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Golden Minerals is a junior silver producer with a strong growth profile, listed on both the NYSE Amex and TSX.
Message: Ed Steer this morning
Silver to the Moon Today?
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Silver analyst Ted Butler has a few things to say. November silver eagle sales now at 3,175,000. Eric Sprott says silver may be the investment of this decade. FDIC's Bair says "Bury the losses." Ron Paul's golden opportunity... and much more.
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Yesterday in Gold and Silver
Gold didn't do much anywhere on Planet Earth on Wednesday... and closed only a few dollars below its Tuesday closing price. Gold's low price [such as it was] came at the London open... and the high [such as it was] came around 10:30 a.m. in New York. From gold's 'high' of the day, the price declined about five dollars into the New York close at 5:15 p.m. Eastern time. It was a pretty quiet day.
The silver price action yesterday was a much more volatile version of what happened in gold... with the low and highs [plus the general price direction] occurring at the same times. This is no longer the quiet silver market that we knew only a few short months [or even weeks] ago... it has become a raging beast compared to what it once was.
Since gold's low at noon on Tuesday, the dollar has been in a slow [but unsteady] decline for the last thirty-six hours... but it was only down 10 basis points net on Wednesday. The precious metals price action was obviously not related to what happened to the world's reserve currency... and I provide the 3-day dollar graph below for entertainment purposes only.
The precious metals didn't do much, but they did track the New York gold price pretty closely... and the HUI finished up 0.71% on the day... but was up over 2% at one point. Obviously there were some bargain hunters out and about yesterday. Quite a few of the junior silver companies did especially well.
The CME Delivery Report contained nothing worth mentioning.
There was nothing reported from either GLD or SLV yesterday, either. But for the week that was over at Switzerland's Zürcher Kantonalbank, they reported that their gold ETF had a withdrawal of 18,752 ounces... but their silver ETF showed an increase of 161,944 troy ounces. I thank Carl Loeb for those numbers.
For the third day in a row there was a sales report from the U.S. Mint. On Wednesday, they reported selling another 10,500 ounces of gold eagles, along with another 460,000 silver eagles. Month-to-date, the mint has sold 62,500 ounces of gold eagles... plus a chunky 3,175,000 silver eagles.
Over at the Comex-approved depositories, they reported a reduction of 264,196 ounces of silver in their collective inventories on Tuesday. The link to that action is here.
In a note to clients yesterday, silver analyst Ted Butler had the following to say about Monday's Commitment of Traders report... and the subsequent price action in silver... "This manipulated take down, as criminal as it was, makes the COT structure great. In fact, I just can't believe how good. Extrapolating for the current reporting week, we may have the best COT structure in silver in six months. Remarkably, we likely have as low, or lower, of a total commercial net short position in the next COT than we had back on July 27th. Please think about that for a moment. Back then, not only was silver at $18, we were below all the important moving averages, including the 50,100 and 200-day moving averages. Now, we're $7 higher... and still well above most major moving averages. I'm getting a feeling in my bones that as soon as this current manipulated take down is complete [which should be close], we will soon witness some real excitement to the upside in silver. These feelings are similar to what I felt back in July and August, when I speculated we could see a $5 to $10 pop in silver from the then-price of $18. This time, I'm thinking that the pop could be larger and quicker."
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¤ Critical Reads
SubscribePretty Good for Government Work
I don't have too many stories today... and I hope you will find some of them of interest.
The first story today is from reader Phil Barlett. It's an op-ed piece from Tuesday's edition of The New York Times. It's written by the one and only Warren Buffett. I used to be a huge Buffett fan back in the days when I thought he stood for something. But that aura is badly stained... and this piece puts the finishing touches on the man who [as the song goes] has sold his soul to the company store. If his dad was still alive, he'd turn Warren over his knee and spank him for saying something like this. It's a short read... and the headline states "Pretty Good for Government Work"... and the link is here.
FDIC's Bair: "Bury the Losses"
This next item is courtesy of reader U.D. It's a piece that's posted over at zerohedge.com. Apparently Sheila Bair has turned a corner in her support of the bankers. On the critical issue of accounting clarity she made these remarks today to a bunch of CPA’s. I hear she got a standing ovation from that audience. The headline reads FDIC's Bair: "Bury the Losses". So much for honest and transparency. It's only a couple of paragraphs... and the link is here.
Mark-to-Make-Believe Perfumes Rotten Bank Loans
While on the same issue, here's another story from reader U.D. that just arrived in my in-box. It's from today's edition of Bloomberg... and is an op-ed piece by Bloomberg reporter, Jonathan Weil. The headline reads "Mark-to-Make-Believe Perfumes Rotten Bank Loans". It's directly related to the previous story... and it's not overly long. The link is here.
Ron Paul's golden opportunity
The next story is imbedded in a GATA dispatch... and is a story out of yesterday's edition of The Wall Street Journal. The headline reads "Ron Paul's golden opportunity"... who better to host the debate over sound money in Congress than the Fed's most persistent critic? If I had to pick a must read story for you today, this would be it... and the link is here.
Chinese Researchers Find Official Statistics Massively Understating Inflation
Reader 'David in California' presents us with his first of three offerings on the day. This one is from yesterday's edition of Business Insider... and is headlined "Chinese Researchers Find Official Statistics Massively Understating Inflation". They seem to be afflicted with the same disease that the USA's BLS has... and the link to the story is here.
Silver may be the investment of this decade
My first precious metals-related story is this short interview between Eric Sprott and Jay Taylor that's posted over at kitcoradio.com that reader Doug Beiers sent me. The headline to this interview states that "Silver may be the investment of this decade"... and the link to the interview is here.
World Gold Council Releases Third Quarter Gold Market Outlook
Reader 'David in California' provides the next story. It's another zerohedge.com piece... and this one is entitled "World Gold Council Releases Third Quarter Gold Market Outlook". I'm no fan of the WGC, but there's some interesting data here if you wish to run through it. There's also a link to the entire 26-page report included in the story... but for most readers [including this writer], what's said in the zerohedge.com piece will be information enough. The link is here.
China Business Daily Reports China Is Considering Raising Gold Reserves
Lastly today is another zerohedge.com piece that's also courtesy of 'David in California'. The headline is a familiar one... "China Business Daily Reports China Is Considering Raising Gold Reserves". Of course China is already buying up every ounce of their own production, plus whatever they can get away with in the open market. If you have the time, this story is worth looking through... and the link is here. Bloomberg picked the story up as well... and their take on it is linked here.
¤ The Wrap
The CME's preliminary report for Wednesday, which was posted at their website in the wee hours of this morning, showed around 185,000 gold contracts were traded yesterday... net of all roll-overs. In silver, the net volume was slightly under 80,000 contracts. These volume numbers are down substantially from what they were on Tuesday... which is to be expected, considering that there wasn't much price action on Wednesday.
Early action on Thursday in Far East trading was quite impressive... with big gains in both gold and silver. This has extended into early London trading as well. These are the biggest price gains in both metals that I can remember seeing at this time of day. Gold and silver volumes are high... but not as high as one would expect considering the price action. The dollar has also dropped about 50 basis points since the metals began trading in the Far East during their Thursday morning.
Here's what the Kitco silver chart looked like when I hit the send button on this column at 4:59 a.m. Eastern time this morning.
If this continues into the Comex open, it could be an exciting day in day in New York, as Ted Butler's "larger and quicker" price move may be upon us already. We'll find out soon enough.
See you on Friday.
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