Mid-Day Gold & Silver Market Report – 11/23/2011
THE FEAR OF EUROPEAN COLLAPSE REARS ITS HEAD
Precious metals prices are on the rise since the Morning Gold and Silver Market Report, heavily due to the continued debt crisis in Europe returning to the spotlight. The focus for now has been lifted off of the U.S. cutting its deficit. The global turmoil has caused a rush to cash positions or bonds, with gold retaining its safe-haven appeal. The issue surrounds the rising price of the dollar to other currencies. “The German bond auctions were the straw that broke the euro’s back,” said Kathy Lien, director of currency trading at GFT Forex. “German bonds are normally perceived as the safest investment in Europe, so if investors aren’t willing to buy German bonds, then Europe is really in trouble.”
The International Monetary Fund (IMF) is trying to control Europe’s sovereign debt crisis by announcing new measures to assist with short-term liquidity to ailing nations. These new measures are viewed by the IMF as “insurance against future shocks and as a short-term liquidity window to address the needs of crisis bystanders.” The measure is called the Precautionary and Liquidity Line. IMF Director Christine Lagarde said, “We have acted quickly, and the new tools will enable us to respond more rapidly and effectively for the benefit of the whole membership.” New York economics professor Nouriel Roubini said, “Money alone is not going to resolve the problems” in Europe, where the “contagion is spreading” far beyond the so-called periphery. “The contagion has now gone viral, cross-Atlantic and global.” With core nations being in hot water with their financial issues, it is no wonder why Europe’s problems keep spreading like a wildfire.
In the Middle East, Egyptians are protesting their new regime, with deadly results. However, the Arab Spring has toppled another leader, as well. Yemeni President Ali Abdullah Saleh has signed an agreement to transfer power in a deal with the six-nation Gulf Cooperation Council. Yemen has joined Tunisia, Egypt and Libya in regime changes this year. In a statement today, Saleh said, “We will be cooperative. … It is not the signing that is important; what matters is the good will and the start of serious and faithful work for real partnership to rebuild.”
At 12:04 p.m. (CST), the APMEX precious metals spot prices were:
- Gold - $1,699.80 – Down $4.50.
- Silver - $32.04 – Down $0.97.
- Platinum - $1,558.00 – Down $13.00.
- Palladium - $590.40 – Down $12.80.