Best of the Week
Most Popular
1. US Housing Market Real Estate Crash The Next Shoe To Drop – Part II - Chris_Vermeulen
2.The Coronavirus Greatest Economic Depression in History? - Nadeem_Walayat
3.US Real Estate Housing Market Crash Is The Next Shoe To Drop - Chris_Vermeulen
4.Coronavirus Stock Market Trend Implications and AI Mega-trend Stocks Buying Levels - Nadeem_Walayat
5. Are Coronavirus Death Statistics Exaggerated? Worse than Seasonal Flu or Not?- Nadeem_Walayat
6.Coronavirus Stock Market Trend Implications, Global Recession and AI Stocks Buying Levels - Nadeem_Walayat
7.US Fourth Turning Accelerating Towards Debt Climax - James_Quinn
8.Dow Stock Market Trend Analysis and Forecast - Nadeem_Walayat
9.Britain's FAKE Coronavirus Death Statistics Exposed - Nadeem_Walayat
10.Commodity Markets Crash Catastrophe Charts - Rambus_Chartology
Last 7 days
How Sony Is Fueling the Computer Vision Boom - 3rd Aug 20
Computer Gaming System Rig Top Tips For 6 Years Future Proofing Build Spec - 3rd Aug 20
Cornwwall Bude Caravan Park Holidays 2020 - Look Inside Holiday Resort Caravan - 3rd Aug 20
UK Caravan Park Holidays 2020 Review - Hoseasons Cayton Bay North East England - 3rd Aug 20
Best Travel Bags for 2020 Summer Holidays , Back Sling packs, water proof, money belt and tactical - 3rd Aug 20
Precious Metals Warn Of Increased Volatility Ahead - 2nd Aug 20
The Key USDX Sign for Gold and Silver - 2nd Aug 20
Corona Crisis Will Have Lasting Impact on Gold Market - 2nd Aug 20
Gold & Silver: Two Pictures - 1st Aug 20
The Bullish Case for Stocks Isn't Over Yet - 1st Aug 20
Is Gold Price Action Warning Of Imminent Monetary Collapse - Part 2? - 1st Aug 20
Will America Accept the World's Worst Pandemic Response Government - 1st Aug 20
Stock Market Technical Patterns, Future Expectations and More – Part II - 1st Aug 20
Trump White House Accelerating Toward a US Dollar Crisis - 31st Jul 20
Why US Commercial Real Estate is Set to Get Slammed - 31st Jul 20
Gold Price Blows Through Upside Resistance - The Chase Is On - 31st Jul 20
Is Crude Oil Price Setting Up for a Waterfall Decline? - 31st Jul 20
Stock Market Technical Patterns, Future Expectations and More - 30th Jul 20
Why Big Money Is Already Pouring Into Edge Computing Tech Stocks - 30th Jul 20
Economic and Geopolitical Worries Fuel Gold’s Rally - 30th Jul 20
How to Finance an Investment Property - 30th Jul 20
I Hate Banks - Including Goldman Sachs - 29th Jul 20
NASDAQ Stock Market Double Top & Price Channels Suggest Pending Price Correction - 29th Jul 20
Silver Price Surge Leaves Naysayers in the Dust - 29th Jul 20
UK Supermarket Covid-19 Shop - Few Masks, Lack of Social Distancing (Tesco) - 29th Jul 20
Budgie Clipped Wings, How Long Before it Can Fly Again? - 29th Jul 20
How To Take Advantage Of Tesla's 400% Stock Surge - 29th Jul 20
Gold Makes Record High and Targets $6,000 in New Bull Cycle - 28th Jul 20
Gold Strong Signal For A Secular Bull Market - 28th Jul 20
Anatomy of a Gold and Silver Precious Metals Bull Market - 28th Jul 20
Shopify Is Seizing an $80 Billion Pot of Gold - 28th Jul 20
Stock Market Minor Correction Underway - 28th Jul 20
Why College Is Never Coming Back - 27th Jul 20
Stocks Disconnect from Economy, Gold Responds - 27th Jul 20
Silver Begins Big Upside Rally Attempt - 27th Jul 20
The Gold and Silver Markets Have Changed… What About You? - 27th Jul 20
Google, Apple And Amazon Are Leading A $30 Trillion Assault On Wall Street - 27th Jul 20
This Stock Market Indicator Reaches "Lowest Level in Nearly 20 Years" - 26th Jul 20
New Wave of Economic Stimulus Lifts Gold Price - 26th Jul 20
Stock Market Slow Grind Higher Above the Early June Stock Highs - 26th Jul 20
How High Will Silver Go? - 25th Jul 20
If You Own Gold, Look Out Below - 25th Jul 20
Crude Oil and Energy Sets Up Near Major Resistance – Breakdown Pending - 25th Jul 20
FREE Access to Premium Market Forecasts by Elliott Wave International - 25th Jul 20
The Promise of Silver as August Approaches: Accumulation and Conversation - 25th Jul 20
The Silver Bull Gateway is at Hand - 24th Jul 20
The Prospects of S&P 500 Above the Early June Highs - 24th Jul 20
How Silver Could Surpass Its All-Time High - 24th Jul 20
China Recovered in Q2. Will the Red Dragon Sink Gold? - 23rd Jul 20
UK Covid19 MOT 6 Month Extensions Still Working Late July 2020? - 23rd Jul 20
How Did the Takeaway Apps Stocks Perform During the Lockdown? - 23rd Jul 20
US Stock Market Stalls Near A Double Peak - 23rd Jul 20
Parking at Lands End Car Park Cornwall - UK Holidays 2020 - 23rd Jul 20
Translating the Gold Index Signal into Gold Target - 23rd Jul 20
Weakness in commodity prices suggests a slowing economy - 23rd Jul 20
This Stock Market Stinks - But Not Why You May Think - 22nd Jul 20
Protracted G7 Economic Contraction – or Multiyear Global Depression - 22nd Jul 20
Gold and Oil: Be Aware of the "Spike" - 22nd Jul 20
US Online Casino Demographics: Who Plays Online For Money? - 22nd Jul 20
Machine Intelligence Quantum AI Stocks Mega-Trend Forecast 2020 to 2035! - 21st Jul 20
How to benefit from the big US Infrastructure push - 21st Jul 20
Gold and gold mining stocks are entering a strong seasonal phase - 21st Jul 20
Silver Eyes Key Breakout Levels as Inflation Heats Up - 21st Jul 20
Gold During Coronavirus Recession and Beyond - 21st Jul 20
US Election 2020: ‘A Major Bear Market of Political Decency’ - 21st Jul 20
Summertime Sizzle for Gold and Silver - 21st Jul 20
Overclockers UK Custom Built PC Review - Delivery and Unboxing (3) - 21st Jul 20
Will Coronavirus Vaccines Become a Bridge to Nowhere? - 20th Jul 20
Stock Market Time for Caution?  - 20th Jul 20
ClickTrades Review - The Importance of Dynamic Analysis and Educational Tools in Online Trading - 20th Jul 20
US Housing Market Collapse Second Phase Pending - 20th Jul 20
Capitalising on the AI Mega-trend - 20th Jul 20
Getting Started with Machine Learning - 20th Jul 20
Why Moores Law is NOT Dead! - 20th Jul 20
Help the Economy by Going Outside - 19th Jul 20
Stock Market Fantasy Finance: Follow the Money - 19th Jul 20
Did the Stock Market Bubble Just Pop? - 19th Jul 20
Quick Souring of the S&P 500 Stock Market Mood - 19th Jul 20
The Six-Year Jobs Recession - 19th Jul 20
Silver Demand Exploding! - 18th Jul 20
Tesco Scraps Covid Safe One Way Arrow Supermarket Shopping System - 18th Jul 20
The Rise of Online Pawnbroking - 17th Jul 20
Gold Rallies Together With U.S. Covid-19 Cases - 17th Jul 20
Gold & Silver Measured Moves - 17th Jul 20
The Bizarre Mathematics Of How Negative Interest Rates Create Stratospheric Profits - 17th Jul 20
From a Stocks Bull Market Far, Far Away, Virus Doomsday Scenerio! - 16th Jul 20
Fiscal Cliffs and the Self-destructing Treasury - 16th Jul 20
Dow Stock Market Crash Watch - Update - 16th Jul 20
Gold & Silver Gaining on US Dollar Weakness - 16th Jul 20
How to Find the Best Stocks to Invest In - 16th Jul 20
Overclockers UK Custom Build PC Review - 2. System Build Changes Communications - 16th Jul 20

Market Oracle FREE Newsletter

How to Get Rich Investing in Stocks by Riding the Electron Wave

Gold Falters as Rumours Grow of a Major Bank Failure

Commodities / Gold & Silver Feb 12, 2008 - 07:32 AM GMT

By: Adrian_Ash

Commodities THE PRICE OF PHYSICAL GOLD BULLION continued to tick lower from yesterday's six-session high early Tuesday, slipping $5 from last night's New York close as rumors grew of a major banking loss in Europe and the US government prepared a new bail-out for struggling mortgage debtors.

By the AM Fix in London , set at $920.25 per ounce, European stocks had pushed 0.6% higher despite a 5.3% drop in ING, the Netherlands ' largest bank, now said to be facing a severe loss on its US subprime investments.


The US Treasury Dept., meantime, is expected to announce "Project Lifeline" later today, a new initiative offering all home-buyers at risk of foreclosure an extra 30 days to renegotiate lower-cost loans.

The plan extends the " Hope Now " scheme launched in Dec. '07 that has now helped 545,000 subprime borrowers. Only one-in-four of those home-buyers has actually arranged cheaper finance, however.

The rest have simply agreed new repayment plans, often with longer terms according to the New York Times .

"There is this huge disconnect between what is being represented by the industry and what is being experienced on the ground," says Kevin Stein of the California Reinvestment Coalition in San Francisco .

"Borrowers are falling through the cracks while more and more of these press releases come out. It's clearly not enough."

Asian stock markets were mixed on Tuesday, gaining 1.3% in Hong Kong but losing 1.6% in Taiwan after a week's holiday for the Lunar New Year.

The Shanghai & Shenzen stock markets re-open on Wednesday.

Sydney 's stock market rose 1.2% even as 10-year Australian bonds rose on news that the country's business confidence has sunk to its lowest level since Sept. 2001. In Tokyo the Nikkei ended the day flat after gaining 0.9% early on.

Gold Market futures traded for Dec. '08 delivery at the Tocom rose 0.8% against the Yen to equal $930.49 per ounce.

"I don't think players have fully returned in the [Asian] region," said Peter Tse, a gold dealer at Scotia Mocatta in Hong Kong , to Reuters overnight.

"Probably we have to wait until market participants have returned from their [Chinese New Year] holidays. I would say today [the Gold Price] is in a $919 to $930 range, but the medium-term range is still looking good."

Copper prices rose for the fifth session running meanwhile, as crude oil slipped back from Monday's 2% gains after Valero, the giant US refinery group, re-opened its Delaware City plant following a power failure.

Wheat rose, corn slipped, and government bond prices ticked lower in Europe on news that UK consumer-price inflation rose last month to a six-month high of 3.2% year-on-year.

Released as the British Retail Consortium confirmed aggressive High Street discounting post-Christmas, the UK inflation data showed clothing & footwear prices falling almost 5% year-on-year. Audio-visual items dropped 17% in price from Jan. '07, and the average cost of a new computer fell by more than one quarter.

But the basic cost of living accelerated sharply, with milk, cheese, eggs and meat all rising more than 15% in price from Jan. '07, while breads & cereals gained almost 8%.

The cost using public transport rose by 6%, as did health insurance premiums. ( Can Inflation Kill Recession? Read more here... )

This sharp rise in UK inflation failed to stop the British Pound dropping a whole cent this morning to $1.9445, however, because the City of London had expected Jan.'s inflation figure to be stronger still.

On its trade-weighted index, the Pound has now lost 8% of its value from this time last year. The Gold Price in Sterling has risen almost 46% since the global banking crisis began in July, hitting new record highs above £476 per ounce already this week.

The European single currency today held steady around $1.4500, capping the Gold Price in Euros below €635 per ounce. The Japanese Yen stuck to the middle of its one-month range between ¥107.50 and ¥106.00 per Dollar.

Impacting the gold-mining sector, meanwhile, Creamer's Engineering News says today that Eskom – the state-owned South African utility which closed the nation's entire mining industry with a series of power outages in late January – is being squeezed by strong global demand for even low-grade coal.

Speaking at an 'Energy Crisis Coping Forum' in Midrand yesterday, Dr. Steve Lennon – managing director of Eskom's corporate services dept. – said that "supply was now generally at the bottom end of a spectrum that measures energy content, material abrasiveness, and acceptable levels of fine material, leading to higher-than-anticipated load losses," Engineering News reports.

The world's second-largest gold producer after China – itself suffering sharply lower gold-mining output – South Africa 's gold mining industry is now running on 90% energy supplies. And adding further to input price inflation globally, researchers at Hallgarten & Company now warn that Chile , the world's largest copper producer, also faces sharply higher electricity costs and even an all-out energy outage thanks to a lack of hydro-generation and lower natural gas imports from Argentina .

"The only thing that remains to be seen is not whether the country goes through an energy crisis, but how deep that crisis will be," warn the Latin American investment specialists.

By Adrian Ash
BullionVault.com

Gold price chart, no delay | Free Report: 5 Myths of the Gold Market
City correspondent for The Daily Reckoning in London and a regular contributor to MoneyWeek magazine, Adrian Ash is the editor of Gold News and head of research at www.BullionVault.com , giving you direct access to investment gold, vaulted in Zurich , on $3 spreads and 0.8% dealing fees.

(c) BullionVault 2008

Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it.

Adrian Ash Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules