March 11th, 2011 4:09 am ET
Precious Metals Examiner
As the Dow Jones Industrial Average plunged almost 200 points on the opening Thursday morning, partally due to the unexpected rise in unemployment numbers, there was shock and awe in the Precious Metals pits as gold plunged down--over $23 dollars an oz and silver lost more than $1.17 an ounce. Neither metal finished anywhere near their lows as both reclaimed more than 30% of the loss for the trading day. That was actually a very good showing considering many of the other sectorw and groups and indices. There was hardly a green mark to be found. Even the oils sold off, with Brent finishing just below $115/barrel....many Commodity analysts think that is significant, and the Light Crude finished the day around $103. The spread went to $12 which in itself causes shock and awe and sets Gold and Silver up for another run at their previous highs, which many Precious Metals technical traders and analysts believe will "step aside" and allow clear sailing to higher ranges seen in these metals in decades.
Once again, there was blood in the streets as the situation in Libya has vastly deteriorated into a bloody civil war. France yesterday became the first country to recognize the "Rebels" as the Legitimate Government of Libya and the United States broke Diplomatic Relations with Libya yesterday as well. When there is this much uncertainty, and Saudi Arabian students and other young people who were protesting there were fired upon by the military, one of the safest places for investment are the Precious metals, especially silver. Many economists feel that gold is building a "bubble" and when all settles down ( I do not remember a time when that has EVER been the case) gold prices will fall out of bed, leaving many independent investors holding losses reminiscent of 2008. They do not feel the same about silver, as we have discussed ad nauseum, silver does have extremely valuable electronic, defense, industrial applications, as well as being a hard asset currency. Silver coins are easily purchased, easily stored and can be used to purchase anything or bribe anyone, if, Heaven forbid, the total economic collapse that more and more economists are predicting actually does occur.
After PIMCO sold the massive US Treasuries in his Hedge Fund, because as Mr Gross, the founder and Investment Manager explained," The maturity dates and the interest rates on the instruments are not competitive with other investments of the same type at this time." He then went on to assure the traders that if and when the situation improves, PIMCO would be back into the market.
One side item: Since the Egyptian uprising and the US Dollar NOT being the safe haven, the Brazilian Real has been the best performing currency of all developed nations, even outperforming the South African rand today, which, since Brazil is one of the BRIC countries that has been facilitating foreign trades in it's own currency, has definitely made a name for itself.
By MaryHolloway Love
Precious Metals Examiner
Continue reading on Examiner.com: Shock and Awe in the Markets---Buy Gold & Silver - National Precious Metals | Examiner.com http://www.examiner.com/precious-metals-in-national/shock-and-awe-the-markets-buy-gold-silver#ixzz1GJTldvzW
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