The gold price was down about five bucks for most of the Far East trading day...and into early London trading as well.

But, by the Comex open, it was back to being basically unchanged from its Tuesday close. Then, around 10:30 a.m. Eastern, the gold price tacked on about $15 in very short order before a seller showed up [or the buyer disappeared] once the price poked its nose through the $1,550 spot price level.

That was its high of the day...and the gains began to get whittled away from there, until the gold price ran into the same not-for-profit seller that silver did in the thinly-traded New York Access market after 3:30 p.m. Eastern time.

Gold then dropped ten bucks in just a few minutes...and closed the electronic trading session up only five dollars. Volume was not overly heavy.

Looking at the silver chart, it's hard to believe that its price action occurred on the same day that gold was up over $15 at one point.

Silver was down fifty cents by the time that the Comex opened at 8:20 a.m. in New York...then got sold off another fifty cents by 10:15 a.m. From there, the silver price rallied like gold...but did not even get above Tuesday's closing price.

Then, like gold, silver got sold off until 3:35 p.m. when JPMorgan et al pulled their bids...and silver 'fell' over a dollar in just fifteen minutes, closing the New York trading day just under $37 spot. From its high to its low, silver got clocked for $2.40. Volume wasn't overly heavy.

Here's the New York spot silver chart on its own that shows the Comex activity in much more detail.

Despite all the bad economic news and the dollar rally, it was obvious that JPMorgan was really after silver. Gold was up 0.31%...platinum was only down 0.66%, with palladium down 1.03%. Silver got it in the neck...down 4.29%.

The dollar opened around 74.60 in early Far East trading yesterday...and slowly declined from there, reaching its nadir at 11:30 a.m. Eastern.

From that low, the dollar rallied about 65 basis points...and closed the New York trading session at 5:15 p.m. virtually on its high of the day.

The top in the gold and silver price came around the same time as the dollar bottomed. But it's obvious that if the bids hadn't been pulled at 3:35 p.m. yesterday afternoon, the gold price would have closed much higher, despite the rally in the dollar.

Despite gold's nice rally, the gold stocks barely made it into positive territory...and then rolled over at the first hint that the gold price was under pressure. The ten dollar drop in the gold price at 3:30 p.m. is more than obvious...as the HUI shed a percent in just a few minutes. The HUI finished down 1.88%.

The silver stocks got hit pretty hard...but, considering the fact that silver was down 4.29% on the day, it could have been worse.

The CME's Daily Delivery Report showed that 149 gold, along with 2 silver contracts, were posted for delivery on Friday. The big issuer in gold was Prudential, with 129 contracts delivered...and the big stopper was JPMorgan with 127 contracts received. The link to the action is here.

The GLD ETF showed an increase of 68,216 ounces yesterday...and their was no reported changes over at SLV.

The U.S. Mint started off the month of June with a small sales report. They sold 15,000 ounces of gold eagles yesterday...all of the 1-ounce variety. There were no sales of gold buffaloes or silver eagles.

The Comex-approved depositories did not report receiving any silver on Tuesday...but shipped 257,458 troy ounces of the stuff out the door. There was also a big transfer of silver from the Registered category into the Eligible category over at Scotia Mocatta. The link to this activity, which is worth a look, is here.

In response to the story on falling real estate sales and prices that I ran in this column yesterday, I received the following comments from reader M.H. in California..."

I've mentioned before that besides being a small bullion dealer, I own a construction company. I'm in what they call the Inland Empire of California which covers Riverside and San Bernardino Counties. We have one of the biggest foreclosure problems in the nation. This will become even more evident as more of the shadow inventory, etc...is revealed. BTW - For every for sale sign, there are twice as many vacant homes...or homes being occupied by squatters, or people still residing in homes that they haven't made a mortgage payment on in over a year.

When they were calling for the bottom in housing last year, I told people we were going to see another 20% drop in prices MINIMUM. Some thought I was crazy.

Anyways, you are right about the spin that comes out even when the stats clearly show we ARE in a double dip (Actually it's just a resumption of the collapse).

I'm hands-on in this industry and the only reason we are still in business is because we decided to try and be one of the 'last ones standing'. Also, I don't know the exact percentage but I guarantee it's high, and that is the amount of people that are 'buying' houses that have just defaulted and/or simply walked away from their overvalued McMansions. So any new home purchase stats are at the least, skewed. I'm looking for 2 main indicators: Permits pulled for new construction & labor stats (Real ones).

The residential construction industry in California is over as we've known it. I predict that eventually the state or fed will become the landlord of record for many of these properties.

I'm trying to keep my company. viable but I agree with you that at minimum it will be 2013 before we see some signs of a turnaround. That's if we don't have an all out financial collapse by then.

Thanks again for your great service. - M.H.

Here's a graph that was sent to me by Washington state reader S.A. yesterday which really tells a lot about what the U.S. consumer has been spending their money on since 2009.

Australian reader Wesley Legrand sent out this 1-year chart of the Philadelphia Bank Index [BKX]. The drop through the 200-day moving average was pretty ugly yesterday.

¤ Critical Reads

ISM manufacturing gauge tumbles in May

Growth in the U.S. manufacturing sector receded in May, owing to fewer orders and less production, according to a closely followed index.

The Institute for Supply Management’s manufacturing gauge fell to 53.5% last month from 60.4% in April, marking the third straight decline and the biggest one-month drop since 1984. It’s also the lowest reading in 13 months.

This was the piece of news that sent the stock markets tumbling yesterday...and I thank Florida reader Donna Badach for sending me this marketwatch.com story. The link is here.

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Global growth fears fuelled by weak factory data

Here's a story from last night's edition of The Telegraph. The manufacturing industry in England is having problems as well...and it's not a stretch to think that these problems are global in scope.

Britain's manufacturing industry slumped "from rapid expansion to near stagnation" last month, according to the closely-watched purchasing managers' index (PMI), raising fresh questions about the recovery and sending the pound down almost two-thirds of a cent against the dollar to $1.6401.

I thank Roy Stephens for this story...and the link is here.

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Nuclear Phase-out Could Spell Disaster for German Energy Giants

With the government's decision to phase out nuclear energy, Germany's four biggest utility companies face an uncertain future. Profits could tumble this year by as much as 30 percent and the companies are also becoming increasingly vulnerable to takeovers. Are the days of giant energy companies numbered in Germany?

This story, posted over at spiegel.de yesterday, is another Roy Stephens offering...and the link is here.

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Want to Buy a Piece of a Greek Island?

Washington state reader S.A. was kind enough to send me this next story from yesterday's edition of The Wall Street Journal.

As part of Greece's privatization plan to raise cash to reduce its mountain of debt, the national government is preparing to sell as much as €30 billion ($42.9 billion) of public property. It is still early in the process, but future sales are likely to include assets ranging from the government's stake in the Mont Parnes Casino resort in Athens, hotels, and even a concession to develop a luxury resort with a world-class golf course on the island of Rhodes.

The Hellenic Public Real Estate Corp., the government body that manages public property, has a list of about 75,000 individual government-owned properties. The corporation has appointed the National Bank of Greece SA to lead a consortium of advisers who are now preparing to sell an initial portfolio of 20 to 30 properties, the first of which could be put on the market in the next few months, according to Aristotelis Karytinos, general manager of the real-estate division at National Bank of Greece.

The link to the story is here.

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Germany says EU and IMF will back Greece bail-out

German ministers were forced to reassure the market that the European Union and the International Monetary Fund would stick together to bail out Greece, amid renewed speculation that the €110bn (£96.7bn) rescue mission is close to collapse.

This is another story from The Telegraph late last night that's courtesy of reader Roy Stephens...and the link is here.

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Greek Default Risk Raised by Moody’s

Greece's risk of default was raised to 50 percent by Moody’s Investors Service as European officials rushed to put together the second bailout plan in two years to stave off renewed financial turmoil in the region.

Moody’s downgraded Greece to Caa1 from B1, putting it on a par with Cuba, according to a report published late yesterday. The move came after policy makers considered asking investors to reinvest in new Greek debt when existing bonds mature.

As you can see, the U.S. is doing everything possible to crash the euro...and the European Union. I thank reader George Findlay for this story...and the link is here.

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The global debt clock

Here's a very interesting interactive webpage from The Economist that was sent to me by Russian reader Alex Lvov.

The clock is ticking. Every second, it seems, someone in the world takes on more debt. The idea of a debt clock for an individual nation is familiar to anyone who has been to Times Square in New York, where the American public shortfall is revealed. Our clock shows the global figure for all [or almost all] government debts in dollar terms.

This is worth spending a few minutes on...and the link is here.

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Metals Will Be Hot This Summer, Gold to Hit New Highs: James Turk

Here's a blog that Eric King sent me last night...and the title pretty much says it all. It's definitely worth reading...and the link is here.

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Expect New Record Highs in Gold This Summer: Sean Boyd

Here's the second blog that Eric sent me last night. Agnico Eagle's CEO Sean Boyd has a few things to say...and the link to that is here.

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GATA files Liberty Dollar brief; New York Sun examines case

Here is today's one and only must read story. This is a GATA release from yesterday...and, as usual, Chris Powell has already done the heavy lifting.

"GATA's legal brief filed in U.S. District Court for the Western District of North Carolina in support of acquittal or a new trial for Liberty Dollar founder Bernard von NotHaus is cited in today's editorial in the New York Sun, "Von NotHaus' Question" -- the question being whether anyone but the government has the right to issue money."

This New York Sun editorial comment was first sent to me by reader 'Charleston Voice' long before it showed up as a GATA release...and the link to that GATA release is here.

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It’s important to remember that silver is a commodity that was born to run in price. We have only seen glimpses of silver’s inherent nature due to the decades’ long price suppression. This manipulation is ending and when it does end there will be nothing left to hold silver back, save the free law of supply and demand. That’s something no one alive has ever witnessed, yet everyone will witness before long. - silver analyst Ted Butler, 01 June 2011

Gold's volume, which was a bit over 140,000 contracts net of all roll-overs, was heavier that Tuesday's volume...but not by a lot. However, the preliminary open interest number showed an eye-watering increase of 15,747 contracts, so I'm guessing that yesterday's big rally was not short covering, but new longs coming into the market...or maybe the raptors were selling long positions...and it could have possibly been new spread trades being placed as well. But since this action occurred on Wednesday, whatever really happened won't show up until next Friday's Commitment of Traders report.

Gold's final open interest number for the Monday/Tuesday trading session only showed a smallish increase of 1,598 contracts, which was down considerably from the preliminary o.i. number of 7,138 contracts. I'm hoping that Wednesday's big jump in open interest [mentioned in the last paragraph] disappears the same way, but I doubt it.

Silver's net volume yesterday was just over 71,000 contracts...which isn't overly heavy...but, despite the smack-down in electronic trading yesterday afternoon, the preliminary open interest showed a steep increase of 4,330 contracts...subject to change later this a.m.

Silver's final open interest number for the Monday/Tuesday trading session showed a smallish decline of 686 contracts...not a big surprise considering that the preliminary o.i. number was only 2,279 contracts.

The final open interest numbers in the Monday/Tuesday trading session in both gold and silver will appear in tomorrow's COT report.

It's entirely possible that because a lot of the action in both silver and gold happened late in the day yesterday, not all the volume figures were reported in a timely manner...and the rest may show up in today's volume numbers.

One of the things that I did notice in this morning's CME's preliminary report was that another 72 contracts were added to June delivery for silver...which is now up to 187 contracts still open for the month. In the first two days of this month, there have already been 183 silver contracts posted for delivery.

The backwardation situation in silver remains unchanged...and until something does change with this, I won't be reporting on it on a daily basis from now on...but I will still check it every day nonetheless.

Not much happened in Far East trading earlier today. Gold was comatose...and silver is showing some signs of life, but those gains could disappear in a New York minute...which is probably what will happen unless the bullion banks show up in the London market before the Comex open. Volume in both metals is extremely light.

There certainly was nothing free-market about what happened in both silver and gold yesterday...and it looked as if 'da boyz' had their hands full in the gold market as they tried to keep a lid on that. At the same time, they were hammering the silver price into the dirt. How much tech fund long liquidation they got from their smash-down in the New York Access Market is unknowable, but considering the fact that we're virtually at the bottom of the barrel in that department, they probably didn't get much...and there was no volume to speak of.

As silver analyst Ted Butler said to his subscribers yesterday..."the market structure, as defined by the Commitment of Traders Report, looks great. Silver hasn't had as good a COT set up in a long while [almost two years]. That means [that] there's not much "juice" to fuel a giant move to the downside, while there is a large potential supply of fuel to the upside." JPMorgan improved that structure a bit more by the time yesterday's trading day was over.

It could be another interesting session in New York when the Comex opens for business at 8:20 a.m. Eastern time.

See you on Friday.