Mid-Day Gold & Silver Market Report – 9/28/2011
RENEGOTIATION = MORE WORRY
Since the Morning Gold & Silver Market Report, precious metals pricing has dropped on increased fears of eurozone stability. There are reported European tax implications, as well as concerns amid European Union (EU) inspectors and IMF inspectors re-examining the austerity measures implemented by the Greek government.
EU and IMF inspectors are headed back to Greece to make sure implemented austerity measures are enough to avoid the country’s possible bankruptcy. There is a lot of opposition from private citizens that feel they are bearing the brunt of the austerity measures. Protestors are again taking to the streets of Athens. The group of inspectors is referred to as the “troika.” German Chancellor Angela Merkel, who faces her own opposition to any legislation pertaining to Greek bailout, said, "We have to wait and see what the troika ... finds and what it will tell us (whether) we will have to renegotiate [the bailout] or not.”
The EU proposed a financial-only transaction tax, so private citizens would not be affected. This proposal would require a “fair contribution from the financial sector.” However, other EU member countries have a split view on this. The United Kingdom in particular opposes this move. “The consensus is that anything less than a globally applied, uniform tax would distort the markets and reward dissenting low-tax regimes rather than raising significant revenue,” the British Bankers’ Association said in a statement. “The U.K. would be particularly affected by any such tax as it is the world’s financial center.” This measure is also viewed as beneficial for adding revenue to the EU member countries.
These concerns have had a definite push/pull effect on gold prices. HSBC said, "If the euro zone's efforts to remedy the sovereign debt crisis falter, gold could still rally even if riskier assets sell off."
At 12:03 PM (CT) the APMEX precious metals spot prices were:
- Gold - $1,627.30 – Down $26.30.
- Silver - $30.46 – Down $1.11.
- Platinum - $1,537.90 – Down $39.10.
- Palladium - $636.00 – Down $15.90.