Marketwatch/Greg Robb
Fed’s Williams warns that U.S. economy far from healthy even if worst of the coronavirus outbreak is over

New York Fed President John Williams “The economy seems to be on the mend from the worst of the early days of the coronavirus pandemic but remains damaged, said New York Fed President John Williams on Tuesday.

“There have been signs that we may be past the worst of the extreme economic distress and early indications of a recovery have started to emerge,” Williams said, in a virtual talk sponsored by the Institute of International Finance.

Consumer spending has rebounded, and building permits have risen, which is a sign of strength in construction, Williams said. In addition, the high unemployment rate has started to recede from peak levels, though job losses remain elevated.

While these improvements are welcome, “the economy is still far from healthy and a full recovery will likely take years to achieve,” Williams predicts.”

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Forbes/Frank Holmes
This Could Be The ‘Perfect Storm’ That Pushes Gold To A New Record High

Gold To A New Record High“A “perfect storm” of surging government debt levels, plunging real bond yields, rising coronavirus cases and deteriorating economic forecasts pushed the price of gold to an eight-year high last week, and some analysts now project the metal to top its all-time high within the next 12 months.

Gold touched $1,778 an ounce last Wednesday, its highest level since February 2012 and coming within striking distance of the psychologically important $1,800 resistance level.

What drove the yellow metal’s price action was not just an alarming rise in confirmed virus infections—U.S. cases hit a new single-day record of more than 42,255 on Friday—but also a weakening U.S. dollar. The greenback declined the most in three weeks as the yen and euro strengthened amid gains in global shares.”

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Kitco/Jim Wyckoff
Gold prices power to 8.5-yr high, much more upside likely

Gold Prices“Gold prices are sharply higher and hit an 8.5-year high Tuesday, on technical buying based on very bullish charts that got even more bullish today—suggesting still more (likely much more) upside price potential to come, including new record highs. Buy stop orders were triggered in the futures market when gold prices penetrated the previous for-the-move high scored in April. August gold futures were last up $19.90 an ounce at $1,800.90. September Comex silver prices hit a four-week high today and were last up $0.571 at $18.635 an ounce.

Underlying bullish fundamentals in the gold and silver markets include safe-haven demand due to the Covid-19 pandemic that appears to be getting worse instead of better and also further damaging global economies. Also, it appears traders and investors are realizing the massive infusion of central banks’ easy money into the world financial markets the past few months will create serious problems down the road—namely problematic inflation. Metals are a historical hedge from inflation.”

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Marketwatch/Myra P. Saefong
Gold posts largest quarterly gain in 4 years; talk of record prices by year end grows

Gold Record Prices“Gold futures posted a gain of nearly 13% for the three-month period ended Tuesday, the largest quarterly percentage climb since 2016, with analysts renewing talk of record prices by year end.

Gold’s performance so far this year is “not attributed to the pandemic,” said Alex Ebkarian, chief operating officer at Allegiance Gold. “COVID-19 simply exasperated the underlying weaknesses as evident by the negative real interest rates and further weakening of the dollar.”

On Tuesday, the August gold contract GCQ20, 0.12% settled at $1,800.50 an ounce, the highest finish since Sept. 2011, according to Dow Jones Market Data. Based on the most-active futures contracts, prices ended the second quarter with a gain of 12.8%. That was the largest quarter percentage rise since the quarter ended March 2016. Year to date, prices were up 18.2%.

Gold accelerated its move towards record highs in the second quarter of this year, as it was “already set on this trajectory” before the seriousness of the coronavirus was even realized, said Peter Spina, president and chief executive officer at GoldSeek.com.

The reaction to COVID-19 over the last quarter was of “historic proportions,” with global debt now soaring and governments injecting trillions of dollars into their economies. Under those conditions, gold is a “lower risk shelter to seek refuge,” said Spina.”

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