Gold & Silver Digest: 4/19/13

Adam Taggart
By Adam Taggart on Fri, Apr 19, 2013 - 6:53pm

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.

4/19/13 7:26 PM EST US close metals price quotes from Finviz

Reuters: Gold posts 5 pct weekly loss, outlook seen volatile

Gold rose on physical buying on Friday, failing to hold onto earlier sharp gains, as bullion posted heavy losses for a second consecutive week on investor liquidation driven by months of disappointment over its performance.

The precious metal is down more than 5 percent this week after notching its biggest-ever daily loss in dollar terms on Monday. Bullion's collapse caught many veteran investors, who see gold as portfolio protection against inflation and other market risks, by surprise.

Forbes: Tug-Of-War Action Possible For Gold Next Week

Following sharp losses this week, market participants are cautious on gold’s outlook for next week, saying that a tug-of-war mentality is forming in the market for the short term, which could lead to a volatile trade.

June gold futures rose Friday, settling at $1,395.60 an ounce on the Comex division of the New York Mercantile Exchange, and were down 7% on the week. May silver fell Friday, settling at $22.960 an ounce, down 12% on the week.

In the Kitco News Gold Survey, out of 35 participants, 27 responded this week. Of those 27 participants, 17 see prices up, while four see prices down, and six see prices moving sideways or are neutral. Market participants include bullion dealers, investment banks, futures traders, money managers and technical-chart analysts.

Yahoo! Finance: 12 (Misguided) Commandments of Gold Bugs: Barry Ritholtz

Gold prices have finally stabilized after falling roughly 11% over the last week.

The yellow metal closed Thursday up 1.84% to $1,417 an ounce.

The reason for the recent drop in gold prices is unclear but some cite Cyprus selling its gold to cover the cost of its bailout as a factor or central bank manipulation.

GoldSeek: Gold Bears Suddenly Appear, More Emboldened than Ever

Congrats to the gold bears and stock bulls! After being slaughtered for the majority of the last decade and more, they finally won a victory. Golf clap for you gentlemen. Now you can have your day in the sun once again. US stocks are at all-time highs and Gold sucks again! You won’t have to listen to your clients bitch and moan about how you ignored, avoided or were underweight the bull market of our time. Time to crow!

I awoke on Monday to a link from a subscriber. It was an editorial titled, “The Day that Gold Died.” The author cited the usual, clueless and baseless arguments both to why folks buy gold and why gold sucks as an investment. It is nothing more than a flimsy rant.  He also cited a “marvelous takedown” by Barry Ritholtz, a formerly humble and generally impartial commentator who is now enjoying mainstream notoriety.

Business Insider: JIM RICKARDS: Here's The Difference Between 'Paper' Gold And 'Physical' Gold

It's not that the price is different, per se.

When gold crashed on Monday, dragging market prices down to a low of $1321.50 an ounce from levels around $1560 only days before, holders of physical gold saw the value of their holdings decline as well.

However, we've seen a lot of claims that somehow there's a difference between the market for physical gold (people buying gold bars or gold coins) and that for "paper" gold (which refers to gold futures traded on the COMEX or shares of GLD, the gold ETF).

Financial Times: Gold: Losing its charm?

After a decade-long bull run, prices have had their sharpest fall since the 1980s. But many are keeping the faith...

GoldSeek:  The Secret World Of Gold (Documentary)

The Secret World of Gold is a documentary exploring the power and politics of gold, a precious metal with more allure and fascination than any other. Valued for its permanence, beauty and scarcity, people will lie, cheat, steal and kill in the name of gold.

Zerohedge: Chinese Gold Exchange Sold Out - Begins Importing From Switzerland

Chinese Gold & Silver Exchange Society Runs Out of Gold... Importing from Switzerland and London

Hong Kong’s Chinese Gold & Silver Exchange Society has been in operations for over a century, and it’s President Haywood Cheung was interviewed by Bloomberg news earlier today.  Whoever orchestrated the attack on gold and silver in the last week or so has gravely miscalculated, since the response to the drop has been surging demand for physical gold and silver.  While I tend to be skeptical when I hear about silver shortages since these reports have been so exaggerated in the past, the lack of silver coin availability and premiums are the most extreme I have seen since the financial and economic meltdown of 2008.  Now we discover that the Chinese Gold & Silver Exchange Society has essentially sold out of gold bullion, and must wait until Wednesday for shipments to arrive from Switzerland and London.

Gold and Silver Blog: Physical Demand For Gold and Silver Skyrockets – Gold Bullion Coin Sales Highest Since December 2009

We have probably all heard enough already from the mainstream nitwits who are forecasting the end of the gold bull market and further price declines.  Funny thing though, most precious metal investors don't need advice from self proclaimed experts on how to invest their money.  The explicitly stated goal of central banks to increase the rate of inflation through currency debasement is blatantly obvious.  Investors are acting accordingly by taking advantage of the recent decline in precious metal prices.

A look at product availability and pricing at some major coin and bullion dealers shows spot shortages of gold and silver as well as large premiums as investor demand overwhelms supply.

ETF Daily News: Silver’s Coming Of Age

Rick Mills: Silver is winning market share from gold buyers.

2008 - In March 2008, sales increased nine times over the month before – 200,000 to 1,855,000.

In April 2008, the United States Mint had to start an allocation program, effectively rationing Silver Eagle bullion coins to authorized dealers on a weekly basis due to “unprecedented demand.”

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