Virtual Gold Investment Conference: February 22, 2007 Featured Speakers: James Turk, Julian Phillips, Peter Schiff & Bill Murphy Featured Companies: Canarc Resource Corp., Gold Resource Corp., Sunridge Gold Corp. & Buffalo Gold Ltd.

 

The Metals:

Gold rose almost 1% in Asia and neared $670 at the London open before it fell back off a bit heading into New York, but it then shot up above $670 with over 1% gains just after 10AM EST as Bernanke’s testimony was released and knocked the dollar down.  It soon fell back off heading into the close and ended well off of its highs, but it still closed with a gain of 0.60%.  Silver topped $14 with well over 1% gains just after 10AM EST as well, but it too fell back off into the close and ended with a gain of just 0.36%.

Euro gold remained just under €510, platinum gained $10 to $1,206, palladium gained $2 to $342, and copper remained at about $2.53.

Gold and silver equities followed gold and silver about 1% higher just after 10AM EST and closed not far off their highs of the day.

The Economy:

Bernanke’s testimony before the Senate Banking Committee revealed he was less hawkish than many on Wall Street thought.  He remarked that he expected inflation to slow and noted that he doesn’t expect the housing slump to affect other parts of the economy.  Bernanke visits the House Financial Services Committee tomorrow.

Tomorrow at 8:30AM EST brings Import and Export Prices for January, Initial Jobless Claims for 2/10 expected at 315,000, and the NY Empire State Index for February expected at 11.0.  At 9AM are Net Foreign Purchases for December expected at $60.0 billion, at 9:15 are Capacity Utilization for January expected at 81.7% and Industrial Production expected at 0.0%, and at noon is the Philadelphia Fed survey for February expected at 4.0.

The Markets:

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

Oil fell after inventories did not fall as much as many were expecting.  Crude inventories fell 600,000 barrels, gasoline inventories fell 2.0 million barrels, and distillates fell 3.0 million barrels.

The U.S. dollar index fell and treasuries rose markedly after poor economic data and dovish commentary from Bernanke pushed interest rates lower.

The Dow, Nasdaq, and S&P closed with impressive gains on easing worries over inflation and interest rates.

Among the big names making news in the market today were Coca-Cola, Delta, Deere, DaimlerChrysler, and Office Depot.

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The Commentary:

“Yes, GATA strenuously objects to the talk of IMF gold sales because the implementation of such will just further delay the inevitable and keeps the price from going to where it already ought to be.

A couple of days ago I heard an oil guy say that the oil industry used $20 oil as a benchmark to go after new supply. However, in just the past couple of years exploration costs (including escalating steel prices) had skyrocketed so much, the industry now needs $40 oil as its benchmark.

The same is true with gold mining. In many cases, as in Canada, gold prices need to be greater than $600 per ounce to make money.

If it were not for The Gold Cartel, the price of gold would be double what it is today. There would be a GOLD RUSH and gold economic boom like never seen before. The gold producing countries in sub-Saharan Africa would be hiring huge numbers of Zulu miners (and others) to find gold reserves. Each of these miners supports 10 to 12 others.” - From yesterday’s Midas report by Bill Murphy of LemetropoleCafe.com

“April Gold finished up 3.5 at 672, 4.4 off the high and 2.3 up from the low.

March Silver closed up 0.05 at 13.965. This was 0.035 up from the low and 0.165 off the high.

The gold market did manage to climb to the highest level since August 2^nd, but the market failed to hold all of the gains.  It is possible that the gold market leaves the session Wednesday with a slight undermine of bullish sentiment. Certainly the sharp slide in oil prices served to prompt some long profit taking and certainly seeing the Fed Chairman down play the inflation threat are potential negatives but many traders thought that an on-hold stance from the Fed would be a positive for gold as it was in the wake of the last FOMC meeting. However, the gold market seemed to be unable to embrace the positive Fed testimony spin that was apparently embraced by the US equity market. In other late breaking but potentially bearish supply side news a London listed Russian gold producer indicated that their 2006 gold production increased a whopping 244% above the 2005 level or for a base output of 219,853 ounces of gold.

While the silver market is still locked into a tight correlation with the gold market, it is possible that corrective action in the copper and aluminum and the softer than expected US retail sales report served to weigh on silver more than the pressure that was present in the gold market. In fact, both gold and silver were certainly under some pressure as a result of the weakness in oil but that pressure was tempered by the new low for the move in the US Dollar. It is also possible that the silver market saw some indirect support from the strength in the equity market.” - The Hightower Report, Futures Analysis and Forecasting

GATA Posts:

Citigroup analysts tell Barrick: Close hedge book, then stand back

At Toronto Financial Forum, Peter Grandich concurs with GATA

Billiton not pursuing Alcoa, sources tell Reuters

Venezuela's nationalization fast but with compensation

The Statistics:

As of close of business: 2/13/2007

Global Gold ETF Holdings

[WGC Sponsored ETF’s]

Note: Change in Total Tonnes from yesterday’s data: 1.54 tonnes were added to the trust.

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:

Agnico-Eagle’s (AEM) plans to acquire Cumberland (CLG), ECU silver’s (ECU.V) assay results, Southern Silver’s (SSV.V) exploration update, Coeur’s (CDE) mine in Bolivia, Fury’s (FUR.V) drilling, Orko’s (OK.V) assay results, and Silver Dragon’s (SDRG.OB) hiring of Ausenco International Pty Ltd. were among the big stories in the gold and silver mining industry making headlines today.

WINNERS

LOSERS

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

All of today's gold and silver stock news:

ECU Silver Announces New High Grade Assays Within the Mineralized Corridor From Level 18, Santa Juana Mine - "The new developments follow known veins in order to assess the evolution of the grades from the upper levels where these veins have been previously sampled. This also provides accesses to test the MC across its entire width. Furthermore, these new developments will look to provide a higher degree of confidence in the possible continuity of the veins within the MC as well as providing an excellent assay base from which the Company can expand." More
- February 14, 2007 | Item | E-mail

Asia Now Expands Beiya Project with Additional Exploration Rights - More
- February 14, 2007 | Item | E-mail

Agnico-Eagle to buy Cumberland, boost gold output - "Gold and base metals producer Agnico-Eagle Mines Ltd. (AEM.TO: Quote, Profile , Research) said on Wednesday it will offer about C$679 million ($580 million) to buy junior miner Cumberland Resources Ltd. (CLG.TO: Quote, Profile , Research) and gain a foothold in Canada's resource-rich Arctic.

Agnico-Eagle will gain full ownership of Cumberland's Meadowbank gold project, in the northern territory of Nunavut, under the deal. Now under construction, the project has proven and probable reserves of 2.9 million ounces of gold, with production expected to start in 2010." More
- February 14, 2007 | Item | E-mail

Wildcat Stakes Additional Ground; Jeep Property, Manitoba, Canada - More
- February 14, 2007 | Item | E-mail

Romios Drills Wide Intersections of Gold, Copper and Silver Mineralization at Newmont Lake-Assay Values as High as 49 G/T Gold - More
- February 14, 2007 | Item</