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World Bank chief calls for new gold standard
The president of the World Bank said in a newspaper editorial Monday that the Group of 20 leading economies should consider adopting a global reserve currency based on gold as part of structural reforms to the world’s foreign-exchange regime.
World Bank chief Robert Zoellick said in an article the Financial Times that leading economies should consider “employing gold as an international reference point of market expectations about inflation, deflation and future currency values.”
Zoellick made the proposal as part of reforms to be considered at this week’s G-20 meeting in Seoul.
“Although textbooks may view gold as the old money, markets are using gold as an alternative monetary asset today,” said Zoellick.
He said such a reform would reflect economic realities and should be considered as a successor to the existing global currency paradigm known as “Bretton Woods II.”
Bretton Woods II refers to the system which began in 1971, when U.S. President Nixon ended the dollar’s link to gold as established under the Bretton Woods agreement.
Zoellick said a return to some sort of currency link to gold would be “practical and feasible, not radical.”
“This new system is likely to need to involve the dollar, the euro, the yen, the pound and a renminbi that moves towards internationalization and then an open capital account,” he said.
Comex gold prices ended higher Monday as bargain hunters stepped in to buy an early dip to send prices to a new all-time record high of $1,407.20 an ounce, basis the nearby December contract. December Comex gold last traded up $8.50 at $1,406.20 an ounce. Spot gold last traded up $12.30 at $1,407.00.
Bullish technical and fundamental factors continue to invite fresh investor demand into the gold market. One key factor boosting gold prices recently has been the buying of gold as a hedge against further depreciation of the U.S. dollar and other major world currencies. Traders are anxiously awaiting the late-week G-20 meeting in Seoul, at which major industrial nations are likely to discuss currency market fluctuations.
Reports overnight said World Bank president Robert Zoellick has stated gold should be an "international reference point" for currency market movements. Zoellick's statement was surprising to most market watchers.
The U.S. dollar index traded solidly higher Monday, on a short-covering bounce in a bear market. While the dollar index remains near-term technically and fundamentally weak, which is bullish for the precious metals, any sustained rebound in the dollar index would likely be temporarily bearish for gold and silver. However, the gold market has enough strong fundamental and technical factors in its favor that even a near-term rally in the U.S. dollar index is not likely to change the overall bullish posture of the gold market.
The London P.M. gold fixing was $1,388.50 versus the previous P.M. fixing of $1,395.50 an ounce.
Technically, December gold futures prices closed nearer the session high Monday. Gold bulls have the solid overall near-term and longer-term technical advantage, and gained more upside power Monday. A 3.5-month-old uptrend on the daily bar chart is in place. Bulls' next near-term upside technical objective is to produce a close above technical resistance at $1,450.00. Bears' next near-term downside price objective is closing prices below solid technical support at $1,350.00. First resistance is seen at Monday's all-time high of $1,407.20 and then at $1,412.50. Support is seen at $1,400.00 and then at $1,390.00. Wyckoff's Market Rating: 9.5.
December silver futures closed up 63.2 cents at $27.38 an ounce Monday. Prices closed session near the session high and hit another fresh 30-year high. Silver bulls have the solid overall near-term technical advantage and gained more power Monday. The market is now short-term overbought, technically, and due for a corrective pullback soon. Prices are in a 3.5-month-old uptrend on the daily bar chart. The next downside price objective for the bears is closing prices below solid technical support at $25.00. Bulls' next upside price objective is producing a close above solid technical resistance at $28.00 an ounce. First resistance is seen at Monday's high of $27.64 and then at $27.75. Next support is seen at $27.00 and then at $26.75. Wyckoff's Market Rating: 10.0.
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US Close Gold Report
Closing Gold & Silver Market Report – 11/08/2010
By Peter LaTonaNovember 8, 2010At 4PM (CT) the APMEX precious metal spot prices were:
- Gold price - $1,410.20
- Silver price - $27.77
- Platinum price - $1,777.00
- Palladium price - $710.00
COMMENTARY: We reported this morning that the World Bank Chief was calling for a new gold standard. At the time, we did not anticipate how much this would move precious metals upward to new highs. Gold spot is at at all time high, while silver spot and palladium spot prices crossed significant resistance points. Somewhat surprisingly,this all occurred as the US Dollar gained against a sinking Euro. There are new concerns over the sovereign-debt problems in Ireland and Portugal. Another factor possibly driving up precious metals prices is that even the Fed officials were split over the $600 Billion stimulus. As long as economic uncertainty remains, precious metals outlook should remain bullish.
Gold spot price is up $11.50 for the day while reaching an all-time high – Silver spot is up 99 cents, while crossing major resistance at $27 – Platinum spot price is up $8.10 – Palladium price is up $22.60, while crossing resistance at $700.
US OPEN GOLD REPORT
At 8AM (CT) the APMEX precious metal spot prices were:
- Gold price – $1,392.60
- Silver price – $26.89
- Platinum price - $1,759.50
- Palladium price - $696.10
COMMENTARY: In late Friday night trading, gold spot price reached an all-time high of $1398.70. Precious metals have been under some selling pressure this morning, as the US Dollar is slightly higher. The US Dollar index remains technically and fundamentally weak in the near term, but if temporary rebounds were to occur, it would be bearish for precious metals.
Gold spot price is down $2.40 from Friday’s Closing Commentary – Silver price is up 12 cents – Platinum spot price is down $12.30 – Palladium prices continue to rise up $7.60.
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Today
Gold highest: 1398.00
Silver highest: 27.02
What Latest QE Means for the U.S. Dollar and the Future Price of Gold
1 Beginning of the End for U. S. Dollar
2 Just the Beginning for the Price of GOLD
Read more
Gold targets new highs this year and next
Gold is not a paper currency, it is nobody else’s liability, it is not a promise to pay by a bank and it’s something you can’t print, whereas dollar bills and other paper currencies you just turn the printing press on
Read...
Weekly Market Recap 11/05/10
The Dow Jones Industrial Average ended the day up just over 9 points, as the market failed to continue its strong momentum this week. Friday’s activity was not reflective of the impressive showing throughout the week based on the Federal Reserve Bank’s plan to boost the economy with $600 billion worth of Government Bond purchases. But even a stronger than expected jobs report, adding 151,000 jobs in October, couldn’t rally the Market higher on Friday.
The Federal Reserve’s plan to purchase Government Bonds drove the 30-year bond higher but also drove the two-year and five-year notes to record lows.The Federal Open Market Committee said that the Fed will expand purchases at the rate of about $75 Billion a month through June 2011.
Precious metal prices continued to climb higher and higher again this week. Gold and Silver both neared important milestones. Gold hit an historic high of $1,398.90 on Friday, while Silver reached a 30-year high of $26.94. Gold had hit 17 new highs over the last five weeks based, at first, on speculation about the Fed’s actions and then on the actual announcement. What will be the newest predictions on the prices of these precious metals now, given their new highs?
Gold:
Spot Gold prices opened this week at $1,351.10. The high during the week was on Friday, November 5th, at $1,398.90, while the low for the week occurred on Wednesday, November 3rd, at $1,327.10. Gold ended the week up $43.80 at $1,394.90.
Silver:
Spot Silver prices opened this week at $24.61. Silver reached a high of $26.94 on Friday, November 5th, while this week’s low for Silver occurred on Wednesday, November 3rd, at $23.94. Silver ended the week up $2.18 at $26.79.
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Gold rises to record close to $1400 on renewed inflation worries
November 5, 2010 9:07 PM EDT
Gold prices rose to an all-time high within a few dollars of $1,400 an ounce on Friday as the U.S. Federal Reserve's program to resume buying government bonds stoked inflation worries. Gold's rally to a record came despite the fact that the dollar was up almost 1 percent on the day, boosted by a U.S. nonfarm payrolls report that suggested the economy may be on a stable road to recovery. The inverse link between gold and the dollar weakened on Friday, even though the relationship had tightened after the Fed announcement, with the hourly correlation between the two easing to 0.57 from Thursday's peak of 0.66. Gold had its biggest one-day rise in about six months on Thursday. Silver set a 30-year high of $26.89 an ounce. It was trading up 1.2 percent at $26.65. Palladium peaked at $697 an ounce and was later 0.3 percent at $683. Platinum slipped 1.1 percent to $1,761.49.
The metal was up nearly 3 percent for the week, its strongest weekly close since May.
Spot gold rose 0.2 percent to $1,394.30 an ounce at 3:35 p.m. EDT, having earlier hit a record of $1,397.80. U.S. gold futures for December delivery settled up $14.60, or 1.1 percent, at $1,397.70.
The dollar soared on Friday after data showed U.S. employers added 151,000 jobs in October, blowing past expectations of a 60,000 rise and marking the fastest pace of hiring since April.
The report came two days after the Fed committed to inject $600 billion to boost the flagging recovery and left some investors open to the possibility that the dollar may have carved a bottom against its biggest rivals, despite the prospect of more monetary easing.
Among other precious metals, silver rallied to a new 30-year high on the rising gold prices, while palladium rose to a fresh nine-year high.
Closing Gold & Silver Market Report – 11/5/2010
By Peter LaTonaNovember 5, 2010At 4PM (CT) the APMEX precious metal spot prices were:
- Gold price – $1,395.00
- Silver price – $26.77
- Platinum price - $1,771.80
- Palladium price - $688.50
COMMENTARY: A recent Reuters poll expects Gold to continue its record climb for another six months. So when do you know when to stop buying? According to one popular financial analyst, gold and other precious metals should represent at least 5% of your investable assets. You need precious metals to protect your wealth, so keep adding, until you get to at least 5%.
Precious metal prices continued their march upward again today. Gold spot price climbed another $10.90 – Silver spot up 69 cents – Platinum spot price up $15.90 – Palladium spot up $11.80.
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GOLD: 1391.50
SILVER: 26.55
OIL: 86.55
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Market Open Report
At 8AM (CT) the APMEX precious metal spot prices were:
- Gold price - $1,381.40
- Silver price - $26.12
- Platinum price - $1,752.00
- Palladium price - $676.00
COMMENTARY: The Federal Reserve’s decision to pump $600 billion dollars into the US economy is received mixed reviews locally, but not so mixed abroad. “With all due respect, U.S. Policy is clueless, “ stated German Finance Minister Wolfgang Schaeuble. This opinion is shared by China and world's new economic powerhouses in Latin America and Asia. All of this sets up for a contentious G20 Summit November 11-12. Mr.Geithner stated prior to the last summit, that he would not start a currency war and that he would protect against the devaluation of the US Dollar. He might have some explaining to do.
Overnight profit taking has taken precious down slightly except for silver. Gold spot price down $2.70 – Platinum price down $3.90 – Palladium price down 70 cents – Silver price up 3 cents.
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By Laura Mandaro and Myra P. Saefong, MarketWatch
SAN FRANCISCO (MarketWatch) — Gold futures surged to a record close Thursday after investors used the U.S. Federal Reserve’s new $600 billion quantitative-easing program as a fresh reason to sell the U.S. dollar.
December gold (GCZ10 1,388, +4.70, +0.34%) surged $45.5, or 3.4%, to $1,383.10 an ounce on the New York Mercantile Exchange, its biggest one-day gain since March 19, 2009, according to FactSet Research. Echoing the latest surge, gold on that earlier date had rallied after the Fed announced a $1.15 trillion bond-purchase program.
Silver (SIZ10 2,623, +18.20, +0.70%) on Thursday rallied $1.61, or 6.6%, to $26.04 an ounce.
Copper (HGZ10 397.40, +6.20, +1.59%) gained 13 cents, or 3.4%, to $3.91 a pound.
Platinum and palladium also made steep advances.
After Wednesday’s close of New York floor trading for gold, the Fed said it would keep rates near zero and unveiled a second round of quantitative easing, dubbed QE2, to revitalize the economy.
The Fed plans to buy up to $600 billion in long-term Treasurys until the end of June 2011, including about $75 billion this month.
“QE2 was a green light to buy everything commodities and sell [the] dollar,” said Zachary Oxman, managing director for TrendMax Futures.
Gold had gained in Asian electronic trading and then vaulted higher as New York floor trade opened. Also early Thursday, European Central Bank and the Bank of England kept monetary policy unchanged and refrained from taking any additional measures.
ECB President Jean-Claude Trichet, at a press conference, said interest rates and nonstandard policy measures were appropriate. The ECB’s key lending rate was left unchanged at a record-low 1%.
The dollar tumbled, falling sharply against the euro. One euro(EURUSD 1.4211, -0.0003, -0.0211%) bought $1.4210, up about 0.6% from $1.4132 late Wednesday after surging about 1% earlier. The dollar index (DXY 75.90, +0.02, +0.02%) fell 0.7% to 75.868 from 76.437.
The Fed’s announcement added to investor concerns that government efforts to drag developed economies out of the recession would lift inflation in the long term and devalue the U.S. dollar, putting a premium on so-called hard assets like gold and other metals.
Asian investors and policy makers, in particular, are increasingly aware that “the U.S. debt and money-printing policies are ‘out of control,’ as the Chinese commerce minister noted last week,” said Martin Hennecke, associate director at Tyche Group in Hong Kong.
Closing Gold & Silver Market Report – 11/4/2010
By Peter LaTonaNovember 4, 2010
At 4PM (CT) the APMEX precious metal prices were:
- Gold price - $1,393.30
- Silver price - $26.37
- Platinum price - $1,786.80
- Palladium price - $686.80
Precious metal prices surged all throughout the day, as investors continue flocking to the safety they provide. Although gold has seen significant price appreciation (over 400%) since 2001, lets not forget that historically, gold’s primary role is to protect and preserve wealth. Money is flowing into precious metals on concerns about inflation,currencies and the health of global economies. Today the Euro topped $1.42 and the US Dollar continued to decline.
Gold spot price finished up $54.70 – Silver spot was up $1.90 – Platinum spot price was up $89.60 – Palladium spot was up $42.10
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Morning Gold & Silver Report – 11/4/2010
By Peter LaTonaNovember 4, 2010At 8AM (CT) the APMEX precious metal spot prices were:
- Gold price - $1,374.40
- Silver price - $25.51
- Platinum price - $1,744.00
- Palladium price - $674.00
COMMENTARY: The US Dollar is experiencing more selling pressure, which sent precious metal spot prices up sharply in overnight trading. An article on the CNBC website today states that Central banks in the developed world are facing the challenge of slow growth and rising inflation. For an interesting take on how the Fed came to their decision yesterday,
Gold spot price is up $35.80 – Silver spot price is up $1.04 – Platinum spot is up $47.80 – Palladium spot is up $29.30.
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