Vikram Pandit, the Chief Executive of Citigroup announced yesterday that in a bid to revive their ailing share price, a massive 52,000 jobs would be cut. That’s 1 in every 7 employees and slash costs by $10bn. Citi shares have lost more than 75% of their value over the past year and suffered over $50bn in writedowns and credit provisions. An analyst likened Citigroup to a super tanker; turning it around takes a long time.
The Washington Times’s Lawrence Hunter wrote last week that U.S. President-elect Barack Obama has an opportunity to reset the economy and restore the U.S. dollar to its preeminence as the world’s reserve currency by reestablishing the gold standard.
The G20 leaders showed a united front as they pledged to shore up global growth, introduce regulatory reform in a relatively short timeframe and avoid protectionism. However, the timeframe for resolution of these reforms is as soon as March 31st. Success will hinge on the new US Administration’s willingness to take big decisions, a mere 2 months after taking office.
Crude oil briefly dipped below $55 a barrel yesterday for the first time in 22 months prompted by reports, warning that demand will be significantly weaker in 2009 due to the global economic downturn.
Despite this, Gold gained slightly on the news that Chinese investors’ demand had surged in the first nine months of 2008. Gold is currently trading at $728 after closing in New York on Wednesday at $710.30.
In wealth preservation terms, Gold is still doing an admirable job.
The great global deleveraging continues. In a world that has become addicted to debt fuelled growth, the idea that readily available credit may no longer be available, has scared many into facing the truth; credit is not free and should never have been priced as such. Over the past few weeks markets have continue to sell off, outlook for production and consumption are all bearish and thus oil continues its volatile ride losing $2 overnight to its current level of $58 a barrel.
Since 2003, GoldCore (then called Gold Investments) has clearly warned of property and stock market bubbles internationally, the risks in sharp falls in these markets, and the importance of diversifying into gold.
This is our homepage from early 2004, when we warned about property and stock bubbles, and the importance of diversifying into gold – http://web.archive.org/web/20040324071856/http://www.gold.ie/
Our home page warned investors and savers as seen in this section:
Gold and silver were up another 2% yesterday as bargain hunters continue to bottom feed.