Gold Seeker Closing Report: Gold and Silver End Lower

	Close	Gain/Loss
Gold	$1318.90	-$14.70
Silver	$27.01	-$0.11
XAU	198.80	-2.57%
HUI	503.84	-2.63%
GDM	1491.23	-2.58%
JSE Gold	2542.23	+31.25
USD	77.70	-0.11
Euro	137.35	+0.31
Yen	120.66	-0.99
Oil	$85.64	-$1.69
10-Year	3.385%	-0.043
T-Bond	120.71875	+0.65625
Dow	11989.83	+0.04%
Nasdaq	2755.28	+0.58%
S&P	1299.54	+0.22%

Gold continued yesterday’s after hours access trade advance and rose $14.35 to as high as $1347.95 in Asia before it fell back off in London and saw a $2.42 loss at $1331.18 by a little before 9AM EST and then bounced around near unchanged for most of the morning in New York, but it then fell of even further in late morning trade and ended near its 11:30AM EST low of $1316.55 with a loss of 1.1%. Silver climbed 69 cents to $27.81 before it fell back to $27.27 a little after 4AM EST and then climbed back to as high as $27.728 by midmorning in New York, but it also fell back off in late trade and ended near its new late morning low of $26.785 with a loss of 0.41%.

Euro gold fell to about €962, platinum gained $1.75 to $1792.75, and copper gained 7 cents to about $4.33.

Gold and silver equities fell almost 3% by late morning and remained near that level for the rest of the day.

Report	For	Reading	Expected	Previous
Initial Claims	1/22	454K	410K	403K
Durable Orders	Dec	-2.5%	1.5%	-0.1%
Durable Orders ex Trans.	Dec	0.5%	0.6%	4.5%
Pending Home Sales	Dec	2.0%	-0.5%	3.1%

Tomorrow at 8:30AM EST brings fourth quarter GDP expected at 3.7%, the Chain Deflator expected at 1.5%, and the Employment Costs Index expected at 0.4%. At 9:55 is Michigan Sentiment for January expected at 73.2.

Oil fell as the U.S. dollar index rose in early trade on the S&P's downgrade of Japanese debt that drove the yen lower, but the dollar ultimately ended lower on weaker than expected economic data in the US.

Treasuries remained higher after today’s 7-year note auction drew a high yield of 2.744% with a bid to cover of 2.85.

The Dow, Nasdaq, and S&P traded mostly slightly higher on decent earnings reports.

Among the big names making news in the market today were P&G, AT&T, Bristol-Meyers, Eli Lilly, Ford, AIG, and Caterpillar.

Despite greatly outperforming stocks and bonds, gold continues to get no respect from the general investment community and much of the media that follows it. In fact, I believe it’s fair to say it’s actually hated by this lot. It’s understandable why they dislike it since much of what makes gold desirable makes financial assets undesirable. Since ninety-something percent of the financial community and the media that follows it lives or dies on the back of stocks and bonds, one should never, ever, ever expect to see any real love for gold from them.

I’ve stated that gold is in the “mother” of all bull markets. I’ve noted $1,500 as a target for 2011 and $2,000+ before any long term end to the rally. The bullish factors that have led gold into 2011 are all intact and what we’ve experienced in the early days of this year is nothing more than a refreshing correction from the near doubling in the gold price in the last two years or so.

•Central Banks, who once were dominant constant net sellers of gold, are now either neutral or net buyers.

•Gold producers, who once cut their nose to spite their face by selling large quantities of gold forward, now know such a feat is a four letter word and would cause shareholder wrath.

The re-flatting of major world currencies including the financial heroin the United States is pumping in monthly to the world’s largest debt junkie, makes ownership of gold a much more secure option for an ever-increasing of alarmed investor worldwide.

I only hope “when” gold makes a new nominal high this year, someone in the media shows the gold perma bears for what they been for nearly a decade – dead wrong!”- Peter Grandich, Grandich Letter

This morning news came down the wires that the rating agency S&P had downgraded Japan’s sovereign debt from ‘AA’ to ‘AA-‘. This is no small development. The reality is that Japan’s finances are in even worse shape than those of the US when its overall indebtedness is compared as a percentage of GDP. Japan is approaching a debt to GDP ratio of nearly 200%! Yes, you read that correctly. The only nation in the entire world that is higher is Zimbabwe. In effect, it would take the sum total of all economic activity generated in Japan over a two year period to eliminate the nation’s debt. Think about that!

What this means is that the rating agencies, who are watching these sovereign debt woes which have struck various countries in the EU, are concerned about the same problem beginning to surface in other quarters around the globe. Quite simply they are looking at the huge deficits being run by many nations in the West (and Japan). In other words – TOO MUCH DEBT!

That led to selling in the long end of the US yield curve this morning as bond traders are starting to be more than a bit fearful that the same thing is going to happen to the US’s ‘AAA’ rating at some point in the future if the US does not get its financial house in order. They are watching massive amounts of QE2 and another ballooning of the federal budget deficit and are selling even as the Fed attempts to jam the market higher with its purchases. AT this point, the only thing holding the long end of the curve is the Fed. How long can that last especially without affecting the Dollar?

More and more we see the integrity of sovereign debt being brought into doubt which leads to the question among many investors; “what is a safe haven that is actually safe?” Who wants to take the chance of holding a nation’s bonds if overnight they face the real risk of being downgraded?

The real world impact of this is that nations whose debt gets downgraded will have to offer potential investors a higher rate of return to compensate them for the increased risk of holding their debt. For nations already hopelessly in debt, that means borrowing costs begin to rise forcing them to borrow even more money just to keep their heads above water. The whole thing becomes a vicious cycle with rising interest rates compounding the problem.

The US has been able to sneak by and thus far avoid a rating agency’s downgrade partly because its borrowing costs are so low. Should these agencies begin to train their sights on the US and give closer scrutiny to its miserable financial condition, there is a chance that a downgrade could follow. Such a development, were it to indeed occur, would force the US to offer higher rates of return on its debt. That of course would raise its borrowing costs at a time when it can least afford it not to mention short circuiting the QE policy which is deliberately designed to lower borrowing costs.

This is why the take down in gold, after yesterday’s nice performance, is so remarkable for its perverseness and why long term oriented holders of the metal should not be the least bit concerned as to the antics taking place in the paper market. Sovereign debt woes are not behind us – the problem lies squarely ahead of us and no amount of wishful thinking is going to change that hard reality.

This being said, one of the things we now want to monitor will be the performance of gold when priced in terms of the Yen.”- Dan Norcini, More at JSMineset.com

COMEX Gold Trust (IAU) Total Tonnes in Trust: 116.55 - No change from yesterday’s data.

Silver Trust (SLV) Total Tonnes in Trust: 10,447.70 - No change from yesterday’s data.

SEMAFO’s (SMF.TO) 2011 outlook, Brigus Gold’s (BRD) equipment contract, Ivanhoe’s (IVN) completed rights offering, Gammon Gold’s (GRS) drill results, Nevsun’s (NSU) commissioning program, and Sabina’s (SBB.TO) drill results were among the big stories in the gold and silver mining industry making headlines today.

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

Steele Resources Corporation Announces New CFO: David Bridgeford - More
- January 27, 2011 | Item | ShareThis

Canyon Copper Corp. Announces Brokered Private Placement Offering of Units - More
- January 27, 2011 | Item | ShareThis

Michigan Congressman Peters Tours Great Western Technologies Inc. Plant in Troy, Michigan - More
- January 27, 2011 | Item | ShareThis

Sabina Gold & Silver Announces Results of Phase 1 Drilling at Newman-Madsen Property in Red Lake Ontario - "Sabina Gold & Silver Corp. (TSX:SBB - News) is pleased to announce the results of the first of a two phase drilling program that began last fall on its 50% owned Newman-Madsen property in the prolific Red Lake gold district of Ontario, Canada." More
- January 27, 2011 | Item | ShareThis

Savant Provides Updates on McWatters Drilling - More
- January 27, 2011 | Item | ShareThis

Cadan Announces Appointment of Directors - More
- January 27, 2011 | Item | ShareThis

Kirrin Resources Reports Results of Geophysical Interpretation Program at Grevet REE Project; Awards Options - More
- January 27, 2011 | Item | ShareThis

Matamec Intersects 1.45% TREO Over 21 Metres on its Kipawa HREO-Y-Zr Deposit - More
- January 27, 2011 | Item | ShareThis

Sphere Resources Inc. Enters Into a Sale and Purchase Agreement to Buy All of Global Minerals Ltd Interest in the Dome Property, Red Lake Ontario - More
- January 27, 2011 | Item | ShareThis

Trinity Mining Holdings A.G. Closes 1.3 Million CHF Private Placement - More
- January 27, 2011 | Item | ShareThis

Halo Announces Drilling Resumes at Cold-Lost Project, Manitoba - More
- January 27, 2011 | Item | ShareThis

Inter-Rock RNY Mineral Property Update - More
- January 27, 2011 | Item | ShareThis

Boss Power Lawsuit Against Province of B.C. Will Proceed to Trial - More
- January 27, 2011 | Item | ShareThis

Crowflight Announces $30 Million Private Placement - More
- January 27, 2011 | Item | ShareThis

Drilling at Abcourt-Barvue Intersects Two Bands of High Silver and Zinc Values - More
- January 27, 2011 | Item | ShareThis

Brazil Gold Appoints Veteran Mining Exec to Advisory Board - More
- January 27, 2011 | Item | ShareThis

Supreme Drills Up to 1.23 % Copper, 132 grams Silver on Verde at Copper Mountain - More
- January 27, 2011 | Item | ShareThis

Golden Hope Mines Completes a 1700 Tonne Bulk Sample at Bellechasse-Timmins - More
- January 27, 2011 | Item | ShareThis

Copper One and Cartier Outline Dynamic Exploration Program on Riviere Dore Copper Nickel Property - More
- January 27, 2011 | Item | ShareThis

Shoreham Resources Announces Name Change to Guyana Frontier Mining Corp. - More
- January 27, 2011 | Item | ShareThis

Copper One and Cartier Outline Aggressive Exploration Program on Riviere Dore Copper Nickel Property - More
- January 27, 2011 | Item | ShareThis

Ressources Appalaches Inc.: 14 Mineralized Saddle Reef Veins in Drill Hole to 358m Depth at Dufferin Mine - More
- January 27, 2011 | Item | ShareThis

Atna Commences Briggs Mine Exploration - More
- January 27, 2011 | Item | ShareThis

Soldi Ventures Inc. Plans for Extensive Drill Program This Winter to Test High Priority Targets as Determined by Airborne - More
- January 27, 2011 | Item | ShareThis

Paget Minerals: 2011 Exploration and Corporate Update - More
- January 27, 2011 | Item | ShareThis

Razor Resources Inc. Announces Second Shipment of Gold From Clavo Rico Mine Acquisition-Refined Gold Shipment From Clavo Rico Mine Property Valued at Over $300k - More
- January 27, 2011 | Item | ShareThis

Platinum Group Metals Appoints Project Finance Advisor - More
- January 27, 2011 | Item | ShareThis

Selwyn Resources Announces Intention to Make a Normal Course Issuer Bid - More
- January 27, 2011 | Item | ShareThis

Caledonia Mining Corporation: Change of Adviser - More
- January 27, 2011 | Item | ShareThis

Explorator Announces El Espino Project 2011 Program and Budget of US$14.5 Million and Related Capital Call to Complete Prefeasibility Study and Commence Feas. - More
- January 27, 2011 | Item | ShareThis

Argonaut Gold Inc. and Pediment Gold Corp. Complete Business Combination - More
- January 27, 2011 | Item | ShareThis

North Bay Resources Inc. (NBRI) Acquires Niobium-Tantalum-REE Property - More
- January 27, 2011 | Item | ShareThis

Everton and Brigus Continue to Receive Positive Drill Results on the La Lechoza VMS Prospect in the Dominican Republic - More
- January 27, 2011 | Item | ShareThis

Avanti Mining Announces Letter of Intent With SeAH Holdings Corp. for Joint Redevelopment of the Kitsault Mine - More
- January 27, 2011 | Item | ShareThis

Inspiration Mining Responds to Proposed Private Placement by Ursa Major - More
- January 27, 2011 | Item | ShareThis

Eduardo Othon Named to Liberty Star’s Board of Directors - More
- January 27, 2011 | Item | ShareThis

Q3 2011 Production Results for the Three Months Ended December 31, 2010 and an Independent Technical Review of the Ezulwini Life of Mine Model - More
- January 27, 2011 | Item | ShareThis

Evrim Debuts on the TSX Venture Exchange - More
- January 27, 2011 | Item | ShareThis

Alder Resources Hires New VP of Exploration and Provides Corporate Update - More
- January 27, 2011 | Item | ShareThis

Primero Reports Record Gold and Silver Reserves and Resources; New High-Grade Sinaloa Graben Discoveries and Mineralization at Depth - More
- January 27, 2011 | Item | ShareThis

Thundermin and Cornerstone Mobilize Two Drills to the Little Deer Copper Deposit, Springdale Area Newfoundland - More
- January 27, 2011 | Item | ShareThis

Mercer Gold Appoints Devinder Randhawa as Chairman and Director of the Board - More
- January 27, 2011 | Item | ShareThis

Lake Victoria Engages the Windward Agency to Provide Investor Relations Services - More
- January 27, 2011 | Item | ShareThis

TC Power Management Appoints Nivaldo Rojas as Director - More
- January 27, 2011 | Item | ShareThis

Rockridge Diamond Drilling Returns 46.65 g/Tonne Gold Over 2.0 Metres, and 4.2 g/Tonne Gold Over 12.0 Metres at Fatou Gold Project, Mali, West Africa - More
- January 27, 2011 | Item | ShareThis

Chalice Granted Two Major Exploration Licences in Eritrea - More
- January 27, 2011 | Item | ShareThis

Willow Creek Looks to Acquire Additional Gold, Silver and Copper Properties - More
- January 27, 2011 | Item | ShareThis

White Mountain Receives Progress Report on Titanium Metal Test Work - More
- January 27, 2011 | Item | ShareThis

Jintian Copper Exercises PBX Warrants - More
- January 27, 2011 | Item | ShareThis

SEMAFO Provides 2011 Outlook - "SEMAFO (TSX:SMF - News) today provided its 2011 guidance and announced the establishment of a $39-million exploration budget, including $30 million for the Mana property in Burkina Faso." More
- January 27, 2011 | Item | ShareThis

Brigus Gold and GLR Resources Agree on Equipment Contract - "Brigus Gold Corp. (“Brigus”) (TSX:BRD.to - News) (NYSE Amex: BRD) and GLR Resources Inc. (“GLR”) (CNQX: GLE) jointly announce that they have reached an agreement regarding the reimbursement by Brigus to GLR in connection with certain equipment originally ordered by GLR. This equipment was related to Brigus’ wholly owned Goldfields Project in Saskatchewan. A predecessor company of Brigus had acquired the Goldfields Project from GLR." More
- January 27, 2011 | Item | ShareThis

Ivanhoe Mines Announces Successful Completion of Rights Offering - "Ivanhoe Mines (TSX:IVN - News)(NYSE:IVN - News)(NASDAQ:IVN - News) announced today that its strategic rights offering expired on January 26, 2011, as scheduled. Based on preliminary results that are subject to confirmation of amounts that will be received from brokers using guaranteed delivery procedures, Ivanhoe estimates it will receive gross proceeds of approximately US$1.18 billion from the rights offering to help finance construction of the Oyu Tolgoi copper-gold project in Mongolia." More
- January 27, 2011 | Item | ShareThis

Gammon Gold Reports a New Discovery with Significant Drill Results at theRecently Acquired Los Jarros Project, Located Near the Ocampo Operations - "Gammon Gold Inc. ("Gammon") (TSX:GAM.to - News): Gammon is pleased to announce that it has successfully completed the first-stage, 2,000 metre drilling program at the Los Jarros Project in western Chihuahua. The drilling was focused on the Gaby target where significant near surface mineralization was discovered. The Gaby target is approximately 22 kilometres southeast of Ocampo and 29 kilometres northwest of Fresnillo PLC's Orisyvo gold deposit." More
- January 27, 2011 | Item | ShareThis

Nevsun Resources Ltd.: Bisha Commissioning and Resource Expansion on Track - "We are very pleased with the commissioning program to date. As the plant moves into steady state operations, we continue to increase feed grade to the mills as gold recovery is at or above schedule. Thanks to the hard work of the Bisha team, their contractors and the continued support from the State of Eritrea, we are on track to be a mid-tier gold producer by the end of this quarter." More
- January 27, 2011 | Item | ShareThis

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