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Gold & Silver Investing Demand Lower Leading Up to Holidays

Demand for physical gold and silver investments has been markedly lower in recent weeks, with many analysts attributing the decrease in demand to a combination of the upcoming holiday season and tight finances. As of 6pm EST the gold spot price was down $1.80 to $1272.80 while silver had lost $0.02 and was trading in the $20.70-$20.75 range.

The U.S. government, despite numerous attempts to convince the American public that an economic recovery is really happening, has been largely unable to successfully push that agenda. Unemployment is about 7% and by some estimates real unemployment is as high as 12%. The official inflation rate is around 2% but when food and fuel cost increases are tallied the real inflation rate is about 10.75%.

The cost of living is steadily rising but wages are not rising in step, with many critics claiming that most of the new jobs created by the current administration are minimum-wage positions, part-time positions or, in some cases, both. Add to this the fact that gold and silver bullion output has been higher than expected and it is no real surprise that November gold and silver demand has been lackluster and projections are for the lack of demand to continue until after the New Year.

Investors with sufficient savings and no issues with holiday shopping budgets stand to gain the most from the current gold and silver investing climate, as low demand and a lack of qualified buyers in the gold and silver markets have forced prices downward, creating a market that bargain-hunters love. September-January are traditionally favorable months for the two metals, so don’t count them out just yet but as it stands it looks like it could be a slow fourth quarter for gold and silver prices, unless institutional and/or mom-and-pop investors decide to take advantage of gold and silver prices that are presently under their target ranges of $1300 and $22, respectively.

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