Gold And Silver on Jobs

It is entirely likely that gold and silver should not be enjoying the surge in price
that they currently are, however, the indication and sentiment aroused by the recent US
economic jobless report is a very strong driver for the precious metals market now.

According to the Bureau of Labor Statistics, 69,000 jobs were added to the
economy in the month of May. Most recently, the February jobless report, which added
200,000 jobs to the United States employer payrolls, created a great deal of optimism
concerning the direction of the United States economy.

This optimism was enough to inspire investors to pull money from the safer
assets, such as gold and silver, and pursue positions in riskier instruments and riskier
markets. Of course, they jumped the gun and are probably now regretting those positions
if they haven’t already unwound.

This does give some indication what the current jobs report should mean to
any investor looking at the United States economy and trying to untangle the strands.
Unemployment is now officially at 8.2%, per the figures that were provided with this jobs
report. While slightly less than we have endured in recent years, it is still disconcerting
for investors, particularly in a major election-year just ahead of the political cycle.

Aside from political posturing, there is every reason to take the current jobs report
as a very accurate indicator for the health of the US on economy in the months to come
and provide the impetus for a move towards safe haven asset purchase on par with the
beginnings of what we saw two years ago and the emergence of the Greek sovereign debt
crisis. Back then, nobody knew how the Eurozone would react to the crisis or whether
Germany or any other country in the European Union would come to the aid of Greece
and that cause the kind of fear that brought about record prices in gold and silver.

We aren’t there yet for demand in gold and silver, but the current market activity
is most definitely a very strong indicator that investors are again going back to gold and
silver for its safe haven asset status in an otherwise questionable if not very risky market.

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