The gold price didn't do much up until about lunchtime in Hong Kong. From that point the price developed a negative bias, with the London low coming about 11:30 a.m. BST.
The subsequent rally really gathered some steam late during the lunch hour in Britain, but at 9:40 a.m. in New York, twenty minutes after the Comex open, a not-for-profit seller showed up...and that was it for the day...and once the London p.m. fix was in at 10:00 a.m. Eastern time, the price got taken down below Monday's close. From there it more or less traded sideways into the electronic close at 5:15 p.m. in New York.
The high tick of the day was $1,672.80 spot. Gold closed at $1,662.20 spot...down $2.10 from Monday. Net volume was around 84,000 contracts, which is a very low number.
The silver price more or less followed the same price path as the gold price. The high of the day in silver, which was $31.45 spot, came at the London p.m. gold fix at 3:00 p.m. British Summer Time...10:00 a.m. in New York.
Silver closed at $30.97 spot...down 4 whole cents on the day. Net volume was vanishingly small at 22,000 contracts.
The dollar index declined slowly all night long...and hit its low minutes before 10:00 a.m. in New York. Then in less than twenty minutes, the dollar index was at its high of the day...and up about 33 basis points from its low. From there the dollar index drifted lower...and finished the Tuesday trading day basically unchanged from Monday.
I guess the skeptics could say that both gold and silver sold off at the London p.m. fix because the dollar gained a third of a cent at precisely that point. OK, if that's the case, maybe they can explain why both metals ran into a brick wall at 8:40 a.m. in New York...and what caused the rally before that?
The gold stocks opened mixed...and then ran up strongly after the low following the London p.m. gold fix. But once gold began to trade sideways to lower after that, the day traders took away most of the gains...but the HUI finished up 0.46% nonetheless. It looked like someone was bottom-fishing in the gold shares today.
The silver stocks finished mixed to down but, despite that, Nick Laird's Silver Sentiment Index finished up 0.69%.
(Click on image to enlarge)
Day three of the May delivery month showed that 4 gold and 315 silver contracts were posted for delivery on Thursday. The big short/issuer in silver was JPMorgan out of it's in-house trading account with 290 contracts. The largest long/stoppers were Deutsche Bank in its in-house trading account...and then way behind them was Goldman Sachs in its in-house account and JPMorgan in its client account. The contracts involved were 122, 83 and 82 respectively. The link to the Issuers and Stoppers Report is here.
For the third day in a row there was a withdrawal from the GLD ETF. This time it was 135,938 troy ounces. There were no reported changes in SLV...and there hasn't been any change since April 20th.
Surprisingly, the U.S. Mint had a sales report on the first day of May. They sold 10,000 ounces of gold eagles and, as Ted Butler pointed out, that was equal to 50 percent of all the gold eagles sold during the entire month of April. The mint didn't report selling anything else.
It was a very busy day at the Comex-approved depository on Monday. They reported receiving 1,914,905 troy ounces of silver...and shipped 1,352,770 ounces of the stuff out the door. Most of the action was at Brink's, Inc...and the link to everything is here.
It was a very quiet news day yesterday...and, thankfully, I don't have a lot for you today. It's so quiet that I'm even including a couple of stories that I was saving for this Saturday. I hope you have the time to peruse them all.
There is nothing quite like a $70 billion debt auction settlement at the last day of a month to bring total US debt to a record $15.692 trillion, which happens to be just $600 billion shy of the $16.394 trillion debt ceiling.
Now that the end of month auction has settled, one can easily see why the Treasury forecast of debt issuance through the end of September will only be correct if somehow the Treasury finds a way to print its own money without reliance on the Fed, or else every US taxpayer somehow hikes their tax payments by 15% voluntarily. Good luck on both counts.
This zerohedge.com story from yesterday was sent to me by Phil Barlett...and the link is here.
Two Federal Reserve officials warned Tuesday that the U.S. could be heading for a "fiscal cliff" at year's end if mandated tax increases and spending cuts are implemented.
Charles Evans of the Chicago Fed called the cliff a "big uncertainty" while Atlanta Fed President Dennis Lockhart said there could be a "financial shock" if markets begin to anticipate that Congress and the White House do little to address this situation.
The expected tax increases and spending cuts were triggered when a congressional "super committee" failed to come up with a way of closing the federal budget deficit.
This cnbc.com story was sent to me by West Virginia reader Elliot Simon...and the link is here.
The Commodity Futures Trading Commission, the main U.S. derivatives regulator, may propose within months which swaps must be guaranteed by central clearinghouses, said Gary Barnett, the agency’s director of swap dealer and intermediary oversight.
The CFTC may seek comment about which types of swaps will face the 2010 Dodd-Frank Act’s clearing mandate that is designed to reduce risk in the $708 trillion global market, Barnett said at the International Swaps and Derivatives Association Inc.’s annual meeting in Chicago.
“We hope that in the next couple of months we will move in that direction,” Barnett said. Clearinghouses seek to reduce risk in swaps by accepting margin, or collateral, from trading parties in the transactions.
Dodd-Frank was enacted after largely unregulated swaps helped fuel the 2008 credit crisis.
This 4-paragraph story was posted over at the Bloomberg website yesterday afternoon...and you just read them all. It's another contribution from Elliot Simon...and the link to the hard copy is here.
In a brazen criminal scheme to defraud taxpayers, one of the highest-ranking officials in the U.S. Immigration and Customs Enforcement agency pleaded guilty Tuesday in federal court to helping embezzle $600,000 from the federal government.
Over three years, James Woosley and at least five other ICE employees scammed the agency by fabricating expenses for trips that were never taken and for hotel, rental car and restaurant expenses that did not exist, according to court records.
His son and Woosley's live-in girlfriend, Lateisha Rollerson -- both ICE employees -- allegedly ran the scam out of the elder Woosley's two Virginia homes.
You can't make this stuff up...and I thank Washington state reader S.A. for bringing it to my attention. It's posted over at the foxnews.com Internet site...and the link is here.
Congressman Paul just makes so much sense, it's impossible to believe that anyone would take that little weasel Krugman seriously. This Bloomberg video from Monday runs just under 21 minutes...and I thank reader Federico Schiavio for sending it along. The link is here.
Of all the people rocked by the debt and austerity tumult rattling Europe, the famously prudent but prosperous Dutch were seldom on anybody’s watch list. Until now.
This bastion of probity became a flash point of euro zone turmoil last week, when the government fell in a showdown over how to cut the budget to keep the nation from getting caught in Europe’s long-running debt crisis. The action focused fears in other European capitals that austerity, rather than helping to put countries back on their feet, will impede growth and make it harder for them to recover.
It is the Netherlands’ toughest test of economic resolve since the nation became a founding member of the euro currency union in 1999. Last week, facing a crisis that could have tarnished the country’s sparkling credit rating, a caretaker government maneuvered to pass a 14 billion euro ($18.5 billion) plan for spending cuts and tax increases. Political leaders acknowledge that the belt-tightening will further retard an economy already in recession.
This 2-page story was posted in The New York Times yesterday...and I thank Phil Barlett for sending it our way. The link is here.
While Europe’s financial overlords debate the wisdom of spurring growth by letting the European Central Bank print more money, some enterprising sorts in this semi-urban sprawl northwest of Naples are taking matters into their own hands and printing reams of counterfeit euros.
The Campania region of southern Italy is known for its sunny skies, fresh mozzarella and organized crime, but it has a different kind of cottage industry that accounts for more than half of the 550,000 to 800,000 fake euro notes pulled from circulation annually by European central banks.
“In Italy, there’s a great, ancient and august tradition: Here, they make fake money, done well,” said Col. Alessandro Gentili, the head of the Italian Carabinieri’s Currency Anti-counterfeiting Unit in Rome. “Giugliano is still the capital. It has the best professionals.”
Well, dear reader, I wonder they don't throw the banksters in jail for conjuring money up out of thin air as well, as it's nothing more than legalized counterfeiting. This second 2-page New York Times offering in a row was also sent to me by reader Phil Barlett...and the link is here.
For Iranians, whose country’s borders have shrunk in the past 200 years after wars and unfavorable deals by corrupt shahs, territorial issues are a delicate matter. So a renewed claim by the United Arab Emirates to the tiny island of Abu Musa in the Persian Gulf has touched a raw nerve.
But many here say that may just be the point.
President Mahmoud Ahmadinejad and his reactionary agenda tend to be unpopular among the urban middle classes, but he is enjoying a rare surge of support even in those inhospitable quarters in the growing dispute with Iran’s Persian Gulf neighbors — one that he touched off by making a surprise visit to the island last month, a first by an Iranian president.
This interesting piece of Persian Gulf trivia was posted in The New York Times this morning...and I thank Roy Stephens for sending it. The link is here.
The first one is headlined "Iran signs €16 billion oil deal with Spanish firm". The second item is entitled "IMF snubs pressures to suspend Iran". And lastly is this article headlined "Iran seeks 200,000 tonnes of barley, offers payment via India". All stories are courtesy of Roy Stephens.
Bolivian President Evo Morales ordered his military to seize the local assets of Spanish energy company Red Electrica, in the latest example of muscle-flexing by a South American leader.
Mr. Morales said the expropriation of Transportadora de Electricidad (TDE), which runs most of Bolivia's power grid, was "in honour of all Bolivian people who have struggled to recuperate our natural resources and basic services". He timed the seizure for May Day.
TDE is 99.94pc owned by Spain's Red Electrica and, according to El Pais, accounts for about 1.5pc of the company's business. Accusing Red Electrica of underinvestment in TDE, Mr. Morales said: "We do this...for the benefit of the Bolivian people."
This story showed up in The Telegraph yesterday evening...and is Roy Stephens final offering of the day. The link is here.
Jean Marie Eveillard oversees $50 billion at First Eagle Funds. Eveillard told KWN that the authorities should not be in the business of manipulating equity prices because it is extremely dangerous. He also discussed the gold market. The link to this KWN blog is here.
This is the title of another King World News blog that was posted on their website yesterday. It's certainly worth the read...and the link is here.
This longish 4-page interview is posted in the clear at the gata.org website...and I'll leave the introduction and the rest of the preamble up to Chris. The link to this must read interview is here.
Great Panther Silver Limited, (TSX: GPR NYSE.A: GPL)headquartered in Vancouver, Canada, is a profitable primary silver producer operating two 100% owned mines in Mexico. Over 94% of revenues are derived from unhedged precious metals production with approximately 74% generated from silver sales and 20% from gold. Since entering production in the first quarter of 2006, the Company has seen five consecutive annual increases in revenues and provides strong leverage to future rises in precious metals prices.
The Company has also been growing its resource and reserve base at both 100% owned operations. A new resource/reserve estimate is expected for the Guanajuato Mine Complex and the San Ignacio Project in the second quarter of 2012 and a new resource/reserve estimate for the Topia Mines during the third quarter of 2012. Great Panther continues to replace mined ounces, grow resources and reserves at both operations, and is targeting a 10 year mine live at each.
I believe that it is better to tell the truth than a lie. I believe it is better to be free than to be a slave. And I believe it is better to know than to be ignorant. - H.L. Mencken
With vanishingly small volumes in both silver and gold yesterday, I wouldn't read too much into Tuesday's price action...except for the fact that a not-for-profit seller had to show up shortly after the Comex open to prevent both precious metals from moving sharply higher.
As I was mentioning in this space yesterday, I was hoping that not too much would happen price wise on Tuesday, as it was the cut-off for this Friday's Commitment of Traders Report at the 1:30 p.m. close of Comex trading in New York. I certainly got my wish.
I'm expecting the biggest improvement in silver, as Wednesday of last week was the big down day that took the silver price briefly below the $30 mark. As Ted Butler and others mentioned, it looked like JPMorgan et al engineered the ideal set up for the technical funds to go short...and if that's what happened, that will show up in Friday's report. Ted also mentioned that there may not be that much improvement [if any] in gold, because gold has spent the last four trading days in a row above its 20-day moving average...and apparently there are some technical funds that go long when that moving average is penetrated to the upside. We'll see what Friday brings.
As I write this paragraph at 3:05 a.m. Eastern time, London has just opened. Gold is down about seven bucks and silver is down just over a dime. Volumes are very light...and only marginally higher than they were on Tuesday at this time. The dollar index is up a smallish 13 basis points.
And as I hit the 'send' button at 5:17 a.m. Eastern time...a bit more than two hours since I typed the above paragraph...I note that the gold price is still down the same amount, but silver is now down a bit over 20 cents. Volume in both metals has doubled since the London open. The dollar index is now up 30 basis points...and is currently sitting above the 79.00 mark at 79.13.
I don't have a clue as to what will happen during the New York trading session, so nothing will surprise me when I turn on the computer later this morning.
Before closing, I'd like to remind you one last time about Casey’s spring summit..."Recovery Reality Check"...which was held in Florida this past weekend. You may want to purchase the complete audio collection (available in a 20-CD set and/or MP3 downloads) so you can listen at home. The faculty that presented included David Stockman, director of the Office of Management and Budget under President Reagan; resource investing legend Rick Rule; Casey Research Chairman Doug Casey; Harry Dent, best-selling author of The Crash Ahead; Lacy Hunt, executive VP of Hoisington Investment Management...and 26 other financial luminaries. To learn how to order this complete audio collection, you can click here...and it costs nothing to check it out.
I hope your Wednesday/Thursday goes well...and I'll see you here tomorrow.