Precious Metals Take a Pounding
Posted on: Jun 16th, 2009 | By Doug Casey | Filed under Gold Market
Gold held near flat until the second hour of trading in New York on Monday, then began a long slide that carried it as low as $925 on the Comex, followed by some very modest buying that took it to a close at $928.00/oz., down $10.30. Overnight, gold is pushing higher.
Platinum was off in the overseas markets, took a big hit between mid-morning and noon in New York, then went dead flat from there through the Globex, ending at $1205/oz., down $45. Overnight, platinum is sharply higher.
Silver sold off from the far East to the London open, leveled off to the late morning, but then resumed its decline, finally closing near its intraday low at $14.02/oz., down 81 cents. Overnight, silver is trending higher. (Click here for charts)
With the dollar up again, commodities including the precious metals and oil were off sharply yesterday. All in all, it was just a broadly negative day. Little was spared, including equities, which also took a serious hit.
Even perennial bull James Moore, of TheBullionDesk.com, was forced to write that, “Short-term the metal could extend lower as a result of the dollar.”
John Reade, of UBS in London, concurred, writing that, “We would not be surprised to see further short-term declines, especially in the absence of any material jewelry, physical-investment or ETF demand.”
How do you put a happy face on that? Easy. “However, the current correction is likely to prove beneficial longer-term with the pullback offering investors a chance to enter the market,” Moore said.
Meanwhile, “The market focus this week will be on the summit of BRIC countries tomorrow,” Barclay’s Capital analysts wrote, referring to Brazil, Russia, India and China by the common acronym.
The meeting in Russia, to which the US was pointedly not invited, is expected to focus on the world monetary crisis and the dollar’s role in it. Some think the countries may be preparing a call for a new international reserve currency, although whether they would have enough economic clout to push that remains to be seen.
Source: Precious Metals Take a Pounding
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.