Ordinarily, a story like this would be troubling ... but not now ... especially when you consider that:
- A one percent drop is hardly a massacre.
- The price of paper gold is down ... the price of physical gold is moving upward.
- It is May Day and therefore, most of Europe is shut down ... many places in the Far East are wrapping up a three day holiday ... volume is light ... and it is therefore the perfect time for manipulators to strike.
- Bank deposits were stolen in Cypress in recent weeks ... governments have made it known this is but the first of many forced conversions.
- ABN AMRO notified their depositors that their metal was gone and that they would have to accept cash settlements ... Swiss banks are refusing to allow their customers to withdraw physical gold, using the excuse of anti-money laundering laws as cover.
- The vaults at the J.P. Morgue are almost empty ... the LBMA is reportedly out of silver and almost out of gold ... the Comex inventories are down significantly as the numbers standing for delivery are soaring (in what is traditionally a small delivery month)
- Queues are long for bullion worldwide ... demand is surging ... mints and refiners are working overtime ... lead times are getting longer.
- Physical is selling at an ever-widening premium over spot ... up to $500 per ounce in Japan ... arbitragers are unable (or unwilling to part with physical) to close the gap ... indicating that the paper price no longer reflects the true price of the metal.
- Barrick is postponing their Pascula-Lama project in Chile-Argentina indefinitely ... Kennecott's Bingham Canyon mine is out of production for at least two years ... huge sources of supplies that the market was counting on will not be available to soften price increases for some time, if ever.
- People buying bullion are essentially converting their fiat currency ... backed by an insolvent government led by a gang of idiots with almost no understanding of basic finance and absolutely no spending discipline ... into another form of currency which has held its value throughout 5,000 years of recorded history.