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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
Dutch Central Bank: Pension Fund Must Sell Gold
SLV adds more silver...and the Comex ships out more silver. Silver Backwardation for Years, Possible Hyperinflation - James Turk. "The Rarest Earth"...an essay by silver analyst Ted Butler...and much more.
¤ Yesterday in Gold and Silver
The gold price was under pressure pretty much through the entire Far East and London trading session on Thursday...with the low of the day coming shortly after the Comex open at $1,350.50 spot.
Shortly after 10:30 a.m. Eastern, gold finally caught a bid...with gold's New York high coming a few minutes before 11:30 a.m. at $1,367.40 spot. From there, it basically traded sideways into the close of electronic trading.
Silver traded mostly unchanged until around 1:00 p.m. Hong Kong time on Thursday. From that point, the selling pressure really began in earnest. Silver's low came shortly after 11:00 a.m. GMT in London...and traded sideways until it's New York low of $29.69 around 8:35 a.m. Then silver also caught a bid...and hit its zenith [$30.32 spot] shortly before lunch...and then closed a bit lower than that in electronic trading at 5:15 p.m. Eastern.
The dollar went on a bit of a tear yesterday...opening around 77.60 in early Thursday morning trading in the Far East...and had tacked on about 60 basis points by the close of trading in New York.
It's easy to attribute most of gold's and silver's decline in Far East and early London trading to the steady rise of the dollar...but that doesn't explain the big rallies in both metals that occurred in early morning trading in New York, as the world's reserve currency continued to rise.
The gold shares pretty much followed the gold price action on Thursday...and although they recovered somewhat from their absolute lows, the HUI still finished down 0.83%...despite the fact that gold finished unchanged from Wednesday. This is very similar to the HUI action on Wednesday, even though gold finished unchanged from Tuesday...which you can see on the gold chart above.
The CME Delivery Report showed that 87 gold and 63 silver contracts were posted for delivery on Monday. All the major New York bullion banks were in attendance...and the link to the action is here.
The GLD ETF showed another decline yesterday. This time it was 29,270 troy ounces. But over at the SLV ETF they had a fairly chunky addition...585,976 ounces of the stuff.
The U.S. Mint had smallish sales report yesterday...adding another 2,500 ounces of gold eagles along with 40,000 silver eagles. Month-to-date gold eagle sales are 26,500 ounces...and 937,000 silver eagles.
Another chunk of silver was withdrawn from the Comex-approved depositories on Wednesday. This time it was 383,690 troy ounces...and the link to that action is here.
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¤ Critical Reads
SubscribeGet ready for higher food prices
Today's first story is courtesy of Washington state reader S.A....and is posted in yesterday's edition of the Omaha World-Herald. The headline reads "Get ready for higher food prices"...Warnings of higher food prices headed for American supermarkets and restaurants were swallowed easily across much of farm country Wednesday. The big gulp came when the U.S. Department of Agriculture reported that global demand had pushed U.S. corn supplies to their lowest point in 15 years. The story is worth your while...and the link is here.
Ron Paul Says Next US Crash Will Be Comparable To That Of Soviet Union, Claims QE2 Is "Total Failure" And Fed Is A "Central Planning Cartel"
The next piece is also from Washington state reader S.A. It's a posting over at zerohedge.com that's headlined Ron Paul Says Next US Crash Will Be Comparable To That Of Soviet Union, Claims QE2 Is "Total Failure" And Fed Is A "Central Planning Cartel". Not too many shades of gray here. The piece contains a couple of video clips as well...and the link is here.
Spain orders drastic caja clean-up to win confidence and fight off EMU debt contagion
Yesterday I ran a story about record Portuguese bond yields. Now Spain is trying to prevent this from happening to them by getting their financial house in order. This is Roy Stephens' first item of the day...and it was filed late last night in The Telegraph. It's an Ambrose Evans-Pritchard offering headlined "Spain orders drastic caja clean-up to win confidence and fight off EMU debt contagion". Spain has imposed draconian rules on its saving banks and is preparing for part-nationalisation of the industry to restore confidence and boost the country’s defences against contagion from the debt crisis in Portugal. The link to the story is here.
Prominent Chinese Economist Advises Country To Sell Its $500 Billion In GSE Holdings Before QE2 Ends
Reader U.D. came up with today's next read. It's another zerohedge.com offering that's headlined "Prominent Chinese Economist Advises Country To Sell Its $500 Billion In GSE Holdings Before QE2 Ends". This plan would dovetail nicely with every TIC [Treasury International Capital] report that China continues to sell its agency debt...as well as lowering its U.S. Treasury holdings. The link is here.
Vietnam Devalues Dong by 7%, Risking Faster Inflation
The next story was filed from Ho Chi Minh City in Vietnam earlier this morning. It's a Bloomberg piece headlined "Vietnam Devalues Dong by 7%, Risking Faster Inflation"...and its courtesy of Russian reader Alex Lvov. Vietnam’s fourth devaluation in 15 months takes place with its inflation rate at the fastest in almost two years, and with the IMF describing its foreign-currency reserves as being “low.” No wonder the Vietnamese people are rabid gold buyers. The link to the story is here.
US and Egypt trade barbs as tension mounts in Cairo
Egyptian correspondent, Roy Stephens, has three stories about the continuing uprising in that country. The first is found posted over at the france24.com website...and is headlined "US and Egypt trade barbs as tension mounts in Cairo". The link is here.
Egypt Strikes Continue as Doctors, Lawyers Join Protests
Roy's second story on Egypt is an AP story that's posted over at the huffingtonpost.com website. It's headlined "Egypt Strikes Continue as Doctors, Lawyers Join Protests"...and the link to this very short piece is here.
Mubarak Refuses to Step Down, Stoking Revolt’s Fury and Resolve
The last story regarding Egypt is this item from yesterday's edition of The New York Times, where the headline reads "Mubarak Refuses to Step Down, Stoking Revolt’s Fury and Resolve". The declaration by Mr. Mubarak that he would remain president appeared to signal a dangerous escalation in one of the largest popular revolts in Egypt's history, and some protesters warned that weeks of peaceful rallies might give way to violence as early as Friday. It's a longish read, but worth it, in my opinion...and the link is here.
Dutch Central Bank: pension fund must sell gold
Today's first gold-related story was first sent to me by reader 'David in California'...and then ended up as a GATA release later in the day. The rather disturbing AP story was picked up by Bloomberg with a headline that reads..."Dutch Central Bank: pension fund must sell gold". I'm sure we'll hear more about this as the days unfold...but I'm not reading a lot into it at the moment. If they're smart, they'll take that money and buy silver with it. Here's the link to the GATA release on this, as I can't find the story on Bloomberg anymore.
Interview With Cazenove Capital Management's Robin Griffiths
Next is a King World News audio Interview With Cazenove Capital Management's Robin Griffiths. Eric said that it's mainly about gold and silver...and runs about 11 minutes or so...and the link is here.
Turk -- Silver Backwardation for Years, Possible Hyperinflation
Here's another piece that was posted over at King World News yesterday...and I'm just going to steal Chris Powell's preamble, plus post the link. "GoldMoney founder and GATA consultant James Turk tells King World News that silver is in unprecedented backwardation and he expects a massive short squeeze and possibly declaration of force majeure to rescue the shorts. Excerpts from Turk's interview are headlined "Turk -- Silver Backwardation for Years, Possible Hyperinflation". It's certainly worth your time...and the link to the blog is here.
The Rarest Earth
Lastly today is this piece by silver analyst Ted Butler that's posted in the clear over at the investmentrarities.com website. The rather provocative headline reads "The Rarest Earth". Ted is, of course, referring to silver...and I'm not prepared to argue with him on this. It's a must read from one end to the other...and the link is here.
¤ The Wrap
The ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influence, are usually the slaves of some defunct economist. ~ John Maynard Keynes
It was basically a nothing sort of day in the precious metals market yesterday. Despite the dollar's strength, both gold and silver managed to recover all their loses and close basically unchanged on the day.
Gold's preliminary volume figures from the CME website shows that around 123,000 contracts net of all roll-overs were traded yesterday. Silver's net volume was slightly under 60,000 contracts. Based on the preliminary open interest numbers, I'd say that gold's o.i. will be up slightly...and silver's o.i. could be up quite a bit when the final numbers are posted later this morning.
Surprisingly enough, Wednesday's final open interest numbers in gold showed a rather healthy decline of 7,383 contracts...and in silver, o.i. was down a smallish 357 contracts.
Today at 3:30 p.m. sharp is the latest Commitment of Traders report for positions held at the close of trading on Tuesday, February 8th. Based on the fact that prices rose during most of the last reporting week, Ted Butler is expecting an increase in the bullion banks' short positions...especially in silver. At the appropriate time, you can click here to view the report.
Price action...and trading volume...was pretty quiet in both metals during the Friday trading session in the Far East...and this lack of activity has continued into the London trading day as well. The dollar is still trending higher...and is up about 20 basis points as of 3:57 a.m. Eastern time.
As Ted pointed out yesterday in this column, it's still possible that the New York bullion banks could pull the pin on this rally and harvest all the longs that have been placed since the lows back on January 28th. If this is their plan, we won't have long to wait to find out. Silver is up almost four dollars from that low...and gold is up about fifty-five dollars, so there is some incentive to do the dirty if they so wish. But can they or will they...especially in the face of the class action lawsuit against the two big crooks...JPMorgan and HSBC USA. And don't forget this rather serious silver backwardation situation as well.
So it could be an interesting day during New York trading on the Comex.
There's still time to either readjust your portfolio...or get fully invested in the continuing major up-leg of this bull market in both silver and gold...and I respectfully suggest that you take a trial subscription to either Casey Research's International Speculator [junior gold and silver exploration companies], or BIG GOLD [large producers], with all our best [and current] recommendations...as well as the archives. A subscription to the International Speculator also includes a free subscription to BIG GOLD as well. And don't forget that our 90-day guarantee of satisfaction is in effect for both publications.
I hope your weekend goes well...and I'll see you here tomorrow.
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