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Ardent Listener
Administrator
USA
4841 Posts |
 Posted - 11/11/2008 : 17:48:49
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Gold, Platinum Drop on Concern Recession May Damp Metal Demand
By Pham-Duy Nguyen
Nov. 11 (Bloomberg) -- Gold futures fell on speculation a global recession will damp demand for precious metals and other raw materials. Platinum and silver also declined.
Equities in Asia, Europe and the U.S. fell today. More than $28 trillion in value has been erased from global equity markets this year as banks have posted more than $920 billion in credit losses and writedowns. The Reuters/Jefferies CRB Index of 19 raw materials is down by almost a third this year.
``We're back to focusing on the recession,'' said Leonard Kaplan, the president of Prospector Asset Management in Evanston, Illinois. ``You're seeing a bear market in everything. Gold traditionally does better than anything else in this recessionary environment, but it still goes down.''
Gold futures for December delivery fell $13.70, or 1.8 percent, to $732.80 an ounce on the Comex division of the New York Mercantile Exchange. The metal has dropped 29 percent from a record $1,033.90 in March.
Platinum futures for January delivery fell $33.30, or 3.9 percent, to $826.60 an ounce on the Nymex. The metal, used in jewelry and pollution-control devices in cars, has tumbled 64 percent from a record $2,308.80 on March 4.
Last week, General Motors Corp., the biggest U.S. automaker, reported a $4.2 billion third-quarter operating loss and warned it may run short of cash by the end of June. Ford Motor Co. reported a $2.98 billion loss in the quarter.
`Slammed'
``Nobody's going to buy cars,'' Kaplan said. ``You'll see platinum trade $100 to $250 lower than gold. It happens in every recession. Platinum is industrial, and catalytic converters and jewelry are going to get slammed.''
Platinum, palladium and silver have wider industrial uses than gold. Gold has dropped 13 percent this year. Silver is down 34 percent, and platinum and palladium has slumped more than 40 percent.
Gold may rebound to $800 in the next three months on investor demand for a haven from market turmoil, UBS AG analyst John Reade said.
``Interest in gold coins remains strong, with coin shortages apparent in many markets, while kilobars, one of the most popular investment categories, are trading at a high premium to the spot gold price due to long waiting lists at refineries,'' Reade said in a report.
A one-ounce Krugerrand coin from South Africa cost almost $37 more than the per-ounce spot price of gold today.
The U.S. Mint said this month it has resumed taking orders for American Buffalo 1-ounce gold-bullion coins after a surge in demand depleted supplies in its vaults.
Silver futures for December delivery fell 41.5 cents, or 4.1 percent, to $9.805 an ounce today on the Comex. Palladium for December delivery fell $2.75, or 1.2 percent, to $219.25 an ounce on the Nymex.
To contact the reporter on this story: Pham-Duy Nguyen in Seattle at pnguyen@bloomberg.net.
Last Updated: November 11, 2008 14:21 EST
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Think positive. |
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Ardent Listener
Administrator
USA
4841 Posts |
Posted - 11/11/2008 : 17:50:30
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This explains why we see all the Buying Gold signs out there and the depression hasn't even hit bottom yet. The Buying Gold business is nothing more than a pawn-shop for the middle class. More Joe6Paks will part with their family gold and silver as times get harder.
Yes, in the end it's not so much how much precious metals you currently have, but more so, how much you will have at the end of the depression.
My advice, for what it is worth, is don't buy precious metals now with money you are going to need anytime soon. It's better to have less PMs then to be selling your PMs at a loss as you need the cash.
Who needs goverment confiscation when they can starve your PMs from you? |
Realcent.forumco.com disclosure. Please read.
All posts either by the members, moderators, and the administration of http://realcent.forumco.com are for your edification and amusement only. It is not the intent of realcent.forumco.com or its host to provide investment, medical, matrimonial, legal, security or tax advice and nothing posted here should be considered to be so. All rights reserved.
Think positive. |
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oober
1000+ Penny Miser Member
USA
1304 Posts |
Posted - 11/11/2008 : 18:16:36
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I myself, always will use non essential money. I am actually considering trying to find a 2nd job till I can't take it no more, just to fund my PM buying...
Playing microstake online poker just isnt making me enough right now... :(
Not to mention Bush and his cronies are working on putting the pressure on the fed to get the regs written for UIGEA.....
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PMs Drop On Recesson Concerns
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