http://www.caseyresearch.com/gsd/edition/reserve-bank-of-india-nears-panic-in-its-war-against-gold
¤ YESTERDAY IN GOLD & SILVER
The gold price traded sideways until shortly after 1:00 p.m. Hong Kong time...and then began to sell off...with the low of the day [$1,387.90 spot] coming shortly before the London close at 4:00 p.m. BST...or 11:00 a.m. in New York. From that point, the price rallied quietly until the 5:15 p.m. EDT close of electronic trading. The high tick...$1,402.10 spot...came shortly before the close.
The gold price finished the Tuesday trading session at $1,400.00 spot right on the button...and down $11.20 from Monday's close. Gross volume was pretty quiet at only 125,000 contracts.
It was more or less the same price pattern in silver, so I shall spare you the details, as the chart below says it all. The high price tick was the Monday close...and the 10:50 a.m. EDT low tick was reported by Kitco as $22.21 spot.
Silver finished the day at $22.55 spot...down 20 cents from Monday. Net volume was a very quiet 25,000 contracts.
The prices of both platinum and palladium didn't do much during the Monday session.
The dollar index closed on Monday at 82.68...and then chopped slowly higher through most of Tuesday, hitting its zenith of 82.95 shortly before 10:30 a.m. in New York. After that it faded quietly into Tuesday's close...finishing the day at 82.77...up a tiny 9 basis points.
It's hard to make a case that gold and silver prices had anything to do with the currency moves yesterday.
The CME's Daily Delivery Report showed that 333 gold and zero silver contracts were posted for delivery within the Comex-approved depositories on Thursday. In gold, the biggest short/issuer was JPMorgan Chase out of its client account with 304 contracts...and the two biggest long/stoppers were HSBC USA with 197...and Barclays with 133 contracts. Once again Canada's Bank of Nova Scotia was conspicuous by its absence. The link to yesterday's Issuers and Stoppers Report ishere.
There was an 87,002 troy ounce withdrawal from GLD yesterday...and SLV had a smallish withdrawal of 144,671 troy ounces, which probably represented a fee payment of some sort.
The U.S. Mint had another sales report yesterday. They sold another 7,000 ounces of gold eagles...1,000 one-ounce 24K gold buffaloes...and another 198,500 silver eagles.
Over at the Comex-approved depositories on Monday, they reported receiving 374,129 ounces ofsilver...and shipped 394,885 troy ounces of the stuff out the door. The link to that activity is here.
In gold, they reported receiving 12,963 troy ounces...and shipped out 49,102 troy ounces to parts unknown. The link to that activity is here.
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selected news and views......
Global shock as manufacturing contracts in U.S. and China
The closely-watched ISM index of US factories tumbled through the “boom-bust line” of 50 to 49, far below expectations. It is the lowest since the depths of the crisis in mid-2009 and a clear sign that US budget cuts are starting to squeeze the economy. New orders plunged 3.5 to 48.8 on weak foreign demand and reduced federal contracts.
The news came hours after HSBC said its index for China also fell below 50, a major inflexion point for the world’s industrial workshop.
“This is not a good moment for the world economy,” said David Bloom, currency chief at HSBC. “The manufacturing indices came in weaker than expected in China, Korea, India and Russia, and then we got America’s ISM.
This Ambrose-Evans Pritchard offering was posted on the telegraph.co.ukInternet site early on Monday evening...and it's definitely worth reading. It's today's first contribution from Roy Stephens.
You thought central bank money printing was at an end? Don’t bet on it
Is the great bond market bubble finally over? For the following, very simple, reason, I’m not yet convinced.
The world economy is still in a very deep hole, with major structural imbalances still largely unaddressed. Any attempt to apply the brakes would only choke off what remains a very fragile and unconvincing recovery, tipping some major economies back into recession.
This in turn means that central banks will struggle to remove monetary accommodation in the way markets are starting to anticipate. We’ve become hooked on easy money, and I very much doubt the world economy is yet ready for the cold turkey of its withdrawal.
This story followed close on the heels of the previous story from The Telegraph...and it's worth reading as well. It's the second story in a row from Roy Stephens.
Solar Strife: E.U. Fires First Shot in Trade War with China
The European Commission on Tuesday announced it was imposing tariffs on Chinese solar panels in response to "price dumping." China has previously warned it would retaliate. The escalating trade war can only have one loser: Germany.
In Chinese industry, the officials of the European Commission have a reputation similar to that enjoyed by tax investigators among affluent tax evaders. They are hated, but at the same time they are received with the greatest of civility.
Which is why more than 100 Chinese exporters of solar panels in recent months have dutifully filled out pages of forms from the European Commission, which accuses them of trying to drive the competition into bankruptcy by undercutting their prices. When the European inspectors arrived, Chinese companies even gave them access to their confidential price calculations for the domestic and international market.
This very interesting must read story was posted on the German website spiegel.de yesterday afternoon Europe time...and it's another offering from Roy Stephens.
Three King World News Blogs
The first commentary is by Richard Russell...and it's headlined "Silver, Gold and a Coming Stock Market Crash". The second interview is with Rick Rule...and it's entitled "A Second Way Investors Can Make a Fortune in These Markets". And lastly is this interview with Jean-Marie Eveillard...and it's headlined "There is Now a Huge Risk of a Collapse in Major Countries".
India's Gold bill for April, May hit $15 billion
India is likely to take more steps to curb the rising imports of gold which may include a ban on sale of gold coins by banks.
India's efforts to keep it’s people away from gold seems to have going nowhere as the country consumed more gold in May than in April when prices crashed.
The world's largest gold consumer, India imported around 162 tonnes of gold in May, from April's 142.5 tonnes. For the two months, cost of gold buying hits over $15 billion.
This must read article appeared on the bullionstreet.com Internet site during the New Delhi lunch hour yesterday...and it's courtesy of Manitoba reader Ulrike Marx.
Reserve Bank of India nears panic in its war against gold
In what traders termed a near-panic reaction to the sliding Indian rupee, the Reserve Bank of India banned import of gold by domestic consumers through bank credit and has made overseas purchase of the precious metal a cash-and-carry business.
The move will nearly cripple the retail jewellery trade and probably lead to higher smuggling into the country, putting the clock back by nearly two decades when socialistic governments restricted gold imports. A day after P. Chidambaram said that "necessarily we will have to check gold imports," the central bank barred gold importers using letters of credit from banks for gold imports.
"All letters of credit to be opened by nominated banks, agencies for import of gold under all categories will be only on 100 percent cash margin basis," the RBI said. "Further, all imports of gold will necessarily have to be on documents against payment basis. Accordingly, gold imports on documents against acceptance basis will not be permitted."
This absolute must read story was posted on the Economic Times of Indiawebsite in the wee hours of their Wednesday morning...and I found this late-breaking news item in a GATA release just before midnight last night.
Major Insider: Time to Buy Gold; The Chinese Want to Make the Yuan Gold Backed
I have mentioned Philippa Malmgren before.
Philippa Malmgren is an insider's insider. She was Special Assistant to the President for Economic Policy on the National Economic Council. She was also a member of the President's Working Group on Financial Markets, aka, the Plunge Protection Team. Her client list includes every elite corporate firm in the world. You don't get much more insider than this.
She is out with a new comment on gold. In it she seems to hint that there might have been a conspiracy to push gold down (Remember this is coming from a major insider, who travels in the circles she is talking about).
This is definitely a must read...as is the link to Dr. Malmgren's commentary at the citywire.co.uk Internet site that was posted on that website last Thursday. I thank Casey Research's own Jeff Clark for bringing this story to my attention...and now to yours.
¤ THE WRAP
The issue which has swept down the centuries...and which will have to be fought sooner or later...is the people versus the banks. - Lord Acton
Another day...and another sell-off back below the $1,400 spot price mark in gold. As I mentioned in this space yesterday, it appears that this price is being defended...as is the $23 spot price mark in silver...but for what reason is not known, although it's a good bet that JPMorgan et al are behind it. How long this state of affairs will last is also another unknown...and despite yesterday's price action, the 20-day moving averages in both metals still remain in play.
Yesterday was the cut-off for this Friday's Commitment of Traders Report and...like every other report for the last six weeks or so, I'll be anxious to see what it contains...plus Ted Butler's take on it...as he's the real expert in these matters.
In Far East trading on their Wednesday, the gold price had the audacity to rally above the $1,400 spot price once again...but that was taken care of at the 8:00 a.m. BST London open...and as I hit the 'send' button at 5:20 a.m. EDT, gold is down about a couple of dollars...and silver is down about a dime. Gold volume is about 'normal' for this time of day...but that can't be said for what went on in silver. Gross volume is already north of 12,000 contracts, with 3,633 of those showing up in the September delivery month. It could be a roll-over out of the upcoming July delivery month...but it's strange to see such large roll-over volume showing up at this time of day. Roll-overs of this size normally occur in New York. The dollar index is trading sideways.
Before signing off today, I'd like to point out that there's a NEW FREE WEBINAR coming your way. It's entitled "Investing in the New Normal". This one stars John Mauldin, Mohamed El-Erian, David Rosenberg, Barry Ritholtz, John Hussman and Kyle Bass. I would bet serious coin that this will be more than worth your while.
It's all happening at 2:00 p.m. EDT on Tuesday, June 11th...and you can read all about ithere.
That's all I have for today...and it's a pretty good bet that today's Comex trading action in the precious metals may be more interesting than usual, as the battle at the $1,400 spot price mark in gold continues in earnest.
See you here tomorrow.
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