Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
It was a pretty quiet day in Far East trading in the gold market on Tuesday. There was a bit of a pop shortly before London opened, but that got sold off the moment that the London a.m. gold fix was in at 10:30 a.m. GMT in London…5:30 a.m. Eastern time.
From there, the gold price slid right into the New York open at 8:20 a.m…when a buyer of some size showed up and popped the price up about ten bucks in very short order. From that point, the gold price ground slowly higher to its 1:00 pm. Eastern time on-the-button high of $1,369.30 spot.
Then gold price then got sold off a few dollars going into the close of electronic trading at 5:15 p.m. Eastern time.
Reader Scott Pluschau was kind enough to send the 10-minute gold chart once again…and you can see the big pop between 8:20 a.m. and 8:35 a.m. Eastern time, where 16,351 contracts got traded in one 10-minute slice between 8:20 and 8:30 a.m.
Silver was the star performer of the day yesterday. The jump in price that occurred shortly before the London open was for naught, as the price got smacked along with gold at the a.m. gold fix in London…and silver was back to the unchanged mark by the time that New York opened. The big jump in silver at 8:20 a.m. was followed by a slow-but-sure rise in the price for the rest of the New York trading session. After hitting its high [$30.40 spot] around 2:45 p.m. Eastern…the silver price basically traded sideways into the close.
The dollar declined slowly right from the open in the Far East yesterday…and its absolute low of the Tuesday session around 11:30 a.m. Eastern. Then it rallied into the close of New York trading…basically finishing unchanged on the day.
The gold stocks gapped up at the open…and then stayed there for the rest of the New York trading day. The HUI finished up 2.40%. Despite the very robust gains in the silver price, not all silver stocks had a big day yesterday…but the ones that did, beat the HUI by quite large margins.
Tuesday’s CME Delivery Report showed that 201 gold and zero silver contracts were posted for delivery tomorrow. The link to what action there was…is here.
The GLD ETF showed a very small decline…only 9,757 ounces…which could have been a fee payment of some kind. There were no changes reported in SLV.
The U.S. Mint had a sales report on Tuesday. The sold another 6,500 troy ounces of gold eagles, along with another 59,000 silver eagles. Month-to-date, the mint has sold 20,000 ounces of gold eagles…and 897,000 silver eagles.
Over at the Comex-approved depositories on Monday…252,945 ounces of silver were reported withdrawn.
Yesterday I ran the BDI/CRB chart…wondering out loud what the graph would look like if the old CRB graph [Continuous Commodity Index – CCI] was used instead of the CRB, since it’s now at record highs…and the CRB is a long way from new highs. As reader Bryan Bishop said in his e-mail to me yesterday…”ask, and ye shall receive.”
Not only does this 5-year chart have the BDI index…it’s got both the CRB and the CCI on it as well. The BDI is in green, the CRB is in dark blue…and the CCI is black and red. The chart is as I imagined it to be.
Correction
I wish to issue a correction to the daily column that I posted yesterday — the one where JPMorgan was going to accept gold as collateral against any kind of “crappy paper,” as GATA’s Chris Powell so eloquently put it. I mentioned that JPMorgan was only going to accept physical bullion that was on deposit with them. Well, it turns out that just about any ETF will suffice as collateral and, one would presume, the GLD ETF would be included in that. I thank reader Randall Reinwasser for setting me straight.
