Good Morning,

Gold prices held steady at near $920 per ounce early this morning,ahead of the release of US bank stress-test data (due at 5 PM NY time) and jobless claims figures due this morning. The spot market session opened at $920.70 an ounce, with a very robust $9.70 gain, while silver reached to near $14.00 per ounce with a 26-cent rise. Platinum was up $26 to $1161, and palladium rose $12 to $239 an ounce.

Spec funds, are at it, again. See oil, see commodities, see copper. See buying spree to be followed by profit-taking spree. Again. The metals complex continues to exhibit a combination of attention from spec funds and inflationary anticipations. At the same time, seasonality factors and an increase inthe 'good news' side of the balance sheet may draw not only some of the sidelined cash but also some of that already parked in gold to the increasingly attractive equities markets.

Following a six-quarter string of negative results (something seen perhaps only twice since 1900) Dow & friends could be set for a further hefty gain, despite an already stunning percentage rise from their lows in March. Bear-market rally proponents could become the object of investor ire after having held them out thus far, and after continuing to advise staying out going forward.

Well, S.T. D-day arrived on the same morning when Rupert Murdoch declared that the world's worst economic crisis in decades (or ever) has seen its worst phase, and that the road ahead is upward. Today was also QE day -sort of-over in the Old World, where the ECB (a quarterpercent late, and many a day too late) finally cut rates to 1%, hoping that such will be 'it' and that 'it' will be enough. Likely, not.

The ECB's ostrich act has been more lamentable than any such kabuki ever to emerge from Japan. Meanwhile, the BoE boosted its bond-purchasing programme by $75 billion, in not-so-tacit acknowledgement that it was not ready to sign on to the 'worst is over' (at least as far as the UK is concerned) scenario just yet.

In today's news, GM lost $5.9 billion, which was less than had been expected. Wal-Mart same-store sales were up 5%, which was better than could be expected (see other chain-store sales for the period). Crude oil took a leap upward, gaining $1.50 to $57.84 (don't look now, but black gold -for all the supposed trouble out there-has gained nearly $20 from its lows). The Obama administration was set to unveil a $17 billion budget cut proposal, complete with the excision of some 120 spending programmes.

The US dollar was quoted at $84.11 - a tad higher on the index. Interest rates have been quietly trending higher, while credit risk shrank to the lowest level since last year's spectacular financial firm failures. The 'biggie' this morning, was the fall in initial jobless claims fell by 34,000 to 601,000. This was the lowest level in US unemployment claims in three months. The stunner of the day came from Down Under, where unemployment unexpectedly fell to 5.4% highlighting the fact that although the crisis is indeed global, there are pockets of activity which show a decidedly counter-trend characteristic.

While Arianna Huffington said that the bank stress-tests fail the 'smell-test' and while former NY Gov. Eliot Spitzer (yes, that Mr. Spitzer) proselytized about the lack of ethics and the lamentability of the so-called taxpayer bailout of Wall Street, the bits and pieces building up to this afternoon's official release of the test results continued to show a mixed-but-mostly-positive bag of findings. Bloomberg finds that:

Federal Reserve stress tests on the 19 biggest lenders show Bank of America Corp., Wells Fargo & Co. and Citigroup Inc. together require about $54 billion, said people familiar with the conclusions. At the same time, Goldman Sachs Group Inc., JPMorgan Chase & Co. and Bank of New York Mellon Corp. have enough capital to help prop up flows of credit to businesses and consumers grappling with the worst recession in five decades.

“There is very significant cushions in these institutions today, and all Americans should be confident that these institutions are going to be viable institutions going forward,” Geithner said yesterday in an interview with PBS television's Charlie Rose program. “The results will be, on balance, reassuring.”

Something else that is reassuring, is the fact that global mints appear to have dealt with isolated production issues and are on top of the coin supply situation. Bloomberg reports that The U.K. mint made 28,496 ounces of gold coins in the quarter, compared with 16,317 ounces a year earlier, according to data obtained by Bloomberg News under a Freedom of Information Act request. Production last year rose 30 percent to 53,089 ounces, the data show.

Demand for gold and exchange-traded funds linked to the metal accelerated as equities collapsed and governments spent trillions of dollars to combat recessions. The Austrian mint, Muenze Oesterreich AG, sold a record 1.5 million ounces of gold last year, while the U.S. Mint's sales of 1-ounce American Eagle gold coins more than quadrupled in January to 92,000.

So, are you sick and tired of paying 8 -10% (or more) for your one-ounce gold coins on some auction site? Tired of your friendly corner coin shop lamenting about not being able to obtain any coins due to some putative worldwide gold shortage? Well, be tired no more. If you feel the need to initiate or augment a gold holding, then your choices have just brightened. Right now, right here, right on the Kitco store's page, you can buy 1-ounce, pure gold, Olympic edition, Candian Maple Leaf coins, for....drum roll.....5% (FIVE percent) above spot gold ask prices. You can also obtain Austrian Philharmonic coins for a 6.5% premium above gold. Shameless self-promo? You bet. It's just one way to combat ill-informed stories about shortages and the need to overpay. Look for more similar surprises in coming days.

Happy Trading.