I am sick and tired of Dennis Garman’s bombastic rants bout "gold bugs and conspiratorialists." He continually pontificates about us as if we were some way off base lunatic fringe group with no evidence to back up our claims gathered over 9+ years. All he is doing is catering to his clients which probably includes the likes of Barrick Gold and some of the bullion banks like Goldman Sachs. And he constantly does so by taking some of our points out of context.

What he wrote yesterday was about as silly and "COMICAL" as it gets, as he seems to know less than nothing about the gold market. I will speak for myself here, as having pointed out the incredible demand the past month for physical gold from India and Dubai gold sources. Yet, the gold price plunged as if sellers couldn’t give the stuff away. Something was way out of whack, still is. The out of whackness was highlighted by Ted Butler’s gold expose…

"3 U.S. banks held a short position of 7,787 contracts (778,700 ounces) in July, and 3 U.S. banks held a short position of 86,398 contracts (8,639,800 ounces) in August, an eleven-fold increase and coinciding with a gold price decline of more than $150 per ounce. As was the case with silver, this is the largest short position ever by US banks in the data listed on the CFTC’s site. This was put on as one massive position just before the market collapsed in price."

Do you think Dennis G would give these startling revelations any time of day? Course not. Instead, he goes out of his way yesterday to mock our camp because we noted that US demand for American Eagle gold coins was so phenomenal that the Mint was forced to stop distributing them. Mr. G…

Turning to the precious metals, with the dollar continuing its bull run, gold, silver, platinum and palladium are continuing their bear run. Certainly we are glad to be out of the precious metals market, for we had been long standing gold market bulls until late last month when gold failed so miserably at the $930 level. Having failed to push to new highs amidst the growing cacophony of ill economic and political news that should have send gold markedly higher, we hauled in our "bull" sails and hoved to the sidelines. We are there still. It is our stated intention to sell gold short on a rally of some consequence that might hopefully take spot gold back toward the $880 - $905 range, but we are less and less certain that we shall get that price given the market's technical condition. For now, the sidelines remains a comfortable harbour.

Finally, last week much was made by the Gold Bugs and the "Conspiratorialists" who populated the bullish side of the market that the US Mint had stopped selling gold coins. The "Bugs" were convinced that this was the signal they had long awaited that the US government's manipulation of the gold market was finally proven. They were convinced that there is less gold in the government's coffers than is reported, and that the Mint's decision to stop coin sales is the first clear reflection of that shortage.

However, the Mint has dashed those hopes noting that there is something far more prosaic at work here than evidence of market manipulation: the Mint has suspended gold coin sales because they've run out of the "blanks" needed to forge the coins. Literally, the stamping tools needed by the Mint are in short supply. According to the Mint's statement

Because our vendors are not able to supply enough one-ounce gold bullion blanks to meet the unprecedented demand we are experiencing, the United States Mint notified our authorised purchasers on August 14, 2008, that we must temporarily suspend sales of the 2008 American Eagle One-Ounce Coin. However, one-half ounce, one-quarter ounce, and one-tenth ounce 22-Karat American Eagle Gold Bullion coins are still available to authorised purchasers and are in stock at the United States Mint. In addition, one-ounce American Buffalo 24-karat gold bullion coins are still available... and are in stock at the United States Mint.

The Mint said that simply that the suspension is due "to a shortage of blanks from its suppliers." The "Bugs" were convinced... truly and utterly convinced... that there has been a fully fledged conspiracy regarding the insufficiency of gold in the US government's coffers, made evident by the shortage of coins for sale. We find the conspiratorialists to be, shall we say,... well, they are conspiratorialists, convinced that some evil cabal manipulates gold at every turn. We think the government has more important things to be concerned with than testing the Gold Bugs. There are wars, and rumours of wars, and famines, and global cooling, and the like. Gold's problems are a gnat in the government's eye. So, we found it nearly comical that the US Mint said that the shortage was due to a shortage of blanks needed to mint the gold it has ready for coinage; there is no shortage of gold; there is a shortage of the minting devices as the public rushes to own gold coins. How prosaic... how mundane... how utterly unimportant is that? Were it not so prosaic it would be comical.

-END-

You missed the point completely DG. With physical market demand surging all over the world, and every reason in the world to own physical gold, the price should have gone up, not down like it did. A FEW banks forced the price down. That is what the EVIDENCE reveals. At least GATA knows what is going on here. Dennis Gartman remains clueless.

They say curiosity killed the cat. DG has no fear of ending up like some cats. For if he had any curiosity, he might want to find out, as James Kirby points out, JP Morgan, the bank so close to the Fed, has 93 billion worth of gold derivatives on their books as of the first quarter of this year, according the Office of the Comptroller of the Currency.

Geez what a surprise that JP Morgan, the Fed’s bank, is up to their eyeballs in gold derivatives. DG, want to make a bet over whether Morgan is one of the banks who increased their derivatives 11 fold? Give you great odds!

On a positive note my niece’s husband, and a very successful VP of a private equity firm, whom I had the fun to talk to here up at BIG BEAR, had a business luncheon recently with someone from Merrill Lynch, another executive, and a prominent gold dealer. My niece’s husband asked the gold dealer if he had ever heard of me and GATA … not knowing what to expect. Still, HE was surprised about the response. The gold dealer told him that people thought we were nuts, or off base for years, but most dealers now believe we were right all along. Perhaps Dennis Gartman ought to talk some independent gold dealers, not aligned with the bullion banks, about what the real deal is. Might help his GOLD trading.