The Metals: Gold fell as much as $12.08 to $1123.67 by late trade in Asia before it rose in London to see a $1.49 gain at $1137.24 by about 10:30AM EST and next fell back off in late morning New York trade, but it then bounced back higher in the last hour of trade and ended with a loss of just 0.06%. Silver dropped 20 cents to $17.45 in London before it rose to see a $0.105 gain at $17.755 in early New York trade and then fell back off midday, but it also rallied back higher in afternoon trade and ended with a gain of 0.34%. Euro gold remained at about €842, platinum gained $4 to $1688.50, and copper fell a couple of cents to about $3.49. Gold and silver equities fell about 2% by midday, but they then rallied back higher in afternoon trade and ended near unchanged. Oil fell as the U.S. dollar index found slight gains on continued risk aversion in further reaction to the news of fraud charges against Goldman Sachs. Treasuries ended lower as the Dow, Nasdaq, and S&P remained resilient and closed mixed in the face of mostly bad news. Among the big names making news in the market today were Eli Lilly, Citigroup, Goldman Sachs, Hasbro, and Toyota. The Commentary: “Well, yesterday's Commitment of Trader report was no surprise in silver... as the bullion banks increased their net short position by another 3,703 contracts. The '4 or less' bullion banks are short 260.9 million ounces of silver... and the '8 or less' traders are short 328.9 million ounces. This is a staggering amount considering that the net short position in the Commercial category... where all these bullion banks reside... currently sits at 276.9 million ounces. So the '4 or less' traders hold 94.2% of the net short position in silver all by themselves. The '8 or less' hold 118.7% of the net short position. The full-colour COT graph for silver is linked here. In gold, the bullion banks increased their net short position by 18,578 contracts... which wasn't as bad a number as Ted Butler was expecting. The Commercial net short position currently sits at 263,484 contracts... which is 26.3 million ounces of gold. The '4 or less' traders are short 18.8 million ounces of that... and the '8 or less' traders are short 24.0 million ounces. The full-colour COT gold graph is linked here.”– From Ed Steer’s Gold & Silver Daily, read the full report here. “Gold $1,130 – Since just above $300, gold has climbed a wall of worry and denial. You wouldn’t need more than your hands and maybe a few toes to count the number of “experts” who have stayed the bullish course along the way. The road is littered with former gold bulls and perma-bears, all of whom predicted gold’s demise (many more than once). Once again we find ourselves at one of those speed bumps…only this time the supposed land mine is one of those claims that just makes you laugh at the extent some go to in futile hopes of stopping the mother of all secular gold bull markets. The latest charade is the fear Paulson will have to sell his gold holdings because of the Goldman charges. While I would expect such nonsense from the “Senior Analyst” (he ran out of legitimate excuses hundreds of dollars lower ago), I find it amusing (but not surprising) that this lame excuse has caused some real grief. Hello? Do you honestly think the rise in gold has been thanks even in part to Paulson? Sure, he has purchased some credible positions in it, but I highly doubt without him having done so we wouldn’t be at this point anyway. Oh, and by the way, even if his fund was somehow force to sell (the chances of which I believe are slim and none), it’s my understanding that there’s a three-year freeze on redemptions. If I told you once I told you a thousand times, the financial world and the media that covers it hate gold. It will never be widely accepted because ownership of it flies in the face of what makes their world go around – stocks and bonds. This secular gold bull market takes no prisoners and this time will be no exception. I believe the latest naysayers (not the permanent ones like you know who) will end up joining an ever-increasing list of bears who end up mauled by the big and bad gold bull.”- Peter Grandich, Grandich Letter “Who paid the bonuses for Wall Street and how it worked: 1. FASB capitulates and allows holders of OTC derivatives to value them at whatever they wish. 2. International investment firms begin strong mark up policies towards their crap inventory. 3. Profits from the mark up of crap OTC derivatives by the international investment firms is recognized as trading income. 4. Tarp money comes into the firms and goes out as bonuses to the management, trading department and general employees at obscene levels. 5. Stock and bond issues are made to pay back tarp funds. 6. Therefore the money bonuses out by the international investment firms were TARP funds, not real earnings, but false FASB permitted mark up paper earnings through the trading department and declared as trading income. 7. The TARP money was paid back through the issue of stocks and bonds to the public, therefore the public paid the TARP back, not the financial institutions. 8. The obscene level of bonuses is because this game of convert false paper profit into cash into the bank account of the banksters and their merry crew is now game over. It was the last dip at the well of public funds laundered via TARP of the caved in FASB. 9. In the final analysis the public paid those obscene bonuses that were in truth, unearned.”- Jim Sinclair, JSMineset.com

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