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The Week In Review – April 16, 2010

April 16, 2010

China trimmed its holdings of US Treasury debt by another 1.3 percent in February, the fourth time it has done so. Such moves, if they continue, may lead to the US government paying higher interest rates to finance its seemingly ever increasing budget deficit.

The number of new unemployment insurance claims rose unexpectedly last week, for the second week in a row. Economists had expected the figure to fall and, unlike last week, continuing claims also edged higher.

The situation in Greece continues to remain unresolved. This week Greece formally requested talks with the European Union and the International Monetary Fund regarding its sovereign debt issues. This is perhaps the first step to their receiving billions of euros in emergency loans via an aid package announced last Sunday by euro zone governments. Should that aid package be activated, a group in Germany is already planning to file suit. This group believes that aiding Greece by providing those loans would violate the “no bailout” clause of the EU treaty. They have firmly and publicly voiced their opinion that Greece should leave the EU, cease using the euro and go back to using their previous currency.

On Thursday, Congress successfully passed a measure to restore jobless benefits to those whose unemployment insurance had expired on April 5th. The republicans blocked the previous extension just prior to a two week recess of Congress. The measure extends benefits through June 2.

Foreclosure activity hit a new monthly record in March. One in every 138 households received a foreclosure notice for the quarter. Based on the March data, bank repossessions are on track to break last year’s record of 918,000.

Concerns over Greece, the US jobless data and China’s apparent moves at tightening and slowing their economy down helped push crude oil back under $85 a barrel.

Retail sales were up better than expected for March, perhaps showing that the consumer is becoming comfortable enough to start spending again despite unemployment levels that remain high. Consumer spending, along with housing, has long been believed to be the keys to speeding up the economic recovery. In a private survey released Friday however, consumer sentiment took a turn for the worse due to continued high unemployment and poor outlook on incomes.

The euro actually moved up against the dollar this week, with the yen trading essentially sideways.

On Friday, the SEC officially charged Goldman Sachs with fraud, accusing them of costing investors close to $1 billion with their collateralized debt obligations that were tied to risky sub-prime mortgages.

Friday to Friday Close

Here are your Short Term Support and Resistance Levels for the upcoming week.

Volatility should be expected to continue. Congress continues to bicker amongst themselves, with democrats spending like the proverbial sailors, and republicans attempting to force them to find ways to pay for their programs instead of just continually adding to an already record budget deficit. Details concerning manipulation in the precious metals market by banks such as JP Morgan Chase and HSBC continue to surface. As more and more “whistleblowers” come forward and the charges keep racking up against these large banks, the chances that the CFTC will take action to stop the manipulation continue to improve. Many analysts feel that the stock market seems poised for a sharp correction while precious metals appear poised for a sharp move to the upside. Remember, the key to profitability through the ownership of physical precious metals is to actually own the physical product and to hold them for the long term. Never over-extend your ability to maintain ownership of your product over the long term.

As we mentioned in our memo last week, if you want the manipulation in the precious metals markets to come to an end we urge you to e-mail the Commodities Futures Trading Commission at this e-mail address: metalshearing@cftc.gov. Thanks to Ted Butler, you can use the following draft for your e-mail to the CFTC (remember to place your name after “Sincerely,” at the bottom):

“Dear Sirs; Thank you for the opportunity to comment on the issue of position limits for precious metals. Please establish a speculative position limit in Comex Silver of no more than 1500 contracts. Please restrict any hedging exemptions from those limits to legitimate hedgers. Please stop the levels of concentration in Comex silver futures that have been experienced over the past few years on the short side of the market. Sincerely, ______________”

The CFTC is only accepting comments from the general public through to the 26^th of April, 2010 so you only have 10 more days to take action. The more of us, as investors, who have and show an interest in the CFTC stopping and finally putting to a halt the manipulation that has been carried on by institutions such as J.P. Morgan Chase and HSBC, the better our chances in getting a positive reaction. Please CC your e-mails to Mr. Chris Powell, Secretary/Treasurer of Gold Anti-Trust Association at cpowell@gata.org.

Trading Department – Precious Metals International, Ltd.

This is not a solicitation to purchase or sell.

© 2010, Precious Metals International, Ltd.

© 2012, Precious Metals International Ltd.
www.wwpmc.com

The Week In Review – April 16, 2010
Posted by Worldwide Precious Metals on Friday, April 16, 2010

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