Russia’s Central Bank Buys 300,000 Ounces of Gold in August

Gold bull market has a long way to go: Jim Rogers. The Battle for $21 Silver Begins. Russia’s Central Bank Buys 300,000 Ounces of Gold in August. The IMF itself has become the problem: Ambrose Evans-Pritchard… and much, much more.


Gold gained about six bucks from the time the markets opened in the Far East on Monday morning… until shortly after London opened at 9:30 a.m. local time. From that point, the gold price rolled over a bit, declining into the London p.m. gold fix at 10:00 a.m. in New York, before rising to a new record high of $1,284.80 spot… and then getting sold off and trading sideways for the rest of the New York session.

Silver’s price followed a similar path, except its high of the day [around $21.00 spot] was in London… shortly after 9:00 a.m. local time. From there it got sold off a bit, rose after the London p.m. gold fix… and then got sold off for a small loss on the day. Silver did not break through to a new record high price on Monday… and this is the second day in a row that silver has closed with a small loss.

The world’s reserve currency traded in a 50 basis point price range on Monday… and closed basically unchanged from Friday’s close.

The precious metals stocks pretty much traded in tune with the gold price action, with the top coming shortly before lunch in New York, which was gold’s [record] high price of the day. From that intraday high, the HUI gave up about a percent of its gains, but still managed to finish up 1.37% on the day… and back above the 500 level once again.

All in all, not much happened during Monday’s trading… and it’s impossible to read anything into one day’s worth of trading, especially considering the fact that volume in both gold and silver was on the light side. I’d love to see gold [and especially silver] blast off to the moon from these big overbought positions… but that sort of thing has never happened before… and if it does this time, it will be [as Ted Butler says] the very first time. It will mean that the bullion banks have been over run with a full short position on… and I see no sign of that from yesterday’s price action in either metal. But I rub my hands together with glee in anticipation of such an event!

Monday’s CME Delivery Report showed that 7 gold and 24 Comex silver contracts were posted for delivery on Wednesday. JPMorgan is still trading in its proprietary account. The link to what little action there was, is here.
The GLD ETF showed an increase on Monday of 117,260 ounces of gold… and there was no reported change over at SLV.

The U.S. Mint had a sales report yesterday. They sold 5,500 ounces worth of gold eagles… 2,000 one-ounce 24-K gold buffaloes… and 655,000 silver eagles. Month-to-date, the U.S. Mint has sold 43,000 ounces of gold eagles… 7,000 one-ounce 24-K gold buffaloes… and 1,045,000 silver eagles. Over at the Zürcher Kantonalbank in Switzerland, they reported adding 23,860 ounces of gold and 809,074 ounces of silver to their respective gold and silver ETFs last week.

Over at the Comex-approved depositories, they reported receiving a net 165,440 troy ounces of silver on Friday. The link to that report is here.
The big gold news yesterday came from the monthly update over at The Central Bank of the Russian Federation. They reported purchasing 300,000 ounces of gold bullion for their reserves in August. Year-to-date they’ve purchased 3.1 million ounces… a hair over 96 tonnes. I’m sure China is socking away gold as well, except they aren’t advertising the fact. Russia is broadcasting it to the world. Here’s the graph courtesy of Richard Nachbar and his most excellent assistant, Susan McCarthy.


I have a lot of stories… too many, in fact… but I’m going to post them all anyway. You can decide what’s worth your time. I’ve already hacked and slashed down to what I thought was the bare minimum, so you can complete the editing job for me. I also apologize for the fact that a lot of them fall into the must read category as well.

I mentioned late last week that Sprott Asset Management in Toronto had just purchased another six tonnes of gold for their bullion fund. Well, there was a story about that in the Saturday edition of Canada’s Financial Post… and it covered more than the Sprott purchase. The headline reads “Gold Glitters For Sprott”… and it’s worth the three minutes it will take to run through it. The link is here.

The next item is a 16-minute long video from the Friday edition of CNBC’s Squawk Box. It’s a story about small business in America… and gives insight into the struggles of making it as an American small business owner, with Home Depot co-founder, Bernie Marcus. Bernie started off life as a [very] small businessman… and he’s still tuned into what’s going on with the small business owner. I was very impressed by his honesty and integrity. People like him are what America is really all about. Even if you don’t own a small business, this is a must listen. I thank my good friend Rick Friesen for sending it along… and the link is here.

According to the following Bloomberg story [courtesy of reader Scott Pluschau], another six U.S. banks were closed by the FDIC on Friday… costing them about $350 million. The FDIC’s list of “problem” banks climbed to 829 lenders with $403 billion in assets at the end of the second quarter, a 7% increase from the 775 on the list in the first quarter, the FDIC said last month. It’s not an overly long story… and the headline reads “Six Banks Fail, Community & Southern Acquires Three”… and the link is here.

Late last week I ran story that the IMF might be coming to bail out Ireland. Well, Ireland’s finance minister Brian Lenihan moved to calm markets with a rebuttal of this story that Ireland is ‘perilously close’ to a debt crisis. The headline from the Saturday edition of The Telegraph reads “Ireland’s finance minister quashes IMF bail-out story”. Where there’s smoke… there’s fire, dear reader… and I thank reader Roy Stephens for sending this story along. The link is here.

Following that article in Saturday’s edition of The Telegraph, comes this Ambrose Evans-Pritchard offering from the Sunday edition of The Telegraph that’s headlined “The IMF itself has become the problem as Europe’s woes return”. Ambrose gets up on his high horse and cuts a swath through the IMF with this piece. It’s very much worth the read… and I thank Washington state reader S.A. for sending it along… and the link is here.

Also on Sunday came this piece on Ireland that was posted over at the Business Insider website. The headline reads “Ireland To Face Crucial €1 Billion Bond Test This Tuesday”. That’s today! The story is only three paragraphs long and will take less than a minute of your time… and is definitely worth the trip. I thank reader ‘David from California’ for sending it along… and the link is here.

As you know, Europe isn’t the only area of the world that has big economic, financial and monetary problems. In many ways the United States is in even worse condition. Here’s the latest GlobalEurope Anticipation Bulletin with the longish headline that reads “The Global systemic crisis Spring 2011: Welcome to the United States of Austerity / Towards a very serious breakdown of the world economic and financial system”. This essay came out last week and lays out in stark terms what’s coming down the pipe for the U.S.A. It’s a long and very ugly read, with excellent graphs. It’s also a must read… and I thank reader Ken Metcalfe [along with others] for sending me this story… and the link is here.

Before I begin all my gold-related stories for today, here’s a graph that Nick Laird over at Gold .:. ShareLynx Gold .:. Gold Charts .:. Gold Markets .:. Gold Articles .:. Precious Metals .:. Alternative Self-Sufficiency .:. Eclectic Scategories slipped into my in-box in the wee hours of this morning. It’s his “PM Funds Index” graph… and it shows that we’re almost back to our 2008 highs in the world’s precious metals equity markets. I’m sure that ‘da boyz’ are looking at this graph as well.

Click here to enlarge.

The first story is the latest offering from GoldMoney founder James Turk over at his FGMR – Free Gold Money Report website. The headline reads “They are printing too much money”. The article [long, by Turk’s standards] is a must read from start to finish… and the graph is excellent… and the link is here.
The next gold-related story is one that I ‘borrowed’ from Kitco. It’s an interview with Jim Rogers that was posted over at their website last Friday. The headline reads “Gold bull market has a long way to go”… and the link to the text and video interview… is here.

Next is Monday gold market commentary from Peter Brimelow over at MarketWatch – Stock Market Quotes, Business News, Financial News. The headline reads “Some gold bugs worried by Friday’s flop”. The gold bug he refers to is your humble scribe… as I was underwhelmed by the price action on Friday… and I get quoted in his column. Just ignore what I had to say… and read the rest. The link is here. I’ll have more to say about this in my closing comments.

Also in Peter Brimelow’s column, he quotes from James Turk’s essay over the weekend that is headlined “The Battle for $21 Silver Begins”. This is a must read commentary as well… and it’s accompanied by the usual excellent graph… and the link is here.

Lastly today, comes this lengthy item that was posted over at zero hedge | on a long enough timeline, the survival rate for everyone drops to zero on Sunday afternoon. The longish headline reads “Bill Buckler Discusses The Last Price Standing Of “True Money”, Answers The Only Question Relevant To Gold Bugs”. “Bill Buckler, publisher of The Privateer, has released one of the most scathing critiques of paper money we have read to date…” Zerohedge has published a huge portion of Bill Buckler’s latest edition of The Privateer… and it’s a privilege for me to present it in this column. I cannot overemphasize how important it is for you to read this. I thank reader ‘David in California’ for bringing it to my attention… and now to yours. The link is here.

Since zero hedge | on a long enough timeline, the survival rate for everyone drops to zero stole a chunk from Bill Buckler’s latest… I might as well ‘borrow’ something from his latest report as well. Last week I mentioned the fact that Alan Greenspan had given a speech saying that “Fiat money has no place to go but gold”. That was the headline from my Thursday column. Well, Bill Buckler… one of the sharpest knives in the drawer in my humble opinion… had this must read commentary about Greenspan’s speech…

“By definition, a political and financial establishment are the rulers of the nation they inhabit. In a “democratic” nation like the US, the people get to “vote”. But who writes the party platforms and picks the candidates for the major political parties, the only parties which stand any chance of forming a government? And who sets up the campaigning and voting rules to make sure that they ARE the only parties which stand any chance of forming a government?”

“The more established an establishment becomes, the fewer the REAL differences between the parties vying for the vote. There was a time when there was a marked difference between the Democrats and the Republicans in the US (or the Coalition and Labor in Australia). That time has long since passed. For many decades now, the only choice available in elections has been which party to put in charge of the borrowing and spending. This policy is carved in granite and has been for almost a century.”

“The first pre-requisite to political power is the ability to control what is used as money. Without that, an establishment cannot be formed because the means for its sustenance cannot be taxed to the extent necessary and cannot be created out of thin air at all. Everybody in the US establishment and in every other establishment in the world knows this and has always known it.”

“Long before Alan Greenspan developed the urge to join the establishment, he understood this and warned against it. Once he DID decide to join the establishment, he turned his undoubted talents to sustaining the economic and financial ignorance of the governed. He was uniquely successful in this task, but he knew it couldn’t last. That is what he was telling the members of the CFR on September 15th. But he was preaching to the converted. They know it too. And that is their overriding problem. The jig is up. The “sting” is no longer working.”

“All over the world, financial markets are clinging to the only things they “know” because they dread to discover that there is no real substance to their “knowledge”. In the US, the establishment knows that their free ride is coming to an end. They have waxed fat on their ability to create the world’s reserve currency out of thin air for many decades. From the “excess”, they have kept their nation in line by the usual means of “bread and circuses”. Now, the system they created has broken down and they know it.” – Bill Buckler, The Privateer… 19 September 2010

Please read those five paragraphs over and over again, until you ‘get it’. I consider those five paragraphs to be the most important ones I’ve read in almost ten years.

Buckler says the following at the beginning of every weekly “Gold This Week” commentary that he writes…”

“In any discussion of the future of Gold, or of the price of Gold, the first thing that must be realized is that Gold is a political metal. In the true meaning of the word, its price is “governed”.

“This is so for the very simple reason that Gold, in its historical role as a currency, is fundamentally incompatible with the modern worldwide financial system.

“Up until August 15, 1971, there has never in history been an era when no paper currency was linked to Gold. The history of money is replete with instances of coin clipping, printing, debt defaults, and the other attendant ills of currency debasement. In all other eras of history, people could always escape to other currencies, whose Gold backing remained intact. But since 1971, there is no escape because no paper currency has any link to Gold.
“All of the economic, monetary, and financial upheaval of the past 30 years is a direct result of this fact.

“The global paper currency system is very young. It depends for its continued functioning on the belief that the debt upon which it is based will, someday, be repaid. The one thing, above all others, that could shake that faith, and therefore the foundations of the modern financial system itself, is a rise (especially a sharp rise) in the U.S. Dollar price of Gold.

And, dear reader, I suggest you read that over a few times as well.



As I said earlier in this column, based on the volume, I wouldn’t read a lot into yesterday’s price action. I note that there we are now down to 798 silver contracts that are still open for September. These have to be closed out, or delivered into, by September 29th.

I also note that there has been some interesting price action that started around 2:00 p.m. Hong Kong time… and it got even more interesting once London opened for trading. Volume [as of 4:55 a.m. Eastern time] is pretty light, which I’m glad to see considering the price action.

Today is Tuesday, the cut-off day for this Friday’s Commitment of Traders report. The last three weeks have seen very unusual price activity [all to the upside, fortunately] on this day… and I’m wondering if Tuesday’s action in New York will follow that same pattern. We’ll find out soon enough.

If we do get a correction of some kind, I do not expect it to be very deep or last very long. Once that low has past, I expect to see some real fireworks in both metals… especially silver. I sleep well at night knowing that when that happens, I won’t be found asleep at the switch.

I hope you are in a similar position, dear reader… but there’s still time to get on board. As I said in this column on Saturday, with the precious metals shares poised to blast off to new highs in the very near future, I would deem it prudent to be as fully invested as you wish to be… starting right now. I’m still urging you to put your investment dollars to work. The first place I’d start would be with a subscription to either Casey’s Gold and Resource Report… or Casey Research’s flagship publication… the International Speculator. Please click on the links, as it costs nothing to check them out… and the subscriptions come complete with CR’s usual money-back guarantee.

It could be an interesting day when trading begins in New York.

Thanks for putting up with this very long column today… and I expect that tomorrow’s commentary will be much shorter. Not only for your sake, but also for mine.
See you on Wednesday.

Is Thailand’s Central Bank Buying Gold?

Is Thailand’s Central Bank buying gold? Gold Dinar Sells Out in Malaysia. Silver soars in early Tuesday trading in London. John Hathaway says that the bull market in gold has barely started… and the truth about gold and silver ETFs.


I wouldn’t read a whole heck of a lot into yesterday’s gold price activity on any market yesterday… even New York. Even though the dollar swooned, it didn’t make one bit of difference to the gold traders on Monday. Both the high and low in Monday’s trading action came during the New York session… with the low [$1,240.10] spot coming at 8:35 a.m. shortly after the Comex open… and the high [$1,429.90 spot] was minutes before 10:30 a.m. Eastern time. I wasn’t entirely surprised to see the U.S. bullion banks turn the gold price back at the $1,250 spot level once again. This has been a line in the sand for the last week or so.

Here’s the New York spot gold chart. It shows Monday’s high spike very clearly. The above chart does not.

Silver was more ‘volatile’ yesterday. Like gold, its price didn’t do much of anything in Far East and London trading. But at 8:45 a.m. in New York.. silver’s price also took off to the upside… only to be stopped dead in its tracks at $20.25 spot… which, like gold, also occurred minutes before 10:30 a.m. Eastern time. An attempt was made to get silver back below the $20 spot price before the end of New York trading… and that attempt failed. Silver has not closed above that number since the middle of March 2008. One has to wonder if the highs from 18 months ago will fall as well. Time will tell.

As I mentioned in my discussion on gold, the world’s reserve currency did a face plant during the Monday trading session. It gapped down at the beginning of Far East trading on Sunday evening New York time… stabilized a bit between 2 and 8:15 a.m. Eastern time… and then declined to its low of the day at 12 noon in New York… and almost closed on its low. The dollar lost around 108 basis points… or 1.3%. Gold should have been up about $15 on the day… but not-for-profit selling made sure that gold closed with a small loss on the day. I wonder who would be selling gold into a falling dollar scenario?

The HUI’s high of the day came around the 10:30 a.m. price spike in gold… and then, along with the gold price, retreated into slightly negative territory… and finished with a small loss of 0.38% on the day.

Well, the CME Delivery Report on Monday showed that nothing of consequence was posted for delivery tomorrow… zero gold and seven silver contracts. Nothing to see here, folks.

The U.S. Mint filed a sales report today. They indicated that they’d sold another 12,500 ounces in their gold eagle program… and another 70,000 silver eagles… and nothing in the one-ounce 24-K gold buffaloes. Month-to-date, there have been 30,500 ounces of gold sold in the gold eagle program, 3,500 one-ounce 24-K gold buffaloes… and 390,000 silver eagles. These are pretty pathetic numbers, dear reader. And, to go along with these low number of silver eagles, comes this story courtesy of the good folks over at They report that the United States Mint has ended rationing of silver eagle coins… at least until the next shortage… and the link to that story is here. It’s worth the read.

The Comex-approved depositories reported that they added a net 349,747 troy ounces of silver into their warehouses on Friday. The link to that action is here.


Along with that story on silver eagle sales a few paragraph back, I have a lot of other stories for you today. The first is courtesy of Florida reader Donna Badach. It’s a posting from last Friday over at… and the headline reads “EXCLUSIVE: Outlook Gloomy at Secret Billionaire Meeting”. For 25 years, legendary Wall Street strategist Byron Wien, now with The Blackstone Group, has held summer meetings with high net worth individuals to get their outlook on the global economy and investing. This year’s group, totaling fifty individuals and including more than 10 billionaires, was decidedly pessimistic on the U.S. economy, investment opportunities and the Obama administration. The link to the story is here.

On Sunday afternoon in Basel, Switzerland… the world’s top bank regulators agreed on far-reaching new rules intended to make the global banking industry safer and protect international economies from future financial disasters. Where have we heard that sort of promise before? Reader Roy Stephens was the first through the door with a story from The New York Times linked here… but ‘David from California’ sent me the story on this… and Tyler Durden [bless his heart] rips ‘da Boyz from Basel’ a new one. The link to this must read article is headlined “Basel III Summary, and the Fed’s Endorsement of 20x+ Leverage” is here.

The next item is an Ambrose Evans-Pritchard story from The Telegraph that was sent to me courtesy of reader Roy Stephens. The neo-colonial rush for global farmland has gone exponential since the food scare of 2007-2008. The headline reads “The backlash begins against the world land grab”. This is a very worthwhile piece… and I suggest you run through it… and the link is here.
As you are aware, I’ve posted many stories regarding real estate… and lately it’s mostly about commercial real estate. Here’s a Bloomberg posting sent to me by Australian reader, Wesley Legrand. Monthly losses on commercial property debt bundled into bonds have doubled since April as loan specialists gave up trying to restructure smaller mortgages, Deutsche Bank AG data show. It’s ugly… as all real estate stories have been for the last three years. The headline reads “Commercial Property Losses Mount Amid Debt Triage”… and the link is here.

The next item today is a GATA release headlined “Zero Hedge covers pervasive market manipulation every day” Imbedded in the release is a story headlined “First HFT Casualty As Finra Fines Trillium $1 Million For Quote Stuffing And General Market Manipulation (Again)”. The story [and Chris Powell’s preamble] are a bit of a read, but worth it in my opinion… and the link is here.

While we’re on the subject of… here’s another eye-opener from that website. The headline reads “Market Liquidity Update: 112 Stocks Now Account For Half The Day’s Trading Volume”. The top 20 stocks account for 26% of all domestic volumes, and the first 1,029 stocks are responsible for 90% of all volume, meaning the remaining 17,349 account for just 10% of all dollar traded. It’s not a long read… and the chart [click to enlarge] is a stunner. It’s a must read… and I thank reader U.D. for sending it along… and the link is here.

The rest of my offerings today are all precious metals related. The first is a story posted over a week ago in the Malaysian newspaper The Star. It was sent to me by Netherlands reader Victor de Waal… and the headline reads “Dinar sold out in Kelantan”… Kelantan Gold Trade (KGT) Sdn Bhd that issues the gold dinar and the silver dirham, said about RM1.5mil worth of dinar and RM1mil worth of dirham had been sold since it was introduced on Aug 12th. The link is here.

Here’s a Financial Times blog from yesterday headlined “Thailand: Who’s Buying Gold?”. It’s contained in a GATA release headlined “Is the Bank of Thailand buying gold on the sly?”. I’m linking the GATA release, as the FT story requires a [free] subscription… and the link to this must read article is here.

My next offering is your long read of the day. It was sent to me by reader Randall Reinwasser… and the headline reads “The Truth About Gold and Silver ETFs”. I found this 7-page essay to be very excellent… and confirms [at least to me] why I won’t own either the GLD or SLV ETFs. This is a must read commentary from one end to the other… and the link is here.

Here’s a silver story that’s posted over at the that was sent to me in the wee hours of this morning by California reader Ray Wiberg. It was filed yesterday from Mumbai and bears the headline “In India, silver tops the charts”. Though the price of silver has scaled to dizzying heights, investment demand in India is at the helm of the price fever. As the country celebrates the Ganesh festival, silver ornaments and coins fly off the rack. It’s an interesting view on silver from a part of the world we don’t hear much from, so I urge you to read it… and the link is here.

The next piece is a posting over at It’s a short synopsis of what Frank Holmes had to say at Kitco Metals eConference yesterday. I know Frank quite well and he’s one of the brightest guys I know… and he’s also a very good friend of GATA. It will take you about two minutes to run through this very worthwhile read that’s headlined “Holmes does Not See A ‘Bubble’ In Gold”… and the link is here.

Lastly today is another piece posted over at… and, it too, is a synopsis of a speech given at their eConference yesterday. This one is by John Hathaway over at Tocqueville Asset Management… and when he’s talking… I’m listening. This is a must read as well… and the headline states “Hathaway Says Gold Bull Run At Midway Point”. The link is here.

Well, I thought that was the last story until Eric King over at King World News slipped the following James Turk commentary into my in-box around 5:45 a.m. Eastern time. Turk stated in an interview earlier this morning that “We are very close to the upside explosion.” From your lips, to God’s ears, James! It’s headlined “Gold and Silver Will Lead the Way”… and the link to this short must read piece is here.



Well, if you look at the New York Spot gold chart at the top, you’ll see that gold did try to break out above $1,250… but was turned back. Silver also ran into the same not-for-profit seller. One would suspect, on the face of it, that it was probably JPMorgan.

Trading volume in gold on Monday was on the lighter side… and moderate in silver.

Needless to say, I’ve been watching Tuesday’s price moves in the Far East and early London trading with great interest since 6:00 p.m. Eastern time last night. Both metals were on a bit of a tear… and showed signs of going parabolic starting at 8:00 a.m. London time… but both got capped shortly after London opened for business. And, without doubt, it was the major U.S. bullion banks [who have offices in London as well as New York] who stepped into the market and put an end to the fun.

It will be interesting to see if we break out to new all-time highs today in both silver and gold… or are these early morning price spikes in London the high ticks for the day? Obviously, as I write this at 5:57 a.m. Eastern time, it’s too soon to say.

After watching every twitch in the gold and silver price for the last ten years, I’m still skeptical… and still camped out in Missouri. But, with all these supposed changes in the works, I am very hopeful… but when you’re up against white collar criminals such as these… a healthy dose of skepticism doesn’t hurt. I’d love to be wildly bullish… but nothing is worse, or more embarrassing, than being wrong at the top of your voice… and there’s this little matter of credibility as well. The fact that I’m ‘all in’ should tell you a lot. Besides which, I’m just as happy to let James Turk [and others] stick their necks out.

I’m sure hopeful we’ll break out to much higher prices in both metals… but I’m also wary of the fact that ‘da boyz’ are still out there and have some pretty monstrous short positions in both metals. I’d love to see these bastards get over run with these full short positions on… but, like I’ve said before… if it does happen, it will be for the very first time.

As I put this report to bed for another day, I see that gold is up $8.50 the ounce, with silver up 29 cents. These are big moves for this time of day… especially for silver. I’d love to read something into it, but I won’t. But I am looking forward to New York trading today… and what I will find when I turn my computer on later this morning.

So pour yourself a big mug of coffee and watch to see what kind of show JPMorgan et al put on for us when trading begins in New York.
See you on Wednesday.

JPMorgan Adds to Their Silver Short Position

The gold price gained about five bucks in Far East trading on Friday… and then basically flat-lined for four and a half hours between the London open and the New York open. The moment that trading began on the Comex, a big not-for-profit seller showed up… and gold was sold down to its low of the day of $1,235.70 within the next thirty minutes.

Then the selling stopped… the gold price turned on a dime… and around 11:15 a.m. gold hit its high of the day at $1,252.30 spot. From there it got sold off once again and closed the Friday session up $2.70 from Thursday’s spot close.

The silver price, as they say, was more ‘volatile’ yesterday. Starting around lunchtime in Hong Kong, silver rallied to its London high around 11:30 a.m. their time. From that point, silver got sold off into the New York open where the not-for-profit seller took it even lower, with silver’s low price [$19.71 spot] coming at precisely the same instant as gold’s low price… around 8:45 a.m. Eastern.

An hour after silver hit its low price, it broke through $20 to the upside… and hung in there… setting its high price of the day [$20.06 spot] shortly before 11:30 a.m. Eastern time. Needless to say, silver was not allowed to close anywhere near the $20 mark… but still managed to close up fourteen cents from Thursday’s spot close.

The world’s reserve currency was all over the place in a very tight trading range yesterday… and obviously had no bearing on what happened with the gold and silver prices yesterday. Here’s the US$ chart for information purposes only.

The HUI pretty much followed the gold price around yesterday… and managed to finish the Friday trading day up 0.50%. Here’s the HUI for the week that was… and, in case you’re interested, the HUI is up 12% year-to-date.

The CME Delivery Report on Friday showed that zero gold and 274 silver contracts were posted for delivery on Tuesday. For the second day in a row, R.J. O’Brien was the big issuer with 267 contracts, with JPMorgan being the biggest stopper. They received 153 contracts in their proprietary trading account, plus an additional 37 contracts in their client account. There was a lot of other activity in yesterday’s delivery report… and it’s worth a look. The link is here.

There was no activity reported in either GLD or SLV yesterday… but the U.S. Mint had a smallish sales report. They showed that 4,500 ounces of gold were sold in their gold eagle program… along with an additional 1,000 24K gold one-ounce buffaloes. They also reported selling another 175,000 silver eagles. Month-to-date, the U.S. Mint has sold 18,000 ounces of gold in their gold eagle program… 3,500 24K gold one-ounce buffaloes… and 320,000 silver eagles. These are hardly earth-shaking numbers, dear reader.

Thursday was a fairly busy day over at the Comex-approved depositories. There were silver withdrawals from all four warehouses… and the total came to 294,289 troy ounces. The link to that action is here.

Well, one of the first things I looked at after my computer was up and running yesterday morning was the September Bank Participation Report for positions held at the end of trading on Tuesday, September 7th. Even without looking back to the August numbers, I could tell that there was big deterioration in both silver and gold.

In a nutshell… here it is for silver. ‘3 or less’ U.S. bullion banks increased their net short position in Comex silver by 5,637 contracts from the August report to the September report. Without doubt, JPMorgan was the culprit. The ‘8 or more’ Non U.S. banks that hold Comex silver contracts were exactly market neutral… holding the same number of longs as shorts. However, this is a deterioration from the August report… as that report showed that foreign banks were net long 1,015 Comex contracts.

In gold, four U.S. banks were net short 109,826 Comex contracts in the September report. This is an increase in net short position of around 11,400 Comex contracts since the August report. The thirteen Non U.S. banks were net short 20,586 Comex contracts. This is also a big deterioration since the August report… as the August report showed that these same 13 Non U.S. banks were only net short 9,317 Comex contracts.

From the August report to the September report, these bullion banks [U.S. and foreign] have increased their total net Comex short positions by 6,652 contracts in silver and 29,903 contracts in gold.

And, without a doubt, a lot of the short position increase by the U.S. bullion banks was put on by JPMorgan. This especially applies to silver where, without doubt, they put on the lion’s share of the 5,637 Comex short position increase that was reported by the ‘3 or less’ U.S. bullion banks.

In a report to private clients yesterday, Ted Butler had this to say… “Here’s why I think JPMorgan shorted more, putting its head back into the lion’s mouth, after closing out a bunch of silver short positions. I don’t think they thought they had any other choice. On August 24th, the price of silver was around $18 the ounce. Over the next couple of days it jumped sharply to $19… and then continued to move up from there. The technical funds were buying aggressively and the Commercials [as a group] sold to them. Without JPMorgan’s additional 5,000 or 6,000 or more short contracts, the Commercials stood a good chance of being over run to the upside. I’m sure JPMorgan was afraid of this and helped out their collusive commercial brother crooks. I’m also sure that without JPMorgan’s pile-on, the price of silver would have exploded upward.” If you wish to read more about this, you can check out Ted’s subscription service here.

The Commitment of Traders wasn’t happy reading either. It showed that the bullion banks went net short another 2,421 contracts in silver. The Commercial net short position [where the bullion banks play] now sits at 61,798 contracts, or 309.0 million ounces of silver. The ‘4 or less’ traders are short 256.0 million ounces… and the ‘8 or less’ traders are short 337.6 million ounces. The link to the full colour COT silver graph is here… and the further deterioration is very obvious.

In gold, the bullion banks increased their net short position by a smallish 3,119 contracts, or 311,900 ounces. The Commercial net short position in gold is now 28.8 million ounces… of which the ‘4 or less’ traders hold 21.0 million ounces short… and the ‘8 or less’ bullion banks are short 28.3 million ounces. The full colour COT graph for gold is linked here. The page was very slow to load earlier this morning.

These increases in net short position in the Commitment of Traders report are part of the numbers reported in the September Bank Participation Report… not an addition to them…. as the cut-off date for both reports was this past Tuesday at the close of trading.

Here’s Ted’s graph of “Days of World Production” for all Comex-traded commodities… courtesy of Nick Laird over at Needless to say, the bullion banks increased their ‘days to cover’ in both silver and gold. In silver, the ‘4 or less’ traders would take 132 days of world silver production to cover their short positions… and the ‘8 or less’ traders are now up to 174 days.

Click here to enlarge.
I have very few stories today, which suits me just fine. The first one is courtesy of reader Roy Stephens. China’s top-ranking UN diplomat embarked on a drunken rant against the UN Secretary General Ban Ki-moon, telling his boss he’d “never liked” him, and adding for good measure that he didn’t like Americans either. It’s a story from Thursday’s edition of The Telegraph… and the headline reads “China’s UN diplomat in drunken rant against Americans”. It’s not a long read… but definitely worth your time… and the link is here.

My second offering today is courtesy of reader U.D. A survey performed by the polling firm StrategyOne came up with some pretty ugly data. The public is fearful about prospects for economic recovery… and almost half see America’s ‘best days’ behind them… and 7 in 10 concerned that the country is ‘fundamentally broken and not working’. The headline reads “Two-Thirds of Americans Expect Double-Dip Recession, Brace for Second Hit Worse Than the First”. It’s posted over at the website… and the link is here.

Here’s a graph that Nick Laird sent me yesterday evening. It’s not one of his, but it certainly is worth looking at. No explanation is needed, as the graph says it all.

Here’s a story that just arrived in my in-box from Thomas John Mullen. For the last couple of days I’ve posted stories about the Anglo Irish Bank that were in The Telegraph out of London. Here’s one that’s posted in Thursday’s edition of The Irish Times. While all the focus has been on losses at Anglo Irish, the other Irish banks are in denial about the scale of State support needed. It is time to face the facts: the three viable banks need over €17 billion. The headline reads “Stark reality of losses at AIB and BoI must be faced”… and the link to this must read articles is here.

My only precious metals-related story today comes from the September 8th edition of The Miami Herald. It falls into the “you can’t make this stuff up” category. A rare 18th century coin worth $9,000 was stolen in Vero Beach – but not for long! The headline reads “Florida man steals $9,000 coin, sells it for $167”. The story [courtesy of Florida reader Donna Badach] is only four paragraphs long… and it’s well worth the read. The link is here.

My last story… and big read of the day… is courtesy of Washington state reader S.A. It’s from the October edition of Vanity Fair magazine. The headline reads “Beware of Greeks Bearing Bonds”. Like every major essay that appears in Vanity Fair… it’s very well written and very well researched. It’s also a must read from one end to the other… and the link is here.

Today’s ‘blast from the past’ doesn’t need any introduction either… as the artist and the song are know world-wide. So turn up your speakers and click


Well, neither Ted Butler nor myself were exactly overjoyed to see JPMorgan show up again on the short side of the silver market. Ted had suspected that that was the case about ten days ago… and I mentioned it in passing at least once in this column… but now its been confirmed by yesterday’s Bank Participation Report.

Unless JPMorgan and the other bullion banks get over run with this full short position on, I must admit that the chances for either silver or gold to blast off to new highs from this point are pretty remote. If I had to bet a dollar, I’d say that unless world events [financial, monetary… or otherwise] dictate it, the bullion banks will engineer another sell-off to blow the brain-dead tech funds out of their current leveraged long positions… which will allow them to ring the cash register one more time.

As Ted mentioned in his closing comments in his letter to clients yesterday… “The most concentrated and manipulative short position in history just got a lot more concentrated. Where is the CFTC? JPMorgan reveals it is exiting proprietary trading and then increases its giant silver short position? The new Financial Regulatory Reform law intends that big banks stop manipulating markets and thereby creating a danger to us all, and JPMorgan drastically ups the danger meter? And all this is taking place as the two-year mark has come in what is supposed to be a silver investigation into this very matter?” Once again, Ted Butler’s website is linked here.

Volumes in both gold and silver on Friday were reasonably robust… and I won’t know until Monday how the open interest numbers fared, as the preliminary numbers don’t give much of a clue. One thing that I did note, however… was that despite the reasonably large deliveries reported on Thursday and Friday, there are still 1,497 silver contracts open for delivery in September. It will be interesting to see how this resolves itself as the month wears on.

Enjoy what’s left of your weekend… and I’ll see you here on Tuesday morning.

U.S. Mint Sales Are Over the Moon

Gold recovered from its little pounding in early Far East trading on Friday morning… and then rallied right into the Hong Kong close. But once the Far East was done trading for the weekend, the selling pressure resumed into gold’s New York low of $1,169.60 spot, which occurred a few minutes after 9:30 a.m. Eastern time. From that low, gold rallied into the London p.m. fix at 10:00 a.m. New York time, before getting sold off… but then rallied to its high of the day [$1,188.90 spot] about 11:45 a.m. Eastern. Then it got sold off into the Comex close… and flat-lined for the rest of the trading day. All in all, it wasn’t a very exciting trading day… but a new low was set for this move down… and, without doubt, there was more tech fund long liquidation.

Silver traded in a twenty cent range for virtually the entire day on Friday… but the bullion banks did set a new low price for the move. That low came at the same time as gold’s… minutes after 9:30 a.m. in New York. That low price was $17.40 spot… followed by silver’s high at 11:45 a.m. Eastern time at $17.88 spot. From there, silver drifted lower into the close and finished up a whole penny from Thursday. With that new low for this move down, there was certainly more tech fund long liquidation.

The dollar was all over the map during Friday’s trading… but ended up closing down a little over 50 basis from its Far East open at 6:00 p.m. on Thursday evening. Needless to say, the dollar’s movements had no effect on precious metals prices yesterday. Here’s the 3-day dollar graph. In those three days, the dollar has lost about 175 basis points… and the precious metals got creamed. But as you know, dear reader, the precious metals price action was in the hands of the bullion banks… and when that’s going on, it matters not what the dollar is doing.

The HUI chart pretty much followed the gold and silver price action… with the low of the day coming at the lows for these two metals…which was minutes after 9:30 a.m. Eastern time… and moments after the equity markets opened. It’s all there… the London p.m. gold fix, the little sell-off afterwards, the rise to the highs of the day around 11:45 a.m… then the slow decline until 3:15 p.m. Eastern time when the Plunge Protection Team showed up [for the second time] to goose the equity markets and reverse a serious decline in the Dow. It worked like a charm… and also lifted the HUI to a positive close of 0.32% on the day. We owe “Helicopter Ben” et al a big thank you for that.

The CME’s Daily Delivery report showed that 172 gold and 35 silver contracts were posted for delivery on Tuesday. The list of issuers and stoppers may be of interest to some… and the link is here. There were no changes reported by either the GLD or SLV ETFs yesterday… and considering how badly the prices of both gold and silver have been crushed during the past week, this is quite amazing.

The U.S. Mint had another report yesterday. One-ounce gold eagle sales were up another 15,000 to 142,500 for the month so far. Another 3,500 24k-gold eagles were also sold… for a total of 61,000 for the month. And 381,000 silver eagles were sold as well… bringing April’s silver eagle sales up to a whopping 3,040,500 for the month. These are huge numbers, dear reader… and as I’ve been saying all week, it’s a good bet that a lot of these bullion coins are headed for Europe. I hope you’re getting your share as well.

The Comex-approved depositories showed another decline on Thursday. This time they reported silver stocks down 582,801 troy ounces. The 2.4 million ounces that the Comex brought in a week ago Friday, was obviously meant for the deliveries that have been ongoing all this past week… and they’ve gone through most of it in the last four days. You may ask [and rightly so] why the Comex just doesn’t deliver from the stocks they have on hand. Well, there’s a very good reason for that, and it goes like this… every single ounce of that silver sitting in those four Comex warehouses is owned by someone; a financial institution, a user, a private investor… and the list goes on. Of that group, nobody wants to sell at the current price, so if the Comex wants to fulfill their delivery requirements, they have to bring in silver from outside the Comex for that purpose… or they would be in default… and that’s what they’ve been doing. On the other hand, if they couldn’t get it from outside sources, then they’d have to bid up the price high enough that some of the holders of Comex silver would be willing to part with it. And that, dear reader, would drive the silver price up substantially in a very short period of time… and we mustn’t have that, now must we?

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The Commitment of Traders report was a disappointment… at least for me… although Ted Butler had an explanation which, quite frankly, would be over the heads of most people… so I will not get into here. Ted explains some of it in his weekly interview with Eric King over at King World News further down.

Anyway, the COT report [for positions held at the end of trading on Tuesday] showed that the bullion banks increased their net short position in silver by an absolutely monstrous 6,700 contracts… which translates into 33.5 million ounces of paper silver. That’s 18 days of world silver production that the bullion banks went short in one five day period! There are currently 89,453 contracts held short in the Commercial [bullion bank] category. Of that amount, the ‘4 or less’ traders are short 49,500 contracts of that… which is 55.3% of the entire gross short position. The ‘8 or less’ traders are short 73.6% of that 89,453 contracts. This concentration is grotesque and obscene. A lot of people should be in jail for this.

There was a small improvement in the Commercial net short position in gold this past week… but it was a miniscule 2,900 contracts. The net paper short position in gold [as of Tuesday’s cut-off] stood at 28.0 million ounces. The ‘4 or less’ bullion banks hold 21.5 million ounces of that… and the ‘8 or less’ traders hold 27.1 million ounces short.

Lot of people think that this situation is perfectly OK… but we know better. The link to this week’s COT report is here.

Of course, since the Tuesday cut-off, the bullion banks have been covering shorts [or going long] like crazy every since… and next Friday’s COT will show a vast improvement. How vast still remains to be seen.

Here’s Ted Butler’s interview with Eric King over at King World News… and I urge you to stop reading and listen carefully to what he has to say. The link is here.

Well, it’s now official, German lawmakers bit the bullet and bailed out Greece… and the associated EU bankers. I thank Washington state reader S.A. for sending me this Bloomberg story headlined “German Lawmakers Approve Share of $1 Trillion Bailout”… and the link is here.

Along a similar line, comes this story posted at the English language website of It’s courtesy of reader Roy Stephens… and the headline reads “EU agrees on coordinated action, financial sanctions”. In my opinion, all this does is delay the inevitable… and the link is here.

Here’s another Bloomberg story courtesy of reader S.A. The headline reads “CFTC Set to Limit Oil Speculation With Senate Backing”. It remains to be seen if CFTC chairman Gary Gensler et al, get around to setting position limits in silver. He know what has to be done… but will he do it? The link to the story is here.

This next item is a very short read… and has an interesting set of numbers to go with it. The title is on the longish side… but explains all… “32 States Have Borrowed from the Federal Government to Make Unemployment Payments; California Has Borrowed $7 Billion” It’s a very short read… and the list of states [and amounts] is shocking. I thank reader Scott Pluschau for bringing it to my attention. It’s posted over at… and the link is here. It’s worth your time.

Here’s another story provided by reader Roy Stephens. This one is about silver. The article was written by Mark O’Byrne, director of GoldCore… and it’s posted over at and bears the headline “Why silver could soon take off”. There are a lot of good graphs… and it’s certainly worth the read… and the link is here.

The next story is definitely gold related… and is headlined “10 Gold Charts Commercial Investment Firms Never Want Clients to See”. There are very good reasons why they don’t want to, either. The charts show that, priced in gold, most Western stock indexes have declined over the last decade. This is an excellent piece… and is a must read. It’s posted over at… and the link is here.

The next gold-related story is also very much worth your time. It’s a piece from today’s edition of The Wall Street Journal. Since you would normally need a subscription to view the whole thing… GATA was kind enough to post it in the clear. The headline reads “A Billionaire Goes All-In On Gold”… and the link to this must read story is here.

Here’s a story courtesy of reader Scott Pluschau that arrived in my in-box at 5:32 a.m. Eastern time this morning… just before I hit the ‘send’ button on this column… so I inserted it here. It’s from today’s edition of The Borneo Post of all places. The ‘Golden Dinar’ has been out of the news for many years… but it’s back again. The headline reads “Support gold dinar as alternate trade instrument, World Islamic Economic Forum members told”. The story is definitely worth your time… and the link is here.

Lastly today is another interview from the King World News web site. This one is with the always-popular Jim Rickards. As you are aware, dear reader, he’s only one of a small handful of people that I have all the time in the world for. Gold is one of the topics de jour in this interview… as is financial warfare… which F. William Engdahl spoke of yesterday. This is a must listen interview from one end to the other… and the link is here.

My ‘blast from the past’ today is a video I posted at least two years ago… and since I have many orders of magnitude more readers now… I will take the liberty of posting it again. It’s one of my favourite songs from the 1970s… and this one hails from 1976. Everyone knows it… and you can sing along if you wish. So turn up your speakers and click


Without a doubt, if the President’s Working Group on Financial Markets [the PPT] hadn’t shown up at the beginning of trading… and also again in the late afternoon on Friday… the markets would have melted down again… as that was where they were going in a hurry. Gold was headed north… and the stock markets were headed south. If that had been allowed to happened on a Friday in North America, the bloodbath in the Far East and Europe on Monday would have been catastrophic. That wasn’t allowed to happen… but it was oh so obvious… both in the stock market and the gold price.

As I keep saying… the world’s current economic, financial and monetary system is on the verge of total collapse. The only thing that concerns me is how soon it will come… and how bad it will be. That’s why I’m “all in”… like that billionaire in that story earlier in this column. I have a feeling that when gold and silver are allowed to melt up… there will be little or no entry points for anyone sitting on the sidelines. After 10 years of this… I’m not going to risk being out of position when the precious metals markets blow up, or the equity markets melt down… either accidently or deliberately.

It’s impossible to tell how far along in the liquidation cycle we are. Only JPMorgan et al know that… as do the powers that be at the Fed and the U.S. Treasury Department. I think that we’ll have to wait until June before we see any major improvement in precious metals prices. At the moment, both gold and silver are badly beaten up, but they don’t hold a candle to what happened to platinum and palladium. We should be thankful the these kinds of loses have not been visited on either gold or silver… at least not yet.

Here’s the 3-year palladium chart.

And the 3-year platinum chart.

Enjoy the rest of your weekend… and I’ll see you right here on Tuesday morning.

Another 1.47 Million Ounces Withdrawn From SLV

It was a quiet trading session in both the Far East and London on Friday… and gold was only down a few dollars when New York opened for business. Almost from the open, gold was under selling pressure. But once the London p.m. gold fix was in at 10:00 a.m. Eastern time, gold quickly rallied back to it’s Comex opening price. But a few minutes after 10:30 a.m. the news broke about the “Giant Vampire Squid”… and the bullion banks hit the gold price immediately.

Under ‘normal’ circumstances, news such as this would be extremely gold friendly… but ‘da boyz’ were there to make sure that that didn’t happen. It wouldn’t surprise me in the slightest if they had been told in advance and were lying in wait. The powers that be wanted to make sure that everyone would see that bad financial news is a negative for gold… and a positive for the U.S. dollar… which was rallying at the same time.

Anyway, by the time the smoke cleared at gold’s low of the day… which occurred at precisely 12:00 noon Eastern time… gold was down $30 from its Thursday close. Then the selling pressure disappeared, volume evaporated… and gold gained back about $8 from it’s low… which was $1,129.30 spot.
Mission accomplished!

Of all the precious metals, it was silver that was singled out to really get pounded. This, dear reader, should be no surprise to you by now. Like gold, silver’s price was basically unchanged at the Comex open… but was under pressure immediately upon the open. I wonder if someone in the know was establishing a small short position in silver [and gold too] knowing what was coming in a few hours time. It wouldn’t surprise me a bit if that was the case.

Anyway, once the p.m. gold fix was in at 10:00 a.m… silver rallied a dime only to get slammed along with gold shortly after 10:30 a.m. The major portion of the selling in silver was also over at noon… but the absolute low of the day [$17.59 spot] was a brief spike down that occurred a few minutes before 2:00 p.m. From it’s absolute N.Y. high to its absolute N.Y. low… silver was down 85 cents… but finished down only 70 cents.

The U.S. dollar was totally unfazed by what happened to Goldman Sachs yesterday… and gained about 35 basis points. Needless to say, the dollar didn’t have any impact on precious metals prices on Friday.

I suppose you would think that it could be hard to be cheerful about a 2.35% loss in the HUI. But considering the deliberate stomping of the entire precious metals complex on Friday… and the big down day on the Dow… the gold and silver shares held up surprisingly well, all things considered.

Thursday’s open interest numbers were very similar to Wednesday’s numbers. Gold o.i. dropped another 2,157 contracts. Final volume was reported as a smallish 109,795 contracts. Total open interest in gold as of Thursday was a very large 524,716 contracts.

Silver’s open interest rose another chunky 2,560 contracts on volume of 31,570 contracts. Both Ted and I agree that this was probably spread related, as neither the volume nor the price action indicated anyone going long… or short. Total open interest in silver is back up to 128,188 contracts. Friday’s crucifixion certainly dropped open interest in both silver and gold substantially… but we won’t find out how much until late Monday morning Eastern time.

The CME Delivery Report on Friday showed that 61 gold and 3 silver contracts are posted for delivery on Tuesday. The GLD showed no change once again… and surprise, surprise… another big chunk of silver was pulled out of SLV once again. This time it was ‘only’ 1,470,729 troy ounces. 17.9 million ounces of silver have been withdrawn since February 26th… 12.5 million of that was in April. Ted Butler and I spent a lot of time talking about this on the phone yesterday.

The U.S. Mint had no report… and the Comex-approved depositories showed that a tiny 12,733 ounces of silver were taken into their collective inventories on Thursday. That number is slightly deceiving… as there was, once again, lots of activity in and out of most of the warehouses… and you can view Thursday’s ‘action’ here.

Well, yesterday’s Commitment of Trader report was no surprise in silver… as the bullion banks increased their net short position by another 3,703 contracts. The ‘4 or less’ bullion banks are short 260.9 million ounces of silver… and the ‘8 or less’ traders are short 328.9 million ounces. This is a staggering amount considering that the net short position in the Commercial category… where all these bullion banks reside… currently sits at 276.9 million ounces. So the ‘4 or less’ traders hold 94.2% of the net short position in silver all by themselves. The ‘8 or less’ hold 118.7% of the net short position. The full-colour COT graph for silver is linked here.

In gold, the bullion banks increased their net short position by 18,578 contracts… which wasn’t as bad a number as Ted Butler was expecting. The Commercial net short position currently sits at 263,484 contracts… which is 26.3 million ounces of gold. The ‘4 or less’ traders are short 18.8 million ounces of that… and the ‘8 or less’ traders are short 24.0 million ounces. The full-colour COT gold graph is linked here.

Here’s the usual weekly King World News interview with silver analyst Ted Butler. Needless to say it’s worth listening to… and you should stop reading at this point and click here.

I can’t think of anyone [can you, dear reader?] that isn’t in rapture about the charges that were filed against Goldman Sachs yesterday. All of the major Wall Street brokerage firms are part of this organized crime syndicate that’s basically raping the world with no one to stop them. So I’m kind of glad to see the SEC finally grow big enough gonads [as Ted Butler so succinctly put it] to take on one of the big boys. Can JPMorgan be far behind? Ted hope that this action against GS will empower the CFTC to take some concrete action themselves. Anyway, I have one story about it, and it’s a piece posted over at that’s headlined “SEC accuses Goldman Sachs of defrauding investors”… and the link is here.

The next story highlights Congressman Ron Paul [R – Texas]. As Obama’s star continues to fall… Ron Paul is now being seen in a different light. I think I stole this story from yesterday’s King Report. It’s posted at the… and the headline reads “Hating the government finally goes mainstream”… and the link is here.

This story… and the next one… are both from yesterday’s King Report. The first is a piece from The Telegraph in London. It is, of course, by Ambrose Evans-Pritchard. The headline is startling… but not surprising. It reads “Morgan Stanley fears German exit from EMU”… “Morgan Stanley has warned that the Greek debt crisis is setting off a chain of events that may prompt German withdrawal from the eurozone, with grim implications for investors caught off-guard.” It’s not a particularly long story, but it is worth reading… and the link is here.

Israel and Iran are back in the news again. Russia has just announced that it will allow Iran’s nuclear reactor located in Bushehr to go ‘hot’ in August. This puts Israel up against it. What will they do… with, or without, American approval? The story is posted over at… and is headlined “Will Israel Strike By August?” That’s a good question, which is now within 100 days of resolution. This is a must read story… and the link is here.

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Earlier this week I ran a story about the Russian-encouraged ‘revolution’ in Kyrgyzstan… and it’s implications in the 21st century version of the “Great Game”. Posted over at is a 3-part exposé on this issue… not only on how it affects geopolitics in the region… but Washington’s response, or lack thereof. The first paragraph pretty well sums up the tenor of the essay… “The extraordinary events of last week in Kyrgyzstan, which saw the overthrow of President Kurmanbek Bakiyev’s administration by a popular uprising and its replacement by a provisional government have been portrayed by many in the “Beltway-istan” (Washington, D.C.) as the latest tussle betwixt Russia and the U.S. in the ‘Great Game” for influence in the post-Soviet space.” The truth is considerably more complex, however… and the further one digs, the more the complex realities of the situation emerge. It’s a microcosm of what’s going on at the outer edges of the American Empire empire… and it’s goal of Full Spectrum Dominance. The headline reads “The Truth Behind the Recent Unrest in Kyrgyzstan”. Part 1, Part 2… and Part 3. All three parts should take about a half hour of your time. I thank Australian reader Wesley Legrand for bringing them to my attention… and now to yours.

If the history of welfare teaches us anything, it teaches us that government money is as addictive as any narcotic. – Michael D. Tanner

Today’s ‘blast from the past’ is known by all… so turn up your speakers and click


Whether or not the U.S. bullion banks try to press their advantage further on Monday is a big unknown. They certainly have the ability if they wish to do so… but will they? Ted doesn’t know for sure, either… but feels that whatever sell-off we do get next week shouldn’t last too long, nor go too deep. I’ll reserve judgment for the time being.

However, ‘day boyz’ did provide another buying opportunity for those who have not made their investments in either the precious metals or their respective shares… and if I wasn’t already ‘all in’… I would certainly be in the market on Monday… and physical metal would also be part of my purchase.

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Here’s the 1-year gold graph. You can see that the 50-day moving average is just a chip shot away if the bullion banks want to press their advantage. But silver has a long way to go from its current price. Both metals are now in ‘market neutral’ territory… at least according to their respective RSI’s. We also have options expiry coming up shortly. May is not a delivery month for gold… but it certainly is for silver… so I’m going to be watching next week’s price action in both metals very carefully.

The CME has posted their preliminary volume numbers for both precious metals… and it shows that gold volume yesterday was a monstrous 212,247 contracts… of which very little was roll-overs. Silver’s volume was equally stunning… with 63,365 contracts traded. Only about 20% of that was switches… so there was a lot of tech fund long liquidation in silver on Friday. I can hardly wait to see what the drop in open interest is for both metals when they’re posted on Monday. Of course the bullion banks can mask their short covering by going long… and it wouldn’t surprise me if these crooks did exactly that.

That’s all for this week… but don’t forget about Casey Research’s $199 “Tax Day Deal” Subscription Special which ends tomorrow night! Click here.
See you on Tuesday morning.

James Turk: Conditions Are Ripe For a Short Squeeze in the Gold Market

Gold gapped up… and the dollar gapped down at the Sydney open in early Monday trading yesterday morning. Gold’s high of the day [a hair over $1,170 spot] occurred a little over an hour later… but most of the price advance was beaten back… and from there, it was a slow, but gentle, slide into the London p.m. gold fix. Once the ‘fix was in’… gold rallied back into positive territory for a few hours in New York… but got taken down hard by a not-for-profit seller starting just before the Comex stopped trading for the day. By the time that electronic trading was through in New York on Monday afternoon at 5:15 p.m. local time… gold was closed almost at its low of the day.

Silver had a slightly different kind of day. It’s high was at 3:00 p.m. in Hong Kong trading, before it began its decline. That decline ended at 9:00 a.m. Eastern time… and the subsequent rally back into positive price territory ended shortly before lunch in New York. But, as they say, it was all down hill from there, with silver’s absolute low price [$18.15 spot] coming minutes before 4:00 p.m.

Monday morning’s 50 basis point gap down in the U.S. dollar at the Sydney open was the second gap down open of some consequence in the last little while. The absolute low [80.076] came at 3:00 a.m. in Hong Kong’s afternoon… which just happened to be silver’s high price spike of the day. From that low, the dollar rallied about 50 basis point… and reached its high price around 8:00 a.m. in New York. The dollar basically sat at that price [80.60] for the rest of the trading day… and beyond. But if you look at the gold and silver price graphs above, you’ll not that both gold and silver [after their respective morning lows in New York] go hammered flat for no apparent reason. I guess the U.S. bullion banks weren’t too amused that gold and silver were heading back into positive territory, despite a flat dollar… and engineered a sell-off in both metals… plus a lot of other things… except the Dow, which the PPT finally got to close over 11,000. Happy days are here again!

The precious metals shares acted in a predictable manner… but it could have been worse… as the HUI only finished down only 1.39%.

Gold open interest rose again on Friday. This time it was up 3,096 contracts. Final volume for the day was reported as 147,981 contracts. In silver, the volume was a pretty chunky 41,282 contracts… with about 15% of the being swaps. Silver’s open increase was chunky as well… up 2,404 contracts. As I’ve mentioned every day since last Wednesday… this rally in both gold and silver is being resisted with a ferocity that I haven’t seen in a quite a while… and it doesn’t bode well for the current rally.

The CME Delivery Report for Monday showed that 449 gold and 12 silver contracts have been put up for delivery on Wednesday. In gold, the ‘4 or less’ traders that are mega short both gold and silver on the Comex, are all present and accounted for in Monday’s report. See for yourself… as the link is here.

There were no reported changes in GLD’s alleged stocks yesterday… but, once again, there’s been another huge withdrawal from the SLV. This time it was 1,470,852 ounces. Since February 26th… 11.07 million ounces of silver have been withdrawn from SLV in seven consecutive tranches. Not one ounces of silver has gone into the SLV since that date. However, in GLD, there have been ten deposits and one withdrawal since February 23rd… with a net total of 1.1 million ounces of gold added. Ted Butler is very bullish about this ongoing withdrawal from SLV… and is probably even more so after Monday’s withdrawal. It should be obvious to all but the most brain dead, that silver [in size] is just not available anywhere at any price… so the ‘authorized participants’ are satisfying demand out of the SLV ETF. One can only imagine what the price would do to if they went and tried to access this sort of silver from the Comex.
The Zürcher Kantonalbank in Switzerland provided their weekly update for their precious metals ETFs on Monday. There was no change reported in their gold ETF… but their silver ETF recorded an increase of 387,770 troy ounces. I thank Carl Loeb for those numbers.

The U.S. Mint had nothing to say yesterday… but over at the Comex-approved depositories, they reported another silver withdrawal there. This time it was 325,982 troy ounces.

Well, there were a lot of stories over the weekend… and I was tempted to put out a commentary yesterday morning, just to ease the reading load today. I didn’t… and now regret it.

Today’s first story is an item from Friday’s edition of The Wall Street Journal. It appears that 18 major banks have masked their risk levels in the past five quarters by temporarily lowering their debt just before reporting it to the public, according to data from the Federal Reserve Bank of New York. And, according to an SEC report… quarter-end loan figures sit 42% below peak, then rise as the new quarter progresses. More ‘book cooking’ to keep the American public in the dark about how bad it really is. The headline reads “Big Banks Mask Risk Levels”… and I thank T.J. from North York for sending me the story… and the link is here.’s James Turk has two offerings today. In his first story, James says his chart suggests that gold will reach $1,200 soon, in large part because GATA’s work has persuaded the market that the investment houses that are suppressing the gold price with the help of central banks, are running a very vulnerable naked short position. Turk’s commentary [along with an excellent graph] is headlined “Gold Hurdles Above $1,140″… and the link is here.

There were a few main-stream stories in the press about Andrew Maguire… the ex-Goldman Sachs trader who blew the whistle on JPMorgan’s silver price management scheme. The first came from the Sunday edition of the New York Post. The headline reads “Metal$ are in the pits: Trader blows whistle on gold & silver price manipulation”… and the link is here.

Two other stories… one in Australia’s largest newspaper… Friday’s edition of the Melbourne Herald Sun. The notice came in a column by John Beveridge headlined “More Bull than Bullion” and was accompanied by a great cartoon. The Herald Sun does not seem to have posted the material on its Internet site but thanks to a friend in Australia we have a pdf image of the article itself… and the link to that is here.

And lastly… many Chinese Internet sites on financial topics have picked up on GATA’s presentations at the March 25 meeting of the U.S. Commodity Futures Trading Commission. Here’s one — Popular Financing — that has posted its commentary in English as well as Chinese. It’s headlined “Two U.S. Dollar Signposts and Gold, Silver Stealth”… and the link is here.

Interviewed this week by Eric King of King World News, mining entrepreneur Rob McEwen acknowledges the likelihood that the U.S. government manipulates the gold market. “The government,” McEwen says, “is involved in manipulating many asset prices in the marketplace, and it’s their function and mandate to do so. I wouldn’t put it past them to have checked the gold price and other commodity prices. They have large strategic supplies.” The interview is linked here.

Jeff Christian of CPM Group continues to step in crappy paper as he tries to explain how the gold and silver markets really are just fine… as long as gold and silver buyers don’t actually take delivery of their metal. has just analyzed Christian’s latest presentation, an interview on Jim Puplava’s Financial Sense News Hour, and you can read the Z.H. analysis, headlined “Jeffrey Christian Has a Second Chance to Disprove the Gold Ponzi Scheme, Fails,” here. [If Christian is the best the central banks and bullion banks can muster as a defense of the gold and silver price suppression schemes as those schemes begin to draw major media scrutiny, the market rigging may be nearing its end.] This article is definitely worth the read.

Not that I want to beat this particular dog to death, but here’s another take on whistleblower Andrew Maguire. This is an article by Mark Mitchell over at The headline reads “Manipulating Gold and Silver: A Criminal Naked Short Position that Could Wreck the Economy” It will take a little more than 5 minutes to run through this piece… and the link is here.
Casey Research’s own Jeff Clark, Senior Editor of Casey’s Gold & Resource Report has issued an article on silver bearing the headline “Why Are Silver Sales Soaring”. The link to this short article is here.

Peter Brimelow over at had a gold-related story in his commentary yesterday. The headline reads “Winning week for gold leaves bugs hopeful, wary: After highs, gold’s Wall of Worry is close, and steep”. The link is here.

And lastly… finally… GoldMoney founder James Turk, editor of the Free Gold Market Report and consultant to GATA, writes that conditions are ripe for a short squeeze in the gold market. He adds that he expects gold to reach $8,000 per ounce by 2015. Turk’s commentary is headlined “Another Short Squeeze in the Precious Metals” and you can find it linked here. Needless to say, it’s very much worth the read.

It is hard to imagine a more stupid or more dangerous way of making decisions than by putting those decisions in the hands of people who pay no price for being wrong. – Thomas Sowell

Well, I certainly wasn’t happy with Monday’s turn of events. As you know, dear reader, the open interest has been skyrocketing over the last four business days… and if you tack that deterioration onto last Friday’s Commitment of Traders report… we’ll, it doesn’t look very pretty.

However, there’s still more room for upside price appreciation… if the bullion banks allow it… so we’ll just have to wait it out. But maybe it really will be different this time… if the short squeeze in gold that James Turk speaks of… along with Ted Butler’s short squeeze in silver… all pan out.

Both gold and silver were under a little pressure in Far East trading earlier this morning… and that has continued right into the London open. Gold volume is just under 19,000 contracts… and silver volume is around 2,700 contracts when you take out the roll-overs from May into the July contract.

The CME has posted volume numbers for Monday. Gold’s volume was reported as 134,881 contracts… and silver’s o.i.. was a largish 40,691 contracts. But a hair over 20% of that number was roll-overs from the May contract into future months… mostly July.

Tuesday should be an interesting day in the gold and silver pits during Comex trading.

See you tomorrow.

Gold & Silver Daily: A Bear Raid in the Precious Metals – Mar 11, 2010

A Bear Raid in the Precious Metals
Gold did nothing worth mentioning in Far East trading yesterday, but was up about $5 by lunchtime in London. From there it declined slowly… losing about $8 going into the London p.m. gold fix at 3:00 p.m. London time… 10:00 a.m. in New York. The moment ‘the fix was in’… gold rallied sharply, only to run into a wall of selling by the New York bullion banks at 11:05 a.m. Eastern time… five minutes after London closed for the day… which is 4:00 p.m. local time in London.

By the time that the not-for-profit selling came to an end about 70 minutes later, gold had ‘fallen’ from its absolute New York high of $1,128.90 spot… to it’s absolute New York low of $1,102.10 spot. From there, gold gained back about six bucks before the close of electronic trading in New York at 5:15 p.m. Eastern time.

It was the same story across the entire precious metals complex… silver, platinum and palladium included. All took off to the upside after the London afternoon gold fix… only to get crushed at 11:05 a.m. in New York… about 65 minutes later. Silver in particular got it in the neck… as it was breaking out to new highs, but got smacked for 75 cents from its absolute high of the day, which was $17.67 spot.

From its highs to its lows, platinum got hit for $48… almost 3 percent. It was the only precious metal that, despite getting creamed, finished up on the day.

Considering the damage done to both gold and silver prices [and sentiment] yesterday, the response of the shares was pretty muted. They started the day in positive territory but then sold off starting shortly after 11:00 a.m. Eastern time when the bullion banks showed up… and the decline ended at exactly 12:30 p.m. From there, the shares traded sideways until the equity market closed at 4:00 p.m. The HUI only lost 1.42%. For the moment, I’m encouraged by that.

The dollar was an interesting study yesterday. From exactly 3:00 a.m. until exactly 11:00 a.m. the dollar gained 50 basis points. If you check the gold chart above, you’ll see that during that time period, gold rose a whole five bucks. But starting at exactly 11:00 a.m… the U.S. dollar reversed course… and over the next hour and a half, gained back about 23 basis points of that 50 basis point loss. Five minutes after the dollar headed north… all the precious metals got slammed for multiple percentage declines. This was too precise an operation to be the free markets operating… in my opinion, this was a well planned bear raid.

As far as open interest goes, I mentioned yesterday that I was hoping that Tuesday’s rally might involve some short covering. Well, that may have been the case, as gold open interest fell 2,383 contracts on volume of 184,500 contracts. That may have been the case in silver as well because, despite it’s nice rally yesterday, silver open interest was only up a very small 452 contracts… and that positive amount may represent the bullion banks going long rather than covering their short positions. Volume was a decent 38,779 contracts. This data, too, will be in tomorrow’s Commitment of Traders report, as Tuesday was the cut-off date.

The CME Daily Delivery Report for Wednesday showed that 11 gold and 152 silver contracts were posted for delivery on Friday. JPMorgan was the big issuer in silver… and the whole report is linked here. Neither GLD or SLV posted any changes yesterday… but the U.S. Mint reported selling another 6,500 one-ounce gold eagles and had no update to silver eagle sales. It was another busy day over at the Comex-approved depositories on Tuesday, as all warehouses reported activity… and they showed that 726,638 ounces of silver were taken into inventory. Tuesday’s action is linked here.

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I only have four stories today, which is just as well, because the last one is a really big read. The first story is another chapter in the ongoing Greek saga. This one also involves Britain as well. It’s a story out of The Telegraph in London… and it’s another offering by their international business editor, Ambrose Evans-Pritchard. The headline reads “Fitch warns Britain and questions Greek rescue as sovereign risks grow”… “Fitch Ratings has delivered a serious blow to the credibility of the Government’s budget plans, warning that Britain risks a loss of investor confidence and erosion of its AAA rating unless it maps out clear austerity measures.” E-P also points out, correctly, that “While the EU game of ‘constructive ambiguity’ [regarding Greece] has succeeded in calming the markets, the agency noted that not a single “hard cent” has been put on the table so far.” It’s a short article… and definitely worth your time… and the link is here.

The next story is a real eye-opener that showed up posted over at Bloomberg yesterday. The headline is almost unbelievable… and reads “U.S. Posts Record Budget Deficit of $221 Billion in February”. The litany of woes contained in the article takes about five minutes to read… and the link is here.

Here’s the first of my two must read offerings for the day. This rather large read is posted over at and bears the headline “Propaganda Campaign Attempts to Mask the Economic Risks and Reality”. The smallish introduction leads to a much larger essay by Yves Smith posted over at The title to this essay reads “The Empire Continues to Strike Back: Team Obama Propaganda Campaign Reaches a Fever Pitch”. Both the introduction and the essay are well worth your time… and the link is here.

And lastly comes this piece from the March/April edition of Foreign Affairs… published by the Council on Foreign Relations… and posted over at It’s written by Niall Ferguson and is titled “Complexity and Collapse: Empires on the Edge of Chaos”. The summary statement says the following… “Imperial collapse may come much more suddenly than many historians imagine. A combination of fiscal deficits and military overstretch suggests that the United States may be the next empire on the precipice.” As I said, I feel this is a must read, even though it will take the better part of half an hour to run through it. I thank reader Roy Stephens for bringing it to my attention… and the link is here.

In the piece I posted above from piece above, came these words… “I have never seen such a load of rubbish being put forward with regard to the markets in US financial assets and commodities, and I’ve seen quite a bit in the last twenty years. In particular, the campaigns against gold and silver are heavy-handed, obvious, and reaching the point of hysteria.”

That would just about sum up what happened on Wednesday… as it was certainly “heavy-handed and obvious”. On Tuesday I included a 6-month gold graph along with the following commentary… “You’ll note that in the last four trading days, it seems like the gold price is rolling over. It’s hard to say whether this is going to correct itself… or if it’s going to go lower. If it does go lower from here… it will certainly not be due to any free market forces that I can think of… but it’s too soon to tell right now.” If you wish to refresh your memory, the link to Tuesday’s column is here… and the graph is near the bottom.

Anyway, here’s what the 6-month gold graph looks like two days later. Yesterday we closed slightly below the 50-day moving average… and if we don’t recover well above it either today or Friday, it’s my bet that the gold price may re-test the 200-day moving average, which has now snuck up to $1,039 spot.

One thing that you must remember looking at this chart is that it’s 100% made in the U.S.A. by the Fed, the Treasury and the PPT… with the bullion banks doing the dirty work. There is no free market price to be seen on this graph anywhere.

Ted Butler feels strongly that we are in the final stages of the bullion banks covering as many of their short positions as they can… and this final push to the downside [if it comes] fits right into the grand scheme of things… but a couple of more days of market activity will be needed to confirm this one way or another, so we’ll have to wait for the bullion banks’ next trick.

Not much happened during Hong Kong trading during their Thursday session, but I did note that silver hit a new low. Volume so far this morning [4:53 a.m. Eastern time] for gold is 19,791 contracts… and in silver it’s a reasonably heavy 4,565 contracts.

The preliminary volume numbers for Wednesday’s trading are now up on the CME’s website… and they show that a massive 235,814 contracts were traded in gold yesterday… and in silver it was 47,681 contracts. The open interest numbers will be worth looking at when they’re posted later this morning. I’m expecting some short covering to be reported. Of course none of these numbers will be in tomorrow’s COT report… as all this very interesting activity took place the day after the cut-off… and won’t show up until next Friday’s report. And as you already know, dear reader, ‘doing the dirty’ on a Wednesday is one of the bullion banks’ favourite tricks.

As I sign off on this column, I see that London has been open for a bit… and not much is happening their, either. It will be [once again] up to the U.S. bullion banks to provide today’s entertainment in the precious metals market when the Comex opens… and after yesterday’s performance… I’m sure they won’t disappoint us.

I hope your Thursday goes well… and I’ll see you tomorrow.

Gold & Silver Daily: World’s Central Banks Meet in Secret in Australia – Feb 09, 2010

World’s Central Banks Meet in Secret in Australia
Gold didn’t do much in Monday trading anywhere in the world. There was a peak in the price [around $1,075 spot] at 4:00 a.m. New York time, when the dollar was at one of its lows of the day… but it was basically all down hill from there, right into the New York close at 5:15 p.m. yesterday afternoon. The low of the day [$1,059.90 spot] occurred during New York trading at some point.

Silver’s high of the day [around $15.28 spot] was also at 4:00 a.m. Eastern time. Then it got smacked for about 30 cents at the Comex open in New York… got it all back by 12:45 p.m… but lost it all by the New York close. Silver’s low of the day [$14.92 spot] occurred shortly before 9:00 a.m. in New York trading.

I wouldn’t read a lot into the action of either metal yesterday. Most of it had to do with what the U.S. dollar was doing… or it was least made to appear that way.

Of course, the precious metals stocks rolled over the same time as the Dow… shortly after 11:00 a.m. yesterday morning… and most of Friday’s lovely gains disappeared.

As far as Friday’s open interest numbers go… gold o.i. rose 5,002 contracts. Volume was a fairly large 275,496 contracts. In silver, open interest was up 1,567 contracts. Volume was a monstrous 67,245 contracts. I’d give a day’s pay to know what the bullion banks did on Friday. On the new lows in both gold and silver, they must have covered a lot of shorts… but gone massively long as well… plus, they were probably 100% responsible for the big rallies off the bottom on Friday afternoon. I suspect that both of these rallies were the result of short covering by the bullion banks, because the tech funds would not be buyers at these prices and moving averages… as they were the ones puking up their long positions earlier in the day! And if this Friday’s Commitment of Traders report shows the correct information… all of this data should be in it.

Well, the CME Delivery Report yesterday showed that 337 gold and a rather large 216 silver contracts are up for delivery on Wednesday. There were two big issuers and stoppers in both metals… and all the details… right down to the last contract, is linked here.

There were no reported changes in the alleged holdings over at GLD… but the SLV added 1,472,061 ounces to their holdings! This, in the middle of one of the biggest bullion bank-orchestrated sell-offs of all time? The Zürcher Kantonalbank in Switzerland updated their ETFs for last week. They added a very small 7,542 ounces of gold… but their silver ETF increased a rather large 510,361 ounces. I thank Carl Loeb for those numbers. There was no report from the U.S. Mint and the Comex-approved depositories showed that 557,194 ounces of silver were added to their inventory on Friday.

Dan Norcini [of Welcome To Jim Sinclair’s MineSet fame] published some excellent graphs over the weekend. Here’s the first one. It shows that the “Commercial Traders” [read JPMorgan et al] are massively short the U.S. dollar index. Do you, dear reader, remember what happened to gold and silver when these fine folks were short both metals as much as that? As Dan says in the sidebar to this graph… “It could well be that the Dollar rally is getting long in the tooth.” No kidding!

There are two other graphs in the 5-page pdf file linked below. The graph above [if you’re having a tough time reading the fine print]… plus the graphs on page 5 and 6… are well worth your time. The link to all of them is here.

It’s Tuesday, and as per usual, I have a lot of stories for your consideration… quite a few of them are very important. Today’s first gold-related story is about another “let’s pretend we have all the physical we say we do” precious metals ETF. It’s called the “ETF Securities USA”. The prospectus, and the story about it, is located in this GATA dispatch that Chris Powell headlined “New ETF will claim to have gold, silver, platinum, and palladium”… and the link is here.

The second gold story is from Peter Brimelow over at MarketWatch – Stock Market Quotes, Business News, Financial News. The headline reads “Gold hit hard, but bugs buoyant”. It’s not very long… and I think you should read it… and the link is here.

There was a top secret banking meeting this past weekend. The only place I found the story was this item from of one of the Australian newspapers. The reason they have the story, is because Australia is the host country… but the location is secret. The headline reads “Secret Summit of Top Bankers: World’s top bankers fly in to meet at secret location… trouble on the horizon”… and the link to this must read story is here.

One must have to wonder, dear reader, just how bad things really are. Well, you should already know. As I’ve said many times over the last ten years… and long before I started writing for Casey Research… “if the free markets were allowed to have their way; the world’s economic, financial, and monetary systems would be a smoldering ruin within a week.”

Here’s another story along the slippery slope. This is a piece that’s posted over at zero hedge | on a long enough timeline, the survival rate for everyone drops to zero. The headline reads “Deutsche Bank And Unicredit Pull Out Of Greek Repo Market, Cease Lending Against Greek Collateral”. This is another must read… and the link is here.

Since it’s Tuesday, I have an Ambrose Evans-Pritchard piece from The Telegraph in London. It’s another one for your must read pile. The headline states “Greek Ouzo crisis escalates into global margin call as confidence ebbs”… “For the third time in 18 months the global financial system risks spinning out of control unless political leaders take immediate and radical action.” The link to the story is here.

In another directly related story from last Thursday’s Telegraph in London… courtesy of Friday’s King Report… comes this piece, and the title is so apropos… “Greece crisis: There, but for the grace of God, goes Britain”… “Should markets pass the same verdict on Britain as on Greece, the results would be almost identical – and just as disastrous, says Edmund Conway.” [That’s a big 10-4 good buddy!] I think this is a must reader… but, dear reader, I’ll leave that decision up to you… and the link is here.

Here’s an interesting story that you’d never find in the main-stream press. “The civil liberties committee in the European Parliament on Thursday recommended that the parliament’s MPs reject a deal that would allow U.S. authorities to continue accessing information held by a Brussels-based international money transfer system… commonly know as SWIFT.” It’s a very short article headlined “Bank Data Wars Escalate”… but has lots of links on this subject if you wish to pursue it. I thank GATA board member Catherine Austin Fitts for providing the story from her Solari | The Solari Report website… and the link is here.

And lastly… thankfully… is this video clip that was posted over at zero hedge | on a long enough timeline, the survival rate for everyone drops to zero. It’s a Marc Faber interview at Bloomberg yesterday. Marc says that “if the U.S. was a corporation, it’s credit rating would be junk.” The video runs about five and a half minutes… and the link is here.

Central banks meeting in secret it Australia… it sounds like The Creature From Jekyll Island all over again. Greece, Portugal and Spain et al on the brink. A stock market [the Dow] that wants to die. It appears that the central banks are watching their control of world financial and monetary events slip away… and are in a full panic mode.

From what I can see at this juncture, there are only two possible ways this economic, financial, and monetary situation is going to resolve itself, and they are… a hyper-inflationary depression… or a complete deflationary collapse. Both of which will result in the destruction of most of the world’s currencies. But, somewhere along either of those paths, or a combination of the two paths… individually or collectively, the central banks will be forced back into using gold as a convertible currency. When [and notice I didn’t say ‘if’] that happens, gold will have to be revalued to some fantastically high price. At that moment, the Golden Rule will come into play… He who has the gold, makes the rules!

Then, and only then, will we find out which countries and their respective central banks have gold reserves of any kind… and how much they really have left.

In the interim, things are going to get incredibly ugly. And, without doubt, the world’s central banks will resort to anything to prevent ‘all of the above’ from happening. But it’s way too late for that now. And, as Ambrose Evans-Pritchard said in his story from The Telegraph above… the crisis in Greece is now escalating into a “global margin call as confidence ebbs.”

These are not just interesting times… they are historic times!

In closing, I see that both metals are up a bit in ragged Far East and early London trading. Gold volume [at 5:03 a.m Eastern time] sits at 22,246 contracts for April… an in March silver, volume traded so far is 3,800 contracts. And the CME has posted the preliminary volume figures for gold and silver trading on Monday. Gold volume was a pretty light 162,375 contracts… and silver shows 47,771 contracts traded.

See you tomorrow.

Gold & Silver Daily: JPMorgan Holds 40% of All Silver Short Positions – Oct 17, 2009

JPMorgan Holds 40% of All Comex Silver Short Positions
Gold and silver didn’t do much anywhere on planet earth yesterday. Their respective lows were at the Comex open… and a $10 rally in gold, along with a 30 cent rally in silver, came to an abrupt end just minutes after London closed for the weekend. After that, both metals prices sagged a bit before heading sideways for the rest of the New York trading session. Both metals posted small gains over Thursday’s closing price… as did the HUI and XAU precious metals indexes.

The changes in open interest for Thursday aren’t worth spending much time on. Even though both metals had substantial down days, and short covering should have been expected… open interest actually rose in both metals. In gold, o.i. was up 639 contracts… and silver o.i. was up 33 contracts. Basically unchanged in both. Volume was pretty chunky, however. In gold it was 162,299 contracts… and in silver it was 41,549 contracts.

The big story was the Commitment of Traders report which came out at 3:30 p.m. yesterday for positions held as of the end of trading on Tuesday, October 13th. Surprisingly, there was almost no further deterioration in silver, as the bullion banks only increased their net short position by a very smallish 238 contracts. Right now the bullion bank net short position is a whopping 65,426 contracts… 327.1 million ounces of paper silver.

In my daily conversation with Ted Butler, he broke the numbers down even further. ‘4 or less’ bullion banks are short 63,383 Comex silver contracts… which is 97.6% of the entire net short position of 65,426 contracts. ‘8 or less’ traders are short 76,168 Comex silver contracts, which represents a stunning 116% of this same short position. And the most grotesque number of all [when you take out all the market-neutral spread trades] is that JPMorgan, all by itself, is short about 40% of the entire Comex silver market!!! The full-colour COT graph for silver is linked here.

In gold, the bullion banks increased their net short position by another 14,062 contracts. Only by purchasing 4,493 long positions did the bullion banks save themselves from the notoriety of being net short over 30 million ounces of gold at the end of this reporting period. Their new net short position [as of Tuesday] was 295,926 contracts… or 29.6 million ounces of gold. The ‘4 or less’ bullion banks are short 19.6 million ounces of that… and the ‘8 or less’ bullion banks are short 27.0 million ounces of gold… or 91.2% of the entire net short position. The full-colour gold COT report is linked here… and is a sight to behold.

Yesterday afternoon, Ted Butler did his usual weekly interview with Eric King over at King World News. The interview is a must listen and I advise you to stop reading right here and listen to this report before continuing. The link is here.

Yesterday, the CME’s Daily Delivery Notices showed that 97 gold contracts were scheduled to be delivered on Tuesday. There were no deliveries reported in silver. Their were no changes to the alleged holdings of either the GLD or SLV yesterday. The U.S. Mint updated their eagles numbers again… another 6,000 gold and 150,000 silver… to 56,000 and 1,417,000 respectively month-to-date. And the daily change in the Comex-approved depositories were, once again, not worth mentioning.

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The usual New York gold commentator reported the following yesterday… “Thursday’s down $14.10 December gold close saw a 639 increase in open interest to 511,391 lots… a new 2009 high.”

“India was an importer all day even though the rupee weakened. However, the currency did gain on the week, the 6th weekly gain running. Since the March low, the rupee has risen 12.8% against the US$. Mitusi-London today noted better Indian gold off-take, but like many, presumes there will be a substantial post-Diwali decline, which I doubt. Unfortunately for the nerves of gold’s friends, Monday is an Indian holiday.”

Gold at the TOCOM was active. Confusingly though, the public cut another 2.32 tonnes from its long, which now stands at the very low level of just over 14 tonnes.”

“Bearishness is widespread, with a majority [9/16] of gold traders in Bloomberg’s weekly poll forecasting a decline next week.” [The link to that story is here.

“The influential Gartman Letter is suggesting… we’ve every reason to believe that our target back toward $1,000 shall be seen at some point in the next week or so…”

“I believe that, as so often, this expectation is based on an in adequate appreciation of the state of the physical market.” [We shall see. – Ed]

Eric King of King World News was kind enough to interview me the other day, and you can listen to the interview here. I have quite a few new stories today, but since it’s the weekend, I hope you can find the time to run through them.

The first story was sent to me by Craig McCarty. It’s a Reuters piece that was posted yesterday evening, so it hasn’t seen much exposure so far. “Billionaire hedge fund founder Raj Rajaratnam and executives from some of the most prestigious U.S. companies were charged on Friday with the largest hedge fund insider-trading scheme ever. Also, three executives from major American companies IBM, top consulting firm McKinsey & Co… and the venture capital arm of chip giant Intel Corp are also facing criminal charges.” The headline reads “U.S. charges billionaire Rajaratnam with record insider trading”… and the link is here.

The next three stories are all courtesy of the King Report. The first is a story posted at . “Despite concerted government-led and lender-supported efforts to prevent foreclosures, the number of filings hit a record high in the third quarter, according to a report issued Thursday.” The headline reads “Foreclosures: ‘Worst three months of all time'”. As I keep saying… call me in 2013 and we’ll talk about a bottom in the U.S. real estate market. The link is here.

In another Reuters story, the headline reads “Capital One credit card defaults rise in September”. Capital One is not the only company recording losses of this magnitude. Most companies are now reporting loss rates of over 10%. The story says that this problem will peak in Q4 of this year “and remain elevated in 2010.” These guys are dreaming in Technicolor if they think that will be in the case. Net charge-offs will get much worse than this before there’s any sign of leveling off. The link to the story is here.

The last story that’s courtesy of the King Report is an offering from Ambrose Evans-Pritchard from The Telegraph in London. The headline reads “German ‘Wise Men’ fear credit crunch in 2010”. “Germany’s leading institutes have warned that the pace of economic recovery is ‘unsustainable’ and that the country’s banks may face a fresh crisis over the next year as bad debts surface in earnest.” Further down in the story, ratings agency Moody’s said this week that Spanish banks face “severe asset quality deterioration” and have yet to make provision for “losses that could reach 225 billion Euros. The link is here.

The last two stories are courtesy of reader P.S. The first is a story from The video clip starts as soon as you hit the link, but the written story posted beside it is a much better synopsis of the situation, and you should pay more attention to that then the video. In the video they never mention two items that are on the screen… the increase in the gold price from $280 to $1,060… nor the price of crude oil, which was a $16.44 back in 1999, and is now over $75. But to their credit, they mention that the dollar has lost 25% of its purchasing power, so today’s 10,000 Dow is, in actual fact, worth 7,500. It’s a short item headlined “Dow 10,000: The More Things Change, The More They Stay the Same”… and is well worth the read… and the link is here.

Lastly is a story posted over at “One of the few places in the world not yet plagued by government intervention is the internet. Although some governments in certain parts of the world have infiltrated the activities of the internet to varying degrees, it remains the closest thing to a purely free economy that we can identify in the modern world.” The essay, which isn’t particularly long, is entitled “Witness the Freest Economy: the Internet” and the link is here.

Who looks outside, dreams; who looks inside, awakens. – Carl Gustav Jung
Today’s ‘blast from the past’ goes back to 1972… and, as usual, needs no introduction whatsoever. So turn up your speakers and click

. I would be the first one to admit that, in the short term… the next 6 weeks… I have no idea which way the gold and silver markets are going to go… and I’m getting tired of repeating myself day after day. If you took the time to listen to what Ted Butler said in his interview with Eric King, you’ll understand why I’m sitting on the fence. Nobody knows for sure how this is going to end… but end it will, one way or another… maybe even with a bang. This is certainly not a market for the faint of heart.

I must, again, repeat what I say every week at this time, In order to participate and gain maximum benefit from this ongoing bull market in the precious metals, you must make the right investment decisions. As a writer in the gold and silver market, and as a member of GATA for the last nine years, I have free access to a lot of precious metals investment newsletters that are sent my way…lots of them! And I can say without a word of a lie, that Casey Research’s International Speculator is far and away the best of the bunch. I know the price is steep… but quality pays… it never costs. But included in that is a complimentary subscription to Casey’s Gold & Resource Report… plus, your satisfaction is 100% guaranteed. I strongly urge you to give this serious consideration.

I await Sunday evening’s opening of the gold market in the Far East with great interest.

Enjoy what’s left of your weekend, and I’ll see you on Tuesday morning.

Gold & Silver Daily: China Eyes Ban on Rare Metal Exports – Sept 03, 2009

World Faces Hi-Tech Crunch as China Eyes Ban on Rare Metal Exports

There was nothing in Far East and London trading yesterday that gave any inkling of what was coming at 8:30 a.m… shortly after the Comex open on Wednesday morning. Gold tacked on a quick $10… then sat at that price for two hours… took another $8 jump, then slowly rose another $7 to $980 shortly after 1:00 p.m. From there, the gold price basically traded sideways until the close of electronic trading at 5:15 p.m. Eastern time.

I was surprised that silver didn’t do better. The price popped a bit along with gold on the early morning Comex rally… but promptly gave it all back within two hours. Then, on the second gold run-up… silver finally took the bit between its teeth, and in the next two and a half hours, tacked on some really respectable gains. But shortly before the Comex close, the silver price looked like it was about to go vertical… and it got stepped on.

Needless to say, I was happy at all these price gains, but in the back of mind I was concerned about who was taking the short side of all these new long positions that were driving up the price. It would be a safe bet that it would be the bullion banks… so it nearly goes without saying that their short position is growing even more grotesque with each passing day.

The shares were on fire yesterday… with the HUI and XAU both up nearly 10%… and closing pretty much at their highs of the day. My stock portfolio [which is 100% in the precious metals] had a pretty good day… as I’m sure, dear reader, did yours. But looking at the 2-year HUI chart posted below, we’ve still got a long way to go [150 points… give or take] to get back to the highs of March 2008… so I’m not breaking out the party favours just yet.

Open interest in gold for Tuesday, September 1st, showed that o.i. rose 2,320 contracts to 384,703… on pretty big volume of 104,075 contracts. Silver o.i. also showed a healthy increase, up 1,614 contracts to 106,671… on decent volume of 30,006 contracts. I’m already cringing at what Wednesday’s open interest numbers will be when they come out later this morning because, without a doubt, they will be u-g-l-y! The thing that concerns Ted Butler is whether or not the ‘big four’ shorts in both silver and gold were actively going short in the market yesterday… or was it other bullion banks carrying the ‘short’ load. Unfortunately, or deliberately, depending on your point of view… we won’t find out until the Commitment of Traders report next Friday… September 11th… because all this action happened on Wednesday…the day after the cut-off for tomorrow’s COT report. As I’ve pointed out many times in the past, this is S.O.P. for the bullion banks when they want to cover their tracks when something big is afoot.

Yesterday’s Comex Delivery Report showed that only 9 gold contracts were delivered… but, once again, there was another big number for silver deliveries… 1,010 contracts… 5 million ounces. The big issuers were the ‘usual suspects’… Deutsche Bank, Bank of Nova Scotia and JPMorgan… with Bank of Nova Scotia taking virtually the entire delivery yesterday by themselves… 951 contracts.

Over at the usual ETFs, there was a small increase of 49,058 ounces at GLD… but over at SLV, for the second time in less than a week, there was a big draw-down. This time it was 2,477,429 ounces. So, in the last week, over 5 million ounces of silver have been withdrawn from the SLV ETF… and since June 13th, the price of silver has increased from $12.40 to 15.49. That’s a hair over three bucks. Silver should be pouring into the SLV ETF… but inventories have been drawn down instead. You would be quite right in asking yourself… “What the hell is going on?”… but it’s obvious that the entity that owned that silver needed it for something else. If there’s lots of silver laying around… why did they have to pull it out of the ETF to get it? Just asking.

There was no report from the U.S. Mint yesterday… and the Comex-approved warehouse stocks showed that 106,820 ounces of silver were withdrawn.

The usual New York gold commentator had the following yesterday… “Today, of course, gold exploded spectacularly on the Comex open, and again just after 10AM. Euro gold tracked $US gold closely, and the move was made before the $US Index started weakening Volume is heavy: estimated at 47,133 lots at 9AM and an even more impressive 113,015 at 12noon. Estimated volume [for the day] was 135,895 contracts.”

The much-abused Gartman Letter deserves credit for its instincts, expressed in the small hours of this morning: ‘…we get the sense that something really quite ominous is upon us and that some news… and clearly not good news… is waiting out there on the market’s periphery that shall tend, on balance, to weigh heavily upon stock prices, shall weigh heavily upon government intervention efforts; shall weigh heavily upon the global capital market’s collective psychology… we have the sense that we are at an historic turning point for the gold market, and that turning point was made mid-day yesterday when the dollar began to strengthen, as commodity prices began to weaken, and yet gold held steady as a rock.'”

“Wide acceptance of this type of thinking amongst the sort of Professionals who read TGL would be [and perhaps is being] an important development for gold.”

“ScotiaMocatta and MKS are both adamant that the rise stemmed from heavy fund buying, with MKS in particular noting “large buying orders before the U.S. market open”… and concluding with… “Large strategic buying from funds helped gold higher…”

“That being the case, a higher estimated volume might have been expected. It also appears that the leader of this advance strongly prefers operating in Comex floor hours.”

“Gold’s price, at present, is in the hands of powerful US-based operators. In this situation, technical input can have real influence. ScotiaMocatta says this evening: “Gold has finally broken out of the topside of our 3-month consolidation triangle at $965… We expect a good extension on this move with $991 [May high], $1006 [2009 high] and possibly $1,032 [2008 high] as technical targets. We expect the market to buy any dip now to $960/965 with only a close back below $950 removing the bullish sentiment.”

“Gold shares had a spectacular day… rising almost unfalteringly into the close. The CEF [Central Fund of Canada] bullion vehicle closed at a 13.6% premium to NAV, a recently high level.”

Talking about the CEF, I received an e-mail from Richard Nachbar yesterday that showed the monthly premium/discount to net asset value for both CEF and Central Gold Trust going all the way back to 1983. It’s hard to believe that CEF ever sold at a 25% discount to NAV at one time… but, as the graph shows, it did!

I thank Richard for the graphs. Richard Nachbar, is a rare coin dealer in upstate New York. His website, is linked here.

Today’s first story is courtesy of Craig McCarty and is a post over at Wegelin Bank, the oldest bank in Switzerland is pulling out of the USA. In an 8-page report entitled “Farewell America” dated August 24th, the bank spells out the reasons for leaving. In the closing paragraph they state the following… “The USA will remain the unquestioned military power and also an enormous repository of debt and other problems. Because they are painful, and there is always an inclination to shift the blame for them onto third parties, redimensioning processes always harbour the potential for aggression. Switzerland is currently experiencing just this. But it won’t end there. Potential aggression and economic progress are mutually exclusive. Which is why we are well advised to take a general farewell of America. This will be painful, for the USA was once the most vital market economy in the world. But for now, it’s time to say goodbye.” The entire article is linked here.

The last two stories of the day are courtesy of the King Report. I’d seen this story on Monday, but didn’t have the space… but now I do. “Traders in London and Frankfurt were buzzing with talk that a major hedge fund was headed for default. Much of the talk was directed at Cerberus, a private equity and hedge fund firm hit hard by losses on investments in Chrysler and GMAC.” The Reuters headline reads “Cerberus dismisses talk of fund defaults”. It’s not a long article, and I suggest you take the time to run through it, and the link is here.

And lastly today, is another piece from Ambrose Evans-Pritchard from The Telegraph in London. It’s a blockbuster and your must read of the day. The headline reads “World faces hi-tech crunch as China eyes ban on rare metal exports”. I didn’t see silver mentioned, but that day may come as well… and if it does, you’ll see a three digit silver price almost overnight. The link is here.

The Constitution is not an instrument for the government to restrain the people, it is an instrument for the people to restrain the government… lest it come to dominate our lives and interests. – Patrick Henry

It’s almost 11:00 a.m. London time [6:00 a.m. in New York] as I put this report to bed. I note that both silver and gold prices have come to life during London trading. But let me quickly point out that the traders are all U.S. bullion banks, as they all have London offices. It’s obvious that we’re in for an interesting day during Comex trading in New York. The precious metals market looks like it wants to bust wide open. With China telling the U.S. bullion banks to take their commodities derivatives and stick ’em where the sun don’t shine… along with the threat to severely restrict exports of rare earth elements [including silver at some point?]… the ‘Big Game’ appears to be on between China and the U.S.A. Hold onto your hats!

See you on Friday.