May 16: Gold and Silver End Lower Again
Gold fell almost 1% to a new 2012 low of $1527.32 in Asia before it rallied back to $1552.03 at about 10:25AM EST, but it then fell back off again into the close and ended with a loss of 0.19%. Silver slipped to $27.202 in Asia before it climbed back to $27.97, but it then dropped to a new low of $26.78 in early afternoon trade and ended with a loss of 1.77%.
Euro gold fell to about €1211, platinum lost $5 to $1426, and copper fell slightly to about $3.48.
Gold and silver equities rose over 2% in the first hour of trade before they fell to see slight losses by midafternoon, but they then rallied back higher in late trade and ended with modest gains.
FOMC Minutes from the fed’s April 25th meeting showed that “a loss of momentum in growth or increased risks to their economic outlook could warrant additional action to keep the recovery going.”
Mortgage refinancing applications jump; rates fall: MBA chicagotribune
Tomorrow at 8:30AM EST brings Initial Jobless Claims for 5/12 expected at 365,000 and at 10AM are Leading Economic Indicators for April expected at 0.2% and the Philadelphia Fed for May expected at 8.8.
Charts Courtesy of http://finance.yahoo.com/
Among the big names making news in the market today were Sketchers, Deere, Target, Facebook, Credit Suisse, and GM.
“With all the turmoil and commotion occurring in Europe, with slowing growth in China and with mixed signals coming out of the US, and now, especially with global stock markets reeling and talk of "US fiscal cliffs" abounding, one would expect the doves on the Fed to begin making noises and talking nicely to the investment community about future plans for additional QE measures. Some have even suggested that one of the things that the Fed also might do is to further push back their date for any rate hike until "late in 2014". For now however we are getting an eerie silence. Even today's minutes of the recent FOMC meeting are rather vague, pretty much just stating what everyone already knows - the Fed will act if they think conditions warrant them so doing. What gives?
Take a look at the following chart of unleaded gasoline which might possibly provide a clue. It seems to me that gasoline prices have become a sort of marker as this commodity is perhaps one that has the greatest impact on the general public at large since it is so obvious as price boards for it are stationed practically everywhere one looks. Notice how gasoline prices have formed a double top on the chart above the $3.40 (these are wholesale prices with no federal or state taxes added) and have begun to come down having fallen some 55 cents or so over the last few weeks.
However, they still remain quite expensive by historical standards and are more than 16% expensive than last fall. My guess is that the policy makers understand full well that any certainty in regards to the advent of a new round of bond purchases by the Fed would turn this chart to the upside faster than one can say "Whoa Nellie".
It is very difficult to deny that while the Fed attempts to stimulate or to provide stimulus to the economy, if gasoline prices rise too highly as a result, it tends to short circuit the impact from such stimulus as higher gasoline/energy prices in general have a depressing or slowing impact on overall economic growth. I suspect that the Fed is hoping and waiting for speculative selling to push gasoline prices even lower yet so that the next round of stimulus will have gasoline prices back closer to levels seen late last year.
The problem for these Central Planners however remains the same, how do they herd speculative money OUT of the COMMODITY MARKETS and particular the ENERGY MARKETS and yet at the same time keep them from abandoning the EQUITY MARKETS? Remember, the more that people talk up the "SLOWING GLOBAL GROWTH" theme to push commodity markets lower the harder it is to justify stock prices at current levels. After all, what is good for the goose is also good for the gander and if the prices of basic commodities are plunging due to slowing growth concerns, then it is extremely difficult if not downright impossible to talk up the stock markets. Rising stocks need an economy that is growing and strongly rising stock prices need an economy that is growing strongly. You cannot have rising stock prices and falling commodity prices simultaneously as it is a logical aberration.
While the ESF and other entities would like to see this aberration - notwithstanding the impossibility of it occurring, if push comes to shove and they have to choose between falling equity prices or rising commodity prices, they will opt for the latter every time, particularly in an election year.”- Dan Norcini, More at http://www.traderdannorcini.blogspot.com/
“My Dear Extended Family,
Please make an effort to stay balanced. Greed is a condition of lack of balance similar to fear. Fear is being fanned from within the gold community as much or more than from outside. When people who know gold is seriously under priced talk temporary bear, they kick good people when they are down. When I last discussed this with Dean Harry Schultz he made a great comment about the leading gold reviewers. Harry said "You cannot herd cats."
We can never make good discussions when we are out of balance. If I can be of any assistance it is to bring you back to balance as you review your situation. The market manipulators depend on being able to unbalance you and the greatest tool they have is to supply credit to the margin junkies who live on the edge of greed. This helps them flash to fear faster than the weather changes on Mt. Washington.
The continued strokes in the fiat money markets, regardless of where, is bullish for gold. The problems of OTC derivative just brought into the headlines by Morgan is alive and well, guaranteeing QE to infinity. It is possible that due to the genus quant's, many of these weapons of mass financial destruction have taken on lives out of the control of their manufacturers. How long the Fed wants to stare down the markets is limited in time in a election year. QE is non-economic buying of US treasuries. They are bought to create a rate by government.
Austerity has exploded in the face of politics in the EU. That always results in changing politicians such as in France and Greece. The recovery in US economic statistics is running thin. That will cause more demand for liquidity especially in this election year as it is liquidity that floats all boats, especially the wishes of the want-to-again-be president.
The Fed has never failed a sitting administration in its history. The Fed is not going to fail the sitting administration in this election year. The assumed strength in the US dollar is a product only of the mirror image of weaker euro. The US dollar is not going to purchase more of anything US when currency induced cost push inflation is alive and well. The USDX is an antiquated index in its weights and measures.
You must make your decision in present time, neither fearful or greed-ful of the future. Look at every factor of gold and list them as bullish or bearish.
My decision is to forge ahead.
Sales of gold or gold shares should only occur when there is a clear and present need to pay bills with no other alternative. Your sales should not be made in the unbalanced fear of the bear raids fundamentally certain to fail in both gold shares as well as gold itself.
Respectfully,”- Jim Sinclair, JSMineset.com
“Gold and Silver – As you can see from the charts, both gold and silver have entered not only key support areas, but are recording some of the most oversold readings in quite some time. This is without a doubt the most bearish overall mood I felt since gold bottomed at the start of the millennium. While there shall be no quick fix and the pain can linger awhile longer, the “mother’ of all bull markets is far from over. I think my views have been cleared in all my recent interviews and commentaries. The boat of real and no-hedge gold bulls has only a few passengers left (and I’m glad to see Captain Jim Sinclair still at the helm) while the gold bear boat is filled up and sailing under the S.S. Titanic 2012 model.”- Peter Grandich, Grandich Letter
As of close of business: 5/15/2012
Gold Warehouse Stocks:
Silver Warehouse Stocks:
Global Gold ETF Holdings
[WGC Sponsored ETF’s]
New York Stock Exchange Arca (NYSE Arca) AND Singapore Exchange (SGX) AND Tokyo Stock Exchange (TSE) AND Hong Kong Stock Exchange (HKEx)
SPDR® Gold Shares
London Stock Exchange (LSE) AND NYSE Euronext Paris AND Borsa Italiana AND Frankfurter Wertpapierbörse (Deutsche Börse - Xetra)
Gold Bullion Securities
London Stock Exchange (LSE) AND NYSE Euronext Paris AND Borsa Italiana AND Frankfurter Wertpapierbörse (Deutsche Börse - Xetra) AND NYSE Euronext Amsterdam
ETFS Physical Gold
Australian Stock Exchange (ASX)
Gold Bullion Securities
Johannesburg Securities Exchange (JSE)
New Gold Debentures
Note: No change in Total Tonnes from yesterday’s data.
COMEX Gold Trust (IAU) Total Tonnes in Trust: 177.49: -0.82 change from yesterday’s data.
Silver Trust (SLV) Total Tonnes in Trust: 9,516.40: No change from yesterday’s data.
Timberline’s (TLR) amended non-binding Letter of Intent to increase its ownership stake in the Butte Highlands Gold Project, Vista Gold’s (VGZ) drill and test results, Allied Nevada’s (ANV) senior notes offering, and Extorre’s (XG) drill results and reaction to current market conditions were among the big stories in the gold and silver mining industry making headlines today.
JAG +5.51% $1.34
IVN +3.82% $8.98
3. Mines MGMT
MGN -8.00% $1.15
Winners & Losers tracks NYSE and AMEX listed gold and silver mining stocks that trade over $1.
Please see Yahoo’s Mining/Metals News Wire for all of today’s mining news.
- Chris Mullen, Gold Seeker Report
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