Gold and silver have traded a bit lower on Friday and are both heading for a loss of 1% on the week in dollar terms. This is to be expected after the 3% and 5% returns of last week and the trading action this week has all the hallmarks of consolidation.
Libor, Bernie Madoff, MF Global, Peregrine Financial, zero-percent interest rates, the Social Security and Medicare entitlement funds, quote stuffing and high frequency trading (HFT), and debt-based money. What do all of these things have in common?
Maybe you didn't know that the rogue trader at UBS AG who lost $2.3 billion last year was trading exchange-traded funds (ETFs)... or that Jerome Kerviel, another rogue trader at Société Générale SA who lost $7.2 billion in 2008, was trading ETFs.
Safe haven demand for gold continues due to concerns that Greece’s “bail out” is yet another short-term panacea and Moody's downgrades of various European nations' ratings have reignited contagion fears.
Gold and silver have extended their recovery and may be headed for the fourth day of gains due to the continuing European sovereign debt crisis, Chinese inflation and the risk that rising commodity prices bring inflation and stagflation.