About a thousand reasons, and I am sure that I missed most. but look to the middle-east for your answer.
Bernanke announcing extended zero fed funds rate, affirming QE2 and leaving the door open for QE3, 4 ......
Pretty much what Bluesboy said. Here is an article. http://www.thebulliondesk.com/news/?id=29209&v=0&lang=en&cid=131985&type=1
IMHO Bernanke's madness is already priced in, although gold will still advance over the long run as all the money that they are creating hits the scene. I think that most people are in denial about how far and how fast the middle east is going to fall. Look for a bump every time this situation escalates. Not to say that is the only thing going on, but it is, again IMHO, the biggest Unknown and with all the other stuff going on including massive warnings this week that there is going to be a 9/11 style attack in Britain or Europe, it has people nervous. Folks who trod through life also have had, at least here in the US, a little break from work this week due to weather and may be waking up a bit. Lets hope I am wrong about the ME!
There is about $1.00 premium build into the price of silver that I believe is directly attributable to the situation in Egypt. Beyond that markets have shrugged it off and are currently sliding sideways. The rise in metals today directly coincides with Bernanke's 11:30 luncheon remarks at the National Press Club. Go to APMEX or other site and look at the hourly charts and see when the increase occurred. I agree that metals have a Bernanke premium but, prior to today, it was based mainly on known actions; like the zero fed rate and the QE2 stimulus program. What we saw today was an additional Bernanke premium based on new information regarding the extension of the zero rate time horizon and the nod he gave toward additional quantitative easing. I think we could see the current Egypt risk trade bounce both up and down as long as things don't get too crazy. If people start getting slaughtered in mass, hang Mubarak or actuall disrupt shipments through the Suez Canal it's a new game. If there is an immediate change of Egyptian leadership I think it will most likely be someone supported by those who have little affection for Israel or the US. This scenario is poised to take place in several other countries in the region. If this happens there will be a more significant long term risk for a conflict with Israel and thus the US. Lots of danger out there and most of it bullish for silver and gold. Regards, Bluesboy65
Agreed Bluesboy. Between the Middle-East and world debt crisis, gold and silver are ridiculously bullish right now IMO. I'm accumulating as much as I can at these prices because I don't think we'll be here for long.
