Gold finished the day in stellar fashion – up $15.41 from yesterday’s close at $1293.87. It finished the week up $18.52. Silver also had a good day up 22¢ to finish at $17.27. It was up 41¢ on the week. As reported here, the upside push began last evening when it bolted higher in concert with the Japanese yen in Asian trading. It sustained the upside in Europe early today then bled over to the U.S. market with the strongest part of the move coming in today’s COMEX trading.
Some gave credit to the tax bill, but with gold holding its own in recent weeks despite heavy paper selling, the shorts look like they are beginning to lose heart. Reports of heavy buying in the physical market by Bridgewater [Ray Dalio] might also have given short speculators cause for re-evaluation. What is he factoring into the gold equation that they are not?
In the background, you have the clampdown in Saudi Arabia on big money players, including asset confiscations. (That had to turn a few heads among the moneyed elite in far-off places.) You also have North Korea back making unsettling assertions about its need to build a nuclear arsenal. Then there is the small matter this past week of wholesale inflation suddenly registering something other than a faint pulse.
Quote of the Day
“The first panacea for a mismanaged nation is inflation of the currency; the second is war. Both bring a temporary prosperity; both bring a permanent ruin. But both are the refuge of political and economic opportunists.” – Ernest Hemingway