The Silver Institute has released its June newsletter. The publication features interesting and educational articles about the latest technology in the silver industry, as well as new silver investment products on the market. This edition notes that industrial demand for silver continues to grow in Asia and developing countries:
Industrial applications accounted for 56 percent of all silver demand in 2014. On a regional basis, a modest increase in industrial demand in developing countries, led by 4 percent growth in China and Taiwan, was offset by weaker demand in advanced countries in 2014. This marks the fifth consecutive year of Chinese industrial demand growth. Last year’s industrial demand total for Taiwan was 23 percent above their 2009 figure.”
Bank of International Settlements issued a blunt report on Sunday, warning that over-reliance on monetary policy has left central banks with little capacity to deal with the next global crisis.
As the Telegraph reports, BIS asserts that central banks have “backed themselves into a corner” by repeatedly cutting interest rates in order to stimulate flagging economies.
These low interest rates have in turn fueled economic booms, encouraging excessive risk taking. Booms have then turned to busts, which policymakers have responded to with even lower rates.”
China will reportedly create a yuan-denominated physical gold price setting mechanism through the Shanghai Gold Exchange (SGE) by the end of the year.
According to a Reuters report, the plan aims to give China more influence over gold pricing. The country already leads the world in production and consumption of gold bullion.
Greece has closed its banks and instituted capital controls. The measures will remain in effect until at least July 6th, the day after a popular referendum on European bailout aid is due to take place.
Rather than agree to further austerity measures in exchange for an extension of financial aid from its international creditors, Prime Minister Alexis Tsipras surprised markets by putting the decision to a popular vote. Greece’s current bailout program expires tomorrow, when a 1.6 billion euro payment to the International Monetary Fund also comes due.
Stock markets across the globe fell on the news, and gold rose about 0.7%.
Bloomberg reports that Greece’s capital controls include:
Mark Dice walked around downtown Encinitas, California and tried to sell a 10-ounce bar of silver for only $10. At today’s prices, that bar is worth about $160. He asked men and women, young and old, if they’d like to buy it. He even lowered the price to $1 while standing directly out front of a gold dealer. How many people do you think took him up on the offer?
This is a great video to show the naysayers who argue that precious metals are in a bubble. There are many people who think the prices of gold and silver are ready to plummet at any time. They predict gold could drop as low as $700 an ounce and silver could fall into the single digits.
However, bubbles are often associated with a certain amount mania. The asset or market in a bubble is often widely considered to be a valuable investment.
Did you know SchiffGold has a YouTube channel with exclusive videos from Peter Schiff? When you subscribe, you’ll be the first to see:
If all the world’s debt were backed by gold, the US dollar price of the yellow metal would be nearly $34,000. Frank Holmes of US Global Investors explains the math in an insightful article.
The price of gold shot up about 1.5% today, breaking through the technically significant barrier of $1200. Gold closed around $1185 on Wednesday, and rallied today to a peak of $1206. It now hovers around $1202.
The jump in price comes on the news that the Federal Reserve is likely to keep the federal funds interest rate at zero for some time. In a press conference yesterday, Janet Yellen hinted at rate hikes later in the year, but ultimately reaffirmed that any rise in rates is entirely data dependent.
In case you missed it earlier, here’s Peter Schiff’s analysis of the FOMC’s meeting and Yellen’s statements:
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It’s official: China now plays a small role in directly setting the price of gold in Western markets. For the first time ever, a Chinese bank has joined the twice-daily gold price fixing process run by the London Bullion Market Association (LBMA).
As we reported back in February, this news was anticipated. The LBMA has replaced the old London Gold Fix with a new, electronic mechanism in an effort to increase transparency in the gold markets.
On Friday, Texas Governor Greg Abbott approved a law creating the Texas Bullion Depository – the first state-level precious metals depository in the United States. The bill would also allow Texas to repatriate $1 billion of gold back into the state. The law will go into effect immediately, though it is still unknown exactly where and when the Depository will be built.
In passing this law, Texas joins the ranks of major global economies that want to bring their gold home. Germany, Austria, the Netherlands, and other European nations have already begun to repatriate gold from the New York Federal Reserve or have proposed to begin doing so.