Gold Outlook 2013: Why is Gold Dropping Now?

April 19, 2013

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SHOW NOTES – Gold Outlook 2013: Why is Gold Dropping Now?

Plus, our stock tip of the week


SEGMENT ONE

Why is Gold Dropping Despite Massive Money Printing?

In our first segment, you will hear some select audio clips from this week’s precious metals investing webinar with economist Jerry Robinson and precious metals advisor Tom Cloud.

The audio clips on this week’s show are taken from our latest investor education webinar: Precious Metals Investing 101: Gold, Silver, and Palladium

WATCH: Precious Metals Investing 101: Gold, Silver, and Palladium


In the above 90 minute webinar, veteran bullion dealer Tom Cloud explains why gold prices are dropping despite the massive money printing campaigns occurring around the world.

After recovering from its largest one day price drop (in dollar terms) earlier this week, strong buying of coins and bars out of Asia drove gold prices back up to around $1400 per ounce on Friday. The global demand for physical gold has sent premiums soaring as supplies have tightened. Despite the increased demand, gold still settled near $1395.60 on Friday, after falling to a two-year low of $1321.35 on Monday. Gold lost 7% for the week. The recent price declines pales in comparison, however, to gold’s massive 400% increase over the last decade.

Consider this report from Zero Hedge:

“According to data from the US Mint, a record 63,500 ounces, or a whopping 2 tons, of gold were reported sold on April 17th alone, bringing the total sales for the month to a whopping 147,000 ounces or more than the previous two months combined with just half of the month gone.”

Silver closed the week down 12%, settling at $22.96.

Meanwhile, the major U.S. stock indices all suffered their worst weekly drop of 2013. Of the ten sectors of the S&P 500, energy was the worst performer while the telecom sector gained.

Next week, around 170 companies listed on the S&P and 10 stocks on the Dow are scheduled to report earnings. Apple, Exxon Mobil, and Caterpillar are among those set for earnings releases. Apple stock in particular suffered another massive 9% loss this week. Since it reached its peak of $705 back in September, the stock has fallen over 40%, causing the company to lose its title to Exxon Mobil as the world’s largest company this week.

For those who still believe that the recent stock rally is based on strong fundamentals, we present these two charts that tell another story:

U.S. Stocks Increasing With Expanding Monetary Base

Stocks Remain Range Bound for 13 Years


 

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