Closing Gold & Silver Market Report, 7/19/2012
AMERICAN ECONOMY POISED FOR WEAK SECOND HALF OF 2012
It’s tough to find good news about the economy these days. Many economists say the American economy is poised for an anemic second half of the year. “We’ll have very slow growth,” said Joshua Shapiro, chief U.S. economist at Maria Fiorini Ramirez Inc. “The excess supply of homes will weigh on housing for quite some time. Manufacturing is starting to suffer a bit. The labor market remains pretty soggy.” According to a Bloomberg survey, Americans are more pessimistic than any time in the past six months. “A soft labor market and political tensions surrounding potential changes in tax policy are weighing on consumer sentiment,” said Joseph Brusuelas, a senior economist at Bloomberg LP.
In the most recent auction of Treasury Inflation Protected Securities, or TIPS, demand for the assets was so strong that interest yields actually went negative, meaning that investors were essentially paying the American government to allow them to loan the government money. The attraction to these inflation protected bonds indicates widespread speculation that the economy could experience high inflation in the near future, possibly because of stimulus action by the Federal Reserve.
At 5 p.m. (EDT), the APMEX Precious Metals spot prices were:
- Gold, $1,582.20, Up $9.90.
- Silver, $27.31, Up $0.13.
- Platinum, $1,419.30, Up $15.10.
- Palladium, $584.40, Up $5.90.
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