Gold, silver reverse losses as dollar drops

Spot silver started the Friday price action with a 76-cent gain and a quote on the bid-side at $35.38 per ounce. Platinum and palladium each fell by $1 to the $1,769.00 and $714.00 level respectively, while rhodium showed no change and was still quoted at the $2,050.00 bid price per troy ounce. Little in the way of news from the automotive sector was on tap this morning, save for the fact that beleaguered automaker Saab might finally be reaching the end of its troubled road following the falling through of a possible deal with a Chinese auto firm, and that Chrysler is idling some of its plants as it tries to cope with a shortage of Japanese-sourced parts.

Meanwhile, Mr. Bernanke does see a threat to the economy of the US – albeit not from rising commodity prices as yet. His warning to US lawmakers is not to try to use the advent of the federal debt limit as a “bargaining chip” during upcoming US budget talks. Such wrangling and public displays of muy macho political grandstanding could unhinge markets and harm the recovering US economy, Mr. Bernanke cautions. Thus, when you hear certain recognizable politicians hammering away at the topic of the US debt ceiling and threatening to let the country default (presumably for its own good???) do bear in mind that Mr. Bernanke has depicted the following scenario:

“Even if the debt is paid, there’s the issue of market confidence and how the market would respond to the risk of default or even the default of non-debt obligations,” he said. The worst outcome would be one in which the financial system would again destabilize. Such an occurrence “would have extremely dire consequences for the U.S. economy.”

Others, on the other hand, see clues that the entire world and not just the US will come to a complete end on December 21, 2012. They have been snapping up survival bunkers all over the world, at some lofty prices (how about $400,000 for less than 800 square feet?) in the hopes that burrowing underground might mean salvation. The fad is most prominent among wealthy Russians. Cottage industries that produce bunkers (even some floating ones in case Noah’s you-know-what repeats itself next year) have been thriving.

Until Monday, at least, try to resist the temptation of buying your own Armageddon shelter. Go out and enjoy the sunshine.

Jon Nadler is a Senior Metals Analyst at Kitco Metals Inc. North America

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About the Author
Jon Nadler Jon Nadler is a Senior Analyst at Kitco Metals Inc. North America
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