From Ed Steer:

Both gold and silver had their lows early in the trading day on Thursday morning. The low in gold was during Globex trading when the New York bullion banks have the run of things...when their counterparty is a gold trader on his cell phone in Western Samoa someplace. Anyway, the low for gold was shortly before Sydney opened on Thursday morning...and the low for silver occurred a few hours later.

From there, both metals rallied slightly, but the real action didn't start until the Comex opened for business at 8:30 a.m. in New York. Once New York began to trade, both gold and silver tacked on some nice gains...but they ran into the proverbial brick wall once London closed for the day at 11:00 a.m. New York time. After that, the gold and silver markets were comatose.

The usual N.Y. commentator said that..."Today was essentially a nightmare for the Bears: strong buying on the Comex open had June gold up $10.20 at its high, and it closed up $8.00 at $961.50. Estimated volume was 175,904 contracts. The HUI closed up 4.15% and the XAU up 4.24%. The charts could not be friendlier."

Wednesday's open interest numbers show huge volume once again...most of which was switches and spreads. In gold, o.i. rose a smallish 1,341 contracts to 398,306 on big volume of 262,718 contracts. In silver, o.i. was up a more substantial 2,535 contracts to 100,655 on pretty big volume...28,427 contracts. The new COT [for positions held at the end of Tuesday's trading] will be out at 3:30 p.m. Eastern time today...and I'll report on its contents tomorrow.

Not a lot to report in gold and silver news. Yesterday was the last day for delivery into the May contract. In an un-exciting finish to the month, 54 gold contracts and 18 silver contracts were delivered. All the commentators on the Internet talking about a delivery squeeze in either gold and silver in May were again disappointed. How many months in a row is that now? There were no changes from the U.S. Mint. I doubt there will be any changes today either. The amounts in the SLV and GLD remain unchanged. With all the activity during the last couple of days, I'm sure that both GLD and SLV are owed a fair chunk...especially SLV...which must be owed in the tens of millions of ounces, if past history is any guide. And lastly, the Comex-approved warehouse stocks in silver rose 196,637 troy ounces yesterday.

It wasn't a big news day yesterday, but what there was, was centered around the Treasury market and the U.S. dollar. The talk of "Quantitative Easing"....monetizing the debt...creating money out of thin air...call it what you will, has people talking more and more about hyperinflation, Zimbabwe...and the U.S.A...all in the same sentence or paragraph. It's obvious that some people are getting spooked, and it should be no surprise that gold and silver are doing well.

Today's first story is from usatoday.com. It shows the frightening decline in U.S. Federal tax revenue in April 2009...down $138 billion, or 34% from April 2008. The deficit can only be funded two ways...either borrow it or print it. Which will it be? I, once again, thank Craig McCarty for the story. The headline reads "IRS tax revenue falls along with taxpayers' income" and the link is here.

The next story is from The Telegraph in England and is by Ambrose E-P. He states that "The US Federal Reserve may soon be forced to launch a fresh blitz of quantitative easing whatever the consequences for the US dollar, or risk seeing economic recovery snuffed out by the latest surge in long-term borrowing costs." The headline reads "Bond markets defy Fed as Treasury yields spike" and the link is here.

The last story is from chinadaily.com. "Bitten by the gold bug, Chinese investors are now rushing to hoard the yellow metal as fears over the global recession deepen." The headline says it all..."Gold fever grips Chinese investors"...and the link is here.

Blessed are the cracked...for it is they who let in the light. - Author Unknown

As I put the finishing touches on today's rant, I note that gold and silver are up nicely in early morning trading in London. Of course, I'm just as happy as you are...as I watch my net worth increase by nice increments every day...but I never forget for one instant that the buying that's driving up the price of both gold and silver right now, is being met by equally determined sellers, as the U.S. bullion banks et al go short against all longs. They are the only parties willing to go short in this environment...and they're still in total control of this market at this moment...until they're not. I'd love to see them get overrun...and watch the prices of both gold and silver head for the stars. It hasn't happened yet, but it could. Someday it will...and when it does, the party will be at Ted Butler's place!

All of us at Casey's Daily Resource Plus hope you have a great weekend, and we'll see you right here on Saturday.

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