Mid-Day Gold & Silver Market Report – 7/14/2011
MOODY’S PUTS THE PRESSURE ON DEBT LIMIT TALKS
The decision by Moody’s Investors Services to review the United State’s Aaa credit rating for a possible downgrade is adding even more pressure to the already-tense debt limit discussions between President Obama and Republican leaders. Interests both in this country and overseas (most notably China, which owns more than $1 trillion in U.S. Treasury debt) are urging lawmakers to make a deal quickly so that fears of a U.S. debt default don’t have a catastrophic impact on the world economy. However, reports out of Washington indicate that for a fourth day in a row, meetings between the President and the GOP ended without any progress made. Meanwhile, in addition to Moody’s credit review, Standard & Poor's has quietly informed lawmakers in the U.S. that if the government fails to make any payments as a result of a debt default, it might also be forced to deliver a ratings cut.
After giving signs yesterday during an appearance before Congress that additional stimulus measures might be in the offering soon, Federal Reserve Chairman Ben Bernanke reversed himself today during a Senate Banking Committee appearance, saying that there are no preparations by the central bank to take any action. Speaking before the Senate panel, Chairman Bernanke said, “The situation is more complex," he told the Senate Banking Committee. “Inflation is higher… We are uncertain about the near-term developments in the economy. We would live to see if the economy does pick up. We are not prepared at this point to take further action," adding that further third stimulus measure might not be effective. Bernanke’s comments today put a damper on the stock market, while gold prices rose to hit a record high for the second straight day.
At 12:12 PM (CT) the APMEX precious metals spot prices were:
- Gold - $1,589.90 – Up $3.40 on the day.
- Silver - $38.92 – Up $0.71.
- Platinum - $1,773.30 – Up $6.30.
- Palladium - $782.60 – Down $3.40.