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UC Resources Ltd. (TSX-V: UC) is an emerging producer of Gold and Silver in Mexico. The Company's goal is to combine both cash flow from production along with a significant exploration upside from its mining assets.

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The Markets:

Charts Courtesy of http://finance.yahoo.com/

Oil came into New York higher and briefly fell under $70 in morning trade, but it quickly rebounded and rose for the rest of trade to close with over $1 gains as traders watched a developing storm in the Gulf.

The U.S. dollar index fell after China hiked interest rates and continued to drop after the soft Michigan Sentiment report, but it rebounded in late trade and ended slightly higher on speculation that inflation fears may resurface and influence the fed to continue to raise interest rates.

Treasuries rose on the poor Michigan Sentiment data.  The yield on the 10-year fell to a new 4 and ½ month low.

The Dow, Nasdaq, and S&P fell in early trade on poor earnings and disappointing Michigan Sentiment data, but they steadily rose throughout trade and ended slightly higher despite the fact that oil ended near its highs.

Among the big names making news in the market Friday were Altria, Reynolds American, Microsoft, Ford, J.M. Smucker, Time Warner, Escondida, Dell, and Tivo.

The Commentary:

“Another day to enjoy the pool for awhile. There was little reason to watch the markets after another blatant assault on the gold price on the Comex … vintage Gold Cartel. This time they made their move after a firm AM Fix of $630.75, but before the PM Fix of $625.50. Once the PM Fix was over, gold had rallied a bit due to good physical demand, they attacked with a second wave mugging that knocked the crud out of it.

Gold and silver love to fill gaps left below the market, which is one reason I loathe higher openings most of the time. It didn’t take both of these metals long to do just that after strong openings this morning. It was downhill from there on in.”- From yesterday’s Midas report by Bill Murphy of LemetropoleCafe.com

“December Gold closed down 3.6 at 621.7. This was 5.2 up from the low and 7.1 off the high.

September Silver finished up 0.035 at 12.03, 0.11 off the high and 0.17 up from the low.

After giving back early gains and tracking moderately lower on the session the gold market mounted a weak afternoon recovery. Some traders suggested that the bounce was inspired by week ending short covering while others suggested that renewed tensions with Iran might have prompted some fresh speculative buying ahead of the week end. With a quasi reversal in the energy complex the return of flight to quality concerns might have actually been seen in the trade. Other traders suggested that talk of a more favorable seasonal pattern ahead inspire the short covering/fresh buying but it was clear at times during the session that weak US economic readings were serving to pressure gold prices.

It is possible that silver continued to see the benefit of a favorable World Silver survey and it is also likely that the overt strength in the copper market served to embolden the bull camp in silver. In fact, some traders are suggesting that with the favorable long term fundamental condition depicted in the World Silver Survey, it is possible that silver will be seen as a purer investment play than gold, as gold is periodically seeing negative influences from economic slowing, currency impacts and the ebb and flow of geopolitical events.”- The Hightower Report, Futures Analysis and Forecasting

GATA Posts:

Sprott raises stake in NovaGold; Barrick confident of keeping Donlin Creek

The Statistics:

As of close of business: 08/17/2006

Global Gold ETF Holdings

[WGC Sponsored ETF’s]

Note: Change in Total Tonnes from yesterday’s data:  The LSE subtracted 0.01 ounces and the ASX added 0.07 ounces.

COMEX Gold Trust (IAU)

Note: No change in Total Tonnes from yesterday’s data.

Silver Trust (SLV)

Note: No change in Total Tonnes from yesterday’s data.

The Stocks:

Claude’s (CGR) new board member and Newmont’s (NEM) arbitration over Uzbekistan's actions were among the big stories in the gold and silver mining industry making headlines Friday.

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