Gold & Silver Daily
 

¤ Yesterday In Gold & Silver

The gold price trade a few dollars above the $1,200 spot price mark for all of Far East and most of the London trading session on Thursday.  But once the "fix" was in at 10 a.m. EDT, the price got smacked back below that price, with the low tick coming minutes after the London close---1 p.m. BST/11:00 a.m. EDT.  From there the price chopped quietly higher for the remainder of the day, as it managed to crawl back and close above the $1,200 mark.

The high and low ticks, such as they were, were reported by the CME Group as $1,194.80 and $1,207.40 in the June contract.

Gold closed on Thursday at $1,202.00 spot, down $1.10 from Wednesday's close.  Net volume was pretty light at around 108,000 contracts.

Here's the 5-minute gold tick chart---and as you can see, the two biggest volume spikes came on the initial spike below $1,200 at 8:30 a.m. EDT---and then again at the 10 a.m. gold fix.  Other that, it was pretty quiet, as almost twenty percent of yesterday's net volume occurred at those two times.  Midnight EDT is the vertical gray line, add two hours for EDT---and don't forget the 'click to enlarge' feature.

Silver traded flat until around 2:30 p.m. Hong Kong time on their Thursday afternoon---and it was all down hill until a few minutes after 11 a.m. when the low tick was in, which was the same time as gold's low.  You'll note from the Kitco chart below that silver also got some help to the downside at 8:30 and 10:00 a.m. EDT time as well.  Once the low was in, the silver price also rallied into the 5:15 p.m. close of electronic trading.

The high and low ticks were recorded as $17.00 and $16.57 in the May contract.

Silver closed on Thursday afternoon at $16.755 spot, down 18 cents from Wednesday.  Net volume was pretty decent at 32,500 contracts, as the technical funds in the Managed Money category sold longs and bought shorts, the exact opposite of what they were doing on Wednesday---as the 50-day moving average got broken to the downside this time.  "Da boyz" are whipsawing these brain dead traders at will.

Platinum traded flat until Zurich opened at 10 a.m. Europe time---and it was mostly down hill until about lunchtime in New York.  After that it traded sideways for the remainder of the day.  Platinum closed down nine bucks at $1,153 spot.

Palladium didn't do much, as it traded mostly within a ten dollar price range---and it finished the Thursday session at $745---down 2 dollars on the day.

The dollar index closed at 98.12 late on Wednesday afternoon in New York---and made it as high as 98.27 around 8:45 a.m. Hong Kong time.  It started to slide from there, hitting its 97.37 low tick around 9:45 a.m. EDT.   It chopped around a bit after that, before closing at 97.53---down 59 basis points on the day.

It was obvious that the precious metal price action had little to do with what was going on in the currency markets yesterday---and everything to do with what was happening in the COMEX paper market, which is always the case.

The gold stocks opened down a bit, but quickly rallied into positive territory, hitting their highs at the London p.m. gold fix at 10 a.m. EDT.  They quickly sold back into the red, but managed a rally starting at 10:30 a.m.  The rally continued until shortly after 2 p.m.---and then the rolled over into the close, but finished the day on an uptick.  The HUI closed lower by 1.25 percent.

The share price pattern in the silver equities was identical---and Nick Laird's Intraday Silver Sentiment Index closed down 1.38 percent.

The CME Daily Delivery Report for Day 4 of the April delivery month showed that only 3 gold and zero silver contracts were posted for delivery within the COMEX-approved depositories on Monday.  Of those three gold contracts, JPMorgan stopped two of them in their in-house [proprietary] trading account.

The CME Preliminary Report for the Thursday trading session showed that gold open interest in April fell by 1,708 contracts, leaving 3,087 contracts still open.  In silver, April o.i. fell by one contract---and now sits at 179 contracts.

There were no reported changes in GLD yesterday---and there was a smallish 135,703 troy ounce withdrawal from SLV.  It's safe to say that this withdrawal represented a fee payment of some kind.

Since yesterday was Thursday, Joshua Gibbons, the "Guru of the SLV Bar List," updated his website with goings on within SLV for the reporting week ending at the close of trading on Wednesday---and this is what he had to say:

"Analysis of the 01 April 2015 bar list, and comparison to the previous week's list.
1,434,423.8 troy ounces were removed (all from Brinks London), no bars were removed or had serial number changes.
"

"The bars removed were from: Solar Applied Materials (0.5M oz), Krasnoyarsk (0.3M oz), Cominco (0.2M oz), and 9 others.  As of the time that the bar list was produced, it was overallocated 434.8 oz."

"A 1,912,900.0 oz withdrawal on Tuesday is not yet reflected, and should be on next week's list."

There was another tiny sales report from the U.S. Mint.  They sold 72,000 silver eagles---and that all.

There was decent gold movement at the North American-based COMEX-approved depositories on Wednesday.  Only 300 troy ounces were added, but 161,135 troy ounces [5,012 kilobars] were shipped out, with virtually all of it coming from Canada's Scotiabank.  The other gold shipped out, ten kilobars worth, came from the Manfra, Tordella  Brookes, Inc. depository.  The link to that activity is here.

In silver, nothing was reported received---and only 157,052 troy ounces were shipped out.  Most of that was from Canada's Scotiabank.  The link to that action is here.

At the Brink's, Inc. COMEX-approved gold depository in Hong Kong, they reported receiving 1,525 kilobars---but shipped out only 25 kilobars.  The  link to the action---and the associated ounces---is here.

In yesterday's column I posted commentary, plus a link to information that Joshua Gibbons had regarding Kitco's Pool accounts.  He also had the following to say in the e-mail that included that information---and I have his permission to post it here, so I am.

I have been doing some extensive research lately into the Kitco Pool. I just put up a page yesterday at http://about.ag/KitcoPool.htm to monitor the situation (kind of like I am doing with Tulving).

I'm guessing many people believe it is 100% backed by physical precious metals, owned by customers (so they would be protected in bankruptcy), and in secure vaults segregated from Kitco's assets. Kitco used to make those claims, which made it safer than a traditional unallocated account.

It turns out that it is now at least partially backed by "third-party pool accounts" (which typically have no guarantee of being fully backed). Kitco is in bankruptcy (technically, CCAA, the Canadian equivalent of Chapter 11 bankruptcy), and they do not consider Kitco Pool customers as creditors, and the Monitor did not respond to my query as to who Kitco Pool customers might have recourse against if not Kitco. And $25M of Kitco Pool assets were seized from Kitco's offices back in the June, 2011 raid, making it unlikely that they were really owned by Kitco customers and segregated in a secure vault.

Worse, Kitco is not responding to my queries (even though I have confirmed they reviewed a draft I sent them of the main article I published yesterday). They did not answer whether or not metal backing the Kitco Pool can be lent out (Kitco borrowed over $30M in 2011 using metal -- although likely not the Kitco Pool metal though -- as collateral). And at the time of the June, 2011 raid, Kitco was expecting $80M in tax credits from Revenue Quebec, which never gave it to them -- leading me to have concerns that Kitco may have "borrowed" money from the Kitco Pool to stay afloat. If so, Kitco could be "deeper in the hole" than the bankruptcy Monitor is aware of. - JG

I have a reasonable number of stories today---and I hope you'll find a few of them worth reading.

 

¤ Critical Reads

James Grant: Don’t expect rate hike in 2015

This 7:02 minute video interview with Maria Bartiromo on Fox Business News, was posted on the granstpub.com Internet site yesterday---and I thank Dan Lazicki for today's first story.

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Dear Texas, Welcome to the Recession

Earlier today, when looking at the latest Factory Order data we saw that based on historical patterns if only in U.S. manufacturing (if not in the recent seasonally-adjusted "hiring" of waiters and bartenders) the U.S. is already in a recession. Ironically, this came out on the day in which the BLS presenting some more amusing "data" suggesting that only 268K workers filed initial claims in the past week, one of the lowest numbers of the second great depression.

Which is great for political propaganda purposes, however, for an accurate perspective we decided to look at a provider of job data that is actually representative of what happens in the real world not some goalseeking Arima-X-12 spreadsheet.

Here is what Challenger Gray found when looking at the latest monthly data:

Through the first quarter of 2014, employers announced 140,214 job cuts, up 15.6 percent from the 120,341 cuts tracked the first three months of 2014. The first quarter saw 17 percent more job cuts than in the final quarter of 2014, when 119,763 job cuts were recorded.

Of the 140,214 job cuts announced in the first quarter, 47,610 were directly attributed to falling oil prices.

“Without these oil related cuts, we could have been looking one of lowest quarters for job-cutting since the mid-90s when three-month tallies totaled fewer than 100,000. However, the drop in the price of oil has taken a significant toll on oil field services, energy providers, pipelines, and related manufacturing this year,” said John Challenger, chief executive officer of Challenger, Gray & Christmas.

This Zero Hedge, which has been edited since it was posted, is now datelined 7:29 p.m. yesterday evening EDT---and it's the second offering of the day from Dan Lazicki.

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Amid record-low snow pack, California orders mandatory curbs on water use

California Gov. Jerry Brown announced strict new curbs on state water use Wednesday to combat a worsening drought affecting more than 50 million people in the western United States.

The executive order imposes mandatory water reductions across California to reduce water usage by 25 percent. Brown announced the new restrictions on a mountain near Lake Tahoe, where state officials gathered to conduct an annual snowfall measure. The field where the measurement took place has averaged 66 inches of snow on April 1 since records began in 1950; today, there is no snow on the ground.

“Today we are standing on dry grass where there should be five feet of snow,” Brown said Wednesday.

While the eastern United States weathered a colder-than-usual winter, a warm and dry winter west of the Rocky Mountains has state officials concerned that the years-long drought will worsen this summer. The drought has diminished urban water supplies, taxed state budgets and created an environment ripe for a disastrous fire season.

I posted a story about this in yesterday's column, but here's something from The Washington Post on the same issue.  I thank Brad Robertson for passing it around on Thursday.

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Pulitzer winner Chris Hedges calls Canada's P.M. a puppet

Pulitzer prize-winning journalist Chris Hedges told The Vancouver Observer he thinks Prime Minister Stephen Harper is a "pawn" or "puppet" of corporations, and that Canada is repeating many mistakes that the U.S. made during the Bush era.

"The problem is corporate power," Hedges said, while at the State of Extraction conference in downtown Vancouver. "Harper is a pawn or puppet of corporate power in the same way Obama is. But you know, the NDP isn't going to save you, at this point. Your security and surveillance state is as advanced as ours. And if this new anti-terrorism law passes, in some ways it will be even worse."

Hedges has a Canadian connection: his wife is Canadian, and his daughter is a university student in Vancouver, currently studying abroad. He said Canadian governments have a "strange" tendency to make the same errors their American neighbours made 10 years earlier.

He also does exactly what Barack Obama tells him to do, as well.  This story appeared on the vancouverobserver.com Internet site yesterday---and I thank reader Sean McLaren for sending it our way.

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We'll go bankrupt in a week, Greece warns creditors as trust frays in debt drama

Greece will go bankrupt in within a week, government officials have told their creditors, as the country's bailout negotiations push the cash-starved government to the wire.

A Greek government representative is reported to have told eurozone officials at a teleconference on Wednesday: "There is no way we can go beyond April 9" -- a reference to an impending International Monetary Fund repayment deadline. The claims were later "categorically" denied by the finance ministry.

The warning shot came as creditors failed to rubber stamp Athens' latest bid to unlock vital bailout cash.

Greece's interior minister has already promised to postpone a €458 million loan repayment to the IMF, saying the leftist government would prioritise its payment of public sector wages and pensions rather than adhere to the repayment schedule of the Brussels Group.

This news item put in an appearance on the telegraph.co.uk Internet site at 6:00 p.m. BST on their Thursday evening---and it's a story I found in a GATA release yesterday.

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Greece comes kicking and screaming to reform table

Greece is coming kicking and screaming to the reform table. The Syriza government’s latest proposals include some concessions to its public creditors. The plan still lacks detail, and reneges on past promises. The risk of an accidental euro zone exit is rising.

As agreed in February, the left-wing Syriza government needed to flesh out its own reform agenda to unlock funding from its international public creditors. Some 1.8 billion euros of debt matures next week, including 430 million euros owed to the International Monetary Fund.

The latest plan from Athens represents some progress. There is an effort to flesh out a previously-vague plan to reform taxation and fight evasion from which the government expects to magic 3.1 billion euros. Commitment to privatisation looks a little more serious now, with proceeds of 1.5 billion euros to be raised this year.

There is still a wide gap between Greece and its euro zone partners. Tsipras appears to intend to row back on labour reform, push up the minimum wage and flouts lenders’ desire to lower pension spending. These together cost 926 million euros this year. The euro zone is treating Greece with the tough love of an exasperated parent. It is refusing funding, but credit is still flowing thanks to European Central Bank benevolence.

This opinion piece appeared on the Reuters website yesterday, but no time is given.  I thank Orlando, Florida reader Dennis Mong for finding it for us.

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Greece draws up drachma plans, prepares to miss IMF payment

Greece is drawing up drastic plans to nationalise the country's banking system and introduce a parallel currency to pay bills unless the eurozone takes steps to defuse the simmering crisis and soften its demands.

Sources close to the ruling Syriza party said the government is determined to keep public services running and pay pensions as funds run critically low. It may be forced to take the unprecedented step of missing a payment to the International Monetary Fund next week.

Greece no longer has enough money to pay the IMF €458m on April 9 and also to cover payments for salaries and social security on April 14, unless the eurozone agrees to disburse the next tranche of its interim bail-out deal in time.

“We are a Left-wing government. If we have to choose between a default to the IMF or a default to our own people, it is a no-brainer,” said a senior official.

This commentary by Ambrose Evans-Pritchard showed up on The Telegraph's website at 9:22 p.m. GMT yesterday evening---and Roy Stephens slid it into my in-box at 2:10 Denver time this morning.

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Merkel’s ‘Anti-Russian Front’ Falls Apart – German Newspaper

More and more European countries oppose an extension of anti-Russian sanctions and disagree with the German policy towards Russia.

Attempts to save "European unity" are doomed, the German online newspaper “Die Freie Welt” reported.

During her recent visit to Helsinki, German Chancellor Angela Merkel tried to convince Finns to further follow the anti-Russian course and stressed the importance of pursuing a common EU policy towards Russia. However, this policy is in fact far from being united, the German online edition wrote.

Finns are not the only ones who criticize Merkel's tough stance towards Russia. Greece, Hungary, Spain, Italy, Slovakia, Cyprus and Austria are also expressing discontent about the anti-Russian sanctions under which they suffer more than other E.U. countries.

This story was posted on the sputniknews.com Internet site at 1:43 p.m. Moscow time on their Thursday afternoon, which was 5:43 a.m. in Washington.

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It’s Official – All Kiev's Investigations of Maidan Crimes Deadlocked

The International Advisory Panel, set up by the Council of Europe to review the progress of the various investigations into the crimes that were committed during the Maidan protests, has now produced its report.

The Panel consists of three members: a British lawyer who was formerly the head of the European Court of Human Rights, and two Ukrainian lawyers.

Media commentary has tended to focus on the highly critical comments in the report concerning the conduct of the investigations by the Ukrainian authorities.

These do indeed constitute the key part of the report. However it is not what is important about the report. To understand what is, it is first necessary to say something about its origins and background and to discuss its contents.

No surprises here.  This longish, but very interesting news story appeared on the russia-insider.com Internet site early yesterday afternoon Moscow time---and I thank reader M.A. for sharing it with us.

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Iraq’s Four-Mile Line of Supertankers Fuels Ship-Rates Surge

Iraq’s biggest oil exports in more than three decades and winter winds are helping to keep shipping rates at a six-year high as a four-mile line of supertankers waits to load the nation’s crude.

There are 22 of the industry’s biggest tankers, or almost 5 percent of the fleet, waiting to collect cargoes from the Basra Oil Terminal in the Persian Gulf, from where most of Iraq’s crude is shipped. The daily rate for supertankers transporting crude from the Middle East to Japan rose to $51,042 on Thursday, bringing the average for this year to $61,306, data from the Baltic Exchange in London show.

Iraq’s oil output is rising faster than any other nation in OPEC as supplies from its southern oil province expand even as Islamic State fighters seize parts of the north. Tankers leaving Basra in the past week waited an average of 16 days, ship tracking data compiled by Bloomberg show. That compares with about 10 days normally, said Odysseus Valatsas, chartering manager at Dynacom Tankers Management in Glyfada, Greece.

This amazing Bloomberg story, which is definitely worth reading if you have an interest in the crude oil market, appeared on their website at 4:16 a.m. Denver time yesterday morning---and I thank West Virginia reader Elliot Simon for bringing it to our attention.

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Iran Agrees to Detailed Nuclear Outline, First Step Toward a Wider Deal

Iran and the United States, along with five other world powers, announced on Thursday a surprisingly specific and comprehensive understanding on limiting Tehran’s nuclear program for the next 15 years, though they left several specific issues to a final agreement in June.

After two years of negotiations, capped by eight tumultuous days and nights of talks that appeared on the brink of breakdown several times, Secretary of State John Kerry and his Iranian counterpart, Mohammad Javad Zarif, announced the plan, which, if carried out, would keep Iran’s nuclear facilities open under strict production limits, and which holds the potential of reordering America’s relationship with a country that has been an avowed adversary for 35 years.

Mr. Kerry and Energy Secretary Ernest J. Moniz, a nuclear scientist who played a crucial role in the last stages of the negotiations, said the pact satisfied their primary goal of ensuring that Iran, if it decided to, could not race for a nuclear weapon in less than a year, although those constraints against “breakout” would be in effect only for the first decade of the accord.

This news story, filed from Lausanne, Switzerland was posted on The New York Times website yesterday sometime---and it's the first offering of the day from Roy Stephens.  Here's a Reuters piece on the same subject---and it's headlined "Iran, world powers reach initial deal on reining in Tehran's nuclear program".  It's courtesy of Orlando, Florida reader Dennis Mong.

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Tehran and world powers reach solutions on Iran nuclear program

Iran and international powers have reached “solutions on key parameters” of Tehran’s nuclear program following eight-day talks in Switzerland, according to a joint statement issued by the negotiators on Thursday.

During the media conference E.U. foreign policy chief Federica Mogherini said the deal achieved as a result of the talks creates the basis of a future comprehensive nuclear agreement between Iran and six powers which is to be concluded by a June 30 deadline.

The agreement envisages the Fordow facility being converted into a nuclear physics center with no fissile material. It was agreed that the Natantz facility would remain as the only uranium enrichment complex in the country. Under the deal Tehran was obliged to refrain from creating nuclear weapons.

Here's the Russia Today spin on the yesterday's nuclear agreement.  It showed up on their website at 5:19 p.m. Moscow time on their Thursday afternoon, which was 11:19 a.m. EDT.  I thank Roy Stephens for digging it up for us.

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Saudi Arabia’s Kingdom Tower——The Pointless Hubris of a Decadent Tyranny

p> I waited until April 2 because this is no joke.

Behold the proposed new Kingdom Tower for Jeddah, Saudi Arabia — at one full kilometer in height, about twice the size of New York’s new Freedom Tower. The  Kingdom Tower comprises 252 floors of mixed market apartments, hotel rooms, and offices. It is an axiom that imperial societies build their greatest monuments just before they collapse, so consider this a portent for the oil empire of Saudi Arabia. There will always be an Arabia — well something will occupy that desolate region — but it may not be the private domain of the Saud clan much longer, especially as war breaks out across the Middle East and Persia.

This short, but must read story appeared on David Stockman's website yesterday---and the photos alone are worth the trip.  It's another contribution from Roy Stephens.

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Picasso painting tipped for record sale unveiled in Hong Kong

Picasso masterpiece "Les Femmes d'Alger" went on show for the first time in Hong Kong Wednesday ahead of an auction where it is tipped to smash the world record price for a painting.

The 1955 piece depicts women in a harem and is the final work in a 15-painting series which pays homage to the 19th century artist Delacroix, who Picasso admired.

It is billed to fetch an estimated $140 million when it goes on sale at Christie's in New York in May -- but the auction house says the price could well go higher.

The current world record for any painting sold at auction is for Francis Bacon's "Three Studies of Lucian Freud", which sold for $142 million in 2013, also at Christie's in New York.

"It's one of the great Picassos, period, and it's one of the last great Picassos that has been in private hands," Derek Gillman, chairman of Christie's impressionist and modern art department, told AFP.

This article appeared on the news.yahoo.com Internet site on Wednesday.  It's dated April 1, but it looks legit---and I thank reader M.A. for sending it along.

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Top 10 breathtaking Mars pictures taken from orbit

Mars exploration isn’t all about Curiosity and Opportunity rovers. NASA’s Mars Reconnaissance Orbiter has snapped loads of beautiful hi-resolution images of the red planet's surface since 2006.

The spacecraft, which is operated by the University of Arizona, is equipped with a $40 million HiRISE (High Resolution Imaging Science Experiment) camera.

The device is the largest aperture reflecting telescope ever sent on a space mission, and is capable of taking 0.3 megapixel pictures.

Mars is known as the red planet, but the HiRISE images have been enhanced by ‘false coloring,’ which helps scientists track changes on the planet’s surface.

This stunning photo essay appeared on the Russia Today website back on Sunday---and it had to wait for today's column.  It's definitely a must read---and I thank Roy Stephens for sending it along.

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Sprott Money Weekly Wrap Up

Listen to Eric Sprott share his thoughts on recent U.S. economic and employment numbers, geopolitics and the effects on global markets, Asian demand in China and India, and the COT structure on the Comex.

This 7:42 minute audio interview with Eric was conducted by Geoff Rutherford---and was posted on the sprottmoney.com Internet site yesterday.

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Doug Casey: Signs of a Resource Sector Bottom

L: Well, Doug, we’ve seen another quarter of high volatility and significant world events. What strikes you as most important at present?

Doug: Everything is still held together with chewing gum and baling wire, for which I’m grateful, considering what’s coming. It’s very clear to me that the global economy is in very much the same space as it was in 2007—in other words, on the edge of a precipice.

L: On the global economy, my question is this: If Obama and Yellen have saved the US and Merkel and Draghi are saving the EU, why are commodities selling off so dramatically? Iron, copper, oil—just about everything is selling off. How can an economy be recovering if it’s not using raw materials?

Doug: That’s another reason why I believe that the Greater Depression started in late 2007. During a depression, people are forced to consume less, and you see that reflected in the price of commodities—at least in real terms. This can be obscured in current price terms, depending on the debasement of the currency in question.

This Q&A session between Doug Casey and Louis James was posted on the Casey Research website on Thursday---and it's definitely worth reading.

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Arizona governor vetoes bill recognizing gold and silver as legal tender

Gov. Doug Ducey vetoed a bill Wednesday that would have made Arizona the third state behind Utah and Oklahoma to recognize gold and silver as legal tender.

Proponents say the bill was designed to reflect a growing distrust of government-backed money. Opponents countered that it sends the wrong message that gold and silver are safer than currency.

Ducey said he didn't feel the bill was appropriate at this time.

Former Gov. Jan Brewer vetoed similar legislation in 2013 over concerns that its language might exempt the state from collecting income taxes on transactions involving precious metals.

This AP story, filed from Phoenix, showed up on the tuscon.com Internet site on April 1 at 9:22 p.m. local time---and it's an item I found over at the gata.org Internet site.

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Barrick Gold must face U.S. lawsuit over mothballed mine

Barrick Gold Corp. has lost its bid to dismiss a U.S. lawsuit that accuses the world's largest gold producer of concealing problems at a troubled South American mine and of fraudulently inflating the company's market value by billions of dollars.

U.S. District Judge Shira Scheindlin in Manhattan ruled on Wednesday that shareholders can pursue class-action claims that Barrick intended to deceive them about environmental problems afflicting its Pascua-Lama project on the border of Argentina and Chile.

"Though plaintiffs have not alleged a motive, they have sufficiently alleged strong circumstantial evidence of conscious misbehavior or recklessness," the judge wrote in a 55-page decision.

This Reuters article, filed from New York, appeared on their website at 4:32 p.m. EDT on Wednesday---and it's another gold-related story I found in a GATA release yesterday.

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World Gold Council considers launch of new London exchange

The gold industry's leading trade body and half a dozen banks have agreed to explore the idea of establishing an exchange in London as the existing market faces greater regulation.

The World Gold Council, a group consisting of 19 gold miners, and at least five banks are participating in initial discussions, according to people familiar with the matter.

That could see a move from London's bilateral over-the-counter gold market, which has been criticised for its lack of transparency, to a centrally cleared market. The WGC has hired a number of consultants and spent the past six months pitching a business case for banks to consider the alternative trading infrastructure, the people said.

If the WGC is involved, you can bet that it will be as equally as crooked as the exchange that already exists.  The above three paragraphs are all that is posted in the clear in this story that appeared on the Financial Times website yesterday---and if you want to read the rest, you have to sign up.  Chris Powell slid this gold-related news item into my in-box yesterday morning.

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The 5 Biggest Myths About Investing in Gold and Silver

Gold prices are rallying and in light of uncertainty in the markets and globally, it could be a good time to invest in the relatively safe precious metal -- or companies that deal with it, like Yamana Gold, Barrick Gold and Goldcorp, which all rallied yesterday on the news of higher gold prices.

Another way to get exposure, outside of buying the stuff and individual companies, is to buy one of the many gold exchange-traded funds, like the SPDR Gold Trust

To get you ready for jumping into the market, here are some myths about investing in gold and silver -- and why they just aren't true.

Stefan Gleason, president of Money Metals Exchange in Idaho, gives GATA a plug in his commentary "The 5 Biggest Myths About Investing in Gold and Silver," posted at TheStreet.com Internet site yesterday---and it's another gold-related article I found on the gata.org Internet site.

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Gold, Governments and Central Banks

Do central banks understand gold? Do they care about gold? Are they “pro-gold” or “anti-gold”?

We will in a series of posts try to shed some light on this frequently discussed subject. In this first part, I will discuss the gold policies of some countries’ often pointed out to make the case that central banks are discouraging private gold hoarding or playing down the importance of the country/central bank holding gold as reserves.

Governments and central banks are frequently criticized by gold bugs for being anti-gold. Examples include the Indian government restricting gold import, the US government refusing to carry out a full audit of the U.S. Treasury’s gold holdings and the Swiss government and central bank strongly opposing the “gold initiative” demands.

India, the U.S. and Switzerland are all three on the top 10 list of official gold holding countries and thus relevant for the discussion.

This interesting gold-related commentary by Bullion Star CEO Torgny Persson was posted on their Internet site yesterday---and I thank Dan Lazicki for bringing it to my attention---and now to yours.

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Top 20 mine, mining company and country gold production stats

For reference purposes here are tabulations of the top 20 mines, miners---and producing country statistics for gold as per the Metals Focus Gold Focus 2015 report.

I found this on Lawrie Williams website in the wee hours of this morning.

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“Faith Many People Have in Gold is Rising as Instability Increases”

Currency depreciation, inflation fears and falling wages are weighing on average Russians and leading them to buy gold and silver bullion and some are making “unusually large purchases” of gold jewellery.

A large Russian chain of jewellery stores, Adamas, with 250 outlets across the country saw “same-store sales climb 40 percent in December,” according to a report from Bloomberg.

The role of gold as a store of value in times of high inflation is well known to Russians. “Many are still scarred by the memories of the ruble devaluation of 1998, which sent the annual inflation rate over 100 percent several months later” according to Bloomberg.

Inflation rose 17% in February against 6% for the same period in 2014. Since the economic crisis in Russia took root gold price in roubles has risen substantially.

This very interesting commentary by Mark O'Byrne appeared on the goldcore.com Internet site yesterday---and it's worth reading.  I found it all by myself.

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¤ The Funnies

Here are four photos of white-breasted nuthatches.  There were quite a few around on Sunday when I was out and about so, except for photos 1 and 4 I believe, these aren't all of the same bird.   The second photo was from about 6 meters/20 feet away---and I'm surprised that the flash reached that far, but it did. The last photo is a male with a piece of a walnut in its bill, which was the 'bait' I was using.  Usually the squirrels beat them to it.

Integra's Lamaque South Gold Project and Sigma-Lamaque Milling Complex and Mines are located directly east from the city of Val-d’Or along the prolific Abitibi Greenstone belt in the Province of Québec, Canada, approximately 550 km northwest of Montréal. Québec is rated one of the best mining jurisdictions in the world. Infrastructure, human resources and mining expertise are readily available.

The Company’s primary focus is on production planning for its high-grade Lamaque South project. The Lamaque South property is divided into three clusters, the North, South and West cluster. The primary targets are the high-grade Parallel Zone in the North Cluster and the Triangle Zone in the South Cluster. The acquired Sigma Mill, located 1 kilometer from the Parallel Zone and 3 kilometers from the Triangle Zone, is a fully-permitted, 2,200 ton per day mill and tailings facility. The Sigma-Lamaque Mill and Mining Complex include the historic Sigma and Lamaque Mines which operated for 75 and 52 years respectively and produced more than 9 million ounces of gold in total. Please visit our website for more information.

 

¤ The Wrap

Even those who insist there is no price manipulation in gold or silver, if they study or comment on the COT reports, must admit futures positioning influences the price. And any objective COT analysis of gold and silver must uncover that the categories of traders most responsible for position and price change are the traders in the managed money and commercial categories (including the producer-merchant and swap dealer category). Even those who reject my premise that the commercials lead the technical funds around by the (price) nose, accept that the managed money category is the “hot money” category.  In fact, most analyses feature the managed money category the most because of its unquestioned influence on price. But since this category is purely speculative by definition, the conclusion is inescapable that speculators are greatly influencing, if not setting, prices.

For the CME to remain silent and intentionally avoid this factual aspect of pricing in gold and silver is understandable, since it cannot deny the impact of managed money/commercial positioning. And it seems clear that just as growing numbers of observers, participants and commentators are embracing the COT reports like never before, it is only a small distance from there to recognize that this influence is, by definition, price manipulation. Let someone argue that a small group of speculators buying and selling in unison and unquestionably driving prices up and down is not price manipulation pure and simple. At the very least, such an argument would be bizarre. - Silver analyst Ted Butler: 01 April 2015

Wednesday's rallies in all four precious metals appeared to have been one-day wonders, but with Thursday being the day before a major long weekend for most traders, it may be too soon to pass judgement.  We should get a better handle on things next week.

Here are the 6-month charts for all four precious metals.

We get the job numbers at 8:30 a.m. EDT this morning, but with no U.S. market open until Sunday night in the precious metals---and Monday morning for equities---it will be hard to get a read on the reaction.

Something else we get today is the weekly Commitment of Traders Report for positions held at the close of COMEX trading on Tuesday.  Judging from the charts above, we should get some sort of improvement in the Commercial net short positions in both metals, but as I said in yesterday's column, I reserve the right to be wrong after the big miss in gold from last week's report.

With just about everything in the U.K. and the U.S. shut tight for Good Friday, I can pretty much guarantee that my Saturday column will be very brief.  But I will have one, just in order to comment on the jobs numbers, the COT Report---and any news stories that may be floating around.

Enjoy your long weekend, if you're lucky enough to get one---and I'll see you here again tomorrow.

Ed Steer