I noticed that Ed Steer mentioned in his latest that "the bids got pulled….. and the price fell $11 in just a few minutes…" This is the first time that I can remember that he left out the words "bullion banks pulled their bids." He's stated many times in the past that when the bullion banks pulled their bids, the PM prices collapsed. This always puzzled me, so I emailed him a few weeks ago with some questions about it to which he never replied. There was something about the bullion banks pulling bids that had me scratching my head.

First of all, what are the bullion banks doing in there bidding at all with prices up there? I thought they wanted prices as low as possible, so why would they in essence be bidding and putting some sort of a floor under the price. Are they really that powerful that they can manage the price with bids, putting them in then yanking them out? Why wouldn't they be more interested in selling/shorting rather than bidding by offering big contracts at lower and lower asks?

And, besides, are the bullion banks the only ones bidding? Aren't there hedge funds, big companies, deep pockets, you, me and so on also bidding. Are they that impotent? Seems to me if Mr. Steer is correct, then the bullion banks control the bidding too along with a lot more, especially if they can yank their bids and prices take a swoon. Why would anyone bid knowing this? It would be like playing in the traffic.

So what does he mean now when he says "the bids got pulled"? That's new from him and a little less puzzling to me. Could it be that others who had bids in pulled them when they saw some big offers coming in from the bullion banks and decided they had better get out of the way. Might make a little more sense to me.