Gold & Silver Price Zigzagging Like US Politicians

There is a deal. There is no deal. There is a deal. There is no deal.

Just like the US politicians have been sending proposals back and forth today, equities and precious metals have been reacting up and down. It all started right at the beginning of the trading day in Asia (morning Asia, midnight Europe) with a spike which lasted a couple of minutes. When the debates between politicians began, with every piece of news there was a reaction in equities and precious metals. The chart shows in particular the moves between 8 AM EST and 2PM EST. Somewhere in between the Bank of France announced they will not be selling their gold reserves resulting in a temporary spike in the gold price.

COMEX gold closed the day at $1,328.40 per ounce, an increase of 0.11% on Friday’s close. COMEX silver closed 0.04% lower at $21.70 per ounce. In London gold traded at $1326.50 or €980.41 at the PM Fix.

 

gold_price_30_september_2013

 

Undoubtedly most have lost track in today’s political debate. All proposals were quick fixeswith a “kick the can down the road” attitude at its best. To get an idea of the type of political discussion readers should check for instance this intermediate status from earlier today Senate Kills House Bill: What Happens Next.

As were are a couple of hours before the deadline and there is no plan the US government will possibly be threatened with a shutdown. As there appears to be no solution everyone starts pointing to each other about the lack of cooperation.

It is clear that no structural plan has been worked out and that the debt monster continues to be fed by the US politicians. This is absurdity in the highest degree.

Coming back to the precious metals markets, given today’s price action and the absence of any fundamental solution, one can expect more volatility in the coming days.

Receive these articles per e-mail

Subscribe for the free weekly newsletter and receive 3 papers about physical precious metals investing