ebb & flow of the market
Good morning and welcome to a Transcendent Tuesday. Today will surpass the ordinary. It will be exceptional. If you desire it…see it…make it happen! Heart greets me this morning with their 1975 hit, “Magic Man.”
The New York Spot Prices pulled backed below the 1300 level yesterday with Gold closing down $8.80 settling in at $1,294.50, Silver was down $0.20 to $17.21, and Platinum lost the largest share at $14.00 to close at $930. In overnight trading, Gold has continued its downward trend losing an additional $6.70, Silver is down $0.16, and Platinum lost another $3.00. Boy, I hope we don’t lose all of last week’s gains in two days of trading!
So what’s going on with precious metals? One week they’re up. The next they’re down. Is it a market correction or are the bullion banks keeping the metals in check? So it seems that if you discount the bullion banks having anything to do with this week’s PM downturn, there is convincing evidence that the drop is only natural. First, the dollar is up. When the dollar increases against other world currencies, it is also up against gold giving the illusion that gold has lost value. Secondly, the NYSE is hitting record highs and investors are stumbling over each other to throw more dollars at it. Of course that means there are less dollars to invest in gold. So the fewer investors that show up to trade PM’s, the more volatile each trade becomes. And finally, U.S. and North Korean diplomats will be meeting next week to hopefully iron things out without lobbing anymore missiles. A stable world is a relieved world. In my book, that means that gold is in the backseat once again.
Here is an excellent read on gold from Ed Steer:
“Gold appears to have formed a solid base since bottoming at year-end 2015 at $1060.00/oz. Through 9/29/17, the metal's price increased 11.10%, even after a sharp pullback from its early September 2017 high of $1355. As of September 30, 2017, the price stood at $1280.15, 20.75% above its low at year-end 2015.
In our view, gold and the precious-metals complex is in the early stages of a dynamic up cycle that will match or exceed the run from 2000 to 2011. Downside appears limited; the greatest challenge for investors will be to muster the necessary patience to hang on until the up-cycle becomes more assertive and evident.
Despite the four-year correction from $1,900/oz. to $1,060 at year-end 2015, gold has outperformed stocks and bonds since 2000, the dawn of radical monetary practices by the world's central banks.
What we also know is that gold production is peaking out, and is likely to decline over the intermediate term even if gold prices rise substantially. Should investor demand reawaken, there is very little slack in supply to absorb it. The depletion of gold inventories in London and other Western vaults - a result of demand in Asia - is a finite process with measurable limits. There are many signs that those limits are being reached.
Finally, we know that the fiscal position of Western democracies is perilous and worsening. History teaches that resolution of fiscal impasses most often results in monetary debasement, which has invariably led to a rise in the nominal value and purchasing power of liquid assets that cannot be debased. Gold and silver constitute a short list of non-financial assets with monetary characteristics.”
Okay, so, what does this mean? Well, to me, it means to make sure you have a balanced portfolio.
Oh, one more thing... "The bling in your ring is a product of the most violent kind of explosion in the universe - 2 neutron stars collide." Scientist recently watched a collision of two stars and saw the creation of heavy metals resulting from the explosion. Of course, some of the heaviest are gold and platinum. Here's the article: "Astronomers Strike Gold"
Well, I’ll let that be it for today. Go out there and make a difference! See ya’ll later!
*Disclaimer: Precious Metal Musings™ is written for entertainment and news purposes only and should not be used in making purchases and/or sales of precious metals.