Weekly Market Report 3/4/13

I am really excited to announce that my 2013 Hyperinflation booklet is now complete and has been mailed out to over 2,000 clients. This Hyperinflation study has been totally revised from last years and now contains 40 pages of pictures, charts, and graphs, plus a table of contents that allows you to locate the information that is of special interest to you. In addition to mailing you two copies (one for you and one for a friend), I have posted the PDF on our website. http://www.mintstategold.com/Hyperinflation/

Our Weekly Market Report keeps you current on the latest events happening in the exciting precious metal and rare coin markets. I always welcome your comments.

Thank you,
Barry Stuppler

GOLD 

Gold’s volatility returned last week with a $56 high/low price range, re-establishing the recent $1,550 to $1,615 per ounce trading range. At the end of last week’s trading Gold actually closed down only $0.50 per ounce. Trading volume has been increasing in Asia, Europe, and the U.S. on the Gold exchanges. Much of the late week weakness in the Gold price resulted from the extraordinarily strong U.S. Dollar versus the Euro amid signs in the Eurozone countries of continued weak growth. In February the Euro/U.S. Dollar exchange rate dropped from $1.35 to $1.29; this 4.4% decline is quite substantial for just one month.

Central Banks step up their Gold buying in 2013

The International Monetary Fund (IMF) released data last Tuesday showing that Russia and Turkey added 12.7 and 10.3 tons of Gold respectively in January 2013. Net purchases hit 535 tons last year, a 17% jump on 2011, and the largest and most substantial purchases since 1964 according to the World Gold Council. Central banks intensified their Gold buying as the price fell in Q4 2012, with purchases running 29% ahead of the year-earlier period.

The World’s developing countries’ Central Banks Gold purchasing has room to grow. Developed economies, which racked up big pre-1970’s financial surpluses, still hold most of their savings in Gold. The U.S., Germany, Italy, and France all have more than 70% of their reserves stashed in bullion. For developing countries that have blossomed as creditors over the past few decades, the picture is very different. Gold accounts for just 1.7% of China’s monetary reserves, 2.6% of Singapore’s, and 9.5% of Russia’s, by World Gold Council’s figures.  They have a lot more Gold to buy to achieve any kind of balance with their T-bill and currency holdings.

Quantitative Easing Continues at our Federal Reserve

Last Tuesday Fed Chairman Ben Bernanke testified before Congress. His testimony gave indications that the Fed would not cut short the current quantitative easing program of purchasing assets at the rate of $85 Billion per month, which led to increased volume and a major rally in Gold.

Moody’s Downgrades Great Britain’s Debt

Moody’s dealt Britain its first sovereign rating downgrade, saying that Britain’s $2.5 trillion economy faced years of additional sluggish growth and debt that would continue to rise until 2016.

SILVER 

Silver volatility mirrored Gold again last week, with a high/low price range of $1.51, trading between $27.93 and $29.44 per ounce. With trading volume increasing, Silver ended the week up only $0.03. Silver has established a new trading range of $28 per ounce as the support, and $30 per ounce as the resistance level. With a 55-to-1 Silver/Gold ratio, plus increasing physical demand, Silver is definitely an outstanding precious metal bargain. The U.S. mint reports 10,866,500 1oz .999 Silver Eagles sold since the beginning of the year, an all-time record sales number.

PLATINUM & PALLADIUM

Platinum and Palladium did not escape last week’s Gold decline. Although the volume of trading was a fraction of Gold/Silver’s, the market price did drop substantially. Platinum closed down $24, at $1,573 per ounce, trading at only a $1.20 premium to Gold. Palladium closed at $720 per ounce, down $15 on the week.

RECOMMENDED INVESTMENT COMMITMENT AND DIVERSIFICATION:

Precious Metal commitment: Minimum of 35% of investment capital

Diversification:  Gold 55%, Silver 40%, Platinum & Palladium 5%

Diversification includes 50% in long term investment quality rare coins and 50% short term bullion products

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If you want to be updated on what is happening in the Gold, Silver, and Rare Coin markets any weekday, our company offers a daily blog Monday through Friday at www.stupplerblog.com

All statements, opinions, pricing, and ideas herein are believed to be reliable, truthful and accurate to the best of the Stuppler & Company’s knowledge at this time.  Stuppler & Company disclaims and is not liable for any claims or losses which may be incurred by third parties while relying on information published herein.  Individuals should not look at this publication as giving finance or investment advice or information for their individual suitability.  All readers are advised to independently verify all representations made herein or by its representatives for your individual suitability before making your investment or collecting decisions.