Cheaper office space for Goldman Sachs, an extension of a tax on rum, and a tax break offered to those building NASCAR racing tracks (yes, you read that last one correctly). All some of the more colourful (or scandalous some might say) provisions of last week’s fiscal cliff deal, courtesy of the The Washington Post.
After enjoying a solid start to the new year thanks to the fiscal cliff deal and better-than-expected US economic data, industrial commodities and general equities have lost some ground this morning, with the Dollar Index rising above 80.00 – a magnet for this particular index going back over a year now.
Likewise, gold continues to be pulled back towards $1,650/oz. Falls below this level always result in value investors – many wealthy Asians especially – stepping into the physical market, while rallies above this price are met with sales at the futures market in New York. The same is true for the $30 mark in relation to silver.
Broadly speaking, silver’s range is $29.50 to $35.50. It’s hard to get excited about any moves up in silver until it clears the latter price in convincing fashion. Gold’s is $1,600 to $1,800. Once we’re back over $1,800 then we could see a resumption of the powerful gains we saw from 2009 to September 2011. “Wake me up when we’re over $2,000” is probably the best attitude.
In other news, it seems farcical that people are seriously considering “the trillion-dollar platinum coin” idea, but then I guess we live in strange times. Jesse has a great take on this, as does one of the commentators at Robert Wenzel’s blog, who notes:
“You know they're desperate when they suggest a method that was funny when it was in a Simpsons episode:
http://en.wikipedia.org/wiki/The_Trouble_with_Trillions”
