Record Amount of U.S. Debt Ever Sold in One Week

Gold
Gold closed trading at $1,037.20/oz yesterday. In euro and GBP terms gold is trading at €700/oz and £634/oz. Gold’s short term frothiness after sharp gains has led to profit taking and an expected correction back down to previous resistance at the $1,030/oz level.

Concerns regarding the sustainability of the recent recovery are increasing after yesterday’s poor consumer confidence number (and last week’s poor jobs and housing data). Concerns about the health of the US consumer and wider US economy are likely to lead to the dollar remaining under pressure in the medium and long term which bodes well for gold. As does the fact that there is a growing realisation that governments cannot print money forever. At some stage in the coming months, the extraordinary stimulus and debt monetization seen internationally will have to end and this may derail the fragile global economic recovery.

This week’s record issuance of US Treasuries (the greatest amount of debt ever sold in one week) will test international appetite for US debt. The net debt increase of $153 billion is so high it will exceed the current authorized federal debt limit of $12.1 trillion (upcoming vote to raise the federal debt ceiling to $13 trillion and this does not include the US’s massive unfunded liabilities of Medicare and Social Security). Support for gold will come from continuingly high oil prices and the dollar remaining under pressure and support is currently seen at $1,027.70/oz and resistance at $1,050.50/oz.

Silver
Silver is trading at $17.08/oz. In euro and GBP terms silver is trading at €11.23/oz and £10.17/oz.

Platinum Group Metals
Platinum is trading at $1,317/oz while rhodium and palladium are trading at $1,800/oz and $325/oz respectively.

Disclosure: no positions

Comments

[ManAboutDallas:]

This plateful of toxic waste is the only reason for the US$ rally going on at the moment. When these fools come to their senses and realise they've just bought Used Charmin, the $ resumes its freefall.

Oct 28 04:47 PM

[The Geoffster:]

48% of Federal Income Tax filers pay no income tax. Many earners don't even bother to file their returns which means a majority of earners pay no federal income tax. This trend will only continue as Congress finds new ways to give away borrowed money in the vain hope that it will stimulate the economy and get them reelected. Sooner or later the treasury market will recoil and the day of reckoning will be upon us. 2012?

Oct 28 07:05 PM

[Spike7878:]

I am new at this and I get so confused. One article says GLD is good, the other says its just paper and its no good. I guess if you have an IRA, there is no other choice. Now I am reading if they raise intrest rates Gold will take a Dive.

I have one IRA that I told them to take the money out of stocks and Park it. Just found out they have been charging Fee's and Chewing my balance up. What a Scam !!!

Seems like there is No Way Out

Oct 28 08:21 PM

[obuzzardo:]

What drivel.

“the extraordinary stimulus and debt monetization seen internationally will have to end and this may derail the fragile global economic recovery” ?

Huh?
There is NO RECOVERY.

All these genius criminals have done is disable the patient’s monitoring equipment and alarm, then pump the lifeless body with blood. We are encouraged to get excited because the skin is less pale. They DARE NOT stop or else the stink will rise and implicate their own criminal complicity in this whole systemic mess.

“test international appetite for US debt” ?

There is NO APPETITE!
And very little money now relative to the size of these “auctions.”
We are buying our own debt now in a shell game financed with the printing press.

The politicians in power and their keepers can only hang on as long as you believe their lies.

Oct 28 11:44 PM

[Gtarras:]

you owe me 5 mins of my life wasted on the article which implied it will cover treasury issuance and instead used just one more opportunity to prop up gold. gold bugs are most annoying creatures ever. and not very smart and/or convincing at all. where are SA editors?

Oct 29 12:28 AM

[Mark123:]

Whats the point of having a debt ceiling if Congress raises the ceiling every time we hit it???

Oct 29 11:17 AM