What is happeningin the PM Markets.

KWN reports that the Gold Market is reporting a backwardation. This is an almost unheard-of phenomenon. What does it mean? It means that the supply of deliverable gold is getting short. The COT report (Commitment of Trade) discloses a tremendous change in the PM Market. The "Commercials" (banks that trade PMs) have decreased their silver shorts from 259M ounces in February to 20M ounces at the end of June. Gold shorts are down to 35,200, which is the lowest in 10 years. Big traders are expecting the Market to turn.

There is another indication (nay, proof) that gold is flowing fro West to East. Look at the graph:

China's deliveries are almost as large as the world production. Demand for gold is increasing. Perhaps that is the reason for the big bump today in gold prices.

Banking changes in the EU.
The EU has inaugurated a new Agency today to deal with failing banks. So, they finally did it, right? Well, no. The Agency won't have any money to spend and some safety regs have been discontinued at the insistence of Germany.

Greece and Portugal have gotten what is supposedly their last bailout. What next? These countries are economic basket cases and their default is not far off.