[Backtosteam]

But where is the money going? Are people just sitting out for a while holding paper currency? It doesn't seem to be going into the stock market and I'm pretty sure it's not going into real estate. What's left? That's why I'm still bullish on metals. Especially with inflation creeping up. The FED is stuck too...they really can't raise rates any significant amount with causing havoc with half of American consumers.

[pea-jay]

$this->bbcode_second_pass_quote('o2ny', 'W')ell Bernanke really yanked the rug out from under the gold rally with his 'tough guy' talk about inflation, but really- how many rabbits do the feds have left in their hat now... everybody knows inflation is coming (see OIL), but raising interest rates as the economy is already entering a slowdown is sheer madness. Stagflation anyone? A couple more moves and then Ben is checkmated. Gold wins.

[DesertBear2]

$this->bbcode_second_pass_quote('Heineken', 'W')hat I want to know is why gold is going down when inflation is clearly heating up---Bernanke's quacking about interest rates aside.

[Heineken]

But DesertBear, recessions are supposed to drive the big smart money into "safe havens" like gold, as happened during the 1973-81 period. Theoretically, that trend more than offsets reduced demand for gold from average folk, and the gold price rises until inflation subsides and growth resumes. So I'm confused by the big gold selloff. Maybe it's just a temporary kneejerk reaction to rate jitters.

[Chaparral]

It appears that gold was deliberately stomped. The lease rates had increased sharply in the prior week. According to futuresource.com, today's bounce was facilitated by a lot of short-covering. According to another commentator, open interest was actually declining before the tuesday massacre. Tuesday's action was a move on the chessboard to trigger program stop losses and then mop up the spoils quickly before the bargain hunters could come in and erase them.

In investing and trading, one must keep in mind that there is more to it than just fundamentals and technical analysis. There is all out financial warfare, complete with ambushes, espionage and deceit.

Intelligence info on the other guy's stop losses is a very valuable commodity on the trading floor. Clerks tend to be sexy attractive people who can tease information out of the undisciplined and vulnerable. If one knows who is buying and what their stop-losses are, one can pump a large enough amount of money into the market by shorting or going long. The other guy's programmed buy or sell orders kick in and do the rest of the damage. It appears that on April 20th with silver and this last Tuesday, those programmed trades are what caused most of the carnage. Once the other guy's program has run its course, one then covers one's shorts or longs and takes profits before opportunists and bargain hunters can jump in.

Remember, trading is a zero sum game. In order for one player to make money, another MUST lose his; no different than carbon- based life really.

[airstrip1]

$this->bbcode_second_pass_quote('Heineken', 'B')ut DesertBear, recessions are supposed to drive the big smart money into "safe havens" like gold, as happened during the 1973-81 period.

[Luckystars]

The PMs fall when the moon is conjunct Pluto at the Galactic center, the next will be July 8th but that is not a US trading day, Friday the 7th should see a sell off, but in the long term they are only going up. I see the high for the year being around December 15th, with a sell off around the 17th.

China will soon realize that US bonds are not a good investment and will begin to transfer assets into gold. When Saturn ( control) leaves Leo the ruler of gold in Sept 07 price fixing will no longer be possible and that is when the gold bull breaks loose, the peak will be late Nov 07, but the upward trend lasts for a few years beyond.

[seahorse]

Several writers like the one mentioned above are saying that 1-3 large investors have shorted a huge amount of silver. Why don't the writers ever say who these investors are? And, I never fully understand the implications suggested by the articles, anyone care to explain it to the dummies?

[JoeCoal]

Banks don't publish the balance of all their customer's accounts by name, just the bank's total assets. Similarly, the COMEX doesn't identify who is holding a short position, just that the short positions exist.

Implication? The short positions (promises to sell in the future at a certain price) are apparently larger than the amount of “good deliverable” metal available, or in other words, someone has promised to sell more metal than there is in existence. This is being done at a very low price, to drive the price down. At some point this game will backfire – the buyer of the short will demand delivery, and the seller of the short won't be able to deliver. This will cause the price to explode while the short seller desperately tries to come up with the goods to avoid defaulting, or at least that's the theory...

[seahorse]

JC or others,

If the price of silver has been pushed down due to big short positions, do you think silver is a good buy right now?

[mattduke]

Spot gold breaks 700... for now.

Kitco

[Tyler_JC]

$this->bbcode_second_pass_quote('mattduke', 'S')pot gold breaks 700... for now.

Kitco

[seahorse2]

Gold Bugs, check this out - US mint stops circulating US Gold Eagles due to increasing market value of gold. Expects to take new orders after September 27, 2007: US Mint Gold Eagles

[mattduke]

"Due to the increasing market value of gold, the American Eagle Gold Uncirculated Coins are temporarily unavailable while pricing for this option can be adjusted; therefore, no orders can be taken at this time. We expect products to be available with adjusted pricing on or after September 27, 2007."

What is the hypothesis here? Clearly "price adjusting" does not require two weeks. The price is continuously updated without problems every day. So what does that leave? Are they "running low" on gold? Can they not keep up with the demand? And what about this date September 27? What is the importance of the upcoming two weeks? Are they expecting certain events to unfold? If the price does catapult after Bernanke's speech, the higher prices would presumably diminish their drain rate. Fascinating.

[SinisterBlueCat]

they have not suspended the sale of all gold coins, only the W marked uncirculated coins that sell at a premium and can only be ordered (at this time) from the mint.

[Offshore]

Hmm.

[manu]

Well they wouldnt want people taking their hard earned $ out of the banks and buying gold would they?

[manu]

Well they wouldnt want people taking their hard earned $ out of the banks and buying gold would they?

[perdition79]

$this->bbcode_second_pass_quote('SinisterBlueCat', 't')hey have not suspended the sale of all gold coins, only the W marked uncirculated coins that sell at a premium and can only be ordered (at this time) from the mint

[emersonbiggins]

No surprises here.
Bloomberg
$this->bbcode_second_pass_quote('', 'G')old Rises to Highest Since 1980 as Dollar Slumps on Fed's Cut By Pham-Duy Nguyen
Sept. 18 (Bloomberg) -- Gold futures rose to a 27-year high after the Federal Reserve cut interest rates, sending the dollar to a record low against the euro and boosting the appeal of the precious metal as a currency hedge.
The Fed lowered its benchmark rate by 0.5 percentage point, more than economists forecast, to 4.75 percent, the first cut in four years. Five of the past six bear markets for the U.S. currency have sparked a rally in gold.
``Investors are scared,'' said Ron Goodis, futures trading director at Equidex Brokerage Group Inc. in Closter, New Jersey. ``The rate cut is inflationary, and money is flowing into gold as a hedge.''
Gold futures for December delivery jumped $11.70, or 1.6 percent, to $735.50 an ounce at 3:26 p.m. in electronic trading on the Comex division of the New York Mercantile Exchange. That marked the highest price for the most-active contract since Feb. 11, 1980.
...