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-- Posted Friday, 18 January 2008 | Digg This Article | Source: GoldSeek.com

Note: US Markets will be closed on Monday in observance of Martin Luther King Day.

GoldSeek.com Radio Gold Nugget: Lou Dobbs & Chris Waltzek
By: GoldSeek.com Radio

The Metals:

Gold saw a nearly 1% loss at as low as $871.60 in early London trade before it rallied strongly into the New York open and rose to as high as $885.15 by about 9AM EST, but it then fell back off for most of the rest of trade and ended with a gain of just 0.07%.  Silver fell to $15.676 and rose to $16.26 before it also fell back off a bit, but it still ended with a respectable gain of 1.19%.

Euro gold rose to about €602, platinum lost $13 to $1545, palladium lost $2 to $366, and copper rose over 5 cents to about $3.24.

Gold and silver equities rose about 2% at the open and fell roughly 2% midday before they rallied back higher into the close and ended with around 1% gains.

COT Gold, Silver and US Dollar Index Report - January 18, 2008  GoldSeek.com

The Economy:

“The Bush administration proposed a growth package of as much as $150 billion to counter escalating risks to an economic expansion now in its seventh year.”

All of this week’s economic reports:

Next week’s economic highlights include Initial Jobless Claims and Existing Home Sales on Thursday.

The Markets:

Charts Courtesy of http://finance.yahoo.com/

Oil traded mixed before ending higher as worries over economic growth were overcome by short covering heading into the long weekend.

The U.S. dollar index found slight gains on hopes that the recently announced stimulus plan will help ease current credit market problems.

Treasuries fell slightly by the close, but interest rates remain close to 4 and ½ year lows on the outlook for a cut of at least 50 basis points by the fed at their meeting at the end of the month.

The Dow, Nasdaq, and S&P fell on worries about the economy and uncertainty about the exact size and details of the proposed stimulus plan.

Among the big names making news in the market Friday were Johnson Controls, NYSE and Amex, GE, MBIA and Ambac, Sprint Nextel, Schlumberger, and IBM.

The Commentary:

“February Gold finished up 1.2 at 881.7, 7.2 off the high and 5.2 up from the low.

March Silver closed up 0.205 at 16.215. This was 0.125 up from the low and 0.155 off the high.

Gold saw a choppy trade this session as the market tried to weigh clear signs of economic slowing this week against US government efforts to avoid a recession. Early efforts to trade higher were limited by the Leading Indicators report showing a third straight monthly decline which some consider to be a sign of economic recession. Outside market influences were also mostly negative with the Dollar gaining ground and the equity markets turning lower as the Bush stimulus plan failed to inject much confidence the US will be able to avoid a recession. The market also held up relatively well despite some weak physical demand news. However, dips in gold prices also seemed to be attracting buyers on a flight to safety basis tied to increased inflation expectations. Bernanke made it clear this week the Fed stands ready to act aggressively to provide monetary stimulus despite the apparent inflation risks of a weak Dollar and high energy and food prices.

The silver market made an impressive upside probe as market action seemed to be more closely tied to strong gains in the copper market this session while the ebb and flow of the gold market seemed to have less influence. There was a mixed bag of economic news out on Friday as a decline in Leading Indicators points to economic slowing ahead, while an unexpected jump in the U of M consumer confidence reading raised hopes that an economic downturn may be less severe. In fact, it looks like industrial metals were able to garner some optimism regarding the economy from the Bush stimulus plan and expectations for the Fed to aggressively cut rates.”- The Hightower Report, Futures Analysis and Forecasting

GATA Posts:

Telegraph's Jeff Randall: When governments print money, buy gold

The Statistics:

As of close of business: 1/17/2008

Global Gold ETF Holdings

[WGC Sponsored ETF’s]

Note: Change in Total Tonnes from yesterday’s data: StreetTRACKS subtracted 1.22 tonnes.

COMEX Gold Trust (IAU)

Note: No change in Total Tonnes from yesterday’s data.

Silver Trust (SLV)

Note: No change in Total Tonnes from yesterday’s data.

The Stocks:

Midway’s (MDW) permitting, Kinross Gold’s (KGC) production outlook, AngloGold’s (AU) operational guidance, Northgate’s (NXG) approved acquisition of Perseverance, Sterling Mining’s (SRLM.OB) exhibit at the Vancouver Resource Investment Conference, Aquiline’s (AQI.TO) and IMA’s (IMR) extended deadline, and Oro Silver’s (OSR.V) drill results were among the big stories in the gold and silver mining industry making headlines Friday.

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