The price of Gold seemingly stuck in the mud despite all the negative news heard around the globe.
Many Equity investors are not sure what their next move will be as they are still expecting
continued volatility in their markets along with a seemingly never-ending Government shut down.
So for the time being, Gold investors are patiently waiting for some news that will bring the price thru the next level of resistance at $1,303 in the spot price.
For the most part, the price of Silver has been trading as an industrial metal, reacting to what the Equity Market action has been. There is still a significant amount of Silver on the shelves of domestic depositories just collecting dust and storage fees.
The price of Platinum continues to be under pressure, looking for some level of support as global supplies continue to increase. On the other hand, supply concerns still plague the Palladium market with the current EFP quoted at minus 50 minus 30. Recently, some supplies have found their way into the market place as we have seen the backwardation come in about 20 to 30 dollars.
The Brexit Vote
Yesterday, British Prime Minister Theresa May’s Brexit plan suffered a huge blow as it was defeated in Parliament 432-202. The Prime Minister’s loss was expected, but not at such a wide margin, translating into a “vote of no confidence” as her political career at this juncture seems to be at the end of the line.
The Prime Minister immediately went on the defense saying, “Tonight’s vote tells us nothing about what it does support.”
This defeat puts the Brexit exit in doubt and now some MP’s are calling for May’s ouster in an early general election.
People now question her ability to go back to Brussels and negotiate a new amended agreement.
It is unclear what the next step will be. Britain is scheduled to leave the EU March 31st. Now with no deal, that date just might be pushed outward as some are calling for the country to hold a second referendum.
This madness is no different than what we have here in the States, as no one is willing to compromise on anything.
It will be interesting to see how this plays out.
The Government Shutdown
Chase CEO Jamie Dimon commented on the Government shutdown yesterday on a media call, “Someone estimated that if the Government stays shut for the whole first quarter, it can reduce growth to zero.” He went on to say, “there’s still growth, despite early signs of a slowdown in China, Japan and the U.S., among other nations. Consumers are in good shape, they’re spending money, they’re saving money, household formation and wages are going up. Eventually there will be offsets that may push the economy into a recession, but we don’t know when that’s going to be.”
A possible recession? Brexit negotiations going nowhere. Economies across the globe slowing
down. Government spending here out of control with a huge debt that can never be paid.
All adding fuel to higher Gold prices as eventually the price will head much higher when Equity
investors look for a safety net and head for higher ground.
Have a wonderful Wednesday.
Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals for information and thought-provoking purposes only and does not purport to predict or forecast actual results. This editorial opinion is not to be construed as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein cannot be attributable to Dillon Gage. Reasonable people may disagree about the events discussed or opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. It is not a solicitation or advice to make any exchange in commodities, securities or other financial instruments. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisers with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.