Mostly related to Gold, the PMG (Platinum Metals Group) and the economy, these articles provide some interesting commentary:
From a London writer for Bloomberg, Gold May Gain as Improving Economy Spurs Demand, Survey Shows: “Thirteen of 23 traders, investors and analysts surveyed by Bloomberg, or 57 percent, said bullion would rise next week. Five forecast lower prices and five were neutral. Gold for delivery in June was up 2 percent for this week at $1,127.50 an ounce at noon in New York yesterday.”
From Reuters India, Gold dips from 2-week high as euro pauses: “As the global economic recovery becomes more evident, gold may come under pressure, with investors turning to other commodities which traditionally gain on strengthening industrial demand such as platinum and palladium, traders said.”
An article via Mineweb, China’s insatiable appetite for gold as demand exceeds supply: “The Council expects Chinese gold demand to double over the next decade, driven primarily by jewellery and investment – with jewellery fluctuating on a cyclical basis, while investment demand has both a cyclical and a counter-cyclical element.”
Plus, in that same Mineweb article, the Chinese prefer 24 carat gold jewelry since they consider gold jewelry and investment: “At least 80% of total gold jewellery demand in China is accounted for by 24 carat gold, but there is a shift underway towards 18-carat pieces, as younger elements of society have been attracted by these pieces, especially the “K-gold” range, which takes its design inspiration from Italy, long regarded as being in the forefront when it comes to design flair.”
For a dash of cold water, this article on the Chinese economy is interesting, China’s On Fire As Factory Production Rises Again: “China’s $585 billion stimulus package may have done its work in ways that were unexpected. Consumer borrowing may have lifted off even if employment did not. That means that Chinese consumer is following the American consumer down that path of leverage. The end point of that path is known all too well in the US where the rapid deceleration in consumer spending cost American at least two years of GDP growth.”
Side note, this Chinese economy article was posted yesterday, April 1. Is it true or was it a prank for April Fool’s Day? Hmmm….
Back to a more positive commentary from the Financial Times, Gold heads north on demand from the east: “Gold may have risen in price by 21 per cent in 12 months, to more than $1,100 per troy ounce – but interest in the metal is not fading in Beijing. A report from the World Gold Council this week suggests that demand from China – for gold jewellery as well as bullion – will double within a decade.”
However, the Financial Times article offers cautions that gold will have some corrections and concludes, “However, Meera Patel of advice firm Hargreaves Lansdown argues that funds investing in undervalued mining stocks – such as BlackRock Gold & General and Smith & Williamson’s Global Gold & Resources fund – look a better bet for longer-term investors.”
In this commentary for Kitco, Jon Nadler says:
“Now, consider platinum, palladium for a moment. Or two.
“Platinum started the year at $1500.00 per ounce. Your theoretical Jan. 4th investment into one ounce of Platinum Pool would today yield a per ounce proceeds of $1640.00 – i.e., a 9.1% return on the money. The metal averaged $1561.00 on the quarter and finds itself at more than $150 higher than its 2010 starting level.
“Palladium was quoted at $421 on Jan. 4th of this year. A purchase on that date of an ounce of Pool metal and its subsequent liquidation today would net its owner am 11% gain on the quarter. The cumulative average for palladium’s price on QI is $441 approximately.”
Happy Easter!