Gold Taken Down Again, Silver and Platinum Follow Amid Massive Deleveraging
Oct 20th, 2008 | By Doug Casey | Category: Financial NewsGold held above $810 until London opened, then began a long slide that continued until mid-morning, after which it found its feet again and tacked on some minor gains before finishing at $782.60, down $21.70. For the week, gold backpedaled by 8%.
Platinum traded within a tight $20 range from the overseas markets straight through the Globex, closing near the low end at $857/oz., down $39. For the week, platinum shed more than 13%.
Silver was in the green until the midpoint of London trading, then it too hit a slow decline that lasted until the same mid-morning point as gold’s, and it too recovered a bit to end at $9.31/oz., down 34 cents. For the week, silver lost 8½%. (Click here for charts)
It was yet another lousy session for the precious metals, as gold slipped to its seventh down day in a row. Bulls had reason to be disappointed, as the dollar was only marginally higher against the euro and crude popped back over $70.
Overall, it was gold’s worst week in two months.
Kitco’s Jon Nadler offered his stark opinion that gold was off “on the back of drastically trimmed inflation expectations and the nauseating volatility in the global equity markets.” Which begs the question of why that volatility hasn’t provoked more safe haven buying.
Perhaps, as John Reade of UBS in London suggests, “The lack of jewelry demand and ongoing deleveraging is likely to keep gold and other precious metals under pressure in the near term.”
Far from turning him bearish, though, “Deleveraging may present some fantastic opportunities for long-term value investors that can live with negative short-term marks on their portfolio,” Reade wrote.
Good for buyers, not so good for sellers, of course.
“Funds who would like to keep their asset of last resort are being forced to sell,” said Peter Spina, president of GoldSeek.com. “There will be more victims of the fund collapse and more forced liquidations even if it requires you to sell your most desired assets such as precious metals,” he added.
Source: Gold taken down again - Silver, platinum follow amid massive deleveraging
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