From Ed Steer:

There wasn't much activity in gold in Far East and early European trading on Wednesday morning. But by the time the Comex opened for business, gold was up a few bucks. However, every time the gold price poked its nose above $900, there was somebody there to take it right back down again.

Silver did better. It traded a few cents on either side of unchanged throughout the Far East and early London trading. That came to an end as soon as the London silver fix was in...noon in London...and 7:00 a.m. in New York. From there a rally commenced which really didn't have much enthusiasm behind it...and it flat-lined from the end of Comex trading until electronic trading in New York was through for that day at 5:15 p.m Eastern.

Tuesday was the last day for trading the April contract in both gold and silver. There was lots of furious action in both metals. Tuesday was also the day of the big smack-down in gold and silver...plus lots of switching from the May contract to future months to avoid standing for delivery on first notice day...which is today. In gold, open interest fell 3,442 contracts on pretty big volume...90,744 contracts. In silver, o.i. fell a big chunk as well...4,034 contracts on huge volume...48,280 contracts. It's impossible to read anything into these numbers...but if the bullion banks et al report all this activity in a timely manner, it should be in tomorrow's COT...as Tuesday was the cut-off for that report.

In Wednesday's Comex Delivery Report [yesterday was the last day for delivery into the April contract] there were 899 gold contracts delivered. The biggest issuers were JPMorgan [440 contracts], Merrill Lynch [319 contracts] and Bank of America [134 contracts]. The big acceptors [stoppers] were Bank of Nova Scotia [631] and JPMorgan [212]. There was nothing in silver. Total gold delivered in April...14,946 contracts, and since each contract is 100 ounces, that means that 1.49 million ounces were delivered. In silver, 367 contracts were delivered in April, representing 1,835,000 ounces. May is a big delivery month for silver but not for gold...and we'll find out today just how many silver contracts are awaiting delivery...and delivery starts on May 1st.

The usual New York commentator has a few paragraphs worth reading..."Mitsui, in its monthly Refining Monitor for March just published, reports that the traditional main physical buyers moved back to the buy side during the mid-March weakness...and subsequently. But it also says that the amount of scrap ‘swimming around’ in the first quarter was probably in the order of 1,000 tonnes – 1.5 times the GFMS primary (mine) supply number and twice what the ETFs were supposed to have added. This was double what GFMS estimated for scrap in yesterday's Bloomberg story."

"This, of course, stemmed from the extreme financial anxiety prevalent then, and particularly the currency weakness [that] countries like India experienced. Another advance on a $1,000...without those extreme conditions...would presumably not have to overcome this extraordinary avalanche of scrap again.

"The Reuters report in mid afternoon...that [House Financial Services Committee Chairman] Barney Frank will support the proposed IMF 400 tonne gold sale on condition it goes to enrich the elites of the basket case countries...might have had more effect if Bloomberg had picked it up."

There wasn't a lot of real hard news yesterday. The biggest story was the huge [annualized] 6.1% drop in U.S. GDP. Normally a story like that would have left a great smoking crater where the Dow Jones Industrial Average used to be...but in this new Orwellian world we live in, that's no longer allowed to happen. I see in a story at marketwatch.com that "Talks between the Treasury Department and lenders aimed at keeping Chrysler LLC out of bankruptcy broke down late Wednesday, making it all but certain the car maker will file for Chapter 11 protection Thursday." All this wonderful news [and much more!] should be good for another 200-point rally today. All the PPT has to do is spin those SPMs...and away we go to the up-side!

The first story is from Austria, and is another derivatives nightmare. The average civil servant doesn't have much more than a room-temperature I.Q... and this is what happens when the wolves are let loose amongst these lambs. "Weapons of financial mass destruction." is what Warren Buffet called them. The Bloomberg story is entitled "Derivatives Hit Austrian Railroad With Record Loss". I thank Craig McCarty for the story...and the link is here.

Today's second story is an indication of just how the revolving door works between the U.S. government and the financial industry...in this case Goldman Sachs. Nobody in government is looking after the best interests of the average citizen anymore. I thought I was pretty jaded about this sort of thing...but this reeks. The story is entitled "Goldman Sachs Hires Former Frank Aide to Run Washington Office" and the link is here.

The last story today is from the Financial Times in London. It's by one of their regular columnists, Martin Wolf. Wolf spends all of his time explaining how the financial system can be saved...but never admits that the printing presses [or their electronic equivalent] would have to run 24/7. In the end, Wolf opines..."The overhang of debt makes deleveraging inevitable. But it has hardly begun. Those who hope for a swift return to what they thought normal two years ago are deluded." [That they are! Call me in 15 years and we'll see how this is all working out. - Ed] I thank Craig McCarty for the story and the link is here.

If you spent $1 million a day since the day Jesus Christ was born, you still wouldn't have spent a trillion dollars. - Senator Mitch McConnell

So where to from here for gold and silver? The set-up in silver hasn't been this good since it was priced around $8.70 back in October. Gold is still the question mark. The 200-day moving average was never broken to the down-side since gold got killed on its last attempt to break through, and stay above, the $1,000 mark on February 22nd. True, the 'sell in May and go away' scenario is almost upon us...but will it apply this year? Don't know, but I haven't taken my money off the table...especially in silver. I've got the time, so I'm just going to wait these bastards out.

I hope your Thursday goes well [or went well, if you're on the other side of our planet]...and I'll see you on Friday morning.

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