Best of the Week
Most Popular
1. Market Decline Will Lead To Pension Collapse, USD Devaluation, And NWO - Raymond_Matison
2.Uber’s Nightmare Has Just Started - Stephen_McBride
3.Stock Market Crash Black Swan Event Set Up Sept 12th? - Brad_Gudgeon
4.GDow Stock Market Trend Forecast Update - Nadeem_Walayat
5.Gold Significant Correction Has Started - Clive_Maund
6.British Pound GBP vs Brexit Chaos Timeline - Nadeem_Walayat
7.Cameco Crash, Uranium Sector Won’t Catch a break - Richard_Mills
8.Recession 2020 Forecast : The New Risks & New Profits Of A Grand Experiment - Dan_Amerman
9.Gold When Global Insanity Prevails - Michael Ballanger
10.UK General Election Forecast 2019 - Betting Market Odds - Nadeem_Walayat
Last 7 days
What happens To The Global Economy If Oil Collapses Below $40 – Part II - 15th Nov 19
America’s Exceptionalism’s Non-intervention Slide to Conquest, Empire - and Socialism - 15th Nov 19
Five Gold Charts to Contemplate as We Prepare for the New Year - 15th Nov 19
Best Gaming CPU Nov 2019 - Budget, Mid and High End PC System Processors - 15th Nov 19
Lend Money Without A Credit Check — Is That Possible? - 15th Nov 19
Gold and Silver Capitulation Time - 14th Nov 19
The Case for a Silver Price Rally - 14th Nov 19
What Happens To The Global Economy If the Oil Price Collapses Below $40 - 14th Nov 19
7 days of Free FX + Crypto Forecasts -- Join in - 14th Nov 19
How to Use Price Cycles and Profit as a Swing Trader – SPX, Bonds, Gold, Nat Gas - 13th Nov 19
Morrisons Throwing Thousands of Bonus More Points at Big Spend Shoppers - JACKPOT! - 13th Nov 19
What to Do NOW in Case of a Future Banking System Breakdown - 13th Nov 19
Why China is likely to remain the ‘world’s factory’ for some time to come - 13th Nov 19
Gold Price Breaks Down, Waving Good-bye to the 2019 Rally - 12th Nov 19
Fed Can't See the Bubbles Through the Lather - 12th Nov 19
Double 11 Record Sales Signal Strength of Chinese Consumption - 12th Nov 19
Welcome to the Zombie-land Of Oil, Gold and Stocks Investing – Part II - 12th Nov 19
Gold Retest Coming - 12th Nov 19
New Evidence Futures Markets Are Built for Manipulation - 12th Nov 19
Next 5 Year Future Proof Gaming PC Build Spec November 2019 - Ryzen 9 3900x, RTX 2080Ti... - 12th Nov 19
Gold and Silver - The Two Horsemen - 11th Nov 19
Towards a Diverging BRIC Future - 11th Nov 19
Welcome to the Zombie-land Of Stock Market Investing - 11th Nov 19
Illiquidity & Gold And Silver In The End Game - 11th Nov 19
Key Things You Need to Know When Starting a Business - 11th Nov 19
Stock Market Cycles Peaking - 11th Nov 19
Avoid Emotional Investing in Cryptocurrency - 11th Nov 19
Australian Lithium Mines NOT Viable at Current Prices - 10th Nov 19
The 10 Highest Paying Jobs In Oil & Gas - 10th Nov 19
World's Major Gold Miners Target Copper Porphyries - 10th Nov 19
AMAZON NOVEMBER 2019 BARGAIN PRICES - WD My Book 8TB External Drive for £126 - 10th Nov 19
Gold & Silver to Head Dramatically Higher, Mirroring Palladium - 9th Nov 19
How Do YOU Know the Direction of a Market's Larger Trend? - 9th Nov 19
BEST Amazon SMART Scale To Aid Weight Loss for Christmas 2019 - 9th Nov 19
Why Every Investor Should Invest in Water - 8th Nov 19
Wait… Was That a Bullish Silver Reversal? - 8th Nov 19
Gold, Silver and Copper The 3 Metallic Amigos and the Macro Message - 8th Nov 19
Is China locking up Indonesian Nickel? - 8th Nov 19

Market Oracle FREE Newsletter

How To Buy Gold For $3 An Ounce

Gold Swoons as Stocks Bounce

Commodities / Gold & Silver 2009 Mar 03, 2009 - 09:49 AM GMT

By: Adrian_Ash

Commodities THE PRICE OF GOLD slipped to fresh 3-week lows at the New York opening on Tuesday, dropping 2.2% to $907 per ounce as world stock markets bounced everywhere but London.

Crude oil rallied above $41 per barrel. Long-dated Treasury bonds fell, pushing interest rates higher.


"Will the ghost of margin calls return to haunt the gold market once again?" asks London dealer Mitsui today after the US stock market plunged 12% last month to its worst levels since 1997.

In mid-2008 the Dollar Gold Price swooned, even while market analysts forecast "safe haven" gains amid the quickening financial crisis, as speculators using borrowed money to trade gold were forced to close their positions.

Now, "with gold in Rupee terms approaching fresh highs, we are unlikely to see [Indian] buying enthusiasm return this week, and once again scrap flows will likely dominate," the London metals dealer continues in its Gold Investment analysis.

"Upside momentum remains intact over the medium term, but this market needs the return of Gold ETF buying before we can consider another stab of $1,000 possible."

Looking at the flurry of press comment on gold – both bullish and bearish – in the Western media, "There is no doubt that gold is getting a lot of coverage in the media," says Daniel Sacks of Investec Asset Management.

Sacks writes today for the London Telegraph 's special new Gold Investing section of its website.

"However," he goes on, "it does not appear that we are approaching the stress point that a market often reaches near the end of a sustained price move as the graph becomes parabolic."

In the broader financial markets Tuesday morning, the US Federal Reserve launched $200 billion aimed at making credit more available to consumers and small business.

The new program – the Term Asset-Backed Securities Loan Facility – may generate up to $1 trillion of new lending, says the Fed. But "the new [Obama] administration's stuttering attempts to repair the US banking and lending mechanisms so far suggests that by late 2010, the specter of a second dip into recession will be looming large," reckons one Merrill Lynch economist.

"[Only] at each corner where a policeman is stationed [do] we witness a decline in crime," agrees the chief economist at Wachovia. Credit conditions only improve in those markets "where the Fed focuses its liquidity facilities."

Back here in London, "I've given the Bank of England powers to put money into the economy," says finance minister Alistair Darling in an interview.

"We've given them the levers. They may decide this month that it's appropriate to do so."

The Bank of England meets tomorrow, and is expected to cut UK interest rates to a fresh all-time low of 0.5% on Thursday.

Press reports say the Bank's first attempt at Quantitative Easing (a.k.a. money printing) will pump £150 billion into short-term government bonds, boosting prices and depressing market-set interest rates.

Meantime in Europe – where capital flight out of newly-joined states has sparked a crisis in their emerging-market currencies – monetary affairs commissioner Joaquin Almunia told the European Policy Centre think tank today that the European Union would step in to rescue a failed member state before emergency aid from the International Monetary Fund (IMF) became necessary.

"Don't fear," he said in his speech. "We are equipped intellectually, politically, economically to face this crisis scenario.

"It's not clever to tell you the solution in public. But the solution exists. By definition, this kind of thing should not be explained."

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 2009

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