Gold Shoots Higher as Equities Continue Tanking
Oct 8th, 2008 | By Doug Casey | Category: Financial News, Gold MarketGold shot higher in early London trading and, though it skittered around thereafter, failed to give up much of its gains, finishing just off its intraday high at $887.10, up $31.80. Overnight, gold is sharply higher. Platinum got some rub-off love, as it too burst higher in the overseas markets, then weathered a few bouts of selling, to also end just off its intraday high at $1015/oz., up $50. Overnight, platinum has fallen off.
Silver was even more strongly higher than its sister metals, peaking over $11.80 in the first hour of COMEX trading, but then it sold off sharply until early afternoon, after which it reversed course through the Globex, closing at $11.56/oz., up 53 cents. Overnight, silver is steeply higher. (Click here for charts)
It was a powerful day for the precious metals, with the dollar hitting its first rough spot in a while and crude climbing, while equities sold off yet again.
The perfect storm rages on, and gold is the port.
Gold “should look to make further gains in the coming days as flight-to-safety demand increases,” said James Moore, of TheBullionDesk.com.
Analysts also cited speculation that central banks will cut borrowing costs in dealing with the credit crunch, boosting demand for the metal as an alternative asset.
“The credit-market contagion has spread, people are fearful about putting money into banks, and they’re still turning to gold,” said Matt Zeman, of LaSalle Futures Group in Chicago. “A global rate cut, certainly a U.S. rate cut, would be imminent.”
Then there’s all the funny money. “The digital printing presses around the world are injecting incredible liquidity levels into the system as the financial system continues to crumble,” said Peter Spina, president of GoldSeek.com. “This is clearly all very gold and silver positive.”
And in the physical market, the U.S. Mint acceded to heavy demand by broadening its freeze on sales of gold bullion coins. 1-ounce Eagle and Buffalo coins will remain on allocation. But once the remaining Buffaloes are depleted, no more coins will be produced this year. Inventories of the 1/2-ounce and 1/4-ounce Eagle are depleted and no more coins will be produced this year. The 1/10-ounce Eagle is also sold out, with no more planned this year after the few remaining blanks are stamped.
Source: Gold shoots higher as equities continue tanking - Pulls platinum and silver along
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Doug Casey is a contrarian investor, sought-after public speaker and author of several books. His work "Crisis Investing" held the position of # 1 bestseller on the New York Times list for 26 consecutive weeks. Doug's unusual views on the economy - and just about everything else - have gained a huge following in the investment community, and it certainly helps that his stock recommendations of undervalued junior exploration companies have made his subscribers millions. Now in its 27th year, Doug's monthly newsletter, the International Speculator, is one of the most established and esteemed publications on gold, silver and other natural resource investments. Together with the Casey Energy Speculator, it covers a broad range of carefully selected stocks with the very real potential of double- and triple-digit returns within 12 to 24 months.