Gold & Silver Daily

¤ Yesterday In Gold & Silver

The gold price rose and fell five bucks in Far East and London trading---and was back to unchanged by the time the equity markets opened in New York yesterday.  Then, a few minutes after 9:30 a.m. EST, some thoughtful soul was kind enough to peel ten bucks off the price going into the London p.m. gold fix---and once the 'fix was in' the price crept quietly lower during the rest of the New York session, closing almost on its low tick of the day.

The high and low ticks were reported by the CME Group as $1,236.70 and $1,216.50 in the April contract.

Gold finished the Wednesday trading session at $1,217.90 spot, down $15.80 from Tuesday's close.  Net volume was 107,000 contracts, which was about twenty percent higher than Tuesday's volume.

Silver managed to rally back above the $17 mark in the early going in Far East trading on their Wednesday, with the high tick of the day coming at 10:30 a.m. GMT, which was the London morning gold fix.  Selling pressure began at that point, with the low coming at 10:30 a.m. in New York---and after getting sold down a bunch more just minutes after the stock markets opened, just like gold.  The rally from that low lasted until noon in New York before getting sold down to its low of the day once again.  The silver price didn't do much after that.

The high and low were recorded as $17.075 and $16.71 in the March contract.

Silver closed yesterday at $16.785 spot, down 12 cents from Tuesday.  Volume, net of roll-overs---which were pretty decent---was only 26,000 contracts, the same as Tuesday's volume.

Platinum hit its high, such as it was, around 1 p.m. Hong Kong time---and that was it for the day for this precious metal as well, with the low tick coming just before 11 a.m. in New York.  The price didn't do much after that.  Platinum Was closed at $1,191 spot, down another 15 bucks from Tuesday's close.

After doing nothing for most of the Wednesday trading session, the palladium price rallied a bit in the last hour before the COMEX open---and when the COMEX did open, a willing seller showed up immediately to take the price down to just below unchanged by noon EST.  Palladium finished the day at $766 spot, down a couple of dollars from Tuesday.

The dollar index closed late on Tuesday afternoon in New York at 94.74---and after dipping ten basis points in early Far East trading on their Wednesday morning, it rallied to its 95.11 high tick by 12.25 p.m. EST.  It didn't do much from there until 4:30 p.m.---and then it dropped 25 basis points in short order, but rallied back a bit into the close.  The index finished the day at 94.92---and up 18 basis points from Tuesday.

The gold stocks opened in positive territory, but crashed for over 2 percent when that not-for-profit seller appeared in the COMEX gold market just minutes after the 9:30 a.m. EST stock market open.  From there they chopped sideways in a reasonably tight range---and the HUI closed down 1.97 percent.

The silver stocks followed the metal price like a shadow yesterday---and Nick Laird's Intraday Silver Sentiment Index closed down 2.10 percent.

The CME Daily Delivery Report showed that 1 gold and 3 silver contracts were posted for delivery within the COMEX-approved depositories on Thursday.  Nothing to see here once again.

The CME Preliminary Report for the Wednesday trading session showed that gold open interest in February declined by 2 contracts, leaving 656 contracts still open.  In silver, 3 contracts were added to February o.i.---bringing it up to 23 contracts.

There were no reported changes in GLD yesterday---and as of 9:56 p.m. EST yesterday evening, there were no reported changes in SLV, either.

As I mentioned yesterday, the fact that no metal is being withdrawn from SLV after last Friday's price smash is no surprise, as the authorized participants are covering their short positions in that ETF.  But the fact that no gold has left GLD so far, comes as a real surprise.  One wonders what entity was buying up the GLD stock that was being dumped last Friday.  I'll be very interested in what these two ETFs have to say for themselves when they report this evening.

Over at Switzerland's Zürcher Kantonalbank for the week ending on Friday, February 6---they reported declines in both their gold and silver ETFs once again.  The gold ETF dropped by 3,981 troy ounces---and their silver ETF declined by 54,415 troy ounces.

There was no sales report from the U.S. Mint yesterday.

There was a very decent amount of gold movement at the COMEX-approved depositories on Tuesday, as 162,175 troy ounces were reported received---and 40,705 troy ounces were shipped out.  2,000 bars of the gold received were in kilobar form at Canada's Scotiabank.  The link to that activity is here.

In silver, nothing was reported received---and 361,042 troy ounces were shipped out the door for parts unknown.  The link to that action is here.

I have a decent number of stories for you today---and I'll leave the final edit up to you.


¤ Critical Reads

Baltic Dry Index Hits [Another] New Record Low

It's like a tax-cut for the world's freight shippers..." oh wait...

This tiny story Zero Hedge story is composed of just one chart---the Baltic Dry Index---and it shows the new low.  I expect we'll see fresh lows in the weeks and months ahead.  It was posted on their website at 8:24 a.m. EST on Wednesday morning---and I thank Dan Lazicki for today's first news item.


Banks May Have Overplayed Their Hand Fighting Wall Street Regulation

The financial industry is finding that winning in Washington comes at a cost.

Wall Street lobbied aggressively and succeeded late last year in persuading lawmakers to roll back rules for the $700 trillion derivatives market. Instead of generating momentum for further changes to the Dodd-Frank Act, the victory sparked a populist uprising among Democrats that’s had wide-ranging consequences, including stymieing less controversial requests from regional banks like Capital One Financial Corp.

“A short while ago there was bipartisan agreement on a number of common sense improvements,” said Rob Nichols, president of the Financial Services Forum that represents the chief executives of Wall Street’s biggest banks. “Unfortunately, that bipartisan agreement is gone.”

Financial companies and their employees spent $169 million on the November elections and had expectations that their bid to loosen regulations would get easier with Republicans in control of both the House and Senate. Now, there is second-guessing that banks overplayed their hand, according to lobbyists. The December win on swaps rules has become a rallying cry for Senator Elizabeth Warren, a frequent critic of Wall Street, and spurred repeated White House vows to defend Dodd-Frank.

This interesting Bloomberg article, filed from Washington, showed up on their Internet site at 3:00 a.m. Denver time yesterday morning---and it's the second offering in a row from Dan Lazicki.


Wall Street Pays Bankers to Work in Government and It Doesn't Want Anyone to Know

Citigroup is one of three Wall Street banks attempting to keep hidden their practice of paying executives multimillion-dollar awards for entering government service. In letters delivered to the Securities and Exchange Commission (SEC) over the last month, Citi, Goldman Sachs and Morgan Stanley seek exemption from a shareholder proposal, filed by the AFL-CIO labor coalition, which would force them to identify all executives eligible for these financial rewards, and the specific dollar amounts at stake. Critics argue these “golden parachutes” ensure more financial insiders in policy positions and favorable treatment toward Wall Street. 

“As shareholders of these banks, we want to know how much money we have promised to give away to senior executives if they take government jobs,” said AFL-CIO President Richard Trumka in a statement. “It’s a simple question, but the banks don’t want to answer it. What are they trying to hide?” 

The handouts recently received attention when Antonio Weiss, the former investment banker at Lazard now serving as counselor to Treasury Secretary Jack Lew, acknowledged in financial disclosures that he would be paid $21 million in unvested income and deferred compensation upon exiting the company for a job in government. Weiss withdrew from consideration to become the undersecretary for domestic finance under pressure from financial reformers, but the counselor position—which does not require congressional confirmation—probably still entitles him to the $21 million. The terms of the award are part of a Lazard employee agreement that nobody has seen.

There's no dateline on this article that appeared on the Internet site, but I suspect it's less than a week old.  I thank Washington state reader S.A. for bringing it to our attention.


The New York Sun: Richard Fisher's next job?

The outgoing president of the Dallas Fed has managed to pack into his interview this morning with the Wall Street Journal more intelligent talk about reform than we’ve heard from the central bank in the entire great recession. Richard Fisher, who’s earned a reputation as an inflation hawk, hasn’t yet — we retain hope — endorsed the kind of Fed audit for which the House of Representatives has twice voted and the Senate is considering. But he wants to reallocate power on the Federal Open Market Committee.

This strikes us as an important start. The idea sketched by Mr. Fisher would be, as phrased by his interviewer, James Freeman, “to recognize the rising population and economic power of the South and the West.” It’s not just the burgeoning population and economies of the South and West that motivates Mr. Fisher; he also aims to “limit the influence of Washington and Wall Street,” as Mr. Freeman puts it. He would also end the tradition of the New York Fed President serving as the vice chairman of the Open Market Committee.

In any event, it is just terrific to see an insider with Mr. Fisher’s stature speaking up for reform. We are now almost 50 years into the age of fiat money. “By now, I think we can agree that the absence of an official, rules-based, cooperatively managed monetary system has not been a great success,” says no less a sage than Paul Volcker. It would be a theme for Mr. Fisher to pick up after he leaves the presidency of the Dallas Fed. Paul Volcker, Richard Fisher, Congressmen Jeb Hensarling, Paul Ryan, and Kevin Brady, Senator Rand Paul, and tribune James Grant — we can imagine a powerful group coming together to lead a reform.

This editorial appeared in The New York Sun yesterday---and I found it embedded in a GATA release yesterday.  It's worth skimming.


Jim Rickards: Unprecedented Central Bank Policies Call for a “Barbell Strategy”

Not a day goes by without some pretty significant developments in the markets. You should not react or overreact in a knee jerk fashion to each piece of data that comes out.  You’ll just end up getting whipped around.

What you need to do – what analysts and investors need to do  — is have a thesis to guide them. Don’t pick one at random, but have a well thought out thesis.  Then use the data to test that thesis.  There’s a name for this: it’s called “inverse probability”. You use subsequent data to test your original idea.

That method is is different from a lot of science where you actually get a bunch of data and then you come up with an idea.  Here, however, you have an idea and you come up with data to test it.  There is no better way of approaching the markets because nobody has a crystal ball.

Our thesis has a number of elements. One of them is that there is a tug-of-war going on between inflation and deflation, which I’ve written about in these pages before (In the short-term, I believe deflation has the upper hand). That confuses a lot of people because they understand one or the other, but it’s challenging for them to keep both things in mind at the same time.

This commentary by Jim showed up on the Internet site on Tuesday sometime---and I thank Harold Jacobsen for bringing it to our attention.


Jim Rickards -- The Shock Doctrine: When Order Trumps Personal Freedom

One of the most influential books among global power elites in the past 10 years is Shock Doctrine: The Rise of Disaster Capitalism, by Naomi Klein, published in 2007. The shock doctrine is an essential concept for understanding how power elites such as central bankers, finance ministers and the ultra-rich work behind the scenes to advance their agendas.

It’s also how today’s world could quickly turn into the dystopian 2024 scenario I’ve penned. This is not conspiracy mongering or science fiction; this is fact.

Shock doctrine is simple. Political leaders use crises to ramrod policies into place no one would accept in normal times.

The shock doctrine begins with the fact that power elites have agendas that take decades or even centuries to implement. These agendas include things like world money, global taxation, control of physical gold, population control and other plans intended to increase the power and wealth of the few at your expense.

Wow!  This  certainly falls into the must read category.  Please pass it around to anyone you think needs to read it.  This commentary by Rickards also appeared on the Internet site, but in Wednesday's edition.  I thank Dan Lazicki for bringing it to my attention---and now to yours.


Obama: "We have to twist arms when countries don't do what we need them to"

President Barack Obama has said the reality of “American leadership” at times entails “twisting the arms” of states which “don’t do what we need them to do,” and that the U.S. relied on its military strength and other leverage to achieve its goals.

In a broad-ranging interview with Vox, which Obama himself described as a venue "for the brainiac-nerd types," the U.S. president both denied the efficacy of a purely “realist” foreign policy but also arguing that at times the U.S., which has a defense budget that exceeds the next 10 countries combined, needed to rely on its military muscle and other levers of power.

When asked about the limits of American power, Obama conceded that there were things that his administration simply cannot do in terms of power projection, but remained upbeat.

“Well, American leadership, in part, comes out of our can-do spirit. We're the largest, most powerful country on Earth. As I said previously in speeches: when problems happen, they don't call Beijing. They don't call Moscow. They call us. And we embrace that responsibility. The question, I think, is how that leadership is exercised. My administration is very aggressive and internationalist in wading in and taking on and trying to solve problems.”

And the price that the rest of the world pays for America being "the most exceptional" country in on Planet Earth is enormous.  That includes us here in Canada.  This article was posted on the Russia Today website at 11:37 a.m. Moscow time on their Wednesday morning, which was 3:37 a.m. in New York.  I thank Roy Stephens for sending it along.


Obama's Force Authorization is a Blank Check for War Worldwide

The president is requesting Congress to pass an authorization for the use of military force (AUMF) resolution against ISIS. Congress has not issued a similar resolution since 2002, when President Bush was given the authority to wage war against Iraq. The purpose of this resolution is to give official authority to the president to do the things that he has already been doing for the past six years. Seems strange but this is typical for Washington. President Obama’s claim is that he does not need this authority. He claims, as have all other recent presidents, that the authority to wage war in the Middle East has been granted by the resolutions passed in 2001, 2002, and by article II of the Constitution. To ask for this authority at this time is a response to public and political pressure.

It has been reported that the president is going to request that the authority limit the use of ground troops. However it would not affect the troops already engaged in Syria and Iraq to the tune of many thousands. This new authority will acknowledge that more advisors will be sent. Most importantly it will appear to have given moral sanction to the wars that have already been going for years.

Interestingly it actually expands the ability of the president to wage war although the president publicly indicates he would like to restrain it. The new authorization explicitly does not impose geographic limits on the use of troops anywhere in the world and expands the definition of ISIS to that of all “associated forces.” A grant of this authority will do nothing to limit our dangerous involvement in these constant Middle East wars.

Declaring war against ISIS is like declaring war against communism or fascism. The enemy cannot be identified or limited. Both are ideological and armies are incapable of stopping an idea, good or bad, that the people do not resist or that they support. Besides, the strength of ISIS has been enhanced by our efforts. Our involvement in the Middle East is being used as a very successful recruitment tool to expand the number of radical jihadists willing to fight and die for what they believe in. And sadly our efforts have further backfired with the weapons that we send ending up in the hands of our enemies and used against our allies and Americans caught in the crossfire. Good intentions are not enough. Wise policies and common sense would go a long way toward working for peace and prosperity instead of escalating violence and motivating the enemy.

This commentary by Ron Paul appeared on this website yesterday---and it's not only right on the money, it's certainly worth reading as well.


Doug Casey on ISIS, Gold, Oil, and What to Expect in 2015

Today’s entrée is a special treat. Doug Casey and Louis James talk gold, ISIS, oil, stock markets, and much more in a conversation about what to expect in the markets in 2015. This interview was originally published in The Casey Report.

L: It’s been a long, eventful quarter since we last spoke, Doug. What’s most on your mind as 2014 draws to a close and we look ahead to 2015?

Doug: Let’s start with gold, since that’s the main focus we’ve had for so long. The Swiss gold reserve referendum just went down in flames, of course, and that was a big disappointment to many.

L: Really? I don’t know anyone who was surprised.

Doug: Well, surprise and disappointment aren’t the same thing. I’m constantly disappointed by how stupid people are, but I’m never surprised by it. There were early signs of support for the measure, but the powers that be mounted an immense propaganda campaign against it, and they succeeded. I hear that the balance sheet of the Swiss central bank has expanded faster than that of any other central bank in the world—

L: Whoa—that would explain a lot.

Doug: Yes. Relying on the Swiss franc to preserve your capital today is like relying on Swiss banks to preserve your privacy. Only fools would trust in either at this point. Despite that, Switzerland may still be sounder than any other country in Europe—which is really saying something about how bad things have gotten in Europe.

Even though this interview was originally posted about six weeks ago, it's still worth reading.  It appeared in yesterday's edition of Casey's Daily Dispatch.


Jean Claude Juncker Poses Challenge to Merkel and Austerity Policies

Jean-Claude Juncker deliberately chose to deliver his warning in German. "Commissioners are proposed by the member states, but they do not represent the interests of their member state," the newly appointed president of the European Commission said as he introduced his team last September. In the event a commissioner confused "national and European policies," he threatened, he would move that appointee to another portfolio.

Germany's Commissioner Günther Oettinger paid little heed to the warning. On Jan. 8, he met in Hamburg with German Chancellor Angela Merkel and Finance Minister Wolfgang Schäuble to warn them that Juncker was planning to loosen the rules of the Stability Pact for the common currency zone. The three quickly agreed at the meeting that the development would not be in Germany's interest, and they agreed to thwart Juncker's plans.

It had been clear for some time that Europe's most powerful leader would eventually clash with the head of the European Commission, the EU's executive, but it happened earlier than some might have expected. Juncker's commission hasn't even been in office for 100 days yet and conflicts between Berlin and Brussels are already surfacing. Policy differences are at the forefront, with Juncker feeling that Merkel has bound Europe to austerity policies for too long. But the conflict also touches on a more fundamental question: Who holds the power in Europe?

This news item appeared on the German website at 3:03 p.m. Europe time on their Tuesday afternoon---and it's another contribution from Roy Stephens.  The story also sports a new headline, as it now reads "Shrinking Merkel Down To Size: Berlin Faces Austerity Challenge in Brussels".


Greece and eurozone in stalemate over debt burden

The Greek government’s confrontation with its eurozone creditors over its campaign to relieve its staggering debt burden while relaxing the terms of five years of austerity resulted in stalemate late on Wednesday.

The first proper negotiations between Greece and eurozone finance ministers failed to make any progress or result in a joint statement. While no immediate agreement had been expected, the emergency meeting had been tipped to produce a framework for talks to be finessed over the next few days before another meeting next Monday.

Jeroen Dijsselbloem, the Dutch finance minister who chaired the Brussels meeting, announced that this aim was not met. It appeared that the new left wing government in Athens was isolated in seeking to extract better terms from Europe.

Alexis Tsipras, the new Greek prime minister, seems to have ordered his finance minister, Yanis Varoufakis, to stand firm against the pressure to make any concessions. Tsipras is due in Brussels on Thursday for his debut on the European stage at an E.U. summit.

This article, filed from Brussels, showed up on Internet site at 00:50 GMT on their Thursday morning, which was 7:50 p.m. EST Wednesday evening.  I thank Roy Stephens for sending it.


Germany faces impossible choice as Greek austerity revolt spreads

The political centre across southern Europe is disintegrating. Establishment parties of centre-left and centre-right - La Casta, as they say in Spain - have successively immolated themselves enforcing EMU debt-deflation.

Spain's neo-Bolivarian Podemos party refuses to fade. It has endured crippling internal rifts. It has shrugged off hostile press coverage over financial ties to Venezuela. Nothing sticks.

The insurrectionists who came from nowhere last year - with Trotskyist roots and more radical views than those of Syriza in Greece - are pulling further ahead in the polls. The latest Metroscopia survey gave Podemos 28pc. The ruling conservatives have dropped to 21pc.

The once-great PSOE - Spanish Workers Socialist Party - has fallen to 18pc and risks fading away like the Dutch Labour Party, or the French Socialists, or Greece's Pasok. You can defend EMU policies, or you can defend your political base, but you cannot do both.

This commentary by Ambrose Evans-Pritchard showed up on The Telegraph's website at 9:53 p.m. GMT yesterday evening---and I thank Roy Stephens for sliding it into my in-box in the wee hours of this morning. It's definitely worth reading.


‘Bankrupt but Free’: Greeks stage nationwide anti-austerity rallies

As E.U. politicians failed to reach a Greek debt deal in Brussels, thousands of people poured onto the streets of Athens and other large cities to protest austerity and voice support for the recently elected Syriza party.

Eurozone finance ministers have made progress in discussions with Greece following hours of talks on Wednesday. The talks on whether to extend an international bailout to Athens will continue during the next scheduled meeting on Monday, as the sides could not agree on another meeting before then.

"We explored a number of issues, one of which was the current program," Eurogroup chairman Jeroen Dijsselbloem said. "We discussed the possibility of an extension. For some that is clear that is preferred option but we haven't come to that conclusion as yet.”

This article put in an appearance on the Russia Today Internet site at 9:54 p.m. Moscow time on their Wednesday evening---and this story is also courtesy of Roy Stephens.


John Batchelor Interviews Stephen F. Cohen on the Ukraine/Russia embroglio

We are at a critical stage with the Ukrainian Civil War and how Europe handles its growing rift against the of the United States will determine outcomes. Things are "swirling" as Cohen puts it....Cohen states that Europe wants an end to the conflict and has largely split away from Washington's aggressive stance.  There are some pressing questions however - especially around Washington designs to arm Kiev with "defensive weapons".

The Kiev military is basically defeated and the Ukrainian state is more or less failed. Who would the US arm, the Azov Battalion (fascist)? This was understandably not really answered. How could Europe be open to that? It would not, with the exception of a minority of countries - Poland and the Baltic States.

Cohen now recognizes that there is a neoconservative clique entrenched in the White House that may be deciding on the showdown with Russia. This so-called war party in Washington believes that arming Kiev (?) at a cost of 1 billion dollars in weapons per year per year is a solution.  "This is crazy says Cohen!". The war party (neocons) are former military, retired NATO personal, and ex ambassadors that have been pushing this "containment policy of competing countries" since the mid 1990s - are responsible for this crisis. It is their political moment as well. Is Obama fully complicit? This is unknown but his last phone call to Putin is clearly a threat. Obama warned that "Russia involvement in Ukraine will be expensive for Russia", and Putin obviously takes this as a threat, says Cohen. However, it is unclear what this means. More sanctions, arms shipments to Kiev, boots on the ground, NATO involvement?

Cohen states that one thing is clear: the leaders of Europe have broken with Washington- except for the Baltic states. But Cohen also warns that this doesn't mean they can necessarily act politically independently.  NATO is controlled by Washington and Europe owes most of its security to NATO which is mostly financially supported by the USA. . Will Europe gain its own foreign policy? Cohen believes that this is the "existential" moment for Europe as well as for Russia. He is unsure what Washington thinks at all. But its reckless actions have, over time, been making Europe more anti-American, especially with the younger populations. Similarly, this is a measured conclusion by thinking Russians. 

Russia sees NATO as "Pac Man".  The Washington war party does not recognize Russia's self determinism.  "Something has gone VERY wrong in the USA", says Cohen. The great error here for the USA is not seeing the world thru Russian eyes". This process has been recognized in the past as vital to dealing with the old Soviet Union. As far as Cohen is concerned, this is no longer the case and is a very dangerous neglect by the White House. Russia and Ukraine are virtually joined in history, culture and spirit  and through marriage and families. Russia will not tolerate direct U.S. subjugation in Ukraine. As of now Washington gets the blame for ruining Ukraine and Washington seems to be oblivious of the consequences of its policies against Russia or in considering what it is doing in Ukraine by any humanitarian measure.

Nobody in the West is more plugged into the Russia/Ukraine situation that Stephen Cohen.  This audio interview runs for just under 40 minutes---but is a must listen if the subject interest you, which it should.  I thank Larry Galearis for sharing it with us.


Poroshenko: Ukraine conflict risks spiralling out of control

Ukraine’s president has warned that the separatist conflict in east Ukraine will spiral out of control if there is no de-escalation and ceasefire.

Petro Poroshenko was speaking as he arrived in Minsk for talks with the leaders of Russia, France and Germany aimed at hammering out a new peace deal on Ukraine.

“Either the situation goes down the road of de-escalation, ceasefire … or the situation goes out of control,” he said.

With Washington warning Putin that the costs of failure at a summit in Belarus would starkly increase for Moscow, and Barack Obama describing the Russian leader as a KGB veteran nostalgic for the days of Soviet empire, the German chancellor, Angela Merkel, and the French president, François Hollande, as well as Poroshenko and Putin, went to Minsk to haggle over the details of a proposed ceasefire and the status of the pro-Russia separatist region of eastern Ukraine.

“There is a glimmer of hope, but no more,” said Merkel’s spokesman, as European leaders played down hopes of a breakthrough.

This is such an anti-Russian propaganda piece [which has become so typical of the Western press now] that I was loath to post it, but I hope you can pick through it OK.  It appeared on Internet site at 6:33 p.m. GMT yesterday evening---and it's another kind contribution from Roy Stephens.


‘Greater OSCE efforts would be needed to maintain demilitarized zones in Ukraine’

If the parties at the Minsk peace talks agree on establishing a wider ceasefire buffer zone between the warring sides, considerable resources from the OSCE will be needed to observe and maintain it, Charles Shoebridge, former U.K. army officer, told Russia Today.

RT: It's understood that there's now a consensus among those involved in the Minsk peace talks, that no military solution to the crisis is possible. Yet, Washington is still mulling arms supplies to Kiev. Could the US derail peace?

Charles Shoebridge: The answer in short, is that it is still possible very much so. As we know from the different theatres around the world - not least Ukraine, Syria, lots of other examples - U.S. foreign policy is far from a consistent coherent beast. There are various different lobby groups advocating, including within the parties themselves, in Washington. Different factions want different things. But it could be that Obama and even Merkel and Hollande are able to use it to their advantage, if indeed on the sidelines they can have not a particularly big stick because the U.S. has said that it is not going to be supplying vast amounts of weaponry.

But if there is a possibility of the U.S. supplying weaponry that my at least focus minds and deliver a sense of urgency. But were those weapons to be delivered of course it would be a terrible step of escalation. One would expect that those arming the rebels would similarly up their game, as well. Indeed we’ve seen the results elsewhere when weapons are poured into a combat zone such as Syria or Libya. It makes the situation much worse and it makes the effects of the war not just greater but also geographically more widespread throughout Ukraine, as well.

This interview appeared on the Russia Today website at 12:32 p.m. Moscow time on their Wednesday afternoon, which was 4:32 a.m. in New York.  Once again I thank Roy Stephens for sharing it with us.


Ceasefire in Ukraine to Begin Midnight February 15 - Putin

A ceasefire in eastern Ukraine will come into effect at 12 a.m. local time on February 15 (22:00 February 14 GMT time), Russian President Vladimir Putin said Thursday after the Normandy four meeting on Ukrainian reconciliation in Minsk.

"This was not the best night of my life. But the morning was good regardless of all the difficulties during the negotiations and we were able to agree on the important thing. The first thing we agreed on is the ceasefire starting from 12 a.m. [local time] on February 15. The second point, which I consider extremely important — is the withdrawal of heavy artillery from the today’s contact line for Ukrainian army, and from the line marked on September 19 last year in the Minsk agreements for Donbas,," Putin told journalists in the Belarusian capital of Minsk following the peace talks on Ukraine.

Kiev refuses to negotiate with the self-proclaimed republics of Donetsk and Luhansk, Russian President Vladimir Putin said adding that the parties have not agreed on the document on the Ukraine reconciliation yet.

"Why did the talks last so long? I think this, unfortunately, is because the Kiev authorities rejected direct contacts with the representatives from the Donetsk and Luhansk People’s republics," Putin said.

This story appeared on the Internet site at 12:08 p.m. Moscow time on their Thursday afternoon, which was 4:08 a.m. in Washington.  I thank reader M.A. for sending it our way just before I filed today's missive.


Russia will not restructure Ukraine’s $3 billion debt – finance minister

Russia has rejected Ukraine's request to restructure its $3 billion debt said Finance Minister Anton Siluanov adding that the ministry “is waiting for this money.”

“We expect all the commitments of Ukraine to be fulfilled this year in December. Any budget income in foreign currency is important to us," Siluanov said on the sidelines of the G20 summit in Istanbul.

“Russia is not in a situation when one can easily write off foreign currency obligations,” he said. "The return of resources that were once invested in foreign currency bonds of another country is very important.”

Siluanov said Russia has the right to demand early repayment of the Ukrainian debt, but Moscow won’t accept any delays or installment of payments.

This is another article from the Russia Today Internet site.  This one showed up there at 9:43 a.m. Moscow time yesterday morning---and it represents the second-last offering of the day from Roy Stephens.


Foreign fighters flocking to Syria at ‘unprecedented rate’

The foreign fighters have traveled to Syria from more than 90 countries, including at least 3,400 from Western states and more than 150 Americans, according to the latest estimate from the National Counter-Terrorism Center (NCTC).

A majority of the foreign volunteers who arrived recently have joined forces with the Islamic State group in Syria and Iraq, it said.

The estimate of the total number of foreign fighters flocking to Syria was up from a previous estimate in January of 19,000, according to NCTC.

No precise numbers are available "but the trend lines are clear and concerning," Nicholas Rasmussen, NCTC director, said in prepared remarks for a hearing before lawmakers on Wednesday.

This article was posted on the Internet site yesterday sometime---and it's the final offering of the day from Roy Stephens, for which I thank him.


Doug Casey's omniscience vs. the many records of gold price suppression

Doug Casey, founder of Casey Research, may be admired for his omniscience anyway. In an interview today with Dan Steinhart of The Casey Report  -- Casey declares, "The government doesn't care about gold. ... They don't care about its price, and even less about that of silver."

Casey adds: "I don't believe in the conspiracy theories regarding gold price suppression. There's zero credible evidence for it, and I'm embarrassed having to discuss the subject with outsiders who have heard it. For them it's more evidence that gold investors all wear tin-foil hats."

But unfortunately once again Casey failed explain how he knows what governments are thinking about gold -- did he question even one government official about it? -- and failed to address any particular piece of evidence of government involvement in the gold market. This may leave those of his firm's clients who are not also omniscient wondering about the contradiction between Casey's assurances and the long, vast, and contemporaneous public record of both open and surreptitious government intervention in the gold market.

This extensive commentary by GATA secretary/treasurer Chris Powell appeared on the Internet site yesterday---and it's worth reading.


Gold miners on the hunt for cheap assets

Gold producers with cash on hand are on the hunt for cheap mining assets as rising prices drive shares higher.

During a 12-year bull run that ended last year, about $30 billion in debt was racked up by companies that mine gold. Those that minimized borrowing then are in the best position now to scoop up mines from rivals with weaker balance sheets, said executives at the Investing in African Mining Indaba conference in South Africa, the biggest such gathering on the continent.

Already, $2.7 billion in deals have been announced or completed this year within the industry, including Monday’s $1.1 billion offer for Rio Alto Mining Ltd. by Tahoe Resources Inc. It’s an early leg up on the $10.5 billion in deals last year.

“Gold is one of the brighter spots out there in the commodities space today,” Rajat Kohli, head of metals and mining at Standard Bank Group Ltd., Africa’s largest bank. “I would expect corporate activity to be reasonably pronounced in gold, not just in Africa but globally. We will see a few transactions, definitely.”

Very few gold or silver producers are "cash rich" these days---not even the large ones, so it will be interesting to see which companies step up to the acquisition plate---and how soon.  This Bloomberg offering, co-filed from London and Johannesburg appeared on their website at 9:50 a.m. MST yesterday morning---and the first person through the door with this story was Dan Lazicki.  It's also his final contribution in today's column---and I thank him on your behalf.


Swiss bank says investors favor gold amid charges on cash

Investors are buying more gold as an alternative to hold Swiss franc cash deposits, according Vontobel Holding AG, a Swiss bank and wealth manager.

"We keep noticing that gold is coming back into favor with investors," Vontobel Chief Executive Officer Zeno Staub, 45, told reporters today after the Zurich-based company announced full-year earnings.

Concerns that Greece may abandon the euro and Ukraine may be headed for a wider conflict have spurred demand for haven assets. Gold has climbed 4.2 percent this year, even as the dollar strengthened on prospects of higher U.S. interest rates. Investors' holdings in gold-backed funds are near the highest since October.

Well, dear reader, that may be true---and if it is, you'd never know it by looking at the virtual non-stop declines in both gold and silver holdings over at Europe's largest precious metal ETFs at Switzerland's Zürcher Kantonalbank.  This short Bloomberg article, filed from Geneva yesterday, appeared on their Internet site at 7:31 a.m. Denver time.


Turkey: PM pledges dowry of gold to young women to have children

Turkey is to offer up to 10,000 Turkish lira ($4,000) to couples that marry early in a bid to get young people to marry before graduating from university and produce at least three offspring.

The Justice and Development Party (AKP) government and Prime Minister Ahmet Davutoglu have outlined a series of financial incentives, including cash rewards and debt paybacks, as part of the AKP's vision of women in the "New Turkey".

The AKP, which has been in power for more than ten years, with Prime Minister Recep Tayyip Erdogan in charge for most of them has its roots in Islam, and wants to make Turkey more Islamic.

Falling birthrates are obviously a problem in Turkey as well---but I doubt very much that this incentive will make young couples "Go For Gold".  This very interesting article showed up on the International Business Times website at 7:01 p.m. GMT on Tuesday evening---and I thank Casey Research BIG GOLD editor Jeff Clark for digging it up for us.


India smugglers, and their bodies, take a break from gold

In the two years since India took steps to pare gold imports, people used all sorts of tricks as the smuggling business boomed -- from simply tucking the metal under a turban to jamming it up their rectums.

That illegal trade, though, is fading now.

Premiums have evaporated for black-market bullion valued at about $8 billion last year, industry data show. That's because the government has begun easing import curbs that in 2013 knocked India from the top spot among gold buyers. In a country that accounts for a quarter of world demand, legal transactions are recovering, with annual purchases from overseas poised to jump 50 percent.

This gold related news item, filed from Mumbai, appeared on the Bloomberg website at 11:30 a.m. Mountain Standard Time Wednesday morning---and I found this in a GATA release.


Central Banks Hungry for Gold: Bought Enough for 75 Dreamliners

Central banks purchased enough gold in 2014 to buy 75 Boeing Co. Dreamliners.

Governments added 477.2 metric tons to their reserves, the second-biggest increase in 50 years and 17 percent more than a year earlier, the World Gold Council said in a report Thursday. Based on the average price of gold in 2014, central banks probably paid about $19.4 billion. A Boeing 787-9 has a $257.1 million retail price, according to the company’s website.

Central banks have added to gold reserves for the past five years, a reversal from two decades of selling since the late 1980s. Purchases will be at least 400 tons this year, according to estimates from the London-based council, which represents 17 gold producers. Total demand for gold fell last year as Chinese consumers bought less jewelry, bars and coins.

“There is a lot of scope for emerging market central banks to expand their holdings as these are still significantly underweight,” Alistair Hewitt, head of market intelligence at the council, in a phone interview on Wednesday. “Demand from this sector is going to remain robust.”

This is quite an amazing story in light of the fact that Doug Casey says that the government doesn't care about gold, or its price.  This Bloomberg article, filed from London, was posted on their website at 10:00 p.m. Denver time last night---and it's another article I found on the Internet site.  The thought police at Bloomberg have changed the headline to a less passionate-sounding "Central Banks Are Boosting Their Gold Reserves".  It's definitely worth reading.



¤ The Funnies

After driving through Show Low, I decided to wander the streets of Snowflake, Arizona which was a little further north on State Highway 77.  I'd heard of the place before in my distant past.  It's not a big town---and it's named after the two pioneers who founded it in 1878---a Mr. Snow---and a Mr. Flake.  You couldn't make this stuff up!  I came across Mr. Flake's home in my drive-around---and the photo is below.  Use the 'click to enlarge' feature so you can read the sign for yourself.

Less than a kilometer away from the above house, I ran across these animals on a small acreage in the "outskirts"---and knew right away they weren't locals, as Texas Longhorns don't look like that.  They're an African breed called Ankole-Watusi, or Ankole longhorn---and they were custom designed for the Arizona climate.  They were also a fair distance away---and I had to crop the photos reasonably severely---and they're also at the very outer limits of what I call an acceptable photo for the lens I was using.  But since they're the only photos of this animal I have, they're keepers!  Notice the P/S brand on the hindquarters in the second shot.

The last photo is about ten miles north of Snowflake---and the landscape changes quite a bit as one approaches Interstate 40/U.S. Route 66---especially when you consider the trees/bushes in the two photos above.  You get a landscape change in less than 30 minutes of driving in Arizona, no matter what direction you're going---and this is one of them.

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¤ The Wrap

Today, Wednesday, the commercials have succeeded in forcing gold prices below most of the popular moving averages, including the 50-day ma (only the 100-day moving average remains unpenetrated at $1,217). Gold is now down $85 from the top of its recent $125 rally. Silver is down $1.50 from the top of its $2.80 rally. The speculators and technical funds which bought aggressively on the way up, have now started to sell in reaction to the lower prices (engineered by the commercials). As always, the commercials are buying the contracts being sold by the speculators as this is the very essence of the market manipulation.

Therefore, we are in “count” mode. Since (I’m convinced that) the price of gold and silver is determined by the number of contracts first bought and then sold by the speculators (with the commercials pulling the price strings), the best way to gauge price bottoms is to figure when the most speculative contracts that can be sold, are sold. This is definitely subjective since the total number of contracts that can be sold by speculators is a number that changes over price cycles. And the “count” doesn’t take into consideration any outside influence, such as war or a physical shortage, so one should be careful about strict reliance on this one indicator.

That said and all suggestions that the count should be relied upon as personal investment advice being denied, it appears there is a significant amount of potential selling by speculators dead ahead. I don’t know if all 100,000 contracts of gold bought by speculators since Dec 23 (or the additional 50,000 contracts added before that) must be liquidated before a bottom can be declared in COT terms, but I would think some good number must be sold than have been sold to date. In silver, the setup is similar; I don’t know if the 28,000 contracts bought by speculators since Dec 23 (or the additional 22,000 contracts bought since November) must be sold before the declaration of a COT bottom, but they could be. - Silver analyst Ted Butler: 11 February 2015

Another day where the Big 8 short holders took slices out of the precious metal salamis, as they continued to engineer prices lower and cover their short positions.  Nothing has to be added to what Ted has already said in the quote that I borrowed/stole from his mid-week commentary to paying subscribers yesterday.

Here are the 6-month charts for both gold and silver, so you can see the "slices" from yesterday in both metals.

And as I write this paragraph, the London open is ten minutes away.  The gold price has been wandering higher since trading began at 6 p.m. in New York yesterday evening---and is currently up about 5 bucks or so.  Silver got slammed for about two bits in early Far East trading, but has recovered most of that---and is only down a nickel at the moment.  Platinum and palladium are up a few dollars apiece.  Net gold volume is currently 17,000 contracts---and silver's net volume is 5,300 contracts.  These are much higher volumes than yesterday at this time, but still very much on the lighter side.  The dollar index, which hadn't done much in Far East trading, has dropped about 10 basis points in the last few minutes.  All in all, there's not much happening.

As most of you are aware, Doug has decided to voice his personal opinion on the gold price suppression scheme by the world's central banks once again---and he's certainly entitled to his opinion.

But as Jim Rickards said in his book "The Death of Money: The Coming Collapse of the World Monetary System" --- "Central banks gold market manipulation is an example of action in a complex system that can cause the system to reach the critical state." ... "That central banks intervene in the gold market is neither new, nor surprising.  To the extent that gold is money, and central banks control money, then central banks must control gold."

I'd bet that you, dear reader, are very comfortable with that statement.

Even John Hathaway has come around.  In his January 15 commentary on the Internet site, he had this to say: "We believe that the gold market has been manipulated, which to us is no surprise. Rigging has become a central feature of financial markets since the onset of quantitative easing. Too-big-to-fail banks, U.S. and European, have admitted to manipulating Libor, energy, and currencies. Zero-interest rates and quantitative easing are to us blatant manipulations of bonds, interest rates, and equities. Why should gold be exempt?"

Besides what Chris Powell pointed out in the rebuttal to Doug in the GATA release yesterday, I'll leave the last word to Ted Butler.  Here's his quote from my February 3 column.

In last Friday's COT Report, the CFTC reported that eight traders on the COMEX held 65,301 contracts of silver net short, close to the highest level in years. That is the equivalent of more than 326 million ounces of silver. It is also the equivalent of more than 40% of world annual mine production and 150 days of world mine production, an amount unequalled among all commodities. By comparison, the concentrated short position in COMEX copper is less than 10 days of world production. With silver priced close to the lowest level in years and below the average primary cost of production, it is hard, if not impossible, to explain the existence of the largest concentrated short position in terms of hedging by mining companies or other legitimate hedgers.

Moreover, the concentrated short position in COMEX silver is mostly held by U.S. and foreign banks, according to data in the Bank Participation Report. There are not many physical commodities where the banks control a larger share of market concentration than they do in COMEX silver futures and those few markets are run by the CME Group, the same self-regulatory organization that is supposed to be the front line regulator in silver.

Again, the issue is not that there are 326 million ounces held short in COMEX silver futures. The issue is that the 326 million oz are held short by only eight traders and there is good reason to believe that this position is responsible for an artificially low price. Certainly, no one would argue that silver prices appear artificially high based upon all the documented evidence, but if silver prices did move to extremely high levels and there was a documented concentrated long position, no one would need to petition the regulators for answers about that concentration. And you’ll notice that the few remaining deniers of the silver manipulation, never dare utter the word concentration (if they even grasp the meaning of the word) because it would expose the matter once and for all. - Silver analyst Ted Butler: 31 January 2015

And as I send today's commentary off to Stowe, Vermont at 5:20 a.m. EST, I see that all four precious metals rallied sharply shortly after London opened---and all got capped by not-for-profit sellers within minutes, but are now struggling higher.  It will certainly be interesting to see how the precious metals react, or are allowed to react, as the Thursday trading session progresses.

Gold volume has exploded to 37,000 contracts net---and silver's volume is over double what it was just before the London open, and is now around 11,500 contracts.  So these rallies are being met with ferocious opposition by the JPMorgan et al.  The dollar index has now rolled over to the tune of 20 basis points.

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That's all I have for today, which is more than enough---and I'll see you here tomorrow.

Ed Steer