Gold Seeker Weekly Wrap-Up: Gold and Silver Fall Over 2% on the Week

	Close	Gain/Loss	On Week
Gold	$1365.90	-$38.30	-2.26%
Silver	$26.00	-$1.38	-2.77%
XAU	216.10	-2.67%	+0.55%
HUI	551.81	-2.81%	+0.35%
GDM	1658.51	-2.61%	+0.17%
JSE Gold	2809.78	-28.66	+3.91%
USD	78.09	-0.08	+1.97%
Euro	136.90	+0.26	-2.47%
Yen	121.32	+0.07	-1.39%
Oil	$84.88	-$2.93	-2.27%
10-Year	2.756%	+0.108	+8.68%
Bond	127.9375	-0.78125	-2.10%
Dow	11192.58	-0.80%	-2.20%
Nasdaq	2518.21	-1.46%	-2.36%
S&P	1199.21	-1.18%	-2.17%

Gold fell almost 2% in Asia before it rebounded in London to see a loss of just $9.05 at $1395.15 at about 9:30AMEST, but it then fell back off for most of trade in New York and ended near its early afternoon low of $1359.75 with a loss of 2.73%. Silver climbed back to as high as $27.29 at about 10AMEST before it also fell back off for most of the rest of trade and ended near its early afternoon low of $25.81 with a loss of 5.04%.

Euro gold fell to about €998, platinum lost $61.50 to $1678.50, and copper fell 13 cents to about $3.89.

Gold and silver equities fell over 3.5% by early afternoon before they bounced back higher, but they still ended with almost 3% losses.

Next week’s economic highlights include Retail Sales, the Empire Manufacturing Index, and Business Inventories on Monday, PPI, TIC Flows, Industrial Production, Capacity Utilization, and the NAHB Market Housing Index on Tuesday, CPI, Housing Starts, and Building Permits on Wednesday, and Initial Jobless Claims, Leading Economic Indicators, and the Philadelphia Fed on Thursday.

Oil fell on worries over waning energy demand due to rising interest rates in China.

The U.S. dollar index reversed early losses and ended only slightly lower on rumors that Ireland may seek a bailout from the European Union.

Treasuries fell after The Federal Reserve Bank of New York announced that it bought $7.229 billion in Treasury bonds as part of the fed’s QE program.

The Dow, Nasdaq, and S&P fell on worries about Chinese inflation and its potential implications.

Among the big names making news in the market Friday were Volkswagen, the U.S. Postal Service, D.R. Horton, J.C. Penney, and Prudential.

How many times in the past five years have you heard China’s growth is finished, and that would tank commodities hard?

Goldman Sachs, now Gold Sachs forecasting $1600 today, gave a warning on investing in China.

The media was going wild on Ireland. That should mean the bottom on the euro is in.

Algorithms had a coronary calling on the hedge funds to sell all long commodities which is by definition an order to shift the position to the short side in the same amount as long.

QE fell on its rear in the bond market as rates increased after the QE exercise which indicated that the size of QE has to be larger to hold even short rates down. It looks like the $900 billion will have to be increased.

The net result was to murder the highly leveraged public futures traders that always seem to have a death wish.

I have seen people go broke on the long side in the gold bull market of the 70s. Guess what? They are doing it again.

Shut down your computer, have a stiff drink if that is your thing, and enjoy your weekend. We have seen this happen a million times and will see it happen a million more times before this story finishes.

Overnight news that China was hiking rates in an effort to remove some of the inflationary pressures that have been building in its economy served as a catalyst for the hedge funds to unload everything that remotely resembled a commodity. There was not a single commodity that was higher today no matter what its current fundamentals may have been. Even the soybean and corn markets, both which have a strong set of bullish fundamentals were sold off as hedgies unloaded some of their longs once their algorithms tripped into the sell mode.

Ditto for gold – it was not spared even though the Dollar was repulsed from its overnight gains. It initially bounced off a support level at this week’s low but then another wave of selling appeared after mid-morning which obliterated that level and dropped it down towards the next support level shown on the price chart near the $1,368 mark. That too did not hold as the longs surrendered their advantage to the shorts by failing to stand their ground. That is the nature of today’s trading crowd however and it is due to the fact that computers are making trading decisions, not human beings. I strongly suspect that quality buying is emerging on this foray lower using the hedge fund liquidation to accumulate the metal however.

Remember the reason gold is moving higher – it is trading as a currency. The failure of the G20 to produce any meaningful consensus in the way of the foreign exchange market leaves unresolved the tensions involving the current monetary system. The status quo remains the same in other words. The US Fed policy of QE is causing inflationary pressures throughout the rest of the global economy, particularly in the emerging market nations as capital flows to those quarters in search of higher returns. As long as the Fed employs its QE, that will not change. The Chinese don’t like what is happening to the cost of commodities and are attempting to slow down their price rise but investors are going to continue to search for areas into which they may protect their wealth from what the Central Banking class is doing do their currencies. Where else are people supposed to put their money? Even the bond market puked today – it is particularly weird seeing this because all the red on my quote screen today especially with bonds, gold, equities and the Dollar all lower, means that for today at least, THERE IS NO SAFE HAVEN TRADE. That is bizarre to say the least. Then again, with the Euro holding slight gains, maybe investors are buying Irish debt as a safe haven!

This is the reason I am not putting much stock in what is occurring today even though damage is being done on the technical price charts for many commodities. It is just money flows being generated by machines without any particular logic behind it. If there was a logic, the bond market would be higher; it is not. Money is coming out of commodities but it is not going into anything. It is just sitting there in trading accounts and investment pools. That tells me no one knows what the hell to do. Look for cooler heads to prevail next week as the sell off in many commodities is overdone and will be corrected as value buyers move back in.

Rest assured, if the stock market gives any indication that it is rolling over, the Fed will not hesitate to ramp up the QE. This could shape up to become a nasty battle between China raising rates and the Fed working to lower longer terms rates with additional QE. What a nightmare that would be! If this cat and mouse game keeps up, it might very well end in a currency war.”- Dan Norcini, More at JSMineset.com

Note: Change in Total Tonnes from yesterday’s data: SPDR subtracted 0.911 tonnes.

COMEX Gold Trust (IAU) Total Tonnes in Trust: 105.45: +1.04 tonne change from yesterday’s data.

Silver Trust (SLV) Total Tonnes in Trust: 10,718.82 - No change from yesterday’s data.

Ivanhoe’s (IVN) listing on the TSX, Exeter’s (XRA) exercised over-allotment option, Gold Field’s (GFI) carbon rating rank, Allied Nevada’s (ANV) test results, and ECU Silver’s (ECU.TO) third quarter results were among the big stories in the gold and silver mining industry making headlines Friday.

Winners & Losers tracks NYSE and AMEX listed gold and silver mining stocks that trade over $1.

Spartan Gold Ltd. Acquires Exclusive Mineral Rights to Historical Arbacoochee Gold Prospect From Alabama Mineral Properties, LLC - More
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Condor Engages Ticar Consulting Corp. for Investor Relations - More
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Khan Responds to NEA Published Statements Concerning its Licenses - More
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Solitaire Minerals Corp. Adds Significant Acreage to its Land Position to the Southeast of BonTerra's Eastern Extension Property, Quebec - More
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Oteegee Innovations Signs Letter of Intent to Acquire Quebec Lithium Property - More
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United Reef Closes Private Placement of 2,440,000 Units - More
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Supatcha Files 10Q Report to Change Reporting Status to Current - More
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Ivanhoe Australia Commences Trading on the Toronto Stock Exchange - "Robert Friedland, Chairman, and Peter Reeve, Chief Executive Officer of Ivanhoe Australia Limited (IAL) (TSX:IVA - News)(ASX:IVA - News), are pleased to announce that the company's stock began trading on the Toronto Stock Exchange following the company's participation in a traditional market-opening ceremony in Toronto this morning." More
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Fancamp Exploration Ltd.: Drilling Starts at McFaulds Lake - More
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Cayden Resources Inc. Announces Proposed Share Split - More
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SEGO RECEIVES PERMIT FOR MINER MOUNTAIN EXPLORATION - More
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Golden Peaks Resources Ltd. Update - More
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Lithium One and KORES Announce Addition of LG International and GS Caltex to Development JV at Sal de Vida Lithium Brine Project, Argentina - More
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MAWSON COMPLETES INITIAL FIELD PROGRAM AT THE ROMPAS GOLD-URANIUM DISCOVERY IN FINLAND - More
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DIAGNOS and Creso Exploration Inc. to Develop Gold and Copper Targets - More
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Numine Resources Announces Receipt of Conditional Approval for Its Qualifying Transaction - More
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Rio Cristal Signs Option Agreement on the La Cumbre Copper Project in Southern Peru - More
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Asia Now Resources Corp. Announces Closing of Private Placement and Welcomes New Directors - More
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Nevada Gold Holdings Inc. Secures $3.425 Million of New Financing with a Strategic Partner in China - More
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Selwyn Announces Reimbursement of CAD$7.44M from Selwyn Chihong - More
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Pele Mountain Resources: Excellent Leverage to Uranium & Rare Earth Elements - More
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Southern Arc Minerals Inc.: Relinquishment of Central Java Properties - More
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PolyMet Agrees to Sell US$30 Million of Common Shares to Glencore - More
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PolyMet and Glencore Agree to Extend Debentures, Cancel Existing Warrants and Issue New Warrants - More
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Nautilus Minerals Announces Financial Results for Q3 2010 and Business Update - More
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Paladin Energy: Financial Report for the Three Months Ending 30 September 2010 - More
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Renaissance Gold Inc.: Wildcat Property Signed with Newmont - More
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Vantex Intersects 8.21 g/t Au Over 22.5 Metres on Galloway - More
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Sprott Resource Corp. Announces Third Quarter Results - More
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Caledonia Mining Announces Third Quarter 2010 Results - More
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ECU Silver Releases Third Quarter Results for 2010 - "The Company generated record net revenues from the sale of dore bars and concentrates for a total of $5,293,139, representing a 20% increase over Q2 2010. The increase in revenue is a result primarily of steady results from the oxide operation plus additional revenues from the sale of the Company's gold/pyrite concentrate stockpile.

The revenues were applied against cash development costs of $4,409,458 bringing the net positive cash flow to $883,681 for Q3 2010. The cash costs were 14% higher than Q2 2010 due to continued exploration and development activities that included opening new areas of the Santa Juana mine and newly discovered veins at the Chicago mine." More
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Exeter Resource Corporation - Over-Allotment Option Exercised in Full From Recent Equity Financing - Exeter Resource Corporation (NYSE-AMEX:XRA, TSX:XRC, Frankfurt:EXB - "Exeter" or the "Company") is pleased to announce that with respect to its recently closed equity financing (the "Offering") the syndicate of underwriters have exercised the over-allotment option (the "Option") granted to them. Pursuant to the Option, the syndicate has acquired an additional 1,209,750 common shares of the Company (the "Common Shares") for gross proceeds to the Company of CDN$7,500,450 bringing the aggregate gross proceeds of the equity financing to CDN$57,503,450." More
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Gold Fields Ranks Top in Carbon Ratings - "Gold Fields Limited (Gold Fields) (JSE, NYSE, NASDAQ Dubai: GFI) is pleased to announce that it was ranked joint first in the JSE Top 100 Carbon Disclosure Leadership Index (CDLI), which rates companies listed on the Johannesburg Stock Exchange in South Africa on their disclosure of carbon emissions." More
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Allied Nevada Reports Additional Metallurgical Test Results Confirming Milling Recoveries of 86.6% for Gold and 84.1% for Silver - "Allied Nevada Gold Corp. ("Allied Nevada" or the "Company") (TSX:ANV - News)(AMEX:ANV - News) is pleased to announce that is has received metallurgical test results from additional composite samples for its Hycroft mine located near Winnemucca, Nevada. The Company has included the new composite test results in a geologically representative metallurgical model, which includes all metallurgical test results received to date for milling oxide and sulfide mineralization." More
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