Morning Gold & Silver Market Report – 9/23/2011
Global Markets Continue to Fall, While Political Leaders Continue to Fiddle – As leaders around the globe continue to provide more talk than action, traders are selling whatever they can get their hands on. European stocks tried to rally overnight, on the promise from the G-20 that European parliaments would work over the next several weeks to come up with a way to increase the bailout fund to troubled euro-area banks. It was a nice pledge, but with no specifics, the rally fizzled and the markets closed down. U.S. stock futures are indicating a triple digit decline at the opening bell.
The markets are infused with fear and traders are turning everything they can into cash. Often, in order to cover margin calls. There are four safe haven plays that investors have turned to of late in time of crisis; gold, the Swiss franc, US Treasuries, and the Japanese Yen. Why is it that gold and the Swiss franc are down, while money flows into the U.S. Treasuries and Japanese Yen? According to Joe Weisenthal, writing for the Business Insider, gold and the Swiss franc have enjoyed bullish support and people are actively long in those positions. U.S. Treasuries and the Yen have been out of favor, so speculators have taken short positions. It should be no surprise that with yesterday’s sharp downturn, the cash crunch forced them to sell their long positions. These were the more popular and easy to liquidate assets. The short term less popular assets, they had to maintain.
At 8AM (CT) the APMEX precious metals prices were:
· Gold price - $1,691.00 – down $50.70
· Silver price - $32.90 – down $3.71
· Platinum price - $1,649.70 – down $63.90
· Palladium price - $653.80 – down $11.30