Hungary Circles the Drain.... Who's Next?

Gold didn't do much in Far East and early London trading yesterday. But that changed shortly before 9:00 a.m. in London when gold got sold off about 10 bucks to it's low of the day around $1,195 spot. From there it came roaring back the same $10 that it had just lost... and by that time it was precisely 8:00 a.m. in New York. From that point it vacillated around $1,205... until it got sold off going into the London p.m. gold fix which occurred at precisely 10:00 a.m. Eastern time.

Then gold price immediately returned to the $1,205 range... and shortly before lunchtime, gold really caught a bid... and was up $15 from the London gold fix in less than 15 minutes. Then a seller of some sort showed up, but gold still managed to close virtually at the high of the day, which was $1,221.40 spot.

This turnaround was a big surprise, as I certainly wasn't expecting it. All my comments yesterday about gold being hit at the release of what were whispered to be fantastic job numbers, turned out to be pure conjecture on my part [and others]... all of it wrong.

Silver was doing OK until around 10:00 a.m in London trading, when the selling began in earnest. This continued all through the rest of London trading and into the New York session. Every attempt at a rally was hit hard... with the final price assault coming minutes before the close of Comex trading. This proved to be the low of the day at $17.26 spot. Silver closed the trading day a bit off its low... but not by a lot. The high was in early Friday trading in the Far East around the $18.00 spot price.

Platinum and palladium were also hit hard as well... with platinum down 2.07% and palladium down a whopping 5.35%

But it was silver that 'da boyz' were after... and they got it good. From it's absolute high to its absolute low... silver was clocked for about 75 cents yesterday.

For 19 straight hours, the dollar barely moved from its high at noon on Thursday. But shortly before 7:00 a.m. Eastern time on Friday, the dollar rose about 60 basis points in an hour... and from there it proceeded to add around 50 basis points right up until the close of New York trading at 5:15 p.m. Eastern time. In ten hours it rose about 110 basis points. If you can find any co-relation between the price of gold and the dollar during that time period, I'd like to know about it.

For the most part, the shares followed the gold price... but only up until 12:45 Eastern time. At this point, the HUI had actually turned positive on the day... even though the Dow stocks were getting slaughtered. Then, for whatever reason, along came a willing seller to sell off the precious metals stocks. I found this rather strange considering the fact that the Dow hardly moved much lower after that point in time. As I said the other day, I sometimes suspect that 'da boyz' sell gold shares into the market when they're trying to paint the tape and make sure that the precious metal stocks are no safe haven when the rest of the equity markets are disintegrating. If that's what they were actually doing, then they were mostly successful. The HUI finished down 2.18% on the day.

I don't have access to the CME's website on this computer... so I don't have any delivery numbers or Comex-approved warehouse silver inventory figures for you. However, the GLD reported that 111,881 ounces of gold were withdrawn yesterday... and SLV was down 1,469,760 ounces.

The U.S. Mint reported selling another 12,500 one-ounce gold eagles... 4,500 24-k gold buffaloes... and 141,000 silver eagles. Month-to-date the U.S. Mint has sold 20,500 one-ounce gold eagles, 12,500 24-k gold buffaloes... and 650,000 silver eagles. Do you have your share yet, dear reader?

The Commitment of Traders report for Friday showed that the bullion banks added a small amount to their already grotesque short position in silver. This time it was 506 contracts. The '8 or less' bullion banks are short about 324 million ounce of silver... which translates into about 175 days of world silver production. And you wonder why Ted Butler keeps screaming about the concentrated short position... and why position limits are necessary.

Of course, they've covered a huge pile of shorts [or added to their long position] since the Tuesday cut-off for yesterday's COT report... but regardless of that, it's still a mind-boggling number.

In gold, the '8 or less' bullion banks improved their net short position by a smallish 75,600 ounces of gold... but they are still net short 27.5 million ounces of gold between them. And, with the Commercial net short position [where the bullion banks hide] sitting at 26.8 million ounces... these '8 or less' bullion banks are short more than 100% of the Commercial net short position. This short position represents about 34% of world gold production held by these 8 bullion banks.

The Bank Participation Report for May was also released yesterday. I haven't even seen the numbers, but silver analyst Ted Butler will have something to say about it [and yesterday's COT report] in his Friday interview with Eric King over at King World News. The link to that interview is here... so drop everything and listen to it.

I don't have much in the way of stories today... but besides the Butler interview, Eric King has provided another interview that's more than worth your time... and I'll get to that later.

As you are aware, the North American equity markets really got hammered yesterday on the U.S. job numbers. There was also a lot of talk that both Turkey and Hungary are facing a Greece-style debt crisis. I have one story on that courtesy of reader Roy Stephens. It's posted at The Telegraph in London... and the headline reads... "Global markets tumble on US jobs and Hungary crisis fears". This story is definitely worth the read... and the link is here.

Next is a piece that Chris Wood included in the Thursday edition of Casey's Daily Dispatch. I've always had a morbid fascination for this whole New World Order thingy... the Council on Foreign Relations, the Trilateral Commission, etc. So this was more than interesting...

Here is Zbigniew Brzezinski speaking to the Council on Foreign Relations [CFR] recently. If you don’'t remember who Brzezinski is, his name could be used as a synonym for The Establishment. He was the national security advisor under President Carter, served on the board of the CFR, helped start the Trilateral Commission, and has attended the infamous Bilderberg group meetings.

Here’s the quote: "And no matter where you go, politics is a matter of social engagement; and most people know what is generally going on. Generally going on in the world. And are consciously aware of the global inequities, inequalities, lack of respect, exploitation. Mankind is now politically awakened and stirring. The combination of the two, a diversified global leadership and politically awakened masses, makes a much more difficult context for any major power, including, currently, the leading world power, the United States."

To see the youtube.com video of Brzezinski’'s entire speech, click here.

If you watch the speech, it certainly sounds like Brzezinski is fearful of the politically awakened citizen, wherever he or she may call home.

Many have asserted [some crazy, some not] that the endgame for Brzezinski and the political elite is a global fascist state. Now, I'’m no conspiracy theorist... but I think that across the world, individual politicians’ lust for power and unwillingness to give up that power would make it impossible for a single global state to emerge... if that is indeed the “New World Order” plan. But any political awakening of the sheeple that makes a piece of work like Brzezinski squirm can’t be too bad. [Amen to that! - Ed]

The next video is on the long side... over an hour. It was sent to me by Casey Research's own Jeff Clark... editor of Casey's Gold and Resource Report. The video is entitled "Mirror, Mirror on the Wall, When is the Next AIG to Fall?" The speech was given by Marc Faber... and when he's talking... you should be listening. No flies on this guy. The video is posted at youtube.com... and the link to this must watch video is here.

And lastly today is the other interview that I spoke of... and Eric King mentioned in the preamble to his Ted Butler interview. It's a 14-minute interview with one of Mexico's richest men... Hugo Salinas Price. He's also been a huge supporter of GATA over the years. The link to this must listen interview is here.

I don't have any cute cartoon, quote, or 'blast from the past' today. I'm in Vancouver working with both a minimum amount of time and sleep.

But, as the story on Hungary indicates, the world's sovereign debt crisis is the end of the financial and monetary line for the great visions of John Maynard Keynes and his disciples. As the world renowned economist John Kenneth Galbraith said of him... "Keynes was for a time... but not all time". How right he was.

As of yesterday, the end of the economic, financial and monetary world as we know it, is almost upon us.

And I'm sure that the powers that be will spend the rest of this weekend trying to figure out how to prevent a complete collapse that may well start on Monday morning. All eyes should be on the Monday morning open in Japan.

Enjoy the rest of your weekend... and I'll see you on Tuesday.