nations with a lower incidence share any medical commonalities that could be used not only to explain that lower incidence but also to provide guidance for potential treatments elsewhere. Such a treatment would be particularly valuable if it could be used as a prophylactic against SARS-CoV-2 (severe acute respiratory syndrome coronavirus 2) transmission, thereby effectively slowing the spread of the disease while we await the wide availability of safe and effective vaccines.
Here, we show that countries with routine mass drug administration of prophylactic chemotherapy including ivermectin have a significantly lower incidence of COVID-19. Prophylactic use of ivermectin against parasitic infections is most common in Africa and we hence show that the reported correlation is highly significant both when compared among African nations as well as in a worldwide context. We surmise that this may be connected to ivermectin's ability to inhibit SARS-CoV-2 replication, which likely leads to lower infection rates. However, other pathways must exist to explain the persistence of such an inhibitory effect after serum levels of ivermectin have declined. It is suggested that ivermectin be evaluated for potential off-label prophylactic use in certain cases to help bridge the time until a safe and effective vaccine becomes available.
More
https://www.sciencedirect.com/science/article/pii/S0924857920304684?via%3Dihub
Next, some very useful vaccine links kindly sent along from a LIR reader in Canada. The links come from a most informative update from Stanford Hospital in California.
World Health Organization - Landscape of COVID-19 candidate vaccines. https://www.who.int/publications/m/item/draft-landscape-of-covid-19-candidate-vaccines
NY Times Coronavirus Vaccine Tracker. https://www.nytimes.com/interactive/2020/science/coronavirus-vaccine-tracker.html
Stanford Website. https://racetoacure.stanford.edu/clinical-trials/132
FDA information. https://www.fda.gov/media/139638/download
Regulatory Focus COVID-19 vaccine tracker. https://www.raps.org/news-and-articles/news-articles/2020/3/covid-19-vaccine-tracker
Some more useful Covid links.
Johns Hopkins Coronavirus resource centre
https://coronavirus.jhu.edu/map.html
Rt Covid-19
Covid19info.live
The Spectator Covid-19 data tracker (UK)
https://data.spectator.co.uk/city/national
Winter Watch.
The Arctic winter sea-ice expansion and northern hemisphere snow cover. From around mid-October, the northern hemisphere snow cover usually rapidly expands, while the Arctic ice gradually expands back towards its winter maximum.
Update: we seem to have started new sunspot cycle 25 this month, though it’s unlikely to affect 2020-2021s coming winter.
Northern Eur-Asia turned snowy fast in mid-October. The Arctic sea ice expansion was slow, and from a very low level at the end of September, but with the vastly expanded snow cover, sea ice formation sped up.
The Laptev Sea ice was back to normal at the end of November. But the failure of the Kara Sea ice still to return to normal, leads me to bet on a warmer western European winter ahead.
US National Ice Center.
Technology Update.
With events happening fast in the development of solar power and graphene, I’ve added this section. Updates as they get reported. Is converting sunlight to usable cheap AC or DC energy mankind’s future from the 21st century onwards.
Expanding Hydrogen Fuel Cell Technology for a Greener Car Industry
By Robert Lea Dec 17 2020
The car industry is starting to get behind hydrogen fuel cells to limit fossil fuel emissions.
Fuels cells are a promising technology that could help the automotive industry massively reduce fossil fuel usage by converting hydrogen into electricity. Just as is the case with any emergent technology, adapting hydrogen fuel cell tech to be as efficient and as cost-effective as possible requires investment.
A new positive step in this direction comes from car-manufacturer Hyundai, which has announced the launch of a new brand called HTWO that will be dedicated to hydrogen fuel cells¹.
The brand, whose name is a take on H2, the chemical designation for the hydrogen molecule, will initially be marketed primarily in the US, China, and Europe.
Hand-in-hand with this new brand, says the South Korean multinational automotive manufacturer in a press release issued on Thursday, will come a “stepping-up of efforts” to develop the next generation of fuel cells. This will include a focus on adapting this clean energy-tech to areas outside of the car-market that could see hydrogen fuel cells used in ships and trains.
The company’s press release goes on to state: “Not only will the next-generation fuel-cell system be available for many different mobility products and services, but it will also deliver enhanced performance and durability at an affordable price in a lighter architecture with advanced energy density.”
Of course, given the fact that fuel cells could be so beneficial to the environment, Hyundai is hardly the only company or organization that is interested in expanding the use of such devices. Even some countries are getting in on the action.
Other car manufacturers such as Toyota, Honda, Foton, Mercedes-Benz, Volkswagen, BMW, SAIC, FeiChi Bus, and Dongfeng have shown a strong commitment to these alternatives to electric batteries². They have also been joined by the governments of South Korea and China, who are preparing to invest heavily in hydrogen infrastructure.
Japan, in particular, is also keen to shift to hydrogen power, as the country has little in the way of fossil fuel reserves and the Fukushima disaster of 2011 has brought its previous dependence on nuclear power into sharp focus.
More
https://www.azom.com/news.aspx?newsID=55210
This weekend’s musical diversion. Vivaldi again. Rather like reading Dickens, the openings and endings are really quite good, the middle, well. I always looked forward to Dickens ending.
The original instrument horn players are both very talented young ladies.
A. VIVALDI: Concerto for 2 Horns, Strings and B.C. in F major RV 538, La
https://www.youtube.com/watch?v=0MBnyVCKyvk
This weekend’s great chess game.
4 Opening Traps Every Chess Player Should Know!
https://www.youtube.com/watch?v=76c3ngBilZE
Finally, get ready for a once in 800 years planetary Great Conjunction, weather permitting. Jupiter and Saturn will be at their closest on the December solstice of December 21, but should be visible in the southwest shortly after sunset from now through month end.
Jupiter and Saturn will form rare "Christmas Star" on winter solstice
On December 21, Jupiter and Saturn will appear closer in Earth’s night sky than they have since 1226 A.D. You can watch the event live here, courtesy of Lowell Observatory.
By Eric Betz | Published: Monday, December 7, 2020
This December, Jupiter and Saturn will put on a show for skygazers that hasn't been seen in roughly 800 years. Astronomers are calling it the Great Conjunction of 2020. On December 21 — coincidentally the winter solstice — the two largest planets in our solar system will appear to almost merge in Earth’s night sky.
During the event, Jupiter and Saturn will sit just 0.1 degrees apart, or a mere one-fifth the width of the Moon. The sight will likely leave many casual observers wondering "What are those large, bright objects so close together in the sky?"
In fact, Jupiter and Saturn will be so close that you will be able to fit them both in the same telescopic field of view. That’s an incredibly rare occurrence. The last time Jupiter and Saturn were this close together away from the Sun was in 1226 A.D., at a time when Genghis Khan was conquering large swaths of Asia, and Europe was still generations away from the Renaissance.
More
"If the profit numbers on income statements are treated with such reverence, it was obviously only a question of time before some smart fellows would start building companies not around the logical progression of a business but around what would beef up the numbers."
“Adam Smith” aka George Goodman. The Money Game.
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