Closing Gold & Silver Market Report – 10/24/2011
HEDGE FUNDS PLACE BETS AGAINST RECESSION, SHADOW STILL LOOMS
Gold and silver are up slightly in afternoon trading, with both metals up by more than 1%. Platinum and palladium are the big gainers today, with platinum up by more than 2% and palladium up by 3.5%.
Hedge funds seems to be generally betting against another recession. Many have placed bets on commodities, which generally increase in value while coming out of a recession. “People are looking around saying, ‘You know what, the world isn’t ending,’” said John Stephenson, SVP and Fund Manager for First Asset Investment Management Inc. Silver, platinum, and palladium are all very industrial metals with many uses as raw materials and an increase in manufacturing levels may mean increased demand for those as raw materials.
All of this seems to be stemming from recent optimism about the situation in Europe. While many (including Berkshire Hathaway Vice Chairman Charles Munger) say the current proposed solutions won’t fix the problem, there has been a shift towards the brighter side in many investors’ outlooks. “Economic expectations got so depressed during the September market rout that any signs of improvement in the economic outlook should have a positive effect on the market,” said Nader Naeimi of AMP Capital Investors Ltd.
At 4:15 pm (CT) the APMEX precious metals spot prices were:
- Gold price - $1,655.70 – up $17.60.
- Silver price - $31.79 – up $.56.
- Platinum price - $1,548.00 – up $38.80.
- Palladium price - $641.70 – up $21.40.