Gold Climbs in London as Crude Oil at Record Encourages Hedging Gold rose in London for a second day as crude oil traded above $99 a barrel for the first time ever, spurring buying of the metal as a hedge against inflation. The dollar touched a record low against the euro for a second day, also prompting some investors to turn to gold as an alternative to the U.S. currency. Crude rose to within 71 cents of $100 a barrel on speculation the Federal Reserve will cut interest rates to try to prevent a housing slump spreading. ``Given the movements of both oil and the euro and the renewed concerns about the financial markets it does look as if gold is on course to re-challenge $850,'' James Moore, an analyst at TheBullionDesk.com, said in an e-mailed note.
Why gold's going straight to $1,000 Gold is about to soar to new highs, and here are four compelling reasons why. Take a look at four gold-mining stocks that could make your portfolio gleam. Gold beat a hasty retreat after setting records by trading north of $840 an ounce earlier this month, but don't be fooled. It's only taking a breather before it climbs past $1,000. So this is a good time to get exposure to the metal. I'd buy shares of four well-positioned gold producers favored by two of the top-performing money managers in the sector, which I'll detail in a moment. Here are four reasons why these two gold bugs and other experts think the metal could see fresh highs soon.
Dollar Sets a New Record Low The dollar sank to a new low against the euro Wednesday on pessimism about the American economy and speculation Washington will soon cut interest rates again. The euro spiked to $1.4855 before retreating slightly to $1.4787 in morning European trading. It broke the $1.48 mark for the first time on Tuesday, settling at $1.4815 late in New York. The dollar also hit a two-year low against the Japanese yen, falling to purchase as little as 108.81 yen before rising slightly to 109.19 yen -- compared with 109.69 yen in New York on Tuesday. It was last lower when it purchased 108.76 yen on Sept. 5, 2005. The euro, the pound and other currencies have been climbing steadily against the dollar since August amid fears for the health of the U.S. economy, stoked by the subprime credit crisis.
Eyes back on Fed for emergency rate cut United States stock markets were lifted on Tuesday on speculation that Federal Reserve chairman Ben Bernanke will call an emergency meeting of the Fed to further cut interest rates, contrary to warnings by policy makers in the past two weeks. The speculation was fueled by the Fed's first set of quarterly economic forecasts, a product of the new regime recently instituted by Bernanke. The degree of "uncertainty'' about the growth outlook is greater than that for inflation, Fed officials said on Tuesday. While they expressed confidence price increases will ease, they viewed markets as "still fragile and were concerned that an adverse shock'' would worsen economic risks.
Feds' budget tricks hide trillions in debt Every year, tens or even hundreds of billions of dollars are quietly added to the national debt -- on top of the deficits that we hear about. What's going on here? When it comes to financial magic, the government of the United States takes the prize. Sleights of hand and clever distractions by purveyors of line-of-credit mortgages, living-benefit variable annuities and equity-indexed life insurance are clumsy parlor tricks compared with the Big Magic of American politicians.Consider the proud trumpeting that came from Washington at the close of fiscal 2007. The deficit for the unified budget was, politicians crowed, down to a mere $162.8 billion. In fact, our government is overspending at a far greater rate. The total federal debt actually increased by $497.1 billion over the same period.
Countrywide says it has ample liquidity and capital Countrywide Financial Corp. said Tuesday that it believes it has ample capital and liquidity to stay in business, and it expects to benefit from ongoing consolidation in the industry. "Countrywide Bank, the Company's primary operating entity, has sufficient liquidity available to meet its projected operating and growth needs and has accumulated significant contingent liquidity in response to evolving market conditions," the firm said in a statement. "Countrywide Home Loans is expected to service debt maturities beyond 2008 without additional debt issuance," the company said. Earlier Tuesday a Countrywide representative told The Wall Street Journal that speculation the company may file for bankruptcy is "absolutely false."
Persian Gulf states ponder their dollar pegs The Federal Reserve's policy meeting next month isn't the only meeting that could determine the dollar's near-term direction -- investors will be closely watching the Gulf Cooperation Council's meeting for clues about the future of its member countries' currency pegs to the greenback. The GCC is an economic group of six Gulf Arab oil producers, and has a stated goal of creating a common currency by 2010. The group will meet in Doha on Dec. 3 and 4, and investors will keenly watch for signs that any members will change their currencies' respective relationships with the dollar. Five GCC countries -- Saudi Arabia, the United Arab Emirates, Qatar, Oman and Bahrain -- peg their currencies to the dollar, setting an official reference rate at which central banks buy and sell. In May, Kuwait abandoned its peg and now links to a currency basket which includes the dollar, euro, yen and sterling.
- - - - - - - - - - - - - - - - Archived Page Link
- - - - - - - - - - - - - - - -
RSS
![[Most Recent Quotes from www.kitco.com]](http://www.kitconet.com/images/quotes_7a.gif)