Note:  For readers not familiar with the concept of our “Melmania” section, this is where your editor can take any subject and develop arguments regarding some ultimate conclusions.  Since some of those conclusions might sound extremely radical, the name of “Melmania” seems appropriate.

This is being written at 9:45 AM PDT and the precious metals markets are in the midst of a furious rally with the following current quotes:

Gold - Spot $695 - up $15
Silver - Spot $12.43 - up $0.27
Platinum - Spot $1285 - up $17
Palladium - Spot $334 - up $4.00

These rallies are having a powerful effect on the price of mining shares as illustrated by the current chart of the “XAU” gold mining share Index which is moving powerfully higher.
 

As can be seen, the XAU is up eight points - or about five percent on the day and is moving toward a powerful breakout to the upside at the 160 level.

We plan to monitor developments during this trading session and offer detailed comment in tomorrow morning’s MM.