Welcome To The Golden Minerals HUB On AGORACOM
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 Lures Indians as Gold Goes Ballistic
"Adjusted for the U.S. government's own inflation numbers, silver would have to reach around $168 the ounce in today's debased fiat U.S. dollar to equal that number today."
¤ Yesterday in Gold and Silver
The little spike in gold around 10:00 a.m. in London that I spoke of in my closing comments in yesterday's column, proved to be the high-water mark for the gold price on Tuesday...as gold got sold off for the next four hours, hitting its low of the day shortly after 9:00 a.m. Eastern during early Comex trading.
From that low, gold rose to $1,428 spot around 10:40 a.m. in New York...and gold didn't break through that price barrier until the last half hour of electronic trading going into the close of electronic trading at 5:15 p.m.
It was a sloppy trading day, just like Monday...as every rally attempt got sold off throughout the day. Volume, net of all roll-overs, was a bit under 100,000 contracts.
Silver also spiked higher around 10:00 a.m. in London...and it, too, got sold off to its low of the day about 9:01 a.m. in New York. From that low, a very spirited rally began, which either got cut off at the knees, or the buyer disappeared, just minutes before 11:00 a.m. Eastern.
Silver spent the rest of the New York and electronic trading session attempting to move above $36.40 spot...but didn't make it. Silver's volume was around 54,000 contracts net...higher than Monday by a bit, but still not overly heavy.
Silver's close at $36.38 spot was another 30+ year record high close in this ongoing bull market...but we still have a ways to go before we break the all-time record high. And don't forget that's a nominal high. Adjusted for the U.S. government's own inflation numbers, silver would have to reach around $168 the ounce in today's debased fiat U.S. dollar to equal that number today.
The dollar declined slowly all night long on Tuesday...hitting its nadir shortly after 7:00 a.m. in New York. It then rallied a bit into the lunch hour time period, before sliding a hair into the close. Nothing much to see here...although the scale of the chart makes the dollar's move look much more dramatic then it really was.
Washington state reader S.A. was kind enough to send along this 12-year graph of the almighty U.S. dollar...and you can read into this whatever you want.
Despite the fact that the general equity markets finished in the red...the gold stocks spent most the day in positive territory...and the HUI finished up 0.52%. And even though the silver price did quite well yesterday...setting a new high...the stocks were definitely a mixed bag from a closing price point of view.
The CME's Daily Delivery Report on Tuesday finally had some action worthy of the name...as 75 gold, along with 87 silver contracts, were posted for delivery on Thursday. In gold, JPMorgan and Prudential were the only issuers...and the Bank of Nova Scotia stopped all contracts. In silver, it was also JPM and Prudential that were the big issuers...and Barclays was the biggest stopper. The action is definitely worth looking at...and the link is here.
The GLD ETF had a smallish withdrawal of 29,257 yesterday...and there was no reported change at SLV.
Over at Switzerland's Zürcher Kantonalbank for the week that was, they reported receiving around 17,500 ounces of gold...but shipped out about 650,000 ounces of silver from their respective ETFs. I thank both Carl Loeb and Ted Butler for those numbers.
The U.S. Mint had another sales report, but they didn't report selling either gold or silver eagles. This time it was their first 2011 24-K gold buffaloes...and they reported selling 31,000 of them so far this month.
It was another busy day over at the Comex-approved depositories on Monday. They reported receiving 1,568,627 ounces of silver...and they shipped out 585,679 ounces...for a net gain of 982,858 ounces on the day. Current Comex-approved warehouse stocks sit at 104,345,448 troy ounces. The link to Monday's action is here.
¤ Critical Reads
SubscribeUS Approaching Insolvency, Fix To Be 'Painful': Fisher
Today's first story is courtesy of reader Scott Pluschau...and is a Reuters piece that's posted over at cnbc.com. The United States is on a fiscal path towards insolvency and policymakers are at a "tipping point," a Federal Reserve official said on Tuesday. "If we continue down on the path on which the fiscal authorities put us, we will become insolvent, the question is when," said Dallas Federal Reserve Bank President Richard Fisher. Richard has a keen grasp of the obvious...and the link is here.
Existing-Home Sales Plunge, Setback for Housing Recovery
Here's a CNBC story that I 'borrowed' from yesterday's King Report. The National Association of Realtors said on Monday that February sales fell 9.6 percent month-over-month to an annual rate of 4.88 million units, snapping three straight months of gains. The percentage decline was the largest since July. The link is here.
UK inflation rate rises to 4.4% in February
Yesterday in this column I ran a story about how Britons were suffering their biggest drop in living standards for 30 years...as incomes will have fallen 1.6 percent over the three years to the end of 2011.
To add to their litany of woes comes this bbc.co.uk story that was sent to me by reader by Paul C. The CPI figure is the highest since October 2008, and will put pressure on the Bank of England to lift interest rates to curb accelerating inflation. The CPI measure has now been one percentage point or more above the 2% target for 15 months. The link is here.
Portugal braces for govt collapse over debt vote
Here's an AP story that showed up over at finance.yahoo.com...and is courtesy of reader Scott Pluschau. Portugal's government is on the verge of collapse after opposition parties withdrew their support for another round of austerity policies aimed at averting a financial bailout.
The expected defeat of the minority government's latest spending plans in a parliamentary vote Wednesday will likely force its resignation and could stall national and European efforts to deal with the continent's protracted debt crisis. The link is here.
The West bombs, the Arab League ducks
Reader Roy Stephens provides today's next reading material. This is an essay by Pepe Escobar over at the Asia Times. Immediately after the Tomahawks started flying, the White House ran into trouble. The "limited operation" - as in bombing Muammar Gaddafi's air defenses and military installations - may be practically over, and the Americans are dying to be relived of the heavy lifting. But who's going to be in charge?
This is an amazing piece, because it reinforces an article on internal Middle East politics that I posted on the weekend. It's a bit of a read, but worth it if you have the time...and the link is here.
Yemen's president warns of civil war
Here's a Roy Stephens offering that's posted over at aljazeera.com. It was originally headlined "Defections plague Yemeni leader". Ali Abdullah Saleh, Yemen's president, has offered to step down from his post by the end of the year as protests against his rule continue in defiance of a deadly crackdown by security forces.
Saleh pledged a "constitutional" transfer of power, and added that he would not hand over power to the military. Addressing military leaders, he warned against "coups" said the country faced a civil war if he was forced from office. Several senior officers have backed protesters in recent days. The link to the story is here.
Tokyo Warns on Water Supply as Radiation Hampers Nuclear Cleanup
Here's Scott Pluschau's last offering for us today. It's a Bloomberg story dated late yesterday. Five kinds of radioactive materials released by damaged fuel rods were detected in the sea, Tokyo Electric Power Co. said on its website. Levels of one, Iodine-131, which increases the risk of thyroid cancer, were 127 times higher than normal in a sample taken yesterday, it said.
“Food-borne radiation will last longer than airborne radiation,” Gregory Hartl, a spokesman for the World Health Organization in Geneva, said in an interview. “Even smaller amounts of radiation in food could potentially be more dangerous because you ingest it.” The link to the story is here.
Silver lures Indians as gold goes ballistic
Today's first precious metals-related story is this piece that was sent to me by reader George Findlay, which was filed from New Delhi...and posted over at commodityonline.com.
Silver is glittering in India these days. Only poorest among the poor in India could have thought of buying silver jewellery for the marriage of their daughters some years back. But these days, driven by the skyrocketing price of gold, Indians—the rich, the middle class and the poor—are buying silver jewellery and investing in silver.
This is well worth the read...and the link is here.
In India, Post Office is selling gold coins like hotcakes
Here's a story that was sent to me early this morning by reader Bording Ostergaard, which he dug up over at sprott.com...and it's a piece that originated over at the mineweb.com. The humble post office is the latest organisation to get into the gold act in India. Standard 24 carat gold coins have been selling like hotcakes at over 466 post offices dotted throughout the country.
Indian consumers are lining up to buy gold. While coins are a current favourite to give-away during festivities, investors fearing the worst are hoarding gold bars. This is another great story that's worth your time...and the link is here.
Money on Trial
Yesterday in Casey's Daily Dispatch was this excellent essay by CR's own Doug Hornig. It's an expose on Bernard von Northaus...the creator of the silver-backed currency, the Liberty Dollar...the act for which he has now been found guilty. I ran at least two stories on this...in my Friday or Saturday column...and also yesterday's column.
Von Nothaus sees himself as a true patriot, offering a product that can function as a citizen’s defense against the ravages of inflation brought on by the systematic debasement of the greenback.
Doug's essay goes into this in quite a bit of detail on this...and it's well worth reading. Once you click on the link, you have to scroll down a handful of paragraphs to get to it. The link is here.
Dr. Dave Janda Interview's your humble scribe
Every month I'm privileged to get invited onto Dr. Dave Janda's all talk radio program over at WAAM 1600 in Ann Arbor, Michigan. The good doctor interviewed me once again this past Sunday...and if you have about thirty minutes, the link to the interview is here. This takes a while to load.
| Sponsor Advertisement |
|
Cornerstone has started drilling its flagship Shyri gold property in Ecuador Ecuador, one of the world’s most under-explored and resource rich countries, has a brand new mining law that supports international investment. Cornerstone is one of the first companies invited back and has begun drilling the Gama Prospect at our flagship Shyri Gold-Copper Property in southern Ecuador. Together with our joint venture partner Intrepid Mines, we will spend $6.0 million on the property during the next five years. We’re very excited about this project that lies just a few kilometers away from a previously discovered multi-million ounce deposit and has the potential to host a significant gold-copper system. Read more about Shryi and Cornerstone’s entire portfolio of properties. |
¤ The Wrap
Just because something is inevitable doesn’t make it imminent.- Doug Casey
As I mention in my gold commentary at the top of this column, volume was very light on Tuesday...under 100,000 contracts net of all roll-overs...of which there were a goodly number. April open interest in gold is still north of 200,000 contracts, so there are lots of roll-overs left to go in the next six business days. The preliminary open interest number is not overly large...7,883 contracts...and it will be interesting to see what that nets out to when the final o.i. number is posted this a.m.
Gold's final open interest number for Monday's trading action/rally showed an increase of 5,379 contracts...which was about half of the reported preliminary o.i. number.
Silver's net volume on Tuesday was around 54,000 contracts...and the preliminary open interest number is a rather chunky 4,446 contracts...and I await the CME's final o.i. number with great interest.
Monday's final open interest number for silver showed a very small rise of only 673 contracts...which is insignificant in the grand scheme of things, considering that silver had a record high close on Monday. These small rises in silver's open interest numbers every day are very encouraging for the price action going forward.
Tuesday was the cut-off for this Friday's Commitment of Traders report...so whatever open interest numbers are shown in the final CME's final tally this morning, will all be included in Friday's report. Ted Butler and I are hoping the report will show a decline in silver's open interest.
March open interest is now down to 843 contracts...and the 87 contracts posted for delivery tomorrow will be subtracted from this number either tomorrow or Friday. But, regardless of that, the silver shorts still have a lot of contracts to deliver in the next six business days.
Here's the 1-year silver chart. The RSI is a long way from overbought...and as you can see, overbought conditions can last for a very long time. But if we do get a big sell-off from here, it won't have a thing to do with supply and demand...it will be because the bullion banks make it happen.
Not much happened in Far East trading yesterday...and it's just as quiet now that London is open. Volume in both metals is vanishingly small...even lower than yesterday at this time...so I'm not prepared to read a lot into the price action so far during the Wednesday trading day.
But as is almost always the case, it's only what happens during the New York trading session that really matters...and I await the Comex open with great interest.
See you tomorrow.
New Message
Please
login
to post a reply