Jim Rogers: British Pound Could Collapse Within Weeks
Gold didn't do much of anything in either Far East or early London trading… and was pretty much unchanged from it's Thursday close by the time New York opened for business yesterday morning. From that point, gold made three separate attempts to break higher… and all were quickly squashed. Once the Comex closed, gold [as usual] traded sideways for the rest of the New York session. Gold was up $11.30 on the day.
Silver's trading action on Friday was very similar to gold's… but it's rally in New York proved to be more successful. However, if you examine silver's graph carefully enough, you can still detect opposition to its rally. Silver rose 39 cents.
The dollar spent most of Friday grinding slowly lower. Here's a 2-year chart. I'm not a technician, but the dollar looks like it's rolling over to me… even though the 50-day moving average just headed north through the 200-day moving average. But with the problems that the euro's having these days… I'm going to keep an open mind on which direction the dollar is going to go short term… even though it's hugely overbought at the moment.
The HUI chart looks more like the Dow chart than the gold chart, although the precious metals shares did catch a bid during the last half hour of trading as the Dow headed south. The HUI was up a paltry 0.81% to 404.18… which was down a bit over ten points on the week.
Well, the CME's website is not performing the way it should at the moment, and I had to steal these open interest changes from Bill Murphy over at lemetropolecafe.com. Gold's open interest change for Thursday's trading was an unhappy surprise when I checked it yesterday morning… as it was up a very large 12,201 contracts. On the other hand, silver's open interest was down a whopping 5,827 contracts. Both metals had decent rallies on Thursday… so why the monstrous dichotomy? Don't know. Ted Butler and I had an 'animated' discussion about it… and that didn't help.
The CME's website does have some data available, however, The latest Delivery Report is now posted and it shows that 38 gold and 518 silver contracts are up for delivery on Tuesday. The big issuer in silver was Bank of Nova Scotia… and they, along with JPMorgan, were the biggest stoppers. This is another day when the list of issuers and stoppers is worth looking over, and the link to that web page is here.
There were no changes in GLD yesterday… but over at SLV they reported receiving 981,116 ounces. The U.S. Mint had no report yesterday and finished the month at 80,000 one-ounce gold eagles and 2,050,000 silver eagles. The Comex-approved depositories reported a net inflow of a smallish 25,091 ounces of silver on Thursday… but there was a lot of activity nonetheless, and you can check out the action here.
The COT report [for positions held at the end of trading on Tuesday, February 23rd] did not make me happy. True, silver's open interest only rose 1,544 contracts… but gold's o.i. was up an astonishing 18,166 contracts. Considering the price action in gold last week, I'm still trying to get my head around why this is so. Add to that the big increase in Thursday's open interest reported above, and it's obvious that gold's tiny rally to date is running into huge opposition. But, so far, it appears that silver has not suffered the same fate. Ted figures that the bullion banks may be trying to divorce the price of silver from gold… a thought that he's had for quite a number of years now. Anyway, I'm not going to try and dissect and bisect this data any further, as Ted Butler has his usual Friday interview with Eric King over at King World News… and I'll let him explain what he thinks may be happening… and the link is here. I suggest you give this interview your undivided attention.
Since James Turk's name came up in the previous paragraph… here's another commentary that he's just posted over at his fgmr.com website. It's a longish piece [for him] and has a couple of nifty graphs. The title reads "What Are Banks Doing with Their Depositor's Money?"… and the link is here.
The next story is all about residential real estate in the U.S. It's a Bloomberg piece headlined "U.S. Economy: Sales of Previously Owned Homes Fall". The first paragraph reads… "Sales of previously owned U.S. homes unexpectedly dropped 7.2 percent in January to a seven-month low, indicating a lack of job growth is undermining government incentives to bolster the housing market." Have you ever noticed, dear reader, that all bad news is "unexpected"? This is just another way that they 'spin' the news… as it's all about molding people's thought about future expectations. This is a longish story… and the link is here.
Here's a story that I attempted to run yesterday… but, for whatever reason, the link didn't work so my 'editor' had to pull it. I've found another source for this story, and here it is… "Billionaire financier Jim Rogers has predicted that the British Pound could completely collapse within weeks, sending shockwaves throughout the global economy and heralding the beginning of a downturn that would make the recent economic crisis look tame in comparison." The headline reads "Jim Rogers: Pound Could Collapse Within Weeks"… and I thank reader Doug Beiers for sending it along. The link is here.
The next story is from the dailymail.co.uk… and is courtesy of yesterday's King Report. It's an absolute must read from one end to the other. The headline reads "Man who broke the Bank of England, George Soros, at centre of hedge funds plot to cash in on fall of the euro". Things are unraveling in the currency markets at warp speed right now… and I have no idea of how long things will continue to careen down this path without something blowing up. Once again it's a must read story and the link is here.
The continuing unraveling of relations between Greece and Germany [and the rest of the European Union] would be a comedy if it weren't a tragedy. Here's Tyler Durden over at zerohedge.com wading into the fray. His piece is entitled "Greece Retaliation Against Germany Escalates: Airbrushed Venus Statue Flipping Off Greeks By Banana-Eating Germans Prompts Greek Boycott". This, too, is a must read… and the link is here. And, by the way, the 2-minute Monty Python skit at the end of the story is a hoot!!!
It seems like every major world currency is circling the drain these days… with the British pound, the euro, and the dollar… at the epicenter. Now, into this fray steps the IMF's chief-cook-and-bottle-washer, Dominique Strauss-Kahn. As usual, he's talking about a new reserve currency. But this time he's talking about a 'new and improved' version of the IMF's Special Drawing Rights… or SDRs. "Strauss-Kahn said such an asset could be similar to, but distinctly different from, the IMF's special drawing rights, or SDRs, the accounting unit that countries use to hold funds within the IMF… [which] is based on a basket of major currencies." He didn't elaborate. But, dear reader, if it isn't backed by gold, it will be D.O.A. The story, posted in the Minneapolis-St. Paul Star Tribune, is headlined… "IMF's Strauss-Kahn suggests IMF may one day provide global reserve asset"… and is very much worth the read. The link is here.
I just have to throw this global warming story in as my closing article for the week. Over at Apple's MacDailyNews.com… the headline reads… "Apple Board member Al Gore mocked at Apple shareholder's meeting". But the real story on Al Gore comes from over at foxnews.com… where columnist Gene Koprowski has a field day with the story. The headline is a beauty… "You Can Call Him Al … But Al Won't Call You Back". I thank reader Roy Stephens for sending me the story… and the link is here.
Today's 'blast from the past' music video is also from the era of black and white TV. This song was a hit back in 1964… that's 46 years ago. Scary, isn't it? If you're over 50… you should know it well, so turn up your speakers and click here. There's a time burn on it, but that doesn't detract from the performance one bit. I thank reader Dave Mancini for bringing it to my attention way back in November of last year.
Well, the CME's website is back up… and they've made some changes to their website while they were down. But I have the Friday's preliminary volume figures for both gold and silver. Gold volume was an insignificant 137,518 contracts… and silver's volume was a decent 35,643 contracts. Silver' open interest for March has evaporated… and is now down to a paltry 1,811 contracts. There is no chance whatsoever that delivery problems are going to manifest themselves in March. There's nothing to see here, folks… please move along.
And there's nothing in those news stories above that warms the cockles of my heart one little bit. There's Armageddon in every direction as far as the eye can see. It's not a matter of how long it will take to arrive on the scene… as it's already here. All I'm waiting for, dear reader, is the day when it all comes crashing down.
I'm in full survival mode now. Yesterday I paid off the last of my tiny mortgage and small line of credit that I had. I'm loaded to the eyeballs with physical metals… and the shares of some of the top quality companies that produce them. I hope it's enough. The Mogambo Guru would be proud of me… even though I don't have a bunker, or dual 50-calibre machine guns.
That's why, dear reader, I'm 'all in' with my precious metals investments. If this isn't a safe haven in the times we face, then nothing is. That's why I keep urging you to invest in a subscription to either Casey's Gold & Resource Report… or Casey Research's International Speculator. It's absolutely critical to be invested in the right precious metals companies at this point. As I said in my column on Friday, I feel that time is running out real quick… and when the real move in both gold and silver gets going, there won't be much of an entry point on that rally… which may be starting now.
Enjoy the rest of your weekend… and I'll see you on Tuesday morning.