Gold Prices & Silver Prices Steady Amid Bank Problems; Steve Forbes Speaks On Gold & Politics
New York (Oct 2) Welcome to this week's Market Wrap Podcast, I'm Mike Gleason. Responding to popular demand, we'll hear a replay of my conversation with Steve Forbes. Earlier this year, Mr. Forbes gave a fascinating interview about the presidential election and why he believes the time is now for America to restore gold in our monetary system. My interview with Steve Forbes, billionaire investor and CEO of Forbes, Inc., coming up after this week's market update.
Well, the big market moving news this week didn't come from the Federal Reserve for a change. It came from another powerful market rigging cartel - OPEC. The organization of oil exporters announced a production cut of 800,000 barrels a day. This, OPEC hopes, will keep oil prices supported amidst a global supply glut.
Following the announcement, crude oil prices shot up more than $3 to hit $48 per barrel. Conventional producers would like to see oil trade in the $50 to $70 range. That wouldn't be unreasonable considering that crude traded above $100 as recently as 2014 before crashing to below $30 earlier this year. The one thing the oil market can be counted on to do is wildly overshoot and undershoot equilibrium price levels.
The same is often true in the precious metals markets. When gold and silver prices fell below mining production costs in late 2014, the fundamental analysis showed those low price levels to be unsustainable. Yet they persisted longer than many analysts expected. Gold and silver markets finally began pushing higher in 2016. And like crude oil, precious metals still have a long way to go before reaching levels on the charts that could even remotely be regarded as elevated.
Precious metals prices sold off early this week and didn't reap much benefit from the oil price surge mid week. We got off to a good start in the metals today after another negative consumer spending report came out. Gold has pulled back since this morning however and as of this Friday recording the yellow metal trades at $1,323 an ounce, down 1.3% for the week. Silver is still up a bit today with prices currently coming in at $19.38, registering a weekly decline of 1.9%.
Source: MoneyMetalsExchange
