21
May
2009

Gold Investments Market Update – Inflation and the Dollar

Recent intense deflationary pressure had taken the shine off gold but with the dollar sliding yesterday, inflation came back to the fore causing gold to rise by more than 1.2%. This morning the metal was over $943, the highest in 8 weeks. This is a strong signal and it could be time for the resistance levels to be tested. If $946 is breached, the next level to look for would be $967.

Silver was a little more sluggish than gold with only a 0.5% gain. It touched $14.40 this morning before moving back to $14.30. This could signal a correction, as $14.40 represents a double top.

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20
May
2009

Beware of Exchange Trade Funds (ETFs) Bearing Gold

Gold Bullion Unique as No Counterparty Risk

Gold is unique among asset classes as it is the only asset class not dependent on the performance of auditors, management, corporations, financial institutions, banks, politicians and governments. Nor should physical gold be dependent on the performance of trustees, custodians and or sub custodians.  Gold does not depend on the performance and health of the wider economy and as importantly when you buy gold in its physical form there is no third party liability or credit risk. Or at least there should not be. Gold has an intrinsic value in and of itself that is not contingent on someone else’s or some entities performance or mere promise to pay. Thus, gold in its physical form is still the ultimate form of financial insurance. This is why every major central bank in the world still maintains a significant portion of their reserves in gold bullion and many, such as the Chinese, are now increasing their gold bullion reserves.

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20
May
2009

Gold Investments Market Update

Gold demand soared 38% to 1015.5 tonnes in the first quarter of 2009 according to The World Gold Council’s “Gold Demand Trends” report. A combination of factors including diversification, safe haven buying and inflation hedge demand are attributed with the upsurge. However, George Milling-Stanley, the Managing Director of the WGC also cites the global shift in sentiment from “capital appreciation to wealth preservation.”

Rumours that the Russian Central Bank may allow Russian banks to pledge gold as collateral are also circulating the market.

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18
May
2009

Gold Investments Market Update

Global markets perceive that economic green-shoots may be growing on stony ground as the rally in the Dow ran out of steam last week. Inflation figures published in the US suggested that core inflation may be higher than previously expected, contributed to the down week for the Dow and a minor strengthening of the Greenback.

Despite the dollar strengthening, gold benefited from the outflows from both stocks and commodities.

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15
May
2009

The horse race: Betting on individual companies

The Horse Race

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15
May
2009

Gold Investments Market Update & Announcement

Further consolidation was seen yesterday with gold and silver rising marginally again and both look set to have a second strong week of gains.

While the staggering pace of economic decline has certainly abated, individual economies and the global economy continues to deteriorate as recessions deepen internationally.

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14
May
2009

Federal Reserve Cannot Account for $9 Trillion

Rep. Alan Grayson talks to the Federal Reserve Inspector General Elizabeth Coleman of the Federal Reserve, asking her questions regarding trillions of dollars that came from the Fed’s expanded balance sheet and what the losses on its $2 trillion portfolio are.

The Inspector General does not have the answers Grayson is looking for.

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14
May
2009

Gold Investments Market Update

Gold and silver were essentially flat yesterday and consolidated on recent gains despite a slight dollar recovery and marked weakness in equity markets.

Gold has fallen somewhat in Asian and early European trading but still looks good from a technical perspective.

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13
May
2009

Gold Investments Market Update – Uncle Sam to be Downgraded?

Gold and silver rose again yesterday (1.2% and 2.3% respectively) as the dollar continues to come under pressure.

The dollar has fallen not due to an increase in risk appetite but rather an increase in risk aversion coming from the dawning realisation that the very credit worthiness of the US is at risk due to the global financial and economic crisis.

The former US Comptroller General, David Walker, warned in an op-ed article in the Financial Times that “America’s Triple A Rating is at Risk”.

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12
May
2009

Gold Investments Market Update

Gold and silver took a breather from their gains of last week and consolidated yesterday with marginal losses for both metals. The dollar recovered somewhat from its sharp falls of last week as did long term US interest rates (10-Year: 3.180% -0.113) but US stock markets came under pressure.

Gold threaded water in Asia but has risen sharply in early trading in Europe as the dollar has again come under pressure with the US Dollar Index falling to 82.40.

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