This action or manipulation is so stupid its beyond ridiculous. Make no mistake, this is a war zone and should be called as such. No sense being nice guys anymore. You have to be ruthless to match your enemies.
S

And then there is Dave from Denver…

The battle against commodities is "game on." I can't print the chart on our trading software, but silver didn't get hit hard until the 6:20 Comex open. Then it went into a cliff-dive. Pure paper smack. I see Obama is going to release 30 million barrels of oil from the SPR over the next month. It's an all-out war on any visible signs of inflation, as Bernanke clearly made statements that leave door wide-open for more QE.

FYI, Obama has placed a complete news black-out on the Nebraska nuclear plant flooding. The airspace over that are is also closed. My understanding is that the situation is much worse than was last reported before the news black-out last Saturday.

RG:

Bill,..
I’m guessing James is already all over this,..

No 1% rule on the downside as ever,..

Crimex is the only appropriate name for this outrage,..

Incidentally, this has not dented the tightness in the Bollinger Bands on the gold daily yet,..
The Jury’s still out on direction of the big move in the pipe!..

I’m don’t see this as anything other than a little ‘gaming’ before the launching north!..
Best,..
Rich (Live from 'The Bridge of the Silver Rocket Ship')

James Mc is all over this Rich. He has done it again…

Bill,
The CME is practically begging speculators to enter gold futures. It is currently the highest leverage that I can find of any major future contract. This has to be the result of sheer panic in the physical silver deliveries. Gold is no doubt the only other product that can lure speculators away from silver in significant numbers. Here is a smattering of leverage ratios currently available to the HFT battlebot crowd, in order of leverage:

Silver 8.17 - 1
Wheat 8.86 - 1
Lumber 11.29 - 1
Crude oil 11.28 - 1
Corn 14.11 - 1
Soybeans 15.18 - 1
Copper 17.66 - 1

It's no coincidence that silver is the lowest leverage of all, while gold is the highest. I'm sure the malarkey CME reason is that gold is less volatile. That is true strictly in the sense of it always having a propensity to getting capped at 1% gains. They undoubtedly don't consider $40 plunges like today part of the volatility equation. The fact is that gold leverage is 307% more than silver, 223% more than crude oil, and even 178% more than corn. It is 142% the leverage of its nearest competitor, copper. Look for the high gold leverage to remain, and even increase in a desperate attempt to thwart silver speculators. Only when physical gold starts exiting the Comex in significant numbers will it then be punished with single-digit leverage. BTW, The low leverage ratio of wheat would also imply there's shorts in trouble there as well.
James Mc

It is with great pleasure that we announce James McShirley has been added to the speakers list for our London conference on August 4, 5, and 6 at The Savoy Hotel.

The gold open interest rose 9,555 contracts to 524,571. How typical that the specs pile back in and then The Gold Cartel rips them off in a day. Just one more reason why our GATA conference is so important. The silver open interest went the other way for some strange reason. It fell 879 contracts to 119,359. Considering what other markets did today, silver usually would have been hurt more than it was. As mentioned the other day, The Gold Cartel has done so much damage to silver spec longs, there are not as many weak hands to flush out these days.

Behavioral Finance Report

*OBVIOUS, OBVIOUS, OBVIOUS … the view from Planet GATA…

http://www.csmonitor.com/USA/Latest-News-Wires/2011/0622/Robert-Gates-Defense-Secretary-s-exit-interview where he says he can't imagine being part of a government that is forced to scale back because of financial constraints. We may just be seeing Uncle Sam being pinched in the pocketbook and actually reacting to it!

Bill H:

To all; "please Uncle Ben give us another QE", that is what the markets are saying very loudly today. In less than 24 hours the Dow is down over 300 points, commodities and especially oil are getting smacked while the worthless Dollar rallies. If today's action continues for any length of time The Fed will be forced to implement another round of QE and they will have to do it so the public can see it. Not that they have any real plans of discontinuing QE but publicly they want (need) to portray responsible guidance. Of course they will continue "greasing the wheels" behind the scenes but this "grease" will not work unless traders know for sure that The Fed is still there propping paper asset values.

Oil is down more than other commodities because the IEA has announced the release of 60 million barrels in total from the SPR which amounts to nearly 10% of the total inventory. This is supposedly because of the lack of production from Libya but oil was already trading down and has been soft for nearly 2 months. Please understand that this oil is not a gift, it could be sold into the market and actually paid for which will raise somewhere north of $5 Billion. I know, this is not what we are being told, this is supposed to be a "loan" into the market but I have my doubts. We also received news yesterday that a not insignificant amount of troops are soon to be "withdrawn" to which I ask why these two events now and within 24 hours? Could it be that Uncle Sam is feeling the pinch of war costs and sees a little cash flow from the release of some oil? Add to this Defense Sec. Robert Gates exit interview

In any case, The Fed CANNOT allow the last 24 hours to become a trend because a panic will ensue very very rapidly as leveraged as traders are and the entire system is. They just can't allow this snowball to begin rolling because once it does it can't be stopped. The "Lehman moment" that occurred in 2008 could be dwarfed by the coming events if they are not careful because now many sovereigns including The U.S. will be seen as part of the problem rather than the solution. These are precarious times indeed and history has always shown man piling into Gold as the ultimate safe haven. This will not only be no different, it will become more pronounced. Regards, Bill H.