Weekly Market Report 10/29/12

GOLD 

Last week we saw a lot of volatility during Gold trading. Three times Gold successfully tested the very important $1,700 per ounce support level, closing above that level all three times. Gold declined $12.10 per ounce for the week, closing the week at $1,711.90 per ounce. Since Jan 1, 2012, as of last Friday Gold has increased $146.10 per ounce, a 9.33% appreciation for the year-to-date. Today’s precious metal trading should be very light due to the closing of most of the U.S. financial markets in anticipation of Hurricane Sandy.

On Wednesday the Gold market reacted to a statement from the Federal Reserve’s FOMC policy committee. The Fed repeated its vow to keep interest rates near zero until mid-2015 and reiterated that it will buy $40 billion a month in government mortgage-backed securities until there are signs that the job market is improving significantly. The Gold market remembered that low interest rates and continued stimulus are very supportive of a higher Gold price; within 10 minutes after the release of the FOMC statement, Gold rallied $12 per ounce on excellent volume.

Three highly respected Gold investors have made their 2013 predictions. Jimmy Rogers, Jeremy Grantham, and John Paulson share why they are bullish on Gold for 2013. See the full article here: http://www.mintstategold.com/investor-education/2013_predictions/

WHAT HAPPENS TO GOLD IF ROMNEY IS ELECTED PRESIDENT?

Last week I read a great on-point article on what would happen to the Gold market if Mitt Romney was elected President of the United States. I recommend spending a few minutes to read this thought-provoking article. http://www.mintstateGold.com/investor-education/cat/news/post/is_romney_threat_to_Gold_price/   

THE WORLD’S CENTRAL BANKS STILL BUYING GOLD

The International Monetary Fund’s (IMF – www.imf.org ) website shows the activities of the World’s Central Banks with regard to their September Gold reserves additions and sales.  The IMF shows that Brazil’s Gold holdings increased by 1.7 tons last month to 35.3 tons, their first increase since 2008. Turkey’s holdings have increased 6.8 tons and the Ukraine added 0.3 tons. Russia’s reserves fell by 2.2 tons, Belarus declined by 1.5 tons, the Czech Republic deceased by 0.3 tons and Kazakhstan by 0.4 tons, the data shows. Central banks have been aggressively expanding their Gold reserves for the past three years. The buying is expected to continue given the lower prices and currency risks in the developed world. Gold-backed ETP holdings reached a record high of 2,585.1 metric tons as of October 24, while big speculators are still bullish on Gold.

LAST CALL FOR GOLD

Gold at under $1,800 per ounce still represents an excellent entry point for new purchases. However, as we get closer and closer to the all-time highs of $1,920, the risk/reward ratio will not look as good as it does right now.  I believe that we will see Gold above go $2,000 per ounce very soon, so why wait?  Look at the Recommended Investment Commitment and Diversification section below, and if your precious metal commitment isn’t a minimum of 35% of your investment capital, make those purchases now.

SILVER

Silver had an $0.86 high/low price range last week on normal trading volume. Silver was down $0.06 for the week, closing on Friday at $32.03 per ounce. $32 per ounce is an important support level, similar to Gold’s $1,700 per ounce level. As of last Friday, Silver has increased $4.16 per ounce, which equals 14.91% in appreciation since Jan 1, 2012. Right now the Silver to Gold price ratio is now at a very attractive 53.44 to 1. 

SILVER CONFISCATION IN 1934

Many Gold investors know that in 1933 President Roosevelt signed Executive order No.6102, which resulted in U.S. Gold confiscation. However, most investors are unaware of Executive order No.6814. In 1934, President Roosevelt signed Executive Order No.6814, the Silver Purchase Act of 1934, which forced American citizens to turn in their Silver or have it confiscated by the government. The following is a link to an article that provides more information about Order No.6814: http://www.mintstategold.com/investor-education/silver_confiscated_by_roosevelt/

PLATINUM & PALLADIUM

Platinum was down $69 per ounce last week, while Palladium declined $28 per ounce in the same period. Platinum is now trading at $1,546 per ounce, an attractive $165.90 discount to the Gold price; compare this to last week’s discount, when Platinum was only a $108.50 per ounce discount to the Gold price.

OCTOBER 2012 COINSTATS IS NOW AVAILABLE

Our numismatic CoinStats report is the best investment tool for rare coin investors. CoinStats is an in-depth statistical analysis of popular rare coin series that allows you to identify the best values in certified rare coins. I am proud to offer this unique and informative tool exclusively to our clients. The October 2012 CoinStats update is now available for $20 Gold Saint Gaudens, $20 Gold Liberties, Morgan & Peace Silver Dollars, and the Walking Liberty Half Dollar series.

The CoinStats Report provides a list of my recommended certified U.S. Gold and Silver coins that are found listed on the Best Value page. These are not the overly-hyped modern issue bullion coins or low-grade circulated coins; they are PCGS/NGC Certified MS63 or higher Gold and Silver U.S. rare coins, dated prior to 1936, that have a proven track record of appreciation.

For the latest CoinStats analysis, just put CoinStats in the subject line and email me which series you would like to see.

RECOMMENDED INVESTMENT COMMITMENT AND DIVERSIFICATION:

Precious Metal commitment: Minimum of 35% of investment capital
Diversification:  Gold 50%, Silver 40%, Platinum & Palladium 10%
Diversification includes 50% in long term investment quality rare coins and 50% short term bullion products

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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.