Gold traded positively overnight and into early morning trading and currently trades at $948.50/oz. A cold warning concerning the US’s worsening debt situation was released yesterday through the federal debt prediction. Figures revealed a total prediction of its 10-year deficit to be $7,14obn. That’s $2,000bn more than that forecast back in February which is dollar bearish and gold bullish. Ben Bernanke’s (aka Helicopter Bernanke) reappointment as Federal Reserve Chairman looks likely to result in more massive shoveling of money into the financial system which could see currency and bond vigilantes become nervous and lead to a falling dollar, higher interest rates and higher inflation or stagflation.
Silver is currently trading at $14.37/oz and looks solid above $13.50/oz to 14/oz and ready to rechallenge the June highs at $16/oz.
Platinum Group Metals
Platinum in currently trading at $1,252/oz and rhodium and palladium are trading at $1,650/oz and $288/oz respectively. Palladium has had a strong run of late but needs to settle above $290-95/oz for it to be in a situation to challenge the $327/oz vicinity.
China’s proposed ban of or severe restrictions on the export of all rare earth metals (China mines over 95% of the world’s rare earth minerals, mostly in Inner Mongolia) is bullish for the platinum group metals and rhodium.
Resource nationalism and the developing global struggle for the earth’s depleting natural resources is bullish for the precious metals.