From Ed Steer:

Everything was quiet in both the gold and silver markets during most of trading in the Far East yesterday. The downwards pressure on the prices began promptly at 3:00 a.m. NY time when London shows up for work. The downwards pressure stopped on the New York open, and prices were kept in a range...and both gold and silver finished almost at their lows for the day. Once again, fingers were pointed at the dollar and the price of oil.

Open interest in gold for Thursday's $20 up day showed a rise of only 2,414 contracts, as there wasn't a lot of volume. In silver's huge price gain, open interest went down 3,351 contracts. For reasons which will become clear further down, this will be the last day that I comment on daily open interest changes. The boyz are jerking these numbers around to the point where they are meaningless. The o.i. numbers I just gave you are a case in point.

And it's almost the same for the Commitment of Traders report. In silver, the bullion banks in the Commercial category decreased their net short position by 3,782 contracts...by going long 2,332 contracts and covering 1,450 shorts. The tech funds in the Non-Commercial category sold 3,416 longs and increased their short position by 1,046 contracts...for a net change of 4,462 contracts. For a drop of over $7 in the silver price since July 15th, these changes in open interest should have been much more substantial, as this is the biggest cartel-engineered sell-off in many years.

In gold, things look a little more 'normal'...if you can call what's happening out there by that name. The bullion banks/'8 or less' traders in the Commercial category went long 20,868 contracts and covered 4,791 shorts for a total improvement of 24,659 contracts...whereas the tech funds in the Commercial category tossed another 15,209 longs and went an additional 3,085 contracts short for an 'improvement' of 18,294 contracts. Since the start of the sell-off on July 15th, the Commercials have reduced their net short position from 24.7 million ounces down to 13.0 million ounces as of Tuesday's cutoff...if these numbers can be believed. From now on I will only mention the COTs in my Saturday commentary if there is something worth discussing...and only if the numbers seem believable. Which means it won't be often.

In a story posted at Kitco yesterday, I see that 'Buba'...Germany's Bundesbank..."rejected calls that it should sell some of its gold reserves to help boost the slowing German economy, telling Reuters (that) financial and political uncertainty make the reserves even more important than before...National gold reserves have a confidence- and stability-building function for the single currency in a monetary union. This function has become even more important given the geopolitical situation and the risks present in financial market developments."

Since it's the weekend, I have three stories sitting in my in-box that deserve your attention. The first is a piece from the Washington Post. It has to do with the CFTC and oil speculation. As Representative John Dingell said..."It is now evident that speculators in the energy futures markets play a much larger role than previously thought, and it is now even harder to accept the agency's laughable assertion that excessive speculation has not contributed to rising energy prices." Amen, brother!!! The story is entitled "A Few Speculators Dominate Vast Market for Oil Trading" and the link is here.

Fitting right into that is my second offering...a special report by silver analyst Ted Butler that was released early Friday morning. It was a bombshell. After careful analysis of this new data that Butler dug up, one of Ted's closest associates has speculated that 2 or 3 American banks may have assumed the silver and gold short positions of either non-banks or non-US banks that currently hold huge short positions in the '8 or less' traders category on the Comex. That's probably why the open interest data over the last month has showed no sign of these huge changes in short position that are contained in the CFTC document that Butler highlights. This is all so new, that it's a work in progress. You will understand this a bit better once you read the GATA release of his essay, which is entitled "The Smoking Gun". The link is here.

And lastly, another essay about the American Empire. This is the second piece by Pat Buchanan that I've put up in as many months. It's definitely worth the read, and...as a non-American...I agree with every word of it. It's entitled "Who Started Cold War II?" I thank D. Owen for sending that along. The link is here.

It is difficult to comprehend how the CFTC would allow a trader to acquire such a large oil inventory and not scrutinize this position any sooner. - Rep. John D. Dingell (D-Mich), speaking about the Swiss oil trading company Vitol (No it's not! - Ed)

Today's 'blast from the past' goes back about 35 years. Everyone knows this one. Turn up the speakers and feel free to sing along! The link is here.

Friday was another one of those days where what was happening made little or no sense. As far as gold and silver goes...options expiry awaits on Tuesday...and first day notice is next Friday. Will all stay calm until then? Who knows...but it's a pretty good bet that 'the powers that be' are making all this up as they go along...with fingers in every hole in the dike.

Enjoy what's left of your weekend and I'll see you Tuesday morning.

Casey Research correspondent-at-large Ed Steer is a keen observer of the financial scene and a board member of GATA.org.