Gold & Silver Daily
"The quick take-downs of both gold and silver after the London p.m. gold fix were duly noted."

¤ Yesterday In Gold & Silver

The gold price did nothing yesterday...and the tiny rally that developed in New York trading after the London p.m. gold fix in, wasn't allowed to amount to much...and got sold off during the following few hours, before trading sideways into the close.

Gold finished the Friday session at $1,667.20 spot...down $3.80 on the day.  Volume was very light...around 94,000 contracts.

The silver price was more 'volatile'...but traded in exactly the same pattern as gold...with the price spike after the London p.m. gold fix being treated even more harshly than the sell-off that accompanied gold's rally at the same time.  From there, silver traded sideways into the close.

Silver finished the Friday session at $31.43 spot...down 3 cents from Thursday.  Net volume was very light at around 27,000 contracts.

The dollar index opened at 80.24 in Far East trading on their Friday...and held more or less steady until 3:00 p.m. in Hong Kong...and then slide to its low of the day [79.95] at noon in London.  Then the index rallied back to unchanged by 1:00 p.m. in New York before trading sideways into the close.  The index closed almost where it started that day...80.23.  Nothing to see here, folks...please move along.

The gold stocks pretty much followed the gold price action yesterday.  They hit their high when gold hit its high...and then sold off when the gold price reversed itself.  The HUI closed down 0.50%.

The silver stocks finished mostly in the green...and Nick Laird's Intraday Silver Sentiment Index...which has returned from the disabled list...closed up 0.35%.

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The regular Silver Sentiment Index is below...showing the longer-term trend.

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The CME's Daily Delivery Report showed that zero gold and 60 silver contracts were posted for delivery within the Comex-approved depositories on Tuesday.  Jefferies was the short/issuer on all 60 contracts...and the 'usual suspects' were biggest long/stoppers.  The link to yesterday's Issuers and Stoppers Report is here.

After a deposit in GLD on Thursday, there was a withdrawal of 96,797 troy ounces on Friday.  But the big surprise was SLV.  When I typed this paragraph shortly before midnight Eastern time last night, the SLV website showed no change.  Now that I'm editing this column at 5:40 a.m. Eastern time, I decided to check to see if the site had been updated...and it had.  It showed that 1,547,142 troy ounces of silver had been deposited by an authorized participant.  Why SLV is sometimes being updated around midnight Eastern time is a big mystery to me.

I was hoping that the short positions in these two ETFs would have been updated on the Internet site yesterday evening but, alas, that was not to be.

There was a smallish sales report from the U.S. Mint.  They sold 1,500 ounces of gold eagles...1,000 one-ounce 24K gold buffaloes...and a very decent 206,000 silver eagles.  Month-to-date the mint has sold 34,500 ounces of gold eagles...1,000 one-ounce 24K gold buffaloes...and 979,500 silver eagles.  Based on these numbers, the silver/gold sales ratio for February to date is just under 28 to 1.

It was another action-packed day over at the Comex-approved depositories on Thursday.  They reported receiving 1,202,121 troy ounces of silver...and shipped 227,050 troy ounces out the door.  The link to that activity is here.

The Commitment of Traders Report...for positions held at the close of Comex trading on Tuesday...showed that the Commercial net short positions in both metals increased during the reporting week.

In silver, the Commercial net short position increased by 1,679 contracts...and now sits at 259.7 million ounces.

The 'Big 4' traders in silver are short 265.1 million ounces...a bit over 100% of the above-mentioned Commercial net short position.  The next '5 through 8' traders are short an additional 55.3 million ounces.

As far as the concentration of these short positions is concerned, the 'Big 4' are short 52.4% of the entire Comex futures market in silver on a net basis.  The '5 through 8' traders are short an additional 10.9 percentage points.  So the 'Big 8' are short 63.3% of the entire Comex futures market on a net basis...and those are minimum percentages.

Ted Butler pointed out that, according to his calculations, JPMorgan Chase is short 35,000 Comex silver contracts all by itself...and that calculates out to about 34.5% of the entire Comex silver market.  One entity short that much of one commodity...what the #%&!$ is the CFTC waiting for?

Then, to make matters worse...and this is my personal opinion...I think that the second big short in the silver market is the Bank of Nova Scotia, through their bullion division Scotia Mocatta...and they are short about 11 percent of the entire Comex silver market.  Despite polite enquiries, I can't get them to admit to it...but they didn't say no...and I given them ample opportunity to do so.

I'm also of the opinion that the number three silver short holder on the Comex is HSBC USA...but their position would be around 5% of the total Comex futures market in silver.

Based on these educated assumptions, of the 41 traders on the short side of the Commercial category, three of them are short about 50% of the entire Comex silver market...and the short positions of the other thirty-eight traders in that category, are immaterial.

In gold, the Commercial net short position increased by 7,510 contracts...and now sits at 174,600 contracts, or 17.46 million ounces.

The 'Big 4' are short 10.51 million ounces of gold...and the '5 through 8' traders are short an additional 5.85 million ounces.  So the 'Big 8' in total are short 16.36 million ounces of gold...93.7% of the Commercial net short position.

As far as concentration goes, the 'Big 4' are short 29.6% of the entire Comex futures market in gold...and the '5 through 8' are short an additional 16.4% of the Comex futures market.  In total, the 'Big 8' are short 46.0% of the entire Comex futures market in gold on a net basis.

Here's Nick Laird's "Days to Cover Short Positions" in all world commodities.

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The CFTC also published the February Bank Participation Report...and the data contained in that is extracted from the above-mentioned Commitment of Traders Report.

In silver, it showed that less than four [probably three] U.S. banks are net short 40,192 Comex silver contracts...about 7,900 contracts higher than January's BPR.  And don't forget that Ted mentioned that JPMorgan Chase is short 35,000 Comex contracts...and it's my guess that HSBC USA is short about 5,000 Comex contracts...and the tiny balance of about 200 contracts would belong to Citi, I believe.

The 14 non-U.S. banks are net short 15,370 Comex contracts, an increase of about 500 contracts from the January report.  My estimation is that Scotia Bank holds about 11,000 of those 15,370 short that leaves the remaining 13 non-U.S. banks holding about 4,370 Comex contracts short between them.  These are immaterial positions when you divide them up more or less equally.

[Note: If the Bank of Nova Scotia wishes to deny that they are the new "Non-U.S. Bank" mentioned on the Bank Participation Report home page...I'd be more than happy to print a retraction...and an apology.]

In gold, 4 U.S. banks are net short 69,300 Comex contracts.  This is a 13,000 contract decline [1.3 million ounces] since the January BPR...and three of those four U.S. banks just mentioned would be the 'Big 3' U.S. banks short the Comex silver market as well.

There are 20 non-U.S. banks short 48,734 Comex contracts in gold...and that's an increase of about 2,900 contracts since the January BPR...or 290,000 ounces of gold.

Just for fun, here's the Reader's Digest version of the Bank Participation Report for both platinum and palladium.  In platinum, 17 banks are long 2,292 Comex contracts...and short 26,286 Comex contracts.  In palladium, 17 banks are long 991 contracts and short 13,667 contracts.

The lion's share of the short positions in both platinum and palladium are held by less than four U.S. Banks.

And just as a matter of interest, there are 17 banks in total holding short positions in the Comex silver market as well.  One has to wonder whether they are the same 17 banks in all three metals.

Here are the Bank Participation Reports for all four precious metals in chart form.  Note the monstrous short positions held by the 3 [or 4] U.S. Banks in all four metals....and note the appearance of Scotiabank in October on silver's chart.  Charts #4 and #5 from each one are the most important...and the 'click to enlarge' feature is a must here.

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I've cut the stories down to a bare minimum for a Saturday...and I hope you can find the time over what's left of your weekend to read the ones that interest you.


¤ Critical Reads

Boeing New Aircraft Orders Implode From 183 to Just 2 in January

After the now several week old exploding battery fiasco, Boeing is nowhere closer to resolving the recurring problem for its appropriately renamed Nightmareliner. But the worst for the company may be yet ahead: as the following chart from Stone McCarthy shows, January new aircraft orders collapsed from 183 in December to a meaningless 2 in January: a seasonally strong month, with some 150 orders a year ago, and more weakness to come as Boeing just warned its first Norwegian delivery due in April may be delayed.

This story was posted on the Internet site yesterday...and I thank "David in California" for sending it.  There are a couple of charts that are worth looking at...and the link is here.


U.S. Economy likely grew in fourth quarter [on back of gold sales]

The economy likely expanded slightly in the fourth quarter as higher exports and a slump in oil imports narrowed the trade gap, suggesting a surprise drop in economic output reported last week was overstated.

The U.S. report showed the country's trade gap narrowed to $38.5 billion in December, which was a much smaller deficit than analysts polled by Reuters had expected.

U.S. exports increased $8.6 billion in December, boosted by sales of industrial supplies, including a $1.2 billion rise of non-monetary gold.

The above paragraph was buried close to the bottom in this Reuters story that was posted on the Internet site yesterday.  I thank "David in California" for bringing this very interesting news tidbit to our attention...and the link is here.


Justice Department, States Weigh Action Against Moody's, Sources Tell Reuters

The U.S. Justice Department and multiple states are discussing also suing Moody's Corp. for defrauding investors, according to people familiar with the matter, but any such move will likely wait until a similar lawsuit against rival Standard and Poor's is tested in the courts.

Inquiries into Moody's are in the early stages, largely because state and federal authorities have dedicated more resources to the S&P lawsuit, said the sources, who were not authorized to speak publicly about enforcement discussions.

Moody's spokesman Michael Adler and Justice Department spokeswoman Adora Andy declined to comment for this story.

This Reuters story was posted on the Internet site early yesterday morning Eastern time...and the link is here.


Why gasoline prices are headed even higher

Gasoline prices at the pump have climbed every day for the past 21 days — and they’re not going to let up anytime soon.

On Thursday, the average U.S. price for a gallon of regular gasoline stood at $3.555, making it the most expensive average ever for that day and the highest level since Oct. 26 of last year, according to AAA.

The price has risen 26.3 cents, or about 8%, this year, steeper than the 6.2% increase for the same period in 2012 and 1.6% rise for the same period in 2011, according to the motorist and leisure travel group.

And as the gasoline market set all sorts of milestones, analysts offered more reasons why prices are headed even higher over the next few months.

This story from early yesterday morning was sent to me by West Virginia reader Elliot Simon...and the link is here.


John Williams: How to Survive the Illusion of Recovery

There is no economic recovery, and there are no signs that a recovery is coming, says author John Williams. In this Gold Report interview, he blames mal-adjusted inflation statistics for creating an alternate reality that overestimates economic activity in a way that is unsustainable. Williams warns that eventually the painful truth will be so difficult that even government manipulation won't be able to deny it and that is when hyperinflation will take its toll on those who have not taken his advice for preserving purchasing power and securing wealth.

This longish interview was posted on Internet site yesterday...and it's well worth the read.  The link is here.


Doug Noland: New Bull or Bigger Ro, Ro?

The inevitable upshot to this unwieldy “risk on, risk off” and New Age Policy Asymmetry is unanchored global liquidity and general currency market instability.  The Draghi and Bernanke Plans incited re-risking, re-leveraging and an absolute global market liquidity bonanza.  Many now talk openly of “currency wars” – recalling the destabilizing “beggar thy neighbor” Credit/currency devaluations from the Depression era.  Watching their moribund economies, European leaders are getting antsy.  And the elevated euro (weak dollar and yen) was the target of strong words this past week from French President Hollande:  “We can’t let the euro fluctuate according to the mood of the market.  We have to act at the international level to assert our interests… We have to determine for the medium term an exchange-rate level that appears most realistic, that is most in line with the state of our real economies.”

Doug Noland is a must read every Friday...and his commentary at the Internet site yesterday evening is no exception.  I thank reader U.D. for sliding it into my in-box last night...and the link is here.


America's Baby Bust

The nation's falling fertility rate is the root cause of many of our problems. And it's only getting worse.

For more than three decades, Chinese women have been subjected to their country's brutal one-child policy. Those who try to have more children have been subjected to fines and forced abortions. Their houses have been razed and their husbands fired from their jobs. As a result, Chinese women have a fertility rate of 1.54. Here in America, white, college-educated women—a good proxy for the middle class—have a fertility rate of 1.6. America has its very own one-child policy. And we have chosen it for ourselves.

Forget the debt ceiling. Forget the fiscal cliff, the sequestration cliff and the entitlement cliff. Those are all just symptoms. What America really faces is a demographic cliff: The root cause of most of our problems is our declining fertility rate.

The fertility rate is the number of children an average woman bears over the course of her life. The replacement rate is 2.1. If the average woman has more children than that, population grows. Fewer, and it contracts. Today, America's total fertility rate is 1.93, according to the latest figures from the Centers for Disease Control and Prevention; it hasn't been above the replacement rate in a sustained way since the early 1970s.

This longish essay was posted on The Wall Street Journal website last Saturday...and it's definitely weekend reading material...but it's also must read weekend reading material.  The link is here.


Podcast: James Rickards on Currency Wars

Investors and economists concerned about the current central bank battle to weaken their currencies might want to get comfortable, because this so-called “currency war” isn’t ending any time soon, warns veteran financier and author of the 2011 book “Currency Wars: The Making of the Next Global Crisis” James Rickards.

In an interview on the DJ FX Trader podcast, Rickards says the continuing currency battle will likely last until 2014 or 2015, and in the meantime rising inflation across the globe remains a key risk.

“We’re not in currency wars all the time, but when we are they tend to last for a very long time,” he says.

This podcast was posted on The Wall Street Journal's Internet site on Thursday morning.  The podcast runs just over 14 minutes...and Mr. Rickards part lasts for about 7:50 minutes.  I thank Elliot Simon for bringing it to our attention...and the link is here.


Global currency war could get nastier, warns Brazil's Mantega

The global "currency war" could get even worse if Europe joins the fray, says the man widely credited with coining the term.

Brazilian Finance Minister Guido Mantega told Reuters [that] European countries should focus on reviving their economies with more investments, rather than trying to weaken the euro to protects jobs as France has suggested ahead of next week's meeting of G20 economic powers.

"We will continue to have this currency problem unless the global economy takes off," Mantega said in an interview late Thursday. "The solution here is to make their economies more dynamic and jolt them out of stagnation."

More than two years ago Mantega used the term "currency wars" to describe the series of competitive devaluations adopted by rich nations to bolster their exports amid the global slowdown to the detriment of emerging market nations.

This Reuters piece was filed from Brasilia mid-morning Eastern time yesterday...and I thank Manitoba reader Ulrike Marx for sending it along.  The link is here.


Venezuela devalues currency by 32%

Venezuela devalued its bolivar currency to 6.3 per dollar from 4.3 per dollar, the finance minister said today, in a widely expected move to shore up government finances after blowout government spending last year.

The measure will help ease a shortage of dollars that has crimped imports and left many supermarkets barren of staples such as flour or sugar. It is also seen pushing up consumer prices in the import-dependent OPEC nation that already has one of Latin America's highest inflation rates.

Venezuela has maintained exchange controls on the bolivar for a decade under which importers and travelers must seek dollars through a state currency board, or buy them on an illegal black market where greenbacks fetch nearly four times the official rate.

I would expect Argentina to soon follow suit.  I borrowed this Reuters story from a GATA release yesterday, but the first person through the door with it was Phil Barlett...and the link is here.


Iceland, Fervent Prosecutor of Bankers, Sees Meager Returns

"Greed is not a crime. But the question is: where does greed lead?" said Olafur Hauksson, a special prosecutor in Reykjavik.

 As chief of police in a tiny fishing town for 11 years, Olafur Hauksson developed what he thought was a basic understanding of the criminal mind. The typical lawbreaker, he said, recalling his many encounters with small-time criminals, “clearly knows that he crossed the line” and generally sees “the difference between right and wrong.”

Today, the burly, 48-year-old former policeman is struggling with a very different sort of suspect. Reassigned to Reykjavik, the Icelandic capital, to lead what has become one of the world’s most sweeping investigation into the bankers whose actions contributed to the global financial crisis in 2008, Mr. Hauksson now faces suspects who “are not aware of when they crossed the line” and “defend their actions every step of the way.”

This 2-page background story, filed from Reykjavik, was posted on The New York Times website last Saturday...and has been sitting in my in-box since then.  I thank Phil Barlett for his second offering in a row...and the link is here.


Cameron triumphs as European leaders agree on first-ever budget cut

The deal is expected to set members’ total payments to the EU for 2014-20 at Euro 908.4 billion or £770 billion. For the last seven-year spending round, payments were set at £800 billion, and the new agreement marks the first time the EU’s multi-year budget has fallen.

The agreement was sealed shortly after 4pm in Brussels, after more than 24-hours of non-stop talks, including an all-night negotiation during which Mr Cameron drank numerous espressos and chewed sugary gum sweets.

The deal was announced on Twitter by Herman van Rumpoy, the EU president.

He wrote: “Deal done! #euco has agreed on #MFF for the rest of the decade. Worth waiting for.”

Big hairy deal.  The E.U. should be abandoned anyway...and it will be interesting to see if the organization outlasts its spending plans.  This story was posted on The Telegraph's website early yesterday afternoon GMT...and is courtesy of Roy Stephens.  The link is here.


Pepe Escobar: The sound of Munich

Let's start with US Vice President Joe Biden: "The United States is a Pacific power. And the world's greatest military alliance [the North Atlantic Treaty Organization] helps make us an Atlantic power as well. As our new defense strategy makes clear, we will remain both a Pacific power and an Atlantic power."

Another Goldman Sachs bonus to hear what our friends in the Zhongnanhai in Beijing make of all this.

Biden also stressed that in terms of the Obama 2.0 administration's leading from behind strategy, the "comprehensive approach" implies the use of "a full range of tools at our disposal - including our militaries".

He even doubled down, praising the Iraq, Afghanistan and Libya quagmires/disasters as models and implying the global war on terror (GWOT) does, indeed, go on forever, as in the US "cognizant of an evolving threat posed by [al-Qaeda] affiliates like AQAP in Yemen, al-Shabaab in Somalia, AQI in Iraq and Syria and AQIM in North Africa".

This short piece by Pepe stamps 'Paid' on the idea that the truth...if this is what stranger than fiction.  You couldn't make this stuff up.  This article showed up on the Asia Times website on Wednesday...and I've been saving it for today.  It's courtesy of Roy Stephens, of course...and the link is here.


Khamenei plays hardball with Obama

It was an extraordinary week in the politics of the Middle East and it ended appropriately by being rounded off with a reality check lest imaginations ran riot.

Three major happenings within one week would have to be taken as the inevitable confluence of a flow of developments and processes: the offer by the Syrian opposition of a bilateral dialogue with the Bashar al-Assad regime; the historic visit of an Iranian president to Egypt; and the public, unconditional offer by the United States of direct talks with Iran and the latter's ready acceptance of it.

Yet, they are interconnected. First, the Syrian kaleidoscope is dramatically shifting despite the continuing bloodbath. Unless the European countries drop their arms embargo on Syria (which expires on March 1 anyway) and decide to arm the rebels, the stalemate will continue.

The mood in Western capitals has shifted in the direction of caution and circumspection, given the specter that al-Qaeda affiliates are taking advantage. If anything, the hurricane of militant Islamism blowing through Mali only reinforces that concern and reluctance.

This Asia Times story, posted on their website early this morning Hong Kong time is a must read for all students of the "New Great Game".  Once again I thank Roy Stephens for sharing it with us...and the link is here.


U.K. deploys toy-sized spy drones in Afghanistan

British troops in Afghanistan are now using 10-centimeter-long 16-gram spy helicopters to survey Taliban firing spots. The UK Defense Ministry plans to buy 160 of the drones under a contract worth more than $31 million.

­The remote-controlled PD-100 PRS aircraft, dubbed the Black Hornet, is produced by Norwegian designer Prox Dynamics. The drone is a traditional single-rotor helicopter, scaled down to the size of a toy. British troops use the drones for reconnaissance missions, sending them ahead to inspect enemy positions.

Each drone is equipped with a tiny tiltable camera, a GPS coordinate receiver and an onboard autopilot system complete with gyros, accelerometers and pressure sensors, which keeps it stable in flight against winds as strong as 10 knots, according to reviews. The tiny aircraft is agile enough to fly inside compounds, and is quiet enough not to attract unwanted attention. If detected, the drones are cheap enough to be considered expendable.

Coming to your neighbourhood sooner or later, dear reader.  This very short Russia Times story is certainly worth skimming...and the photos are alarming.  Roy Stephens sent me this story on Monday...and the link is here.


Vietnam’s banks: Tiger tamed

The good times won’t return until the country’s stricken banks are dealt with

The arrest of a former bank boss is just what many people in the rich world would like to see. In Vietnam it is becoming a regular occurrence. On January 23rd the government announced that it had arrested Pham Thanh Tan, until recently the head of state-owned Agribank, the country’s largest. His is the fifth arrest of a senior Agribank executive in as many months; the previous four face charges of embezzlement and theft totalling about $7m.

Back in August the arrest of the head of another big bank, Asia Commercial Bank, led to a plunge in the stock market and a bank run. Six months on the markets barely reacted to Mr Tan’s arrest. So inured have investors become to bad news from the banking sector that they just ignored it.

Five years ago Vietnam was riding high as the sexiest of the Asian tigers. In the past couple of years, however, the country’s growth has slowed. The souring debts of state-owned enterprises, together with a burst property bubble, have left the country’s ill-managed and secretive banks in a mess. Many got into trouble by making reckless loans during the good times, often to cronies of the ruling Communist Party. The executives arrested so far have been charged either with graft, plain mismanagement or, in Mr Tan’s case, “irresponsibility causing serious consequences”.

This short piece showed up on the Internet site last Saturday...and it's worth reading if you have the time.  I thank Paul Laviers for bringing it to my attention...and now to yours.  The link is here.


Two Chilling Developments Suggest Asia May Be One Step Away From War

China and Japan, along with North and South Korean troops at the DMZ, appear one step away from armed combat and tensions don't look likely to ease any time soon.

New developments within both regions illustrate how close to open combat the four countries are, and how quickly one incident could expand to war among very powerful nations.

Tokyo reported two January events where Chinese naval vessels targeted its East China Sea forces with fire-control radar. This specific type of radar is used almost exclusively to assist guided weapons systems in their flight toward a target. It's an unmistakable action that can be the first step to open combat, and was taken seriously enough by the Japanese captain to prompt a combat alert aboard his vessel.

This must read story from yesterday morning Eastern time...was sent to me by Roy Stephens...and it's his final offering in today's column.  The link is here.


King World News Blogs/Audio Interviews

As most readers discovered yesterday, the KWN website got hacked...and it was vicious.  I got more e-mails from readers on this issue than anything else since I started writing this column.  I did manage to post the links to all his blogs that were sent to me on Thursday, but I did have some issues with the website even then...but by the time my column was posted at 6:30 a.m. Eastern time on Friday morning, his website was out of service

I get the KWN blogs and interviews directly from Eric...and I haven't heard a thing from him since late Thursday evening.  I'm sure that I'll hear something in due course...and when I do, I'll let you know.


Gold vending machine in Boca Raton may be first of many

Just outside of Burberry, Tory Burch, Stuart Weitzman and Banana Republic stores in the corridor next to the Brahman Motors Bentley display is a six-foot-tall golden box that dispenses 1 gram to 10 grams of gold.

Meris Kott, managing director of PMX Gold Bullion, said the machine was placed at the mall Jan. 4 and the company has a year lease. The company used a German machine about two years ago for a trial run at Town Center. This time PMX Gold Bullion Sales, based in Boca Raton and a subsidiary of publicly listed PMX Communities Inc. (OTC BB: PMXO, 7 cents), had its own machine designed.

Another machine will be placed in a Florida mall in the next few weeks, Kott said. Her goal is to have 10 to 12 machines placed in various malls by the end of June.

This story appeared on the Internet site late on Wednesday afternoon...and it's courtesy of Elliot Simon.  The link is here.


Russian policy study group notes GATA's exposure of gold price suppression

GATA's work has come to the attention of a public policy study organization in Russia, the Strategic Culture Foundation, whose researcher, Valentin Katasonov, notes particularly GATA's publication of secret records from the International Monetary Fund confirming gold price suppression by Western central banks.

Katasonov's analysis, published yesterday, is headlined "IMF Information Leaks: Central Banks' Gold Manipulations" and it's posted in English at the Strategic Culture Foundation's Internet site.

Russian officials have been watching GATA's work for a long time, at least since 2004, when the deputy chairman of the Bank of Russia, Oleg Mozhaiskov, with whom GATA had not previously had any contact, spoke approvingly of GATA in his address to a meeting in Moscow of the London Bullion Market Association.

This GATA release contains more commentary from Chris...and a link to the above policy a few others.  It's a must read for sure...and it's posted at the Internet site...and the link is here.



¤ The Funnies

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¤ The Wrap

If all else fails, immortality can always be assured by spectacular error. – John Kenneth Galbraith

Today's classical 'blast from the past' was sent to me by reader Rob Bentley.  It's Tomaso Albinoni's Adagio in G minor...and everyone has heard it in one form or another sometime during their lifetime...and the history behind this composition is truly amazing.  This video features the Franz Liszt Chamber Orchestra...and it was recorded at the 1,000 year old Benedictine Pannonhalma Archabbey in Hungary.  At only 8:39 minutes, it doesn't last nearly long enough to suit me.  The link is here.

Today's pop 'blasts from the past' are both by The Young Rascals...and both are from 1967...forty-six years ago.  Where the hell did all that time go?  The link to the first one is here...and the second one is here...and you'll know them right away.

I'm not going to spend much time waxing philosophical over the entrails of yesterday's trading action in gold and silver...although the quick take-downs of both gold and silver after the London p.m. gold fix were duly noted.

I haven't the foggiest notion of where we go from here.  As I've said a few times already this month, it appears that gold and silver are being held in place...but for what reason I don't know.  Lots of pundits feel that a break-out to the upside is imminent...and they could very well be right, as I'm certainly cheering for one.  But who will be going short against all the new longs that come in the market to drive the price up?  That's always the question you should be asking when any rally gets underway.

Just look at the CFTC Bank Participation Report charts for platinum and palladium above and see how the U.S. banks have blown out their short positions in these metals as the prices have risen over the last few months...chart #4 and #5 in each metal.  They are not-for-profit sellers...and if they weren't there, both platinum and palladium would be at prices that would make your eyes glaze over.  This is precisely what is going on in the silver market...and to a lesser extent in the gold market.  That's why the monthly BPR is so important, as it strips out the banks to show you their undeniable footprints in the precious metals market.  This is further confirmed by the "Days to Cover Short Positions" chart that I post in this column every Saturday...Sunday west of the International Date Line.  JPMorgan et al are the 800 pound gorillas in the living room of the precious metal markets.

It's surprising the number of people that see these charts, but brush them aside as if they mean nothing, no matter what the facts show.  Au contraire...they are everything!  There's even a T-shirt for that syndrome...and I know that a vaccine is in the works as well.

In closing...and on a more serious's one of my favourite charts from Nick that I like to post on the weekend.  It's the "Total PMs Pool"...and it continues to climb from lower left to upper right despite what the prices are doing.  I sure do hope, dear reader, that you're getting your share.

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That's more than enough for today.  I'm off to bed...and I'll see you here on Tuesday.