I have two simple responses to the opinions of Mike Bolser. First, he has been advocating shorting gold since the $413 price level. Which suggests to me that he is like Prechter, another stubborn gold bear, in that he cannot admit he was wrong and has missed most of the gold bull market, so why believe anything he has to say now?

Secondly, the bullion banks have been able to make money by playing the short term trend and then hammering the market with shorts and bear raids on the downside. They are now almost net long gold for the first time during this bull market. IF there was indeed a plan underway to unload a massive gold position this week, the bullion banks would be in on it, and would be shorting ahead of that move. They are not, so I doubt it is more than just noise. I would also add that the IMF is not able to sell any gold without approval from the member countries, and Italy is bound by the Washington agreement limiting total central bank sales to just 500 tonnes per year. So the notion that 3000 tonnes will hit the market is pure nonsense.

I do agree that the CBs are hostile to gold and would consider any attempt to sabotage the spot market and drive gold lower. However, I disagree that they have access to the physical bullion to crush gold now. The premise that a COMEX squeeze would make it an ideal time to strike and "mercilessly slash"the retail gold bulls is also nonsense. One need only consider the open interest on the COT report to see that the speculative long position in gold futures is near the lows for the entire gold bull market. There are fewer specs to attack now than ever before, in other words, and therefore the value of a raid now is much lower (hence the major bullion banks are at the lowest net short position in years). Refering to the strong demand for retail bullion is also a red herring, since those who buy retail bars of physical bullion are immune from the raids on the futures market.

This guy will be discredited. I doubt there is any big selloff coming for gold. Those who talk dont know, and those who know dont talk...

cheers!

mike