Precious MetalsPrecious Metals
Gold was flat to slightly down into the first half-hour of the New York session on Friday, but shot up from there, touching a new alltime high of $1007.20 before selling took it back below the $1000 mark for the afternoon hours, after which strong Access Market demand pushed it back over the mark to a finish at $1002.50, up $7.40. For the week, gold added 3%.
Platinum had an upward bias which held it above $2100 until nearly the noon hour of the New York session, but then it plummeted to $2060 before Access Market buying advanced it to end at $2,073, down $15. For the week, platinum was up 2.4%.
Silver was flat up to the early hours of London trading, then sold off into the first half-hour of the New York session, dipping to $20.24, where buying interest re-emerged, driving it as high as $20.86 before it eased to a close at $20.67, up 11 cents. For the week, silver tacked on 2.6%.
(Click here for charts)
Gold finally accomplished a close above the psychologically-important $1000/oz. mark, leaving investors to ponder the equally psychologically-important question: What now? That’s one for which there are probably as many answers as there are people who care enough to offer one.
While the tanking dollar and soaring price of oil are playing their parts, few would any longer disagree that the flight into precious metals is being fueled in large part by uneasiness over the disintegration of the world financial sector.
“Gold's assault on $1,000 is happening for a good reason,” says James Turk, of GoldMoney.com. “Gold is not only an inflation hedge, it's a catastrophe hedge. Gold is becoming increasingly important as the credit crunch continues to spiral out of control.”
The latest blow has been the collapse in liquidity at Bear Stearns, one of the biggest names on Wall Street.
“Bear is the first, who is next? That question is haunting investors right now and they are looking for a flight to quality,” said Zachary Oxman of Wisdom Financial.
That flight is now so furious that it’s battering down barriers such as that noted by James Burton, CEO of the World Gold Council, who wrote that the price escalation has “posed a short-term problem in regard to consumer purchases of jewelry, gold bars and coins, acting as a disincentive to some buyers.”
Not much of a disincentive, it would appear.