The only thing that’s free right now is the air that we breathe. Other than that it costs to manufacture every object and commodity in the world. There is also a certain cost to producing an ounce of gold. It doesn’t grow on trees.
To satiate the world’s growing hunger for silver, a lot of pressure has been placed on its supply chain. And with total annual supply recently exceeding 31k metric tons (1.0b ounces) for the first time ever, suppliers have made a valiant effort to meet demand.
GFMS forecasts that investors will purchase 973 tons of gold in the second half of 2012, more than during the wild gold market of the summer of 2011. This surge in demand for the yellow metal, GFMS says, will move gold above the $1,850 an ounce level.
CFTC reports continue to show that net long positions in gold are being liquidated. Nineteen tonnes were shed in the latest reporting period on Comex. Long-silver specs unloaded 210+ tonnes from their logbooks and added 110+ tonnes to short positions.
Prices quoted for buying gold fell together with the US dollar on Thursday morning in London, dropping away from $1,660 per ounce and falling harder in other currencies as commodities also edged lower. Silver prices slipped back to $31.50 per ounce.
Gold is preferred by the vast majority of investors a fact you could attribute to 5,000 years of constant investment use, everywhere and by every culture which has discovered it – a history which gold shares with silver alone.
Metals prices received further lift this morning as turmoil in Europe diverted funds in their direction but the complex was still competing with what is apparently shaping up as a stock market rally of notable proportions on both sides of the Atlantic.
So what is getting Germany's version of the New York Post and Britain's The Sun - only with topless models on page 1, not 3 - so excited that it has to admit its own headlines are false in the very next line?
Gold prices briefly reclaimed the $1,500 mark in overnight trading and rose to highs near the $1,505 area following the emergence of sporadic bargain hunting and a modicum of weakness in the US dollar.