Gold Hits 7-Week High

Gold hits a 7 week high and silver climbs to the highest in 15 months.

GDP growth reported yesterday for the first quarter 2016 was 0.5 percent. This number is a true indication of a slowing economy. How slow you ask? The Commerce Department announced yesterday that the U S economy expanded at the slowest pace in two years. Not to pick on any one president BUT, President Obama will be the only president in history not to deliver a single year of 3.0 percent economic growth. So why do I mention this? Remember the 19 trillion dollar debt we are faced with? Entitlements consuming a good portion of tax revenues. Negative interest rates over the pond ring a bell?

Do anyone of you believe that in a year that we are choosing a new President and experiencing a slowing economy, the Fed will have the data or the nerve to raise rates? And who knows how the presidential contest will end? And will anyone of the contestants be able to control run away government spending?

The GDP number should be an eye opener to the retail investor that it just MIGHT be time to diversify their portfolio into physical precious metals. Some of the financial advisors I spoke to have indicated they have been seeing an increase in physical demand, mostly in silver, for the reason I have indicated in my previous reports.

Remember just a few months ago when gold hit a low of $1,046.00 and then look at where we are today. At the time of my report this morning, gold is up $13.00 from yesterday’s close and $29 dollars higher in the last two days. Silver is up this morning $.25 cents and $ .51 cents higher in the last two days.

More and more participants are entering the markets as we hear a number of commodity hedge funds have recently joined the club.

Looking at other markets this morning, we see at the time of this report, the dollar index down -.44 trading 93.33, adding fuel to the rally in the gold market. Strong inflows into the Gold ETF inventories now at just above 58 million ounces held. ( 1,812.5 tons ) .

A lot of bullish indicators, but like in any market – especially this one – any news that hits the tape can affect the prices in a big way. Remember electric trading platforms and algorithmic programs can move the price in a heartbeat. And let’s not forget, as in any market that experiences a rally like gold and silver has, there WILL be profit taking to contend with.

Let the buyer beware.

What’s in your safe deposit box?