“The boyz were nowhere to be found yesterday,” says Ed Steer in Casey Research. “They may have been in the equity markets briefly during the day, but if they were, it was to no avail… and they certainly didn’t show up on the short side of any gold or silver trade during regular Comex hours either.” However, Ed says the not-for-profit sellers showed up in New York after 9pm and have been hammering away at prices since…

As the gold and silver prices indicated, there was hardly a soul in sight that wanted to take the short side of any precious metals trade.

However, once regular trading was done, gold and silver flat-lined. But once Globex trading began on Thursday morning in the Far East, gold and silver began rising again, and really took off once Hong Kong opened. At one point, gold was up $30+ and silver almost 50 cents. Then…shortly before 9 p.m. in New York…the not-for-profit sellers showed up and they’ve been hammering away mercilessly ever since.

All those lovely gains have vanished and both metals are in the red as I write this. The boyz show up quite frequently in the thinly-traded Far East market because it’s so much easier to have their way…plus they can set the tone for trading later in the morning when European and British markets open.

Having gold north of $900 when the LBMA opened in London would not be helpful…which is exactly where it was headed until they dropped the hammer. By the time you read this, you’ll know how the made out with their raid. Here’s the Kitco gold chart from yesterday. It’s easy to spot where the boyz showed up last night.

click to enlarge

I note that GLD added 1.1 million ounces yesterday. The SLV was unchanged. In a Bloomberg story, “Venezuela’s central bank may buy 15 metric tons of gold a year to develop gold investment products including coins”, said Eli Sanchez, head of the gold department at Venezuela’s central bank.

Many headlines of interest yesterday….

1) Taiwan’s government ready to prop up stock market (Bloomberg)
2) Russian stock market suspends trading until further notice (Financial Times)
3) Flight to quality may break more money market funds (New York Times)
4) Goldman Sachs may have to merge or divest assets (Reuters)
5) SEC bans naked shorting for all securities (SEC web site)
6) Fed can buy all bad mortgages, banking chairman says (Bloomberg)
7) Uncle Sam taps piggy bank, borrows to aid market (AP)
Government takes over AIG and provides $85 billion loan (AP)
9) FDIC fund slips below minimum target level (AP)
10) U.S. August housing starts at 17.5 year low (Reuters)
11) U.S. current account deficit widens in second quarter (Reuters)
12) U.S. gasoline stockpile drops to lowest since at least 1990 (EIA)
13) IMF Director General says that the worst of the financial crisis may still lie ahead (Reuters)

Today’s first story is from Ambrose Evans-Pritchard from The Telegraph in London. AE-P writes that “the global credit system almost ground to a halt yesterday as yields on US Treasury bills reach zero for the first time since the Great Depression.” The story is linked here.

A gold story finally made it onto the pages of CNNMoney.com. The story is entitled “Gold Posts Record Gain”, and the link is here.

And this just in from the King Report…”The biggest rescue deal in British banking history was agreed to last night as the credit crisis reached new heights. HBOS (Halifax Bank of Scotland), the country’s biggest mortgage lender, accepted an emergency take-over from rival Lloyds TSB following the collapse of its share price.” Sounds familiar to me. Then for the laugh of the day…the CEO of Goldman Sachs was complaining to the CFTC that illegal short selling was the reason his stock was collapsing. What goes around, comes around!!!

What we are facing is the biggest financial crisis the world has ever seen. Today and Friday should be interesting. Seat belts should be on…and the chin straps of your crash helmet should be tightened up one more notch. The President’s Working Group on Financial Markets will have their hands full today.

I hope you have a good Thursday, and all of us at Casey’s Daily Resource Plus will see you on Friday.

Source: And Then There’s This… Thursday September 18, 2008