Dear PGM Capital Blog readers,
Yesterday, Sunday, May 19 2013, in the first few minutes following the opening of electronic trading on the Comex division of the New York Mercantile Exchange, silver futures slumped 9.4% to a low of USD 20.250 a troy ounce.
As a consequence of this the Silver trading was stopped for two 20 second intervals at 6:07 p.m. EDT and 6:09 p.m. EDT, and two consecutive 20 second halts at 6:09 p.m. and 6:10 p.m.
In accordance with a zerohedge article, the the flash crash of silver was caused by, someone who received a margin call when the USD-JPY exchange rate hit a high of 102 and due to this was forced to dump a whole lot of silver in thin, hardly any volume trading, in order to cover for a margin call.
In the course of the trading day silver recovered completely to close today’s trading day at USD 22.92 an oz as can be seen from below chart.
Arround noon EST today the news hit the wire that the USA government had suspended the debt ceiling, setting a date, and not a concrete dollar sum as a deadline, an unprecedented first in USA history.
Citing ‘extraordinary measures’, the US Treasury has further delayed tackling America’s debt, and will wait until Labor Day, September 2nd, to revisit the burgeoning crisis. The ceiling has been lifted, and the Treasury has promised it will keep pumping cash into government spending programs beyond the debt limit through a series of emergency cash tools.
As can be seen from screenshot of the USA debt Clock, taken today, May 20, 2013 at 7:00 pm EST, the current USA national Debt has reached a record of 16.831 Trillion US-Dollars.
Based on this news, Gold, Silver, Platinum and Palladium rallied as can be seen here in below charts:
Ladies & Gentlemen, today’s rally in Gold, Silver, Platinum & Palladium, after the news of suspension of the USA Debt ceiling proves again, that precious metals – which cannot be printed by Central Banks – are the only safe haven during these turbulent times.
Before following any investing advice, always take your investment horizon and risk tolerance into consideration and keep in mind that the price of precious metals as well as the stocks of their producers can be very volatile and that sharp corrections may happen in the short term.
Yours Sincerely,
Eric Panneflek