Market Update: Gold Consolidates, Readying to Shoot To Highs Unknown

Following gold’s slip last week, this week saw a round of bargain hunting. Gold traded near highs of $1,730, ending the week at $1,716. Silver held in a lateral position with platinum taking a beating as South African mining strikes resulted in massive layoffs and mine closures. US job reports leave many unimpressed, and the country’s presidential elections seem to be sliding into confusion rather than home base as the candidates categorically ignore Europe’s meltdown, China’s slowdown and untold mismanaged mineral wealth in Eastern and Central Africa. With the world’s markets indexed to the over-abundant weak-kneed US dollar, those in the know are calling for reinstating the Gold Standard. Central banks are snapping up gold, leading calls for a November fat with $2,000 per ounce gold.

Precious metals on the move

Spot price of each metal at week’s end, and change over previous Friday:

  • Gold: $1,716, down 1.2%
  • Silver: $31.67, down 2.0%
  • Platinum: $1,561, down 4.4%
  • Palladium: $604, down 5.3%

In the news

Gold in great demand by central banks of the world
“The whole economic situation is going to get worse rather than better. Paper currencies have already lost their function as a store of value and it’s getting worse. People are increasingly putting their savings into precious metals.” — Thorsten Polleit, chief economist at Degussa Goldhandel GmbH (link)

Will the Gold Standard return for the US?
“We’ve got massive economic imbalances, structural mal-investments around the world because the dollar is the reserve currency. It’s too weak. We print too many. We are headed for a currency crisis and the only way we’re going to stop it is by putting real value back into the paper dollar. So we have to tie it to gold.” — Peter Schiff (link)

Gold the souvenir of choice from Mecca
“If you are away from your wife for a month you have to get her some gold.” — Haj Namen, tour operator from Iraqi Kurdistan after buying $2,450 worth of gold for his wife (link)

Ready to get out of your paper metals for some hard bullion? Here’s how
Hint: You need to own a lot of paper (link)

Spotlight on Silver

‘Resource Nationalism’ plagues the silver market (link)

Long-term outlook

Will November see $2,000 gold?
“It is critical to note that while gold prices react to monetary policy developments, they are more generally determined by a geographically and thematically broad set of factors.” — The World Gold Council (link)

If gold remains the new conflict mineral of choice in the Congo, is global outrage (and crippling trade policies) far behind? (link) [link to CBS News homepage; original article has been removed]

The week ahead

  • Crowdfunding portals ready to enter the market, looking for deals
  • Wither the Southern European countries?
  • Platinum on the skids due to South African mine closures
  • Banks sustain terrorists cyber attacks seek new security measures
central banks, china, Featured, gold, gold standard, peter schiff, silver, south africa, us dollar