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Gold and Silver Prices
Gold prices rose on Friday to end the week in positive territory as investors anticipate further weakness in the U.S. economy.
“Gold prices rose Friday, as investors bet a spate of U.S. data to be released next week will continue to show that the country’s recovery has hit a snag… The U.S. is expected to report a raft of key economic numbers next week, including industrial production and manufacturing data. Some investors believe the reports will further bolster the argument that the economy has hit a soft patch, after a series of disappointing numbers in recent weeks led market watchers to question the strength of the country’s recovery and raised doubts that the Federal Reserve will raise interest rates in the next few months.” (“Gold Gains on Expectations of Weaker U.S. Economy,” WSJ, 4/10/15.)
Gold finished the week --- up $5.30, closing at $1208.30. Silver prices closed the week at $16.59, down $0.17.
Gold “Big Buy:” Colvin.Todd Colvin, senior vice president of commodity traders Ambrosino Brothers, told investors to acquire gold given the uncertainty in the U.S. and global markets.
“Investors searching for a safe haven from the markets recent volatility should buy gold, Ambrosino Brothers' Senior Vice President Todd Colvin said Monday. ‘I think gold is a big buy here with all you don't know about what the Fed's doing, what you don't know about what's going on in the Middle East and as a buy-and-hold instrument, I think it still has a lot of value… I'd rather be long gold and go down with this ship than be chasing it with the idea that my fiat currency isn't worth the paper that its printed on. I think gold is a good stash-and-hold. I certainly don't think it's an investment you want to retire on… I think you should put a little money away and come back to it when you need it…’" (“Investors should buy gold as safe haven: Expert,” CNBC, 4/6/15.)
Turk: Dollar Drop Coming in 2015James Turk, the former head of commodities for the Abu Dhabi Investment Authority and precious metals analyst, warns the U.S. dollar is likely to see a “big drop” by the end of this year.
“James Turk, a well-known precious metals expert believes that the US dollar is going to face trouble this autumn. According to Turk, "there are a couple of reasons for this…’
“The Chinese have taken every effort over the last five years to be included in the SDR when the next rewriting comes in September and October. China may move further away from western institutions and create other Asian institutions like the Asian Infrastructure Investment Bank. The autumn of 2015 will be a critically important time of the year.
“The dollar may fall substantially, if the US government makes wrong moves, James Turk believes…’Remember that the dollar has only risen because people around the world perceive it as the best option of a lot of poor choices. In other words, people are moving out of the euro, and moving out of other weak currencies, in an emotional kneejerk reaction into the dollar. They are not moving into the dollar because of any fundamental strengths. The problems of the U.S. are still quite severe, particularly the debt problem and government spending out of control. Things tend to rise and things tend to fall, and I wouldn't be surprised to get a big drop in the dollar before the end of the year,’ James Turk said.” (“’The dollar will fall substantially’ – James Turk, precious metals expert,” Pravda.ru, 4/9/15.)
Next Financial Crisis Looming: Dimon, StockmanJP Morgan Chase’s CEO, Jamie Dimon, and President Reagan’s former budget director, David Stockman, foresee another, more volatile, financial crisis.
“While financial conditions have improved vastly since the 2008 credit meltdown, another financial crisis will eventually arise, says JPMorgan Chase CEO Jamie Dimon… ‘Triggering events could be geopolitical, a recession where the Fed rapidly increases interest rates, a commodities price collapse, a commercial real estate crisis, bubbles, etc.’
And what about the impact on financial markets? "The markets in general could be more volatile… It will be harder for banks either as lenders or market-makers to “stand against the tide.”’
“David Stockman, White House budget director under President Reagan, sees a crisis looming close on the horizon. ‘The worldwide central bank money printing spree of the last two decades has generated massive excess capacity and mal-investment all around the planet… What is coming, therefore, is not their father's inflationary spiral, but an unprecedented and epochal global deflation…’
“’So the central banks just keep printing, thereby inflating the asset bubbles worldwide. What ultimately stops today's new style central bank credit cycle, therefore, is bursting financial bubbles… That has already happened twice this century. A third proof of the case looks to be just around the corner.’" (“Dimon: 'There Will Be Another Crisis',” Newsmax, 4/10/15.)
New Asia Infrastructure Investment Bank May Dethrone Dollar as World CurrencyThe Chinese-backed alternative to the International Monetary Fund (IMF) and the World Bank may threaten the U.S. dollar’s role as the world’s reserve currency as well as America’s influence in international finance.
“China's big foray into global finance is causing nervousness on Wall Street while helping to exemplify how dysfunctional Washington has become. The Asia Infrastructure Investment Bank is positioning itself as an Asia-centric alternative to the World Bank and International Monetary Fund…
“[C]ritics worry that ultimately the institution will help China knock the U.S. off its pedestal as the world's pre-eminent economic and military superpower, give the dollar competition as the global reserve currency and to change a fundamental dynamic by filling a funding void.
“’The result of its actions both internally and externally has been the creation of an entity that can compete with the IMF and World Bank internationally; an entity controlled by a country that is seeking to reduce the United States hold on the world financial markets," [banking analyst Dick Bove] said in a report for clients. "The creation of the AIIB also demonstrates clearly that not only are the U.S. enemies but also its biggest allies fed up with the United States demands and tactics in the financial world. This is incredibly dangerous to this country's standing internationally in an area where it counts—finance and the dollar.’" (“Asia Infrastructure Investment Bank gambit has US on edge,” CNBC, 4/7/15.)
American Advisor Week In Review
Goldline provides a wrap-up of the week's precious metals news along with important commentary on the American Advisor Week in Review audio program: Joe Battaglia shares some good reasons why gold is up: 1) London Gold Fix... Learn more