Ron,
This is what I think and what I put out today. Que sera sera ?
Le Metropole members,
A major gold rally is about to unfold. Our intelligence
network has informed us that the Asian official sector has
,indeed, been stepping up to the plate again and has
been a buyer of physical gold. That is the reason the
gold market has not collapsed under the weight of all
the spec gold borrowings and short selling that
has hit the market. The Asians love to buy on weakness
and have been doing so with great stealth.
The reason that the price of gold is going to ROAR UP
any day now is that some producers have become very
concerned about all this talk about collusion with
the bullion banks and are in the process of covering
hedges, to take on this gold borrowing and spec crowd.
These specs and gold borrowers are now massively short.
On Comex alone the large specs are net short 70,000
contracts. The OTC spec short position is many times that.
These mining companies are becoming increasingly nervous
about too close an association with the forces that are
holding down the price of gold.
The timing of this bull attack is imminent. A clue to all
of this is the plunge in the silver price. Why is
silver tanking when the 1m silver lease rate is
still at 7.5%. The gold lease rate is less than 1% for
comparison's sake. We are assuming the "buyers"
that we are talking about have some heavy gold tonnage
to buy. The gold market is asleep. A way to create cover
to buy gold in size without any "bells and
"whistles" going off, is to crap out silver. That only
brings on more demoralization in the precious metals
arena and distracts market participants from noticing
the gold accumulation of the buyer. If we are correct,
the price of silver will go right back up again after
the buyers have finished their gold buying
( or short covering ) as they buy back their silver
short positions.
Goldman Sachs ( coincidentally ) has been a big gold
buyer this past week. I wonder why? They just went
on a road show to South Africa proclaiming their bearish
market outlook. Of course, they could be buying for a
client. What is important is that they are buying in size.
We suggest they know a change of short term strategy
is now being orchestrated. They are booking profits
on their short positions for their own account and, or,
for client accounts, before the avalanche of other
specs cover when the gold price breaches the $290 to $292
area to the upside. The price of gold could easily shoot
up to $315 as a result of a powerful short covering
rally.
We have been told by very well informed sources from
around the world that GATA is actually having some effect
in that we have raised the awareness level about
"collusive activities" in the gold market. This has
caused many uncomfortable questions to be asked.
The heat is on.
The gold price has turned up in foreign currency terms.
Often, that is a precursor of an upturn in the gold
price in dollars. Last September, Midas du
Metropole called on David Niven, James Darren,
Gregory Peck and Anthony Quinn to take out The
Guns of Navarone resistance at $290. They were our hereos
then as the bears were routed. We call them back
again and also have thrown in Indiana Jones and
Shaka, the great Zulu warrior, to help them.
So Be It !!!!
All the best,
Midas
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