The Gold price started December strong on  positive manufacturing news from China, regaining some of the footing lost in November. The data from a private manufacturing purchasing-managers index came in slightly stronger than anticipated. In addition, the Gold price could stabilize after last week’s sell off. A strategist at Credit Suisse wrote in a research note that the sell off “appears absorbed and we think prices should now stabilize before a modest recovery could take place towards the end of the year. The seasonal weakness of the U.S. dollar in December should also help.”

Closer to home, the fiscal cliff is being set up as a holiday showdown between the two government powers. Last week saw both the president and the Republican leadership sparring with words over the spending cuts and tax increases due to be implemented early in 2013.  The past three Christmas seasons showed us similar eleventh-hour developments  that ended up being resolved: 2009 health care, 2010 tax cut, and 2011 payroll tax holiday. Maybe we are getting used to this type of last minute resolution.

At 9 a.m. (EST), the APMEX Precious Metals spot prices were:

• Gold, $1,718.10, Up $5.40.
• Silver, $33.68, Up $0.42.

Home prices rose in September, sending a signal that the housing market is showing signs of a recovery.The S& P/Case-Shiller home-price index was released this week, showing that “prices gained 3 percent over the past 12 months.”

The Gold price has held mostly steady Friday with a recent dip as U.S. trading began. The Gold price is set to gain overall for the month of November. Trading has been volatile as the asset seems to be tied to the fate of the fiscal cliff. Right now, Gold is trending with equities.  Simon Weeks, head of Precious Metals at Scotia Mocatta, said that if a breakthrough in the fiscal cliff talks came, the trend would likely continue and the Gold price would likely follow any bounce in those assets. “The knee jerk reaction will be for Gold to follow other markets up or down, and after its initial reaction, it will tend to decouple,” he said.

At 2:30 p.m. (EST), the APMEX Precious Metals spot prices were:

• Gold, $1,712.80, Down $16.70.
• Silver, $33.34, Down $1.08.

Gold is looking to end the month of November on the positive side today. Analysts at Commerzbank said that  one bullish sign for Gold’s price  is the number of investors interested in not only physical metals, but exchange-traded funds (ETF) as well.  “ETF investors … are proof that Gold remains in high demand as a store of value and a safe haven despite all the price fluctuations.  We are confident that the Gold price will continue to climb in 2013,” analysts said in a note.

The European Central Bank (ECB) and the International Monetary Fund (IMF)  continue to push for reform in the eurozone.  ECB chief Mario Draghi said, “We have not yet emerged from the crisis.  The recovery for most of the eurozone will certainly begin in the second half of 2013.”  The comments from Draghi come after 173,000 people joined the already-large number of unemployed workers in the region.  Spain, the eurozone’s third-largest economy, continues to be one area of concern, but until the country formally requests aid, the ECB is not allowed to intervene.

At 9 a.m. (EST), the APMEX Precious Metals spot prices were:

• Gold, $1,725.00, Down $4.50.
• Silver, $34.14, Down $0.28.

Gold is slowly recovering today after yesterday's profit taking  took the metal’s price down. The price of Gold has increased more than 10 percent for the year so far as investors have flocked to the yellow metal as a safe haven. Jeff Kilburg, CEO of Killir Kapital Management believes the Federal Reserve is adding value to Gold as they continue to print money. Kilburg said, “The theoretical value of Gold when you see that the monetary base grow by another 18.4 percent, $735 billion, it puts Gold at $2,000.”

The Bank of England announced today that British banks may not have sufficient funds to protect themselves against financial market mishaps. Next year the BoE’s Financial Policy Committee will have power over British bank regulation and have already encouraged the present regulator to re-evaluate the banks’ capital to accurately represent the risk of bad loans and examine fines for misconduct. “Progress by banks in raising capital has slowed and investor confidence remains low. … The Financial Services Authority should ensure that firms either raise capital or take steps to restructure their business and balance sheets in ways that do not hinder lending to the real economy,” the BoE said in its half-yearly Financial Stability Report.

At 5:15 p.m. (EST), the APMEX Precious Metals spot prices were:

• Gold, $1,727.70, Up $8.90.
• Silver, $34.31, Up $0.56.

Optimism from yesterday is pointing to a positive start to the markets today.  The Dow reversed a greater than 100 point opening deficit yesterday  after comments from both political parties alluded to a resolution of the budget crisis by Christmas. According to the most  recent Bloomberg Global Poll of Investors, there is sentiment that the U.S. will in fact avoid a head long dive off the fiscal cliff. When investors were asked which markets had the best opportunities for 2013, the U.S. was picked at the top, which has happened for eight straight quarters of this poll.

The Gold price also saw a sharp correction yesterday as it rode the rollercoaster ride of the fiscal cliff talks.  Ross Norman, CEO of Sharps Pixley, said,  “Gold is being pulled higher on this prevailing optimism over the fiscal cliff.” He goes on to say, “One would expect good news on the fiscal cliff to be Gold-negative, but now Gold is acting as a risk asset like shares.”

At 9 a.m. (EST), the APMEX Precious Metals spot prices were:

• Gold, $1,725.40, Up $6.70.
• Silver, $33.91, Up own $0.15.

The Gold price fell today in sharp contrast to the Dow Jones Industrial Average and S& P 500. After reassuring comments today on the part of President Obama and Speaker of the House John Boehner, the  stock market spiked more than 100 points. A hard line approach appears to be under way in Washington as President Obama indicated he would like  a solution to the fiscal cliff sooner than later. “The president set a timetable, that he'd like to get this done by Christmas, as opposed to drawing it out to Dec. 31, and I do think the markets are encouraged that there is an aggressive, let's get it done, attitude,” said Jim Russell, chief equity strategist and regional investment director, wealth management, at U.S. Bank.

As stocks rallied, Gold suffered its largest single day plunge in almost a month. Fiscal cliff concerns and ongoing worry over Greek debt initiated a hefty round of stop-loss orders at today’s open in which  2 million ounces of Gold futures exchanged hands in less than five minutes. Experts still assert that Gold still promises upward movement as a long term investment. According to Richard Hastings, macro strategist at Global Hunter Securities, “[G]old will come right back after other assets take a beating.” The fiscal cliff countdown continues with 33 days left on the clock to see if politicians can find a strategy to sidestep the $600 billion in tax hikes and spending cuts set to take place at the end of the year.

At 5 p.m. (EDT), the APMEX Precious Metals spot prices were:

• Gold, $1721.30, Down $23.00.
• Silver, $33.82, Down $0.24.

GOLD HITS A TWO-WEEK LOW, U.S. FEDERAL RESERVE PROCEDURE REVIEW 

Gold and other precious metals prices are seeing a significant dip in price today. The price of gold has fallen two percent today, which is the largest drop in three weeks. The gold price dropped twenty dollars in a five minute span this morning due to a large sell-off of the precious metal.  Over two million ounces of gold futures were traded in that short time frame.  " Clearly if a trader was looking to take profit on his positions then one would finesse metal into the market slowly - so not profit-taking going on here. More likely this could be a short play, with the seller looking to trigger stops below the market and thus extend the move lower significantly. If so, he certainly caught the market on the hop as the move is counter-intuitive with everything else that is going on in the economy." Sharps Pixley chief executive Ross Norman said.

Earlier in the week the European finance ministers agreed on a plan to help debt ridden Greece work towards financial stability. While the main point of the plan was to push back the deadline of reaching the country’s financial goals.  Another point that has not gotten as much press is the talk of simply forgiving some of Greece’s debt completely.  German Finance Minister Wolfgang Schaeuble hinted at the idea in a news conference yesterday. When Greece has achieved, or is set to achieve, a primary surplus and fulfilled all of its conditions, we will, if need be, consider further measures for the reduction of the total debt," he said.

In the United States the Federal Reserve has continued to keep their financial easing program in place indefinitely. The main key to the easing program is the level of interest being charged on loans. It has been kept around zero percent and there has been no indication of when that will change. Charles Evans, president of the Chicago Fed gave his opinion this week. He believes the interest rate should remain low until the U.S. unemployment rate improves.  It is unusual for any member of the Fed to give specifics on guidelines for policy changes.  However, the idea of doing so is gaining support. Janet Yellen, second in command to Chairman Ben Bernanke on the Federal Reserve Board recently said, " I support this approach because it would enable the public to immediately adjust its expectations concerning the timing of liftoff in response to new information affecting the economic outlook." While now this is just opinion, time will tell if this could lead to new procedures at the Fed.

At 1:00 pm (EDT), the APMEX precious metals spot prices were:

• Gold, $1722.40, Down $21.90.
• Silver, $33.81, Down $0.26.

Precious Metals prices and stock futures are lower this morning after  statements made yesterday by Senate Majority Leader Harry Reid. Reid said that Republicans and Democrats of Congress are still far apart in agreeing on proper way to avoid the fiscal cliff. Stephen Pope of Spotlight Ideas said, “I can’t believe anyone really believes that in the first serious get-together post-election, anyone will walk out and say, ‘You know what guys, we agree on everything.’ I think … you’re going to see, going forward from here, a repetition of yesterday, with people making grandstanding statements – a bit like how it’s gone in Europe – and trying to flex their muscles.”

With the end of the year just around the corner, many eyes are on Italy as the  next country in the eurozone that will need a bailout. Italy is the eurozone’s fourth-largest economy, and with Spain also in a constant state of will-they-or-won’t-they in regards to requesting a bailout, the problems only continue in the region. Citi Analyst Giada Giani said, “Italian economic fundamentals have not really improved, despite some improvement in market conditions. The negative feedbacks from fiscal austerity on growth have been severe.”

At 9 a.m. (EST), the APMEX Precious Metals spot prices were:

• Gold, $1,716.50, Down $27.80.
• Silver, $33.44, Down $0.62.

The Gold market has stayed mostly level for the day, ending a bit lower than Monday’s close. One of the main reasons for the decrease has been a rebound in the value of the United States dollar. October’s demand for products such as machinery and electronics went up the most in five months.Another reason is a lower than expected demand from India. India has been the leading in Gold buying, and when their demand goes down, the market feels the affects.

In the United Kingdom, the economy has experienced the same issues that plague the rest of the global economies. The U.K. has a growing budget deficit and slower than anticipated growth. Next week the countries finance minister will give his annual Autumn Statement to show the path which they will follow to progress through the economic turmoil.  If a solid plan is not given, there is a strong possibility that England could lose their triple-A credit rating. “The U.K. can only be given the benefit of the doubt for so long. The ratings agencies want to see debt metrics stabilize in the medium term. If fiscal pain is kicked too far 
down the road, a downgrade is inevitable,” HSBC’s chief U.K. economist Simon Wells said in a research note.

In the United States, all eyes are fixed on the capitol and the outlook of avoiding the fiscal cliff. News of both sides softening their stance on certain issues has brought hope to the crisis, however, both sides are reportedly far away from a deal.  The largest issue seems to be taxes, or lack thereof. “There remains no clarity on the ultimate status on the Bush tax cuts, which have to be resolved before you can move forward with the remainder of the fiscal cliff,” Chris Krueger, an analyst at Guggenheim Securities’ Washington Research Group, said.

At 5 p.m. (EST), the APMEX Precious Metals spot prices were:

• Gold, $1743.90, Down $7.70.
• Silver, $34.10, Down $0.11.