Welcome To The Golden Minerals HUB On AGORACOM
Golden Minerals is a junior silver producer with a strong growth profile, listed on both the NYSE Amex and TSX.
Message: Ed Steer this morning
The CME Increases Silver Margin Requirements
Sprott buys 15 million ounces of silver. China downgrades the USA again. 'Da Boyz' are back in town. Robert Zoellick now says he doesn't support a return to the gold standard. The Mogambo Guru speaks... and much more.
Yesterday in Gold and Silver
Everything looked pretty normal when I checked in after I got up late on Tuesday morning. Gold wasn't up a lot, but it was well into positive territory. Silver was screaming to the upside once again. It looked like the shorts were on the run.
But, when I checked the precious metal stocks, I was not at all impressed with the price action. The silver stocks were particularly moribund. I could tell that someone was selling shares into this rally. I immediately thought of the bad old days when a counter-intuitive stock move meant that the precious metals were about to get hammered.
Then, at 1:05 p.m. Eastern time, the selling began in both metals. I'm not sure if it was 'da boyz'... or the big increase in margin requirement for silver that the CME announced yesterday... or a combination of both. I would bet money that both played a part.
From its high [$1,425.50 spot] to its low of $1,381.70 spot just before 4:00 p.m. Eastern time, gold got clocked for $43.80... but recovered some of that before the New York close.
Silver was on fire to the upside... and was already up $1.62 from its Monday close, when the hammer fell. It was obvious that some shorts were covering... and there was an even more obvious danger that the price was going to get away from the bullion banks... and so they decided to act. From its high of the day, to the low print... silver got hit for $2.95. The silver price recovered almost 50 cents going into the close.
Here's the dollar graph for yesterday. A cursory glance indicates that there wasn't much co-relation between what the dollar was doing... and any of yesterday's price action. The prices of both gold and silver were both advancing in the face of a rising dollar. The big sell-off started at 1:05 p.m... and there's nothing in this graph that indicates that the sell-off was dollar related. It was probably all bullion bank related... with a helping hand from the CME.
The HUI topped out at 10:00 a.m. Eastern time... and then began a decline that turned into a rout starting at 1:05 p.m. when the big sell-off started. It was all downhill from there, with a minor bounce going into the close.
Well, the CME Delivery Report showed that a smallish 39 gold and a fairly chunky 153 silver contracts were posted for delivery tomorrow. Here's the link.
The GLD ETF reported a small withdrawal yesterday... 39,066 ounces. But there was monster addition over at the SLV ETF... 3,617,941 ounces. That's a lot.
The U.S. Mint had another report yesterday. They sold another 8,000 ounces of gold eagles... along with another 435,000 silver eagles. Month-to-date totals are 20,500 and 915,000 respectively.
Not to be outdone in the big activity department, the Comex-approved depositories reported a net silver withdrawal on Monday of 1,101,559 troy ounces. The link to that action is here.
While still on the subject of silver, I spoke with John Embry on Monday... and he mentioned that Sprott's new silver ETF has purchased in the neighborhood of 15 million ounces. It remains to be seen how long it takes them to receive it all.
Dennis Gartman had a few things to say about gold in his daily commentary yesterday... "Can gold then double from its present levels? If this data is correct, certainly it can. This is the gold bull’s day in the sun, and the sun may remain shining a while longer it would seem." I thank the usual New York gold commentator for this tidbit.
| Sponsor Advertisement |
|
Secret Asset Class with 18.5% Annualized Gains Ever heard of the A.O.P.? Over the last decade, this secret asset class has beaten out REITs, Utilities, the S&P 500, the DJIA, even gold. In fact, the A.O.P. has outperformed practically every asset class on the market with average, annualized returns of 18.5%. As A.O.P. recipient Rick H. of Hingham, Mass. says, it seems "too good to be true." |
¤ Critical Reads
SubscribeWhen JPM/HSBC Don't Like The Results, The CME Just Changes The Rules: Full Revised Silver Margin Schedule
Today's first story is all about silver as well. As I mentioned earlier, the CME raised margin requirements on silver by 30% on all 5,000 ounce contracts yesterday... effective at the close of business today. Here's a short story on that posted over at zerohedge.com. The letter from the CME is also posted in the article. It's headlined "When JPM/HSBC Don't Like The Results, The CME Just Changes The Rules: Full Revised Silver Margin Schedule". I thank Florida reader Donna Badach for sending it along... and the link is here.
China Downgrades US Again, From AA To A+, Outlook Negative, Sees "Long-Term Recession", Blasts QE2, Expects Creditor Retaliation
It appears that China has downgraded the U.S.A one more time. Here's another article from zerohedge.com that was sent to me by Washington state reader S.A. The longish headline reads "China Downgrades US Again, From AA To A+, Outlook Negative, Sees "Long-Term Recession", Blasts QE2, Expects Creditor Retaliation". The link is here.
ICE Starts Accepting Gold As Initial Margin Collateral For All Energy And CDS Trades
My next gold-related story is courtesy of reader 'David' in California'. Once again it's a posting over at zerohedge.com. This one is headlined "ICE Starts Accepting Gold As Initial Margin Collateral For All Energy And CDS Trades". The ICE acronym stands for Intercontinental Exchange. They are a leading operator of global regulated futures exchanges, clearing houses and over-the-counter (OTC) markets. This is a pretty big deal... and the link to the story is here.
No, The GLD ETF Is Not Overdue To Buy 200 Tons Of Gold
Here's an interesting story that's posted over at businessinsider.com. Everything that you wanted to know about the precious metals ETFs is contained in this article. Reader Kimberly Somers was kind enough to bring it to my attention. The headline reads "No, The GLD ETF Is Not Overdue To Buy 200 Tons Of Gold". I feel that this article is worth your time... and the link is here.
Thanks for the Silver: An Open Letter to JPMorgan and HSBC
Reader Larry Galearis is responsible for today's next story. It's a short essay posted over at silverseek.com by the one and [hopefully] only... Mogambo Guru. The wretched and sniveling little creature that he is, has produced this rather entertaining piece headlined "Thanks for the Silver: An Open Letter to JPMorgan and HSBC". Please don't e-mail Richard and tell him how wonderful it is, because it only encourages him... and his wife is trying to get him to quit. The link is here.
World Bank President: My Words Were Manipulated, I Don't Support A Return To The Gold Standard
Even though he said as much in his op-ed piece in the Financial Times on Sunday, World Bank president Robert Zoellick has now 'clarified' his recent comments about gold. He isn't advocating a return to the gold standard. Gee, I wonder who got to him? Reader 'David in California' just slid that into my in-box as I was about to hit the send button. The short story is posted over at businessinsider.com... and bears the headline "World Bank President: My Words Were Manipulated, I Don't Support A Return To The Gold Standard"... and the link to this very short read is here.
Deregulation set to lift China gold demand
Here's another gold-related story from reader 'David in California' that he just popped into my in-box. It's a Reuters piece that was filed earlier today from Singapore. It's posted over at the South African website sharenet.co.za and bears the headline "Deregulation set to lift China gold demand". It's a bit on the longish side, but well worth the read... and the link is here.
How I learned to stop worrying and love 'inflation'
My last three stories are all GATA releases... as I'm running late this morning [plus I have a splitting headache] and don't have time to wordsmith the preambles myself... so I'm taking the easy way out today. The first is something from Ben Davies of Hinde Capital Management headlined "How I learned to stop worrying and love 'inflation'... and the link is here.
Gold Mining Stocks Are Still Cheap
The next GATA release is a piece by James Turk that bears the headline "Gold Mining Stocks Are Still Cheap"... and the link is here.
Three's Company -- Silver Margin Change
Lastly today is commentary posted over at King World News on yesterday's increase in silver futures contract margin requirements. Omnis Inc. market analyst Jim Rickards warns traders that futures exchanges will change the rules on them whenever the exchanges or the government need an advantage -- that the power to change the rules is itself a rule. Rickards' commentary is headlined "Three's Company -- Silver Margin Change" and you can Jim's blog linked here... and is today's only must read commentary.
¤ The Wrap
Although textbooks may view gold as the old money, markets are using gold as an alternative monetary asset today.- Robert Zoellick, World Bank President and former US Treasury official, 08 November 2010
Yesterday was a wild one. As I've said a few times over the last week or so, you can expect the precious metals prices to be 'volatile'. When the not-for-profit sellers are lurking about, that comment is a given. Volumes yesterday were monstrous. Gold volume was well north of 300,000 contracts net of roll-overs. In silver it was an incredible 200,000+ contracts... 175,000 net... which is the biggest silver volume number I've ever seen. The open interest numbers when they're reported later this morning, should be a sight to see.
Since a lot of volume occurred late in the Tuesday trading day yesterday, it will be interesting to see how much of it was withheld from yesterday's volume figures... and won't make it into Friday's Commitment of Traders report... and will be reported in Wednesday's volume figures instead. As you are aware by now, this is a little trick that the bullion banks love to pull.
Both gold and silver are making very decent recoveries in overseas trading at the moment... starting in the Far East time period... and continuing into the London open.
I won't hazard a guess as to what's going to happen during New York trading today, but whatever it is, it will be interesting to watch.
See you on Thursday.
New Message
Please
login
to post a reply