Morning Gold & Silver Market Report – 7/22/2011
DETAILS OF GREEK BAILOUT AND OBAMA’S DEBT-SHRINKING PLAN
Details of the European Union’s bailout of Greece have emerged, and the package is being seen as stronger than expected. Fitch Ratings said it will declare Greece to be in "restricted default,” however this was an expected consequence, according to EU leaders. The deal is expected to stave off any contagion to other countries in the eurozone. This led to stocks rising globally, as well as gold and silver, as investors’ attention is now focused squarely on the U.S. debt ceiling.
President Obama is said to be working on a major deficit-reduction package that includes $3 trillion in cuts while not including immediate revenue increases. This is a sticking point to Democrats, who are said to be upset with the plan. Obama would have to convince his fellow Democrats that this is the right deal, and he will need to do it quickly. The U.S. is now a mere 11 days away from defaulting on its debts.
Malcolm Gissen, co-manager of the Encompass Fund, said recently that gold is the “one commodity that gives comfort” to the people who hold it. He added that gold never loses its value (everything changes around it, instead). Silver is gaining a lot of attention globally as demand spikes. Martin Hennecke of Tyche Group said that the rising “…demand of gold and silver [especially in China] is one of the reasons why we continue investing in these metals, even at today’s prices, coupled with the fact that underground reserves that can be mined at reasonable costs have become fewer and harder to find.”
At 8:20 am (CT) the APMEX precious metals spot prices were:
- Gold – $1,603.50 – Up $15.50.
- Silver – $39.90 – Up $0.90.
- Platinum – $1,796.40 – Up $8.60.
- Palladium – $810.20 – Down $0.80.