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Doug Casey: U.S. government won''t avert dollar''s collapse
By Myra P. Saefong
Friday, November 12, 2004
SAN FRANCISCO -- Gold futures logged a gain of $4
an ounce for the week to close Friday at a level the
market hasn't seen since July 1988, boosted by a
drop in the U.S. dollar and continued violence in Iraq.
Ongoing fighting in the Iraqi city of Fallujah and
tensions in the Middle East have encouraged an
element of safe-haven positioning ahead of the
weekend, said James Moore, an analyst at
TheBullionDesk.com in London.
Against this backdrop, gold for December delivery
closed at $438.30 an ounce on the New York
Mercantile Exchange, a closing level the market
hasn't seen in more than 16 years. The contract
logged a gain of $2.90 for the session and was
up $4 for the week.
"Gold continues to maintain its strong uptrend and,
at this point, the commodity funds and individual
traders have no reason not to bid up the price in
anticipation of a move to $450 an ounce," said
Dale Doelling, chief market commentator at
Bullion.com in Chicago.
"Talk that the Bush administration's resolve
regarding a strong dollar may be waning just helped
to add fuel to the selling of the greenback," he said.
A report showing that U.S. consumer sentiment
stands at a three-month high failed to lift the dollar
Friday. The dollar has stabilized from historical
lows hit this week, but its tone is negative as
focus remains on U.S. deficits.
From here, the next significant point on the technical
chart for gold prices is $446, the monthly high back in
1983, said Doelling.
"A close above that would probably put the market into
overdrive, taking it well above $500," he said. "A close
below $432 would signal that a short-term top may have
been made, but that would not negate the long-term
Other metals futures also closed higher for the session
as well as the week.
December silver rose 14.5 cents to close at $7.622 an
ounce. It was up 1.6 percent for the week. December
copper ended at $1.3945 a pound, up 2.2 cents for the
day, and up 2.3 percent for the week.
The January platinum contract closed up $19.60, or 2.3
percent, at $874.20 an ounce -- up 2.9 percent from a
week ago, while December palladium ended the day at
$221.15 an ounce, up $5 for the day and up 1.6 percent
for the week. Traders lifted prices for the platinum group
ahead of Tuesday's 2004 outlook for the metals from
metals refiner and marketer Johnson Matthey.
Tracking inventories, copper supplies were down 535
short tons at 42,281 short tons as of late Thursday,
according to the Nymex. Silver stocks were unchanged
at 102.9 million, while gold inventories stood at 5.33
million troy ounces, down 129 from the previous session.
In equities, metals mining shares closed mainly higher,
sending a key index for the sector to its highest level
in more than seven years.
The CBOE Gold Index closed at 98.4 -- its highest
ending level since March 1997 -- up 2.5 percent for the
day and 1.8 percent for the week. A nearly 5 percent
increase in shares of Anglogold Ashanti led the climb.
The Philadelphia Gold and Silver Index rose 2.4 percent
to close at 108.59, a level not seen since mid-February.
It gained 1.6 percent on the week. The Amex Gold Bugs
Index closed at 241.86, up 2 percent for the day and 1.5
percent from the week-ago close. The Amex index ended
at its loftiest since January.
In metals news, Coeur d'Alene Mines Corp. said it plans
to file with the Securities and Exchange Commission to
offer 25 million common shares. The company also
granted the underwriters an over-allotment option of
3.75 million shares. Bear Stearns and Harris Nesbitt will
be co-managers. Shares of Coeur fell 13 cents, or 2.5
percent, to end at $4.99.
Harmony Gold said its shareholders voted for the $8.1
billion hostile takeover bid for Gold Fields Ltd. Harmony
holders representing 85 percent of its shares voted at
the meeting. Of the shares voted, 87.7 percent were
voted in favor and 11.4 percent against the proposed
merger. Harmony's stock fell 9 cents to close at $11.05.
Gold Fields stock rose 2 cents at $14.18.
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