Gold & Silver Daily
"The end game for the world's financial and monetary system is coming up on us hard...and I have no idea how the powers that be will be able to keep it all glued together for much longer."

¤ Yesterday In Gold & Silver

Gold was down between ten and fifteen dollars through most of the Far East trading day, but the price picked up a little shortly after the London open.

Then shortly after 12 o'clock noon local time, a rally began, but it should be obvious that a not-for-profit seller entered the market around 1:00 p.m. British Summer Time...which was twenty minutes before Comex trading began at 8:20 a.m. in New York.  The three attempted rallies of note that occurred in the New York trading session after that, also ran into the same not-for-profit seller.  The last rally got capped at half-past lunchtime in New York...and from there, the gold price traded sideways for the rest of the day.  The low during Comex trading came at the London p.m. gold fix at 10:00 a.m. Eastern time.

Three of the four interventions were so obvious that even Stevie Wonder could see them.  One can only wonder what the gold price would have done to the upside if JPMorgan et al hadn't shown up when they did.

Gold closed at $1,764.40 spot...up $27.00 on the day.  Net volume wasn't overly heavy at 153,000 contracts.

Here's the New York Spot Gold [Bid] price on its own, where the three interventions clearly stand out.

The silver price was also under pressure all through the Far East trading session.  It's low of the day came shortly after the London open...and was down about 85 cents from Wednesday's New York close.

It gained back about 50 cents of that loss in pretty short order...and then traded sideways into a slightly later than normal London silver fix which came around 12:15 p.m. local time.

As you can see from the Kitco chart below, every rally attempt ran into a not-for-profit seller before the price was about to blast off to the moon and the stars.  The high price tick of the day...$35.00 spot...came minutes after 9:00 a.m. Eastern.  The New York low [$33.75 spot] also came at the London p.m. gold fix...minutes after 3:00 p.m. local time...and minutes after 10:00 a.m. in New York.  Like gold, silver also traded sideway from 12:30 p.m. Eastern time onwards.

The silver price closed at $34.80 spot...up a magnificent 21 cents on the day and, like gold, one can only fantasize about where the real close would have been if true market forces had been allowed to play out as they so desperately wanted to do.  Net volume was not overly heavy...around 33,000 contracts.

And, like I did for gold, here's the New York Spot Silver [Bid] price on its own.  Not too many shades of grey here, either.

The dollar was all over the map yesterday...and if you can find much of a co-relation between what the gold price did and the wild gyrations of the dollar, you're a better person that I am, as I couldn't see much of anything.  Both gold and silver wanted to blast off regardless of what the dollar was doing.

The only co-relation I could find was the fact that the dollar peaked in New York at precisely 10:00 a.m. Eastern time...just minutes before the London p.m. gold fix.  And there's no chance at all that that was a random market event.

The gold shares followed the gold price fluctuations pretty closely yesterday...although there was a rally during the last seventy-five minutes of trading that was not co-related to the dollar at all.  The HUI finished up a very respectable 3.05%...and virtually on its high of the day.

Despite the poor close in the silver price yesterday, the stocks did very well for themselves...and Nick Laird's Silver Sentiment Index closed up 4.61%.

(Click on image to enlarge)

The CME's Daily Delivery Report showed little activity, as only 24 gold and zero silver contracts were posted for delivery on Monday.

There was no reported change in GLD yesterday.  It's now been a full week where there's been no in or out activity.  Over at SLV, there was another tiny withdrawal...the second one in as many days.  This time it was 194,614 troy ounces.

And, for the second day in row, there were no sales report by the U.S. Mint.

There was some activity over at the Comex-approved warehouses on Wednesday.  They didn't receive any silver on that day, but they did ship 451,471 ounces out the door.

As usual, I have a lot of stories for you again today.


¤ Critical Reads

CFTC's Gensler Testifies on MF Global’s Downfall

The top regulator tasked with overseeing the bankrupt brokerage firm MF Global said Thursday that the search continued for more than $630 million in missing customer money, warning that the protection of client assets is essential to doing business on Wall Street.

Gary Gensler, chairman of the Commodity Futures Trading Commission, said his agency was investigating the firm, a powerhouse commodities brokerage run by a former New Jersey governor, Jon S. Corzine.

“The most troubling aspect about the MF Global situation is the shortfall of customer money at the firm. Segregation of customer funds is the core foundation of customer protection in the commodity futures and swaps markets,” he said in prepared testimony. “Segregation must be maintained at all times. Simply put, that’s every moment of every day, down to the nanosecond.”

I wonder how much this MF Global situation will slow down the CFTC's ongoing 3-year investigation into the silver price rigging scheme?  Just asking.  This story was posted over at The New York Times yesterday...and I thank Washington state reader S.A. for sending it along.  The link is here.


Debt Increased $203 Billion in Oct.--$650 for Every Man, Woman and Child in America

The federal government’s debt increased by $203,368,715,583.63 in the month of October, according to the U.S. Treasury.

That equals about $650 per person for each of the 312,542,760 people the Census Bureau now estimates live in the United States.

At the end of September, the total national debt stood at $14,790,340,328,557.15, according to the Bureau of the Public Debt. By the end of October, it had risen to $14,993,709,044,140.78.

This story was posted over at the website yesterday...and I thank reader 'David in California' for sharing it with us.  The link is here.


Iran: the damning nuclear evidence

Iran is attempting to engineer and test nuclear weapons at a series of banned production sites in defiance of United Nations sanctions, according to a report to be released next week.

The research by the UN’s watchdog, the International Atomic Energy Agency, will add a substantial layer to seven years of investigations that is likely to inflame tensions in the Middle East.

Yukiya Amano, the organisation’s director-general, is unlikely to draw a definitive conclusion that Iran is making nuclear weapons, but according to Western diplomats the facts will make any other conclusion implausible.

Roy Stephens sent me this story out of Wednesday's edition of The Telegraph...and the link is here.


UK and U.S. 'draw up joint plan to attack Iran': Evidence of nuclear programme raises tension in Middle East

The UK and U.S. are drawing up plans to attack Iran amid growing tensions in the Middle East, it was claimed last night.

Barack Obama and David Cameron are preparing for war after reports that Iran now has enough enriched uranium for four nuclear weapons.

President Mahmoud Ahmadinejad’s hard-line regime in Tehran has been linked to three assassination plots on foreign soil, according to senior officials in Whitehall.

Iran has come sharply back into focus following the end of the Libya conflict...and the unrest has been inflamed by sabre-rattling from top politicians in Israel.

This story was posted over at The Daily Mail less than half an hour after the previous story on this issue was posted in The Telegraph.  I thank reader 'h c' for bringing it to my attention...and the link is here.


Israel Considers Pre-Emptive Attack On Iran

Israeli Prime Minister Benjamin Netanyahu is trying to rally support in his cabinet for an attack on Iran, according to government sources.

The country's defence minister Ehud Barak and the foreign minister Avigdor Lieberman are said to be among those backing a pre-emptive strike to neutralise Iran's nuclear ambitions.

But a narrow majority of ministers currently oppose the move, which could trigger a wave of regional retaliation.

The debate over possible Israeli military action has reached fever pitch in recent days with newspaper leader columns discussing the benefits and dangers of hitting Iran.

This story was posted over at on Wednesday.  Is it just me, or are you hearing war drums as well?  All this anti-Iran war rhetoric has just appeared out of nowhere now that Libya is no longer on the West's hit list.  I borrowed this story from yesterday's King Report...and the link is here.


Caretaker Government in Athens? - Greece Backs Away from Referendum Plans

Amid growing fears of a government collapse in Athens, Prime Minister Giorgios Papandreou on Thursday scrapped plans for a bailout referendum and moved to start talks on a national unity government. He has, however, refused to step down, saying that new elections would mean a Greek exit from the euro zone.

German Chancellor Angela Merkel seems to have gotten her way yet again. Not even a day after she and French President Nicolas Sarkozy suspended aid payments to Greece pending the results of a bailout referendum called by the government in Athens, Prime Minister Giorgios Papandreou has backed away from his plan.

On Thursday, a government spokesman in Athens announced that Papandreou was ceding to demands that he enter into negotiations with the opposition on the formation of a cross-party caretaker government. Shortly thereafter, plans were scrapped to hold the controversial referendum, a decision confirmed by Greek Finance Minister Evangelos Venizelos.

Things are changing so fast in Europe that virtually every story I'm running in this column regarding European events risks the chance that it may be irrelevant by the time you clap eyes on it.  This Roy Stephens offering was posted over at the German website yesterday...and the link is here.


Greece may leave euro, leaders admit

G20 summit on eurozone crisis is dominated by news about Greeks, while IMF is given more cash and fears grow over Italy.

The G20 is planning to increase the crisis-fighting firepower of the International Monetary Fund after the start of its summit was dominated by the first open admission from EU leaders that it might be necessary for Greece to leave the eurozone if the single currency is to survive.

George Osborne said there was a "real sense of urgency" on a day that saw an emergency interest rate cut from the European Central Bank, backtracking from Greece over a referendum on its bailout conditions, and a recognition that the IMF may need extra resources to cope with a deteriorating global economy.

This story was posted in The Guardian early yesterday evening...and is another Roy Stephens offering...and the link is here.


Bank Exodus From Euro Zone Sovereign Debt Quickens

Banks including BNP Paribas and ING are ditching billions of euros of euro zone government bonds, cutting their exposure to the region's trouble spots.

More lenders are expected to retreat as the euro zone crisis deepens and leaders raise the possibility of the exit of Greece from the bloc, further damaging prices.

"The market value of the debt of the countries most under scrutiny is likely to decline further as banks unload sovereign bonds," Charles Dallara, managing director of the Institute of International Finance, warned on Wednesday.

No surprises here, as everyone is looking for a safe haven these days.  This Reuters story was posted on the website...and I thank West Virginia reader Elliot Simon for sending it my way...and the link is here.


Opponents Of Gold, Get On Your Mark

As the essential Nathan Lewis, of Forbes and Gold: The Once and Future Money fame, once put it, “monetary interpretations of the [Great] Depression had fallen out of favor somewhat by the 1970s. It wasn’t until the 1980s, as a political drive for a gold-linked currency gathered force, that academics revived old notions about an unstable gold standard.”

Well, academics, you’d better dust off those old notions and start spiffing them up. Because the same individual who set your thoughts a-reeling in 1982 is making waves again in 2011.

This 2-page item posted in Forbes on Tuesday was sent to me by Nick Arnold...and the link is here.


Robin Griffiths tells King World News that silver is a ten or twenty bagger

Eric King sent me this blog early yesterday afternoon.  It's an interesting read...and the link is here.


Fund Manager Jean Marie Eveillard say there's good reason not to trust governments today

Jean says that..."Since I tend to look at gold as substitute currency, I am more interested in gold than I am in silver, but I recognize, I acknowledge the fact that maybe there is more money to be made in the future in silver than there is in gold."

This is another blog that Eric King sent me yesterday.  It's posted over at the King World News website...and the link is here.


Markets mustn't learn about our gold transactions, Bank of England says

Denying a recent freedom-of-information request from a citizen of the United Kingdom, the Bank of England has insisted on secrecy for its swapping and leasing of gold from the national reserves.

Bank of England spokeswoman Jackie Keating wrote that the gold swap and leasing information is "market sensitive" and its disclosure "would allow enquirers to find out what gold transactions have been taking place." This, the bank's spokesman wrote, would impair the interests of both the British government and the bank's "private customers," to whom the bank "owes a duty of confidentiality."

This GATA release came out yesterday afternoon...and is well worth the read.  The link is here.


Gold: The hedge against political stupidity

Gold is said to be a hedge against inflation, deflation and all other nasty sorts of economic bugaboos. It looks like it may be a hedge against political incompetence too.

The price of gold has surged more than 7% in just the past week and a half. The yellow metal is now trading around $1,750 an ounce.

That's still a bit lower from the all-time high of about $1,924 from just a few months ago. But experts think that a new record could be in the cards soon if the debt melodrama in Europe continues.

This is an excellent main stream media story about gold that was posted over at yesterday...and I thank reader Elliot Simon for sharing it with us.  The link is here.


John Hathaway tells King World News that generations of gold analysts are out to lunch

“I was at a meeting the other day where there was a commentary on Newmont Mining and the assumptions that had to be made to support the stock here.  I won’t mention the name of the firm but the analysis was based on a drop in the gold price to $1,000 in five years.

That left the analyst with a target price on Newmont of $56 and I believe the stock is $68 today.  If that analyst were to use the same methodology and assume a $1,700 price in five years, that same methodology would get Newmont to $200.

So these analysts are totally behind the curve.  I would say there is a generation of sell-side analysts that are just going to be completely out to lunch on this whole thing.”

This KWN blog is a must read...and the link is here.


Financial writer Gerald Celente interviewed by Alasdair Macleod for GoldMoney

Gold figures heavily in an interview with financial writer Gerald Celente by economist Alasdair Macleod on behalf of the GoldMoney Foundation, for which he has become a senior fellow. Celente denies that gold is in a bubble and discusses the ridicule heaped on gold investors by the financial establishment. The interview is 38 minutes long and you can watch it at the GoldMoney Internet site.  The link to this must watch video is here...and I thank Chris Powell for writing the introduction on my behalf.



¤ The Funnies

Sponsor Advertisement

ASHBURTON VENTURES INC. (ABR-TSX:V) (ARB-FRANKFURT)  (“Ashburton” or the "Company”) has entered into discussions with Premier, whereby Ashburton would assist Premier in assessing new gold exploration opportunities in North America as identified by Premier, or independently identified by Ashburton. Funding for the arrangement would be raised either partially through additional Ashburton share purchases by Premier, or through independent financing by Ashburton. Identified projects would become subject to earn-in style Option and/or Joint Venture Agreements between the Companies.

Premier Gold Mines Limited is one of North America's leading exploration companies with a high-quality pipeline of projects focused in proven, safe and accessible mining jurisdictions in Canada and the United States.

Ashburton has also signed a letter of intent (LOI) with Premier Gold Mines Limited (PG-TSX; ‘Premier’) to option the Golden Edge property, located 50 kilometers (31 miles) east of Winnemucca, Nevada. The Golden Edge property is positioned in the Battle Mountain-Eureka trend, roughly 26 kilometers south of the Turquoise Hill Mine (operated by Barrick Gold Corporation) and eight kilometers north of the Lone Tree Mine (operated by Newmont Mining Corporation). Previous work on or near to the property includes CSAMT, reflection seismic, and soil geochemical surveys, and roughly 1,700 meters of drilling distributed over six RC drill holes. Please visit our website to learn more about the company.


¤ The Wrap

In the last ten years we've lost Jobs (Steve), Cash (Johnny) and Hope (Bob) - Author unknown

It's obvious that the precious metals really wanted to roar yesterday...and it's just as obvious that they weren't allowed to.  Not surprisingly, the preliminary open interest number for gold was quite chunky, as 'da boyz' really threw the kitchen sink at the gold price in order to prevent it from doing what it really wanted to do.

On the other hand, the preliminary open interest increase in silver was rather small by comparison and, considering the price action, I really don't understand why that would be the case...unless 'day boyz' were selling long positions instead of going short all comers.  Maybe it was the small commercial traders, Ted Butler's raptors, taking profits...but if it was them, they certainly weren't selling in an attempt to maximize their returns.

None of this will be know to us until next Friday's COT report...and by that time, the landscape in both gold and silver could be quite different.  We'll see, but next Friday is a long wait.

While on the subject of the Commitment of Trader Report, the new one will be out today at 3:30 p.m. sharp.  Nothing will surprise with what it contains, especially considering the melt-down of MF Global during the reporting week.  Heaven only knows how badly the reporting got thrown out of whack when they went under on Monday...and it may take a while for this whole mess to sort itself out.  Still, I'll be looking forward to the report nonetheless.

Well, the end game for the world's financial and monetary system is coming up on us hard...and I have no idea how the powers that be will be able to keep it all glued together for much longer.

The thing that really concerns me now, on top of everything else, is this out-of-the-blue pounding of the war drums against Iran that started everywhere late Wednesday night.  I find this very disturbing.  True, we've heard it all before, but somehow the three stories posted above have a menace about them that I haven't seen before.  It wouldn't surprise me in the slightest if the world is getting softened up to the idea that war is coming...sooner rather that later...and I'll be watching developments closely.

However, I just dug up a piece by Justin Raimondo over at on this very subject.  It's datelined today...and is entitled "Behind the Headlines: Israel's Big Bluff".  It's a stunning article...and an absolute must read...and the link is here.

As of 5:19 a.m. Eastern time, both gold and silver are slightly below their Thursday closing prices in New York.  The dollar isn't doing much of anything...and volume in gold is pretty light for this time of day.  Silver's volume is heavier...and very similar to what it was this time yesterday, so the high-frequency traders are obviously mucking about in the futures market as of this writing.

I haven't the foggiest idea what today will bring.  The fact that its Friday sometimes makes a difference, but I wouldn't bet on how the precious metals finish the day, however nothing would surprise me.  But, since it's the first Friday of the new month, the jobs report will be issued around 8:30 a.m. Eastern time...and I'll be more than interested in seeing how gold reacts to that, or is allowed to react.

There's still time to either re-adjust your portfolio...or get fully invested in the continuing major up-leg of this bull market in both silver and gold...and I respectfully suggest that you take a trial subscription to either Casey Research's International Speculator [junior gold and silver exploration companies], or BIG GOLD [large producers], with all our best [and current] well as the archives. A subscription to the International Speculator also includes a free subscription to BIG GOLD as well.  And don't forget that our 90-day guarantee of satisfaction is in effect for both publications.

Have a good weekend...and I'll see you here on Saturday sometime.