Demand for Gold Increases as Banks Lose Favor

Both gold and silver are up a bit today, but nothing spectacular. Notice that platinum has exceeded the price of gold, again. We must remember that this is a short trading week and many of the main traders are on holiday with the second team manning the con. A number of economic indicators are due this week. Thus, we may well see a very volatile time in the markets.

With the light volume expected, it will give the precious metals boyz an opportunity to put a cap on the precious metals at any time they desire. The game goes on. It is a game for them, but a life and death struggle for individual investors. With the deep pockets they have at their disposal, they have the ammunition to play it with more gusto than any of us. Just beware of this at all times.

The mining stocks have begun to demonstrate the leverage they offer over the metals themselves. My Scottrade streaming quotes of the mining stocks it almost all green. These stocks are up today, so far. The DJI is about even. It is up 3-4 at 8575. Nothing exciting at all. The mining stocks are providing interest well above that. Here are some examples: AGXM 0.10; CDY 1.15; CEF (Cdn Trust ETF in gold and silver) 10.47; DROOY 5.47 (down 0.17); GDX (Miner's Index) 30.89; GFI 8.64; GG 29.10; GLD (ETF in gold) 83.47; GSS 0.79; HMY 9.35; IAG 5.69; KGC 16.93; KRY 0.13; NYM 38.02; PAAS 15.77; SLW 5.80; SSRI 14.32; VGZ 1.32; and XRA 1.59. Most of these are performing well for the time being.

Presently, gold is847.20 up 8.20 and silver is 10.81 down 0.01.


From Bloomberg:

Gold Rises in London as Weaker Dollar Boosts Investment Demand

By Nicholas Larkin

Dec. 22 (Bloomberg) -- Gold rose for the first time in three days in London as a weaker dollar increased the appeal of the metal as an alternative investment to the U.S. currency.

Read the article HERE:

From Mineweb:

Phenomenal demand for gold coins continues

The SA Gold Coin Exchange says demand for gold coins has picked up as investors wish to take charge of their own affairs.

Author: Tessa Kruger
Posted: Sunday , 21 Dec 2008

JOHANNESBURG -

International demand for gold coins has picked up as people strive to take charge of their own financial destinies in an uncertain investment world.

Sales manager at the South African Gold Coin Exchange Len Sham says the demand for Krugerrands and collector coins such as the Mandela Coin has been phenomenal over the past five years as the rand weakened and the gold price strengthened.

International demand for coins has also increased over the last two to three years as people increasingly "want to be in control" of their investments. In addition, the recent credit crunch has led to a further uptick in demand for coins across the world, as seen in the fact that many countries are asking South Africa for Krugerrands due to their own short supply of coins.

Read the article HERE.

More from MineWeb:

Gold ETF: the lifeboat in 2008's stormy seas - and has oil bottomed?

The latest Commodities Review from ETF Securities points out that precious metals still generally outperformed the general stock market, with gold particularly strong.

Author: Rhona O'Connell
Posted: Friday , 19 Dec 2008

LONDON -

Once again, precious metals were in 2008 the only commodities with a negative correlation to equities; while investors are swinging from short oil positions to long.

In its review of commodities for 2008, ETF Securities Limited points out [even though it might not currently feel like it] that commodities outperformed most equity benchmarks, with gold standing out as a particularly strong performer.

Read the article HERE.

Still more from Mine Web:

Swiss gold bullion in huge demand as trust in banks dives

Swiss gold refiners are having great difficulty in keeping up with demand for gold bullion leading to long delivery times as investors wary of other stores of wealth.

Author: Arnd Wiegmann and Lisa Jucca
Posted: Wednesday , 17 Dec 2008

MENDRISIO/ZURICH, Switzerland (Reuters) -

Sealed off by grey concrete walls and barbed wire, the workmen in protective glasses and steel-toed boots at this smelter cannot work fast enough to meet demand from the nervous rich for gold.

This refinery near Lake Lugano in the Alps is running day and night as people worried about recession rush to switch their assets into something that may hold its value.

"I have been in the gold business for 30 years and I have never experienced anything like this," said Bernhard Schnellmann, director for precious metal services at the refiner Argor-Heraeus, one of the world's three largest.

Read it HERE.
From Reuters:

UPDATE 2-Harmony raises $100 mln in share issue to cut debt

Mon Dec 22, 2008 5:57am EST

* Raised cash through share issue

* Repaid R1.25 bln of 2 bln loan, rest due in Dec 09

* Reaffirms commitment to capex plans

By Muchena Zigomo

JOHANNESBURG, Dec 22 (Reuters) - South African gold miner Harmony Gold has raised 979 million rand ($100.1 million) in a share issue to boost its balance sheet and said on Monday it was sticking to its capital expenditure plans.

Read the article HERE.

In the US the ADR on Harmony trade under the symbol HMY. It is one of my core holdings and a portion of my trading shares.

As the great day of celebration of the birth of King Jesus, let us meditate upon the word of God to find the joy that was brought into the world about 2,000 years ago. God's Son brought life into a world wraught with sin from Adam's fall. As our hymns proclaim, "The world in darkness lay."

His life, death, and resurrection brought life to a world dead in sin. That is the true lasting joy and peace which is the good news of the gospel. He earned life for each and every one of His people. In a real sense, He brought a measure of blessings to every person on earth past, present, and future. The bible reports that a blessing of God; for example, the rain falls on both the good and the evil among us. That common grace abounds to all. However, the saving grace of God belongs only to His people.

This year prayerfully study the scriptures, humble yourself before King Jesus, seek forgiveness of your sins, turn from them, and follow the Sovereign living God of all. Each of us must do this daily. Let us all together with a mighty voice praise Him for the gift of eternal life with Him.

Best to each, Doug