American stock futures and Precious Metals were down slightly this morning, as investors are taking profits on recent gains. News of a downgrade to the  outlook for Greece’s sovereign debt rating  also affected the markets, as the European Union and International Monetary Fund seem less likely to provide more bailout funds to that troubled country. Also, the Bank of England paved the way for another round of quantitative easing for its country, cutting growth and inflation forecasts.

At least one analyst said the recent market rally is actually just setting up the stock market to fall. “I think we’re in choppy waters, and that continues,” said Charlie Morris of HSBC Global Asset Management. “You need to trip the market to have a proper collapse. So you almost need to set it up with a rally, get everyone excited, and then it can fall. If there are risks, the risks to a very negative market come after this rally fades.” In the long term, traditionally steep stock market losses are supportive of the Gold price.

The main topic supporting the price of Precious Metals now is still  the possibility of future monetary easing  by the United States and the eurozone. Richcomm Global Services senior analyst Pradeep Unni said, “Gold seems to be supported by hopes that Europe and the United States would launch more stimulus measures to help shore up their faltering economies. Investors are betting that the festering debt crisis in the eurozone could push the ECB to launch a new round of bond buying soon.”

At 9 a.m. (EDT), the APMEX Precious Metals spot prices were:

• Gold, $1,608.40, Down $2.40.
• Silver, $27.90, Down $0.30.

As the markets closed Tuesday, there had been little movement in the Gold price.  The reasoning behind such light trading is based on the lack of action from major central banks.  In the United States, the question remains whether the slow economic numbers warrant another round of monetary easing from the Federal Reserve. In Europe, the main issue revolves around all of the countries working together toward a resolution to their financial issues. “We still haven’t received the positive news that everybody believed we would see at some point down the road. That’s why we are in this no man’s land,” said David Meger, director of metals trading at futures brokerage Vision Financial Markets.

It is well known that the European financial crisis has taken its toll on the region. One of the few bright spots has been Germany and its economic success.  However, reports from the European giant show the crisis has made its way into the German economy, as well.  “Germany can’t escape the crisis, and that has been shown by a consistent deterioration in recent data,” said Nick Kounis, chief European economist at ABN Amro Bank NV in Amsterdam. “At the same time, the country will not fall into a massive recession. It’ll be a long, drawn out period of flattish growth.” 

In the U.S.A., there has been a recent surge in the stock market of late.  In most cases this would be seen as a good sign for the economy.  Not all economists are impressed. Dan Geller, chief research officer of the Money Market Index, has his view of the sudden spike in the Dow Jones Industrial Average. “The rally on Friday after the release of the employment figures and the consumer confidence index really has no economic merit,” Geller said. “It’s totally irrational.”

At 5 p.m. (EDT), the APMEX Precious Metals spot prices were:

• Gold, $1,612.30, Down $1.80.
• Silver, $28.18, Up $0.21.

Precious Metals prices were up again in early morning trading as the euro gained on the American dollar on the hope that the European Central Bank will step in with a quality easing plan. However, concerns persist over our own fiscal cliff and investor outlook for further Fed easing domestically. Analyst David Wilson hit on both concerns, saying, “It’s all about the exchange rates.  We’ve had a slightly softer dollar, and that’s been supportive. Every so often we get some more optimism that Europe is sorting out its problems, as we did over the second half of last week, but I don't think this (strength) will continue. For that, we really need to see a significantly softer dollar, and that won’t happen until the Fed takes action.”

Meanwhile, reputable or “safe” banks are starting to show their faults. Standard Chartered’s reputation has taken a huge hit as dealings have come to light that suggest the British bank hid $250 billion for Iran over the past 10 years in almost 60,000 transactions. If so, the bank could lose its New York banking market license. Analyst Gareth Hunt said,  “Some people were walking around under the illusion that Standard Chartered was the world’s first riskless bank, and it’s not.  We’ve discovered that Standard Chartered is a mortal bank, as they all are.” Standard Chartered was one of the least affected global banks during the global financial crisis. This credibility hit, coming when banks need to step up and lend during globally uncertain times, is alarming.

The world’s wealthier people seem to have taken notice of this growing uncertainty with banks and have begun branching out into smaller wealth management services, such as multifamily offices. The top growing firms for the ultra wealthy are  family offices that actually have no banking affiliation. Chief investment officer Rick Pitcairn has said, “If you are able to serve one of these complex families in an excellent way, you have the added benefit of creating an annuity effect by forming long term relationships. While the margins may be smaller in the beginning, the opportunity to build and expand these relationships over time is far greater.” The alternative benefits certainly aren’t anything to sniff at, either. But considering the lack of outside influence, the popularity of this business model continues to grow.

At 9 a.m. (EDT), the APMEX Precious Metals spot prices were:

• Gold, $1,615.60, Up $1.40.
• Silver, $28.21, Up $0.24.

Gold held on to price gains Monday. In a note, Credit Suisse explained how United States data ultimately affects the yellow metal. “Stronger economic data is a double-edged sword for Gold.” The note said the American dollar “tends to depreciate after good economic data due to reduced safe haven flows.  That is positive for Gold.” Optimistic fiscal data, though, “means that there is a lower probability of further monetary easing, which is negative for Gold. We think the most likely outcome for this week is sideways trading.”

Jay Taylor, publisher of the Miningstocks.com website, shared his forecast for Gold’s price as Europe’s financial crisis resumes and affects economies worldwide. Taylor presumes one of two predicaments can happen, which are either hyperinflation or deflation. If hyperinflation occurs, he suggests Gold could surge to $10,000 per oz, and if deflation happens, then he predicts Gold could push its way to $2,000. Taylor said he believes the most important factor to consider about possible price hikes for Gold is what happens to prices in general, and Gold’s relationship to them. In a recent interview on Canada’s Business News Network, Taylor said, “Despite all the anti-Gold propaganda, there is no reason to doubt that we are in the bull market of a lifetime for both Gold and mining shares.  Very soon we are going to see a dramatic increase in both the real and nominal price of Gold, and the Gold shares are going to break out, as well.”

At 5:06 p.m. (EDT), the APMEX Precious Metals spot prices were:

• Gold, $1,611.80, Up $4.50.
• Silver, $27.95, Up $0.04.

As the week begins, so does the rise in Gold prices. With reports coming out at the end of last week showing another rise in the United States jobless rate, the talk of more monetary easing from the Federal Reserve continues. “There is still room for easing if it is required, and there is still a perception that it may be required,” said David Jollie, an analyst with Mitsui Precious Metals.  Another factor in the Precious Metals market is the high demand from China.  Even though shipments of Gold went down in the last month, China is still on pace to overtake India as the world’s largest Gold market. “Although this was down on the previous month’s figure, it was well above the year on year level,” Commerzbank said in a note. “In the first half year, China thus imported 382.79 tons of Gold from Hong Kong, following a figure of 64.95 tons in the same period last year.”

In Europe, it may be a new week, but the news remains the same. There are many opinions on the best way to deal with the economic crisis in the region, but there are no signs of unity. While the European Central Bank has promised action, that will be next to impossible if the ECB does not have the support of the countries involved.  While some of the nations are prepared to act, others seem to be lagging behind.  “The Spanish seemed to think they could get a free ride from the ECB without conditions. That was never going to happen,” said a senior eurozone policymaker, speaking on condition of anonymity.

Reports in the United States are showing that productivity in the workforce is down.  One expert said he believes that is the best case scenario at this time.  “The only reason 1.7 percent GDP growth can go with 1 percent jobs growth is because productivity growth is less than 1 percent,” said Robert Gordon, a Northwestern University economics professor. These numbers, while not ideal, have created a drop in unemployment benefits claims over the last year.

At 1 p.m. (EDT), the APMEX Precious Metals spot prices were:

• Gold, $1,613.70, Up $6.40.
• Silver, $28.00, Up $0.09.

A report from HSBC Bank states, “Economic uncertainty, geopolitical tensions and the uncertainty of the U.S. November elections are theoretically Gold bullish, and Gold should perform better later in the year when U.S. growth is poor and the dollar is weak.” The report further stated that “we expect prices to  rally to above $1,900 per oz by the end of the year. Patience is the most important commodity.”

Gold was up slightly in early morning trading as  the United States dollar index hit a one month low. Friday’s positive jobs report increased the appetite for risk and, therefore, put downward pressure on the American dollar. There is much speculation that further monetary easing will be announced after September’s Federal Open Market Committee. For now, Gold remains in a fairly tight trading pattern while trying to decipher the direction of the global economies.

Spain remains in the spotlight, and the question is  how much bailout will that country actually need. At the moment, efforts are being made to stop the bleeding, but it is uncertain whether that can save the patient. The credit ratings make it very difficult for institutional investors to invest in Spain. There are concerns that this could turn into the same pattern as Greece, where smaller bailouts eventually turned into a full fledged bailout.

At 9 a.m. (EDT), the APMEX Precious Metals prices were:

• Gold, $1,1610.00, Up $2.70.
• Silver, $27.80, Down $0.11.

Precious Metals stayed in positive territory Friday based on the better than expected jobs report that was released earlier in the day. The news however was tempered by the fact that unemployment still remains relatively unchanged. Expectations continue to grow that further quantitative easing will likely occur in September. Trader Nicolas Berge said, “Even though the nonfarm payrolls beat the estimates, the unemployment rate also rose, so the odds for a QE are all the same. The increasing expectation of central bank actions is likely to  help Gold break above  its recent trading range.”

The number of new jobs was 163,000 last month, which beat the less than stellar showings over the previous three months. The news is a slight silver lining over eurozone concerns, America’s looming “fiscal cliff” and pending elections. The stock markets remained relatively unfazed by the news.  Though the number of jobs rose, the unemployment rate rose, as well. Economist Robert DiClemente said, “It’s a relief we did not post another number like 75,000, but the reality is it’s not night and day. It’s not as though it brings us all the way back to being wildly optimistic.” Economists also are in agreement that the Fed’s action is likely to occur in September. Michael Feroli said, “We think the odds are still tilted in favor of more Fed accommodation at the September meeting, and that call obviously remains contingent on economic and financial developments over the next six weeks.”

At 5:12 p.m. (EDT), the APMEX Precious Metals spot prices were:

• Gold, $1,604.00, Up $15.30.
• Silver, $27.84, Up $0.73.

Gold’s price began to ascend after positive numbers were released from this morning’s nonfarm payrolls report, which showed an estimated 163,000 jobs were created for July. For many investors, the upbeat data could begin to erase any chance of further economic stimulus in the United States. Stephen Stanley, chief economist at Pierpoint Securities, said, “Even with the better than expected payroll number, it’s not sufficiently big to change the big picture view.  The economy is growing, but not at a satisfactory rate  to bring down unemployment. If the Fed had considered doing QE3, I suspect today’s number pushes them half a step back.”

PIMCO’s Mohamed El Erian said he firmly believes the world’s central banks cannot be looked upon to save everyone from their financial crisis. The Bank of England, the European Central Bank (ECB) and the Federal Reserve all had individual meetings this week to disclose the norm that each would assist with future stimulus if the situation calls for it. El Erian suggests that other government entities should step in with better suited policy tools before central bankers resourceful system stops working. ECB President Mario Draghi seems to hold the same sentiment, saying, “Central banks cannot replace governments.”

At 1 p.m. (EDT), the APMEX Precious Metals spot prices were:

• Gold, $1,604.20, Up $15.60.
• Silver, $27.79, Up $0.68.

Stocks and many commodities sank lower today after the  lack of any sign of commitment to stimulus by the European Central Bank. ECB President Mario Draghi had buoyed markets last week by promising that the ECB would  “do whatever it takes.”  However, at today’s news conference, “whatever it takes” turned into “what didn’t work when we tried it the first time.” While Draghi did say that the ECB would keep interest rates low to encourage lending by banks, this was far short of what was expected. “It’s status quo. I don’t know why people feel that authorities can come up with magic solutions. I don’t know that the magic bullet exists. There are limits to what the ECB can do,” said Hayes Miller, head of asset allocation in North America at Baring Asset Management Inc. Gold prices fell by about 1 percent on the news.

In a rare show of bipartisanship,  members of the Senate Finance Committee passed legislation todaycontaining $205 billion in tax breaks. However, analysts say the bill would have to be radically changed to pass through the House of Representatives. Still up in the air is exactly how Washington will handle the looming “fiscal cliff” -- the massive tax hikes and spending cuts demanded by the deal struck to raise the debt ceiling last year, scheduled to take effect in January. “These steps ... pare down the number of ‘must pass’ issues Congress has to tackle during the lame duck period, which will facilitate deal making on the toughest questions,” said Sean West, an analyst for Eurasia Group.

At 5 p.m. (EDT), the APMEX Precious Metals spot prices were:

• Gold, $1,589.40, Down $15.50.
• Silver, $27.18, Down $0.47.

American stock futures gave up some early gains after the European Central Bank (ECB) announced that  eurozone interest rates will remain the same. While many economists said this would be the case, it seems investors were hoping for more. ECB President Mario Draghi reinforced his commitment to the euro, stating that it is an “irreversible” union. He also called out to governments, saying they need to “stand ready to activate bailout funds.”  Stock futures and Precious Metals moved into the red as Draghi spoke.

The Federal Reserve said Wednesday that actions would be taken to stimulate the economy. Yesterday’s drop in Gold’s price was the biggest in more than three weeks and was largely due to the lack of announcement by the Fed. However,  Gold buying by central banks is still supporting the Gold price. UBS said in a note, “It (central bank buying) has been providing investors with some comfort, that stronger hands are active.”

At 9 a.m. (EDT), the APMEX Precious Metals spot prices were:

• Gold, $1,598.40, Down $6.50.
• Silver, $27.32, Down $0.32.

Precious Metals prices took a blow today as the United States Federal Reserve decided against any action to stimulate the economy at this time. The Federal Reserve is only one part of the monetary puzzle, so to speak, as the  European Central Bank and the Bank of England are set to meet Thursday, which will give observers a better idea of what actions will be taken in the global marketplace to ease the fears. Monetary easing has been known to boost the price of Gold, as the value of currencies depreciates when easing occurs.

The Federal Reserve stopped short of any stimulus announcement but did acknowledge the economic recovery is sputtering. Although no new measures of easing were announced, there was a decidedly different tone from its previous proclamation in June that it was “prepared to take further action as appropriate.” In its statement, the Fed said, “The committee will closely monitor incoming information on economic and financial developments and  will provide additional accommodation as needed.” There are a number of considerations being made to help boost the economy, including the Bank of England’s recent “funding for lending” proposal to increase lending to private citizens and corporations. Thursday’s European Central Bank meeting is being seen as a clear indicator of market activity. Strategist Jim Russell said, “The big fireworks will be tomorrow. Anything short of (aggressive ECB action) will represent a disappointment to capital markets.”

At 5:01 p.m. (EDT), the APMEX Precious Metals spot prices were:

• Gold, $1,600.60, Down $11.60.
• Silver, $27.46, Down $0.55.

Precious Metals, stock markets, and currency trades alike  were relatively flat this morning. The markets all seem to be waiting for a decision from the United States Federal Reserve at the conclusion of a two day policy meeting today. A big decision, such as a third round of quantitative easing (QE3), is not expected to come from this meeting. But many analysts suggest that lower interest rates could be extended into 2015.

The European Central Bank (ECB) also has an announcement due this week, though comments from Bundesbank President Jens Weidmann dampened expectations for that announcement. Weidman said that the ECB’s independence “requires it to respect and not overstep it’s own mandate. We are the largest and most important central bank in the euro system, and we have a greater say than many other central banks.”

Precious Metals turned slightly negative (with Silver and Platinum taking more significant downturns) after the  release of the ADP jobs report  this morning. The economy saw more jobs added than expected in July, according to the report from payroll provider Automatic Data Processing. This good economic news perhaps makes it less likely the Fed would announce drastic measures such as QE3, which helps explain the lower Precious Metals prices. 

At 9 a.m. (EDT), the APMEX Precious Metals spot prices were:

• Gold, $1,607.00, Down $5.10.
• Silver, $27.34, Down $0.68.