Gold & Silver Digest: 4/2/13

Adam Taggart
By Adam Taggart on Tue, Apr 2, 2013 - 7:58pm

The Gold & Silver Digest contains headlines of stories that members of this group deem relevant and/or interesting to precious metals enthusiasts.

If you have articles to submit for the next digest, please email them to me by clicking here.

4/2/13 8:30 PM EST US close metals price quotes from Finviz

Reuters: Gold down 1.5 pct on Wall Street gains, economic hopes

NEW YORK, April 2 (Reuters) - Gold fell 1.5 percent on Tuesday, its biggest one-day drop in more than a month, as economic optimism lifted U.S. equities to near a record high and weakened bullion's safe-haven appeal.

Silver dropped almost 3 percent to an eight-month low, and platinum group metals declined sharply, ignoring higher U.S. auto sales results.

Bullion's losses snowballed through the session as the U.S. equities benchmark S&P 500 index climbed to within striking distance of an all-time intraday high. 

FoxBusiness: Gold Sells Off as Traders Bid Up Stocks

Gold fell to a 2-1/2 week trough on Tuesday, moving down with other precious metals due to a session high in the dollar index and better appetite for assets seen as higher risk, such as European stocks.

Silver also dipped to its lowest since mid-August at $27.53 an ounce, while platinum and palladium lost more than one percent.

Bloomberg: Gold ‘Bubble’ Seen Turning to Bear Market by SocGen on Recovery

Gold is in a “bubble” after the best annual run in at least nine decades and will head into a so-called bear market as a stronger U.S. economy helps increase interest rates and cut bullion demand, Societe Generale SA said.

Investors are unlikely to raise gold holdings because inflation has remained low, signs that the economy is improving may spur the Federal Reserve to curb stimulus and the dollar has strengthened, the bank said today in a report. Bullion is down 4.6 percent this year after 12 straight annual gains and would need to drop another 4.8 percent to mark the common definition of a bear market.

CNBC: Gold Headed to $1,375 in 2013: Pro

The price of gold has reached bubble territory and stands to fall 15 percent by year's end, Societe Generale Head of Commodities Research Michael Haigh said Tuesday on CNBC.

"We've been bearish gold for a couple of months now," he added. "Coincidentally, we put out our longer report today looking at the end of the gold era right before we saw a 1.5 percent selloff."

On "Fast Money," Haigh expanded on his SocGen note, titled, "The End of the Gold Era," and making the case that a perfect storm is brewing for gold.

CNBC:Why Gold Has Lost Its Luster (For Now)

The gold rally might be over, at least in the short-term, some professional traders told CNBC on Tuesday.

Gold has suffered two consecutive quarters of losses and it appears the second quarter isn't getting off to a good start either, as the precious metal fell 1.5 percent on Tuesday, its biggest one-day drop in more than a month. The second quarter, by the way, began on Monday.

The Atlantic: David Stockman's Delusions: The Gold Standard Is Still a Really, Really Terrible Idea

Have we been living in some kind of economic hellscape the past 80 years?

Now, the past five years have been brutal. And the five before that weren't great, either. But it seems hard to argue that the U.S. economy peaked in any way back in 1933. Well, unless you're a certain kind of libertarian. The kind of libertarian who thinks we cast ourselves out of our economic Eden after we cast off the gold standard to taste the forbidden fruit of fiat money.

In other words, a libertarian like ex-Reagan budget director David Stockman. 

King World News: West Much Closer To Collapse As Gold War Continues To Rage

On the heels of the Cypriot Finance Minister quitting and continued volatility in gold, today acclaimed money manager Stephen Leeb told King World News the West is much closer to collapse than it was even three weeks ago, and gold is being sold to mask the desperate situation the West faces going forward.  Here is what Leeb had to say in this powerful interview:  “Eric, the thing to remember right now, gold is the barometer of what is wrong with the West.  We can look at Cyprus, Spain, Italy, and say the West is sick.  But you put the thermometer in your mouth and you see 98.6 (degrees, normal temperature), and that’s because someone is putting cold water on the thermometer right now in the form of selling gold.” 

Stephen Leeb continues:  

“That can only continue for a certain period of time.  After that period of time you will have what is known as the greatest short squeeze the world has ever seen (in gold).  It could be that China suddenly decides they have enough gold and come out and say, ‘The yuan is partially backed by gold.’

Mirror News: Is this Tolkien's Ring of Power? Ancient gold artefact believed to have inspired The Hobbit goes on show

An ancient gold ring believed to have inspired JRR Tolkien to write The Hobbit is going to have its own exhibition for the first time.

The ring, which was found in a field in Silchester, Hampshire in 1785, is linked by a name inscribed on it to a Roman tablet - Senicianus.

The ring features the words "Senicianus live well in God".

GoldSilverWorlds: The Great Disconnect Between Paper & Physical Silver

This article proves how paper silver (i.e. silver futures market) has been able to cap the silver price despite exceptional strength in the physical silver market. The first quarter of 2013 revealed this great disconnect based on publicly available data. Besides, silver expert Ted Butler calculates an historic concentration of short positions by JP Morgan allowing the bank to control the silver price.

Silver started the first quarter at $30.45 per ounce (Jan 2nd 2013) and closed more than $2 lower at $28.30 per ounce (March 29th). During the same time period, investment demand for physical silver was historically strong and all data pointed to accumulation by investors. This evolution asks for an explanation; the answer lies in the paper silver market.

The Wall Street Journal: Silver’s Breakdown Doesn’t Bode Well

Silver prices have entered a bear market but chart watchers say the metal’s decline may still have a ways to go.

After a steep fall to start the year, silver prices largely leveled off in February, bouncing between $28.25 to $29.50.

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