From Ed Steer:

Well, there's not a lot to discuss when it comes to Monday's gold activity. You'd have to be deaf, dumb, blind and stupid not to recognize that there were no free-market price mechanisms at work in either gold or silver yesterday. The usual N.Y. commentator said it all..."World gold was bashed down $10 immediately after the Indian foreign exchange market close at 6:30 a.m. N.Y. time [a point in the day which seems to be getting more volatile]. Faced with Washington's politicization of the auto industry, the concomitant Wall Street swoon, and stories about the Chinese and Russians seeking to boost the foreign exchange role of gold at the expense of the dollar, gold leapt $18 in 45 minutes after 9 a.m. N.Y. to up $9.40 on the day--only to be capped by massive selling. By 10 a.m., estimated volume was 98,582 lots...and this jumped another 32% by 11 a.m. After the London p.m. gold fix of $928...and as London was closing...heavy selling reappeared to take gold down $15.50 in 20 minutes. Comex floor trading closed down $7.60 on the day. Estimated volume was 177,150 contracts with a switch effect of 18,304."

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Silver's chart was similar. The precise bottom for the silver price was the London silver fix which occurred at noon London time...7:00 a.m. in New York. You could have set your watch by this one. Silver rose strongly from there until shortly before London closed for the day...and, like gold, it was lights out after that. Even Richard Russell was in full cry about it...yelling 'central bank interference'. [Note to Richard: It's JPMorgan Chase and HSBC USA...both are bullion banks. - Ed]

Open interest changes for Friday's trading activities are as follows...gold o.i. fell 627 contracts, and silver o.i. rose 300 contracts. There was huge volume on Friday, but most of it was switches. Monday's o.i. in both gold and silver should be interesting when they come out later this morning. And I think we should count our blessings that the PM stocks did as well as they did...considering the pounding that gold...and the general stock market took.

In other gold news, there were only 51 gold contracts delivered yesterday...50 of them by Prudential Bache. The biggest stopper was Fortis Clearing with 39. In silver, 160 contracts were issued by several firms and there were a pile of companies that were stoppers. Monday was the last delivery day for the March contract. I've had several e-mails over the last few days asking me what an issuer and stopper is. It's trading jargon. An 'issuer' is a company that delivers a contract[s]...and a 'stopper' is one that accepts a contract[s]...sellers and buyers, if you will. I have attached the link to the Chicago Mercantile Exchange that shows that data that I provide. There are three columns...Gold [GC]...Silver [SI] and Copper [HG]. The two sub-headings for each are DEL and ACC...delivery and acceptance. The list of companies involved in that days' trading is on the left. This pdf file updates daily. The above data is for March 30th...Tuesday's delivery numbers will probably be the ones you see when you click here.

I have more precious metals news. The Comex-approved warehouse stocks in silver showed no change on Friday...and Monday it showed silver stocks down a trivial 9,884 ounces. However, over in Switzerland, it was another good week for the ETFs at Zürcher Kantonalbank. Their gold stocks rose 144,494 ounces, and their silver bullion stash added another 499,398 ounces. As of last Friday's numbers...ZKB was holding 4.36 million ounces of gold and 44.18 million ounces of silver. I once again thank Carl Loeb for these numbers. As far as I can tell, there were no changes in either GLD or SLV yesterday. But the U.S. Mint...bless their dear little hearts...put out another update on March's eagles production yesterday. I was fully convinced [and said so] that last week's mini-update on Thursday would certainly have been the last for March. Wrong again! One ounce Gold eagle bullion coin production rose another 26,000 to 129,500. And in silver...drum roll please...they minted another 682,000; bringing March's total up to an absolutely stunning 3,132,000 silver eagles...that's almost 100 tonnes of silver! Total year-to-date mintings are 7,157,000!!! I know quite a few full years that didn't do those kind of numbers...and they've done it in just the first quarter of 2009! Are they trying to flood the market?

Today I'm going to spend some time on the latest derivatives report [Q4/08] issued late last week by the Office of the Comptroller of the Currency [OCC]. Five U.S. banks, hold 96% of all U.S. bank derivatives positions in terms of nominal values, and an eye-popping 81% of the total net credit risk exposure in event of default. The five are, in declining order of importance: JPMorgan Chase which holds a staggering $88 trillion in derivatives. Morgan Chase is followed by Bank of America with $38 trillion in derivatives, and Citibank with $32 trillion. Number four in the derivatives sweepstakes is Goldman Sachs with a ‘mere’ $30 trillion in derivatives. Number five, the merged Wells Fargo-Wachovia Bank, drops dramatically in size to $5 trillion. Number six, Britain’s HSBC Bank USA has $3.7 trillion. Below is a table of numbers [courtesy of lemetropolecafé.com] that includes the derivatives holdings of the top 25 U.S. banks.

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The same report [Page 30, Table 9...pdf link below] shows that U.S. bank JPMorgan Chase holds $82.4 billion in gold derivatives...77.1% of the entire U.S. banking system total. HSBC USA carries $19.2 billion in gold derivatives...18.0% of the entire U.S. banking system total. Citibank has an inconsequential 4.4%. The Bank of America has the other 0.5%. And in silver...the numbers are an even bigger surprise. JPMorgan holds about $3.5 billion in silver derivatives...46.3% of the U.S. banking system total...and HSBC USA holds around $3.9 billion in silver derivatives...52.2% of the U.S. banking system total. Bank of America and Citibank hold $500 million in silver derivatives between them. No other U.S. bank has any gold or silver derivatives at all...zero, none, nada, zip, zilch, squat!!! Any questions? JPMorgan is the custodian of the silver ETF...SLV; and HSCBC USA is the custodian of the ETF...GLD. The link to the lastest [and all prior] quarterly reports of the OCC is here. Ted Butler's must read essay on this issue is featured below.

Before continuing on to the feature stories of the day, John Grandits here at Casey Research sent me the latest touchy-feely AIG TV commercial that just came out. The question is...will the public believe them. Do you, dear reader, think it’s got a chance...tee hee! The link is here.

I don't know how many stories I've got today. I'm just going to close my eyes and run them all. They are all extremely worth your while, or I wouldn't show them here...but, as always, it's your call.

The first is a Bloomberg story that just came out about six hours before I typed this. The headline reads "China, Argentina Reach Agreement on Currency Swap". The agreement extends China’s efforts to reach economic accords that don’t involve the dollar. "The yuan is one of the currencies with the greatest potential and has a significant role to play in the current redesign of the international monetary system," Argentina’s central bank said. I thank Craig McCarty for the story. The link is here.

The next story is from Reuters. It's the usual canard about IMF gold. The headline reads "G20 leaders to discuss IMF gold sales - source". Ever since the price of gold started to perk up back in 2001, the IMF gold story has been trotted out occasionally to squash any enthusiasm. It used to work...but not anymore. The link is here.

Next is a story out of the Washington Post. It has the very provocative title..."Welcome to America, the World's Scariest Emerging Market". It's well worth reading...and the link is here.

In a story out of The Telegraph in London, I see that the G-20 meeting is about to get off to a bad start. "In an embarrassing disclosure, a draft of the final communiqué to be signed off by world leaders at the end of the one-day gathering on Thursday appeared in the German magazine Der Spiegel. There were suspicions that the leak was a deliberate act of sabotage by sources within the German government, where Chancellor Angela Merkel is adopting a more cautious approach to fiscal moves to boost the national economy than British Prime Minister Gordon Brown, who will chair the summit." The headline reads "G20 summit: blow for Gordon Brown as £1.4 trillion spending blueprint is leaked". The link is here.

Another story out of The Telegraph is this offering by Ambrose Evans-Pritchard. "Russia has become the first major country to call for a partial restoration of the Gold Standard to uphold discipline in the world financial system." The headline reads "Russia backs return to Gold Standard to solve financial crisis". The link is here.

The second last story just popped in my in-box a few moments ago. It's a Reuters piece about retail bullion demand...and it's off the charts. The headline reads "Mints coin it as consumers scramble for gold". Well worth the read of course...and the link is here.

And lastly...silver analyst Ted Butler's latest commentary. Ted drills down deeply into the derivatives numbers from the Office of the Comptroller for the Currency for Q4/08, and makes some astounding discoveries. Butler concludes that the U.S. Government, operating through its usual agent, JPMorgan Chase, "intentionally cheated silver investors worldwide of many billions of dollars during the fourth quarter of 2008 and longer...It was a scam of historic proportions." Butler's new essay is headlined "The Sting"...is a must read...which you can find linked here.

While the crash only took place six months ago, I am convinced we have now passed the worst and, with continued unity of effort, we shall rapidly recover. - President Herbert Hoover, 29 June 1930

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I see, as I put this to bed, there's an early morning story in The Times of London that French President Nicolas Sarkozy is threatening to walk out of the G20 summit because France will not accept an agreement that produces a "false success with language that sounds good but contains no commitments." And you wonder why I keep hammering away at you to buy all the physical gold and silver that you can afford. Today is the last trading day of the month...and the quarter. I see that the S&P futures are up a couple of handles. It should be a wild and woolly one!

See you on Wednesday.

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