Mid–Day Gold & Silver Market Report – 1/13/2012
FRANCE’S CREDIT RATING DOWNGRADED; WHO’S NEXT?
Gold and Silver prices are down slightly since this morning’s report. Both Gold and Silver declined sharply on the announcement that France has been downgraded by Standard & Poor’s, but the metals have since recovered to near their 8 a.m. prices. The stock market currently is down triple digits. It is expected that several other eurozone countries will be downgraded before the day is over. Downgrades may force some investment funds to sell bonds because they have a requirement that a set percentage of their bonds be AAA-rated. For those countries that would be affected, this could raise their borrowing costs. At a time when debt is rising and GDP (income) is declining, the last thing these countries need is for borrowing costs to rise.
Is there anyone who does not remember the “flash crash” of May 2010? A trillion dollars in shareholder equity was lost in a matter of minutes. The demand for answers on how such an event could occur was harsh and immediate. But more than a year later, there are still no answers. The Securities and Exchange Commission is pushing hard on the exchanges. After all, they were embarrassed by their lack of answers on the “flash crash,” then Bernie Madoff came up and made them look bad again. We should expect bigger government intervention, but no answers at the moment. It makes one wonder if such an event could happen again?
At noon (CST), the APMEX precious metals spot prices were:
- Gold - $1,631.80 – Down $15.90.
- Silver - $29.63 – Down $0.56.
- Platinum - $1,485.90 – Down $13.20.
- Palladium - $633.50 – Down $8.80.