Finally, regarding gold, our friends at

TheBullionDesk.com reported “massive turnover”

yesterday on the London PM fix, and that we found

rather interesting for the “fix” is where central banks

have tended in the past to make their trades. Central

banks like to use the “fix” because they can buy large

sums of gold in sizes that cannot be done elsewhere

without having a very real market effect. Further, the

gold traded on “The Fix” is in deliverable position in

one of the secure vaults associated with the London

market, if they cannot buy gold in large size from the

IMF for example. Yesterday, 4.8 tonnes of gold were

bought, and although not a record, this is one of the

larger sums of gold traded on “The Fix” in a very long

while. If not central bank buying, then someone of size

was involved.

While on the topic, we note that the Gold SPDR ETF

saw its holdings of gold rise 17.34 tonnes to 1209.5

tonnes yesterday, which if not a record, is close. This is

consistent with a report from the Australian Mint which

reported yesterday that it

has sold 243,500 ounces

of gold in the form of coins

and bars in the past two

weeks, characterizing this

as “panic” buying out of

Europe. The buying from

the Australian Mint was

more in this two weeks

than they had sold in the

entire first quarter of the year… so this is either

Dec Corn

impressive or disconcerting, depending upon how

much one wants to see this as ill-informed late buying,

or sophisticated, hedge fund buying.

Is gold over-wrought on the upside? Is this a Bubble

that is likely soon to break? Should we be cautious. In

turn: Maybe, but not likely: No, probably not; Yes… as

always, but we need to be long nonetheless. We are

long of gold in non-US dollar terms, and that has

served us very, very well. Gold is becoming more and

more volatile, passing $10-$15/oz in a matter of

moments, both to the upside and the down, but that is

a matter of price and percentage. A 2% move at

$1250/oz is much larger than a 2% random noise

move at $600/oz. But in reality, since Tuesday, gold

has acted quite rationally, rising swiftly, correcting midday,

and rising again. The public is not involved yet;

indeed, the public is selling gold not buying it, as

evidenced by the fact that there are as many

advertisements on television touting the opportunities

one might have in selling one’s gold in old rings,

heirlooms and the like as there are touting gold as an

investment. Until such time as the latter

advertisements dwarf those of the former, the Bubble

has not yet been blown: