While prices of gold don’t necessarily affect silver prices or vice versa, history has demonstrated that when gold rises or falls, silver usually follows suit.

I’m going to open the door to a “secret society” for you today.

The commodity markets are surging today. Are the bulls charging because of investor fear or is something else going on? Here’s the answer.

Gold futures trimmed losses but still ended lower on Monday, as risk-averse investor sentiment and a tumbling Chinese equities market prompted selling in bullion and other commodities.

Commodities prices are surging. World white sugar prices reached record levels on Aug. 10, largely because of booming demand in India where the government has lifted a ban on imports.

Upbeat headlines have been everywhere in recent weeks, and they all seem to point to a single conclusion: The U.S. economy is in the early stages of a very rapid recovery.

I wouldn’t read a lot into the action in the gold market on Friday. It was just another day off the calendar…as Ted Butler would say. The only comment I would make is that the action in the gold price feels more like a top than a bottom.

Gold added about five bucks to its price from the time that trading began in the Far East Thursday…and the London a.m. gold fix. Then from there, it gave back seven dollars going into the p.m. gold fix…and after that, it gained over eight dollars until half past lunchtime in New York. Then a really serious seller showed up taking nine bucks off the price between then and the close of electronic trading in New York. It was pretty choppy trading all around…and it was obvious that every rally ran into serious resistance. The same could be said for silver.

It was a nothing kind of day yesterday. Both gold and silver got sold off at bit in the Hong Kong market late in their afternoon. This lasted until shortly after London opened. Then the prices just sat there until shortly before the London p.m. gold fix, when a N.Y. rally of sorts commenced in both, with neither metal going too far. Ted Butler pointed out to me that neither silver or gold got above their Monday highs…and that was probably the intent.

America is witnessing a mammoth increase in the money supply.  According to the U.S. Federal Reserve, seasonally adjusted M2 has gone from $7.25 trillion in July of 2007 – to over $8.37 trillion today.  That’s 15.44% more money circulating around the economy in just two years, a colossal $1.12 trillion increase.