Silver Market Morning

Gold Today – The gold price closed at $1,287.30 down $2.00 on Friday in New York. In Asia and London, gold prices were lower in both the dollar and the euro at $1,275. The gold price was Fixed at $1,277.75 down $9.50 and in the euro at €974.42 down €4.924, while the euro was weaker at $1.3113. Ahead of New York’s opening, gold was trading at $1,270.60 and in the euro at €968.85.

Silver Today – The silver price closed in New York at $19.37 down 11 cents. Ahead of New York’s opening it was trading at $19.37.

Gold _{(very short-term)} We expect gold to consolidate with a weaker bias, in New York today.

Silver _{(very short-term)} We expect silver to consolidate with a weaker bias, in New York today.

Price Drivers

There were no sales or purchases of gold from or to the SPDR gold ETF and none from the Gold Trust on Monday. The holdings of the gold ETFs stand at 794.999 tonnes in the SPDR gold ETF and at 165.45 tonnes, in the Gold Trust.

Once again, with no physical sales and a lower euro the gold price was pushed lower. The Technical picture pointed to this in the short term as gold fell below the 200-day average. But the downside is limited on the Technical picture. However, we do expect Asian physical demand to lift prices soon as they are encouraged by falling prices. September is one of the strongest months for gold and we can see no reason why this should change this year. Yesterday was a painfully slow and thin day for gold. But nothing has changed since yesterday. It is a pattern now that where there is small physical demand and the euro weakens gold prices will be pulled down. But note the gold fell in all currencies, not just the dollar.

Standing back and looking at the ‘big’ picture a major change in the world that goes almost without any comment is the change in the cash flow of the world. After the Second World War the U.S. earned 50% of the globe’s cash flow. As the developed world recovered, its share of global cash flow rose to 80% by the turn of the century. This is changing rapidly. China now has 40% of that cash flow and the entire ‘emerging’ world will command 65% of this cash flow sometime between 2016 and 2020 with the developed world earning 35% of the global cash flow. Apart from the changes in society across the world, what this means for the monetary system is a shifting of the tectonic plates of financial power to the east and a fall in that power in the west. With China encouraging its people to buy gold and with such private gold available to government, gold will have a pivotal role, at least in the times of strain, as this metamorphosis takes place and most likely, in view of that history, a permanent place in world finance well beyond a simple, but important reserve asset.[Subscribe www.GoldForecaster.com – ensure your gold will not be confiscated and you not penalized -see www.Stockbridgemgmt.com ].

Silver– The silver price sagged overnight as gold fell. www.SilverForecaster.com]

Regards,

Julian D.W. Phillips for the Gold & Silver Forecasters