Gold & Silver Digest: 6/11/13

Adam Taggart
By Adam Taggart on Tue, Jun 11, 2013 - 8:09pm

The Gold & Silver Digest contains headlines of stories that members of this group deem relevant and/or interesting to precious metals enthusiasts.

If you have articles to submit for the next digest, please email them to me by clicking here.

6/11/13 7:49 PM EST US close metals price quotes from Finviz

Reuters: Gold down, worries over central bank stimulus weigh

Gold hit a near three-week low on Tuesday, ending lower as a lack of new economic stimulus from the Bank of Japan fueled worries that other central banks may also withdraw their support, denting bullion's inflation-hedge appeal.

The precious metal was down as much as 1.4 percent after the Bank of Japan said it held off on new measures, arguing that bond markets had stabilized. Gold closed around 0.6 percent lower. 

ZeroHedge: JPM Vault Gold Drops By 28.4% Overnight, Slides To Fresh Record Low As Withdrawals Accelerate

With a massive 6,208 (or 80% of the total in the entire Comex system) Customer Delivery issues outstanding against JPM so far in June alone, many have been wondering - how and when will the firm reconcile what is seemingly more demand for JPM vaulted gold than the firm has in its possession?

While we still don't have the answer, what we do know is that as of an hour ago when the Comex released its daily vault depository statistics, JPM has said goodbye to another 28.4% of all of its vaulted gold - the largest one day withdrawal since April 25, the result of the departure of 61.5% of its Eligible gold, or 218k troy oz, as hundreds of thousands of registered ounces in the bast few weeks have seen warrant detachment.

Yahoo! Finance: Gold: Respect the Range from $1,350 – $1,422 Says Kilburg

Dirty Little Secret: Picking winners is relatively easy compared to controlling losses. Once an investment has racked up gains for an investor it's extremely difficult to sell. When a position has been a loser since day 1 it can be even harder to get rid of it, if only because doing so is tantamount to confession of defeat.

Such has been the case with gold. Over the last decade an investment in the SPDR Gold Trust ETF (GLD) has risen 200% compared to about 50% for the Dow Jones Industrial Average (^DJI). What really set the hook for gold lovers were the five years of relative performance of the GLD over the five years ending at gold's peak in September of 2011. Over that terrifying period of global economic history gold rose 200% while the Dow was virtually flat.

Bloomberg: Gold ‘Triangle’ Signals Price Drop to $1,250: Technical Analysis

Gold is set to drop to the lowest level since 2010 after forming a symmetrical triangle, according to technical analysis by Bank of America Corp.

Bullion for immediate delivery will drop to as low as $1,250 an ounce over the next month after the “well-defined, symmetrical triangle” it formed since April 16, MacNeil Curry, chief of rates and currencies technical strategist at Bank of America in New York, said by telephone yesterday. That would be the lowest level since September 2010.

Bloomberg: Paulson Gold Fund Fell 13 Percent in May to Steepen Loss

Billionaire John Paulson, the hedge-fund manager trying to recover from losses related to bullion this year, posted a 13 percent decline in his Gold Fund last month, according to a letter to investors.

The drop brings losses in the strategy to 54 percent since the start of the year, the firm said in the letter, a copy of which was obtained by Bloomberg News. The Gold Fund is the smallest strategy of the $19 billion money manager, with about $360 million, or 2 percent of assets, most of it Paulson’s own money.

SFGate: 10 Countries That Are Losing A Fortune On The Collapse In Gold (GLD)

Gold prices first fell below the $1,400 per ounce level in April.

For central banks that bought up 534.6 metric tons of gold last year this hasn't been a good time. Gold is well off its 52-week high of $1,804.

Global gold holdings totaled 31,793.9 tonnes as of June 2013, according to the latest report from the World Gold Council. This is up from 31,735.4 in May.

GoldSilverWorlds: JPMorgan Now Long Gold. A Game Changer?

The latest futures positions report (Commitment of Traders, COT) shows the continuation of a pattern that started after the gold and silver price rally in August 2012. Especially the gold market is turning upside down. Why? Because of the gigantic spread between the speculators (increasingly short, although it somehow stabilized past week) and the commercials (increasingly long, although it stabilized as well past week). The below chart reveals this point; commercial positions are in green (close to net zero), speculators are in blue and red (also moving to net zero). As readers see, today’s positions are comparable to the ones at the end of 2008, right before a major upleg in the price of gold and silver price started. Does it mean that we are about to witness the same bull run? It could be although the big difference between now and then is that QE only started then while QE seems to becoming increasingly ineffective right now. Otherwise stated, the central bank has created +2 trillion US dollars between now and then, while other central banks across the world have created similarly huge amounts of money to combat deflation. Chart courtesy:

Forbes: May Gold Sales Fall At Perth, U.S. Mint

Gold coin and bar sales have cooled at two of the world’s largest mints, the Perth Mint and the U.S. Mint, as the buying seen during April’s breakneck pace eases.

Silver sales are also softer, according to data listed on both mints’ websites.

Business may be off versus a month ago, but total sales remain elevated versus a year ago.

Total gold ounces sold at the Perth Mint, which includes coins and bars, were 86,983.54 ounces in May, compared to 111,505.06 in April, the Perth Mint said on its website. April’s sales were a record, they said.

Reuters: Opportunity knocks as palladium hits 2-year high vs gold

Palladium prices have reached their highest versus gold in more than two years this week as a rally in risk assets boosts the appeal of industrial commodities, with further rises likely as the economic recovery gains impetus.

The ratio of gold to palladium slid to 1.81 on Monday, its lowest since March 2011, as firm U.S. jobs data fuelled hopes the U.S. recovery is on track, and after Standard & Poor's revised up its sovereign credit outlook for the United States.

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