Mid-Day Gold & Silver Market Report – 6/21/2011
MARKETS UP IN ANTICIPATION OF GREEK PARLIAMENT VOTE – Stocks and precious metals rose this morning in anticipation of a vote of confidence in Greece’s Prime Minister, George Papandreou. The general consensus is that Papandreou is expected to win the vote, which brings Greece one step closer to a bailout package. Papandreou is in favor of the economic reforms that the International Monetary Fund and other EU member states are demanding in exchange for another bailout package.
Negotiations are taking place to prevent a default here at home, which could have considerably more impact than a Greek default. Remarks by lawmakers are now indicating that even if a large spending cut and debt ceiling agreement cannot be reached, a smaller package may be passed to allow more time for debate. The two sticking points now seem to be cuts in entitlements like Medicare, and an increase in revenue (which is a nice way to say “higher taxes”).
Meanwhile, new data on the U.S. housing market shows the slump in existing home sales is continuing. Foreclosures glutting the market, along with banks’ extremely tight loan requirements, have led to a surplus of unsold homes and, therefore, a drop in home prices overall. The median home price in the U.S. is $166,500, which has dropped by 4.6% since this time last year, meaning the average U.S. homeowner has lost 4.6% of their investment if they bought their home at that time. Falling home prices and high unemployment contribute to lower consumer sentiment, which leads to lower consumer spending, the bread and butter of the U.S. economy.
At 12:03 pm (CT) the APMEX precious metals spot prices were:
- Gold – $1,545.50 (up $3.20)
- Silver – $36.50 (up $0.34)
- Platinum – $1,747.30 (up $15.80)
- Palladium - $770.10 (up $19.90)