Gold rose when Globex trading resumed in New York late Thursday evening, but sold off the second the Sydney market closed for the weekend. The bottom was in London…about 7:00 a.m. NY time. From there it rose (with lots of opposition) until Globex trading was through for the weekend in New York.

Silver gained about a dime in Far East trading, but got sold off hard the second that Hong Kong closed…but began to rise (along with gold) around 7:00 a.m. NY time. From there, it oscillated either side of $16.50 until New York closed for the weekend. It’s obvious (at least to me) that someone didn’t want any excitement in the precious metals today…at least not in gold and silver…although platinum and palladium seemed to do OK.

Open interest on Thursday was once again of the strange variety. Gold o.i. only dropped 891 contracts on a price fall of about eleven bucks…not a lot. And even though silver was down a bit on Thursday, the o.i. was up again…for the third day in a row! This time by 1,157 contracts. Is this shorting…new spreads??? It will, of course, be in next week’s COT. It seems like we’re always waiting for the next report, as the current one never provides us with what we really want to know…like what’s happening right now.

However, we do have the latest Commitment of Traders report. There weren’t a lot of changes in silver, but the bullion banks did improve their position by about 1,500 contracts as the tech funds pitched their longs. The tech funds (in the Non-Commercial category) only added 161 longs to their position, but went short 1,193 contracts. The bullion banks in the Commercial category added 3,643 contracts to their long position, but also added another 2,087 contracts to their short position…which nets out to the 1,500 contracts mentioned above.

But the big story is in gold. I guess I was wrong this time, as everything that should have been reported, obviously was. The COT showed about a 19,000 contract improvement in the bullion banks’ short position, as the tech funds in the Non-Commercial category not only pitched a pile of longs, but went short by a bunch too. To be precise, the tech funds tossed 11,369 longs and put on a whopping 7,594 short contracts! That’s a lot…and they’ve added more since the Tuesday cut-off. The bullion banks hiding in the Commercial category not only added 1,731 contracts to their long position, but covered a more than impressive 17,359 contracts in their short position. There’s your 19,000 contract improvement right there.

I feel that the Thursday/Friday time period was the absolute bottom…but I’ll wait to see what the G8 has up their respective sleeves this weekend before I break out the bubbly.

I note the following headlines in John Williams’ latest commentary over at shadowstats.com…and they are as follows: 1) Inflationary recession and banking crisis continue to intensify, 2) Market fantasies of contained crisis begin to fade, 3) Severe inflation surge in offing, 4) Evidence mounts for manipulation of key headline economic numbers.

The first story today is from The Telegraph out of London and is another offering from Ambrose Evans-Pritchard. Does this guy ever sleep? If you think that the $US has its problems, the Euro doesn’t seem to be much better off these days. The story is entitled “Support for euro in doubt as Germans reject Latin bloc notes”. It’s well worth the read and is linked here.

The second story is also from The Telegraph and is entitled “Russia plans Arctic military build-up”. This story is certainly no surprise to me, as the rush to claim whatever oil and gas reserves may be left on this planet is now on in earnest. The link is here.

I didn’t attend the funeral, but I sent a nice letter saying I approved of it. – Mark Twain

Despite the enormous influence that the Beatles had on music in Britain and around the world, this rock tune is still #1 in Britain, and will probably remain so until long after I’ve left this world. The youtube.com video in question is linked here.

I see in a Bloomberg story that foreclosures were up 48% in May and repossessions have doubled. “One in every 483 U.S. households either lost their home to foreclosure, received a default notice or were warned of a pending action.” But, hey…the Dow was up…so everything is fine.

Enjoy what’s left of your weekend and I’ll see you early on Tuesday morning.

Casey Research correspondent-at-large Ed Steer is a keen observer of the financial scene and a board member of GATA.org.

Source: And Then There’s This…Saturday, June 14th, 2008