From Ed Steer:

Despite a sharply rising US$ all through Far East, Europe and the Comex open...gold managed to stay within five dollars of its Friday closing price in New York. Gold and silver's prices peaked at 9:00 a.m. in New York...when both had managed to claw their way into positive territory for the day. But once the London fix was in at 10:00 a.m. in New York, the rug got pulled out from under them. As per usual, either [or both] JPMorgan and HSBC USA should be considered prime suspects.

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Both the gold [above] and silver [below] charts show where they pulled their bids on three separate occasions during the day, and whatever sellers there were...were forced to sell into a vacuum. It's the 'same old, same old'.

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As I said on Friday, the 50-day moving averages had still not been taken out to the downside on either metal. And as I also pointed out, despite the $2 decline in silver prices in the last week or so, the COT in silver actually showed [unbelieveable?] deterioration...and I feared that because of the huge Treasury auction this week, that the boyz still had the ammunition [tech and small trader longs] to take gold and silver down hard. They may be in the process of doing just that. Will they? Can they?....sure, if they want to. Look what they did yesterday. A quick message to their floor traders to fold their arms...or the electronic equivalent thereof...and "Bob's your Uncle!"

As of yesterday, the 50-day moving average for silver was $12.30...and for gold it was $901.34. These are chip shots for the boyz...and if they really play their cards right we could get a 'super spike' to the downside in both metals. It wouldn't last long, but it would be enough to force the tech and small traders holding longs, to liquidate them. Let's see how the PPT and JPMorgan et al play this over the next couple of days.

Open interest changes for Friday, you ask? Gold o.i. rose 3,418 contracts to 373,399 and silver o.i. was down 198 contracts to 92,109. Another 119 contracts were delivered in gold yesterday...now up to 1,383 for the month. And in silver, another 135 contracts were delivered...with the Bank of Nova Scotia issuing them all...and JPMorgan [64 contracts] and Goldman Sachs [39 contracts] being the largest stoppers. Comex silver warehouse stocks fell a hair over 500,000 ounces...and there were no changes to the GLD and SLV yesterday either. However, over in Switzerland, their gold ETF added another 50,011 ounces during the prior week...and their silver stash added another 1,189,590 ounces. Now don't forget that in the 'week that was' the SLV took out about five million ounces at the same time that the Swiss were adding to their stockpile. No wonder Ted Butler thinks that something isn't quite right with the SLV. I also noted that the U.S. Mint has once again updated their numbers for the gold and silver eagles. For March in gold, they are now up to 47,000...and in silver it's now up to 1,075,000. And lastly...in an e-mail from Ted Butler yesterday morning came this little 'nugget'...if you'll pardon the pun..."I noticed some unusual trading in the March/May silver switch today...and see March closed a penny premium to the May. There was definitely demand for the delivery month [March] today." Well, golly gee, if there was big silver demand yesterday...with silver slipping slightly into backwardation...that totally explains why the price got hammered by JPMorgan...LOL!!! Take the blue pill...then call me when you're '10 feet tall'.

In 'other news'...I see in a Bloomberg story on the weekend that Bernanke said that the Fed will deploy 'all tools' for economic revival. [Note to Ben: Does that include beating the crap out of the gold and silver markets? - Ed] I note that LIBOR and the TED spread are starting to sneak back up a bit. And I note that AIG played the Armaggedon card yesterday...give us another $30 billion "or else". In a story at forbes.com "Zhang Guobao, head of the National Energy Administration, said that China should use part of its nearly $2 trillion in foreign exchange reserves to buy more gold, oil, uranium, and other strategic commodities." In a story posted at The Independent out of the U.K..."A silent US$1 Trillion ‘Run on Britain’ by foreign investors was revealed yesterday in the latest statistical releases from the Bank of England. The external liabilities of banks operating in the UK fell by $1 trillion (£700bn) between the spring and the end of 2008, representing a huge loss of funds and of confidence in the City of London...Some $597.5bn was lost to the banks in the last quarter of last year alone, after a modest positive inflow in the summer, but a massive $682.5bn haemorrhaged in the second quarter of 2008 – a record. About 15 per cent of the monies held by foreigners in the UK were withdrawn over the period, leaving about $6 trillion. This is by far the largest withdrawal of foreign funds from the UK in recent decades – about 10 times what might flow out during a ‘normal’ quarter.” And lastly, I note with some alarm what appears to be the resumption of sectarian violence in Northern Ireland...something none of us want to see. And in a Financial Times story that I shamelessly stole from the King Report last night, I see that "North Korea has cut its military 'Hotline' between them and Seoul...and has put their one million man army at 'battle stations'...ratcheting up tensions as south Korean and U.S. troops began war games that Pyongyang warned could spark open conflict." Don't sell your gold just yet.

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Because of the weekend, I have five stories today. The first one is posted at news.yahoo.com. The headline reads "Too big to fail? 5 biggest banks are 'dead men walking'.” You will carefully note in the second paragraph, the names JPMorgan and HSBC Bank USA...the two U.S. banks that have 98% of all the precious metals derivatives...and are, without doubt, the '2 or less' or '3 or less' U.S. banks stated by the Bank Participation report as holding the vast majority of short positions against gold and silver on the Comex. Queston: What happens if they're allowed to fail. The short answer is...I don't know. So's the long answer. The link is here.

The next story is from The Telegraph in London. This time it's NOT written by Ambrose Evans-Pritchard. You've read and admired his work dozens of times. Now you can see and hear Ambrose Evans-Pritchard, international business editor of The Telegraph in London, as he talks about gold with the Robert Miller of Telegraph TV. Evans-Pritchard says gold has decoupled from commodities, has regained its position as an international currency, and likely will continue to do well as central banks strive to avert debt deflation. The link is here.

The third story is from Bloomberg TV [not Bloomberg USA...probably the Far East/Australia - Ed] In the video interview, doubts are expressed about the gold ETFs...and silver price management by only one or two banks. The interview [which is worth watching] is imbedded in a GATA release that is linked here.

The next story is from The Wall Street Journal and is headlined "Bearish Big Investors Catch Gold Bug". Unfortunately, as the article goes on to state, these "big investors" are purchasing mostly paper gold...not the physical metal itself. I hope you, dear reader, have not fallen into this trap yourself. If you have, you should know better by now. The link is here.

And lastly comes a story from the Financial Times in London. The headline reads "Barrick founder sets no limits on gold price." Chairman Peter Munk goes out of his way to qualify any enthusiasm he shows for the product his company has been mining for decades. It's underwhelming to read...but you should anyway...and the link is here.

When the great ship Titanic made her maiden voyage across the North Atlantic and its blinded leader struck the iceberg, it would have been absurd to announce: "All hands on deck to man a bucket brigade; this ship is too big to fail!" To require men, women and children to try to bail out the Titanic until its final plunge, while its captain and officers took refuge in the few lifeboats is not unlike what taxpayers are being forced to do in this financial meltdown. Just as then, the correct response would be not "too big to fail," but instead, "Too Big to Bail." - Charles Schisler, Buenos Aires Herald, March 7, 2009

As I put this report to bed in the wee hours of Tuesday morning, I see that both gold and silver are under 'pressure' again...right from the open in Sydney...to the open in London. As I explained before, there is no secret as to why this is happening in the face of 'the end of the world as we know it.' Two U.S. bullion banks hold all the cards. When they're through flushing out all the longs they can get...the 'bottom' will be in. The CFTC does nothing. Your gold and silver mining companies do nothing. And we, the investors, are left twisting in the wind.

See you on Wednesday.

Casey Research correspondent-at-large Ed Steer is a keen observer of the financial scene and a board member of GATA.org.