Video: West Red Lake Gold works to restart Madsen mine
The company is optimistic about the potential of its Red Lake assets in the storied gold district of northern Ontario.
This week has continued where last week left off. After the finance ministers from the European Union announced they had in conjunction with the (IMF) International Monetary Fund had approved a bail-out package in excess 45 billion Euro’s to aid Greece’s debt crisis the general feeling amongst investors was one of relief.
Most traders and investors globally certainly realized the Euro states still had more hurdles ahead considering Portugal, Italy, Ireland, and Spain were all thought to be seeking aid in addition to Greece. However, Greece was the largest debtor nation in the European Union and many regarded the bail-out as a vote of confidence in the Euro states and the Euro Dollar. Once again the news from the EU is difficult to decipher. Billionaire Investor George Soros was quoted as saying “Greece still faces the danger of a “death spiral” because the cost of borrowing in the Euro region is too expensive”.
Economic data released this were mixed this week. There were better than expected corporate earnings and U.S Retail sales that helped sustain the recent precious metals rally. However, the U.S Department of Labor released data stating that the number of Americans filing claims for first time jobless benefits INCREASED 24,000 last week. This brings the total to 484,000 for the week ending April 10. This jobless news was followed with data supplied by Realty Trac Inc.’s report stating Foreclosure filings in the U.S. rose 16% in the first quarter from a year earlier and bank seizures hit a record as lenders enforced action against delinquent homeowners.
The prediction is for more than one million seizures this year! One out f 138 households received a default or action notice, or were repossessed by lenders. Also this week we learned that Federal Reserve Chairman Ben Bernanke has pledged to keep the main interest rate LOW for an “extended period” contingent on high unemployment and low inflation. Mr. Bernanke also stated” the U.S. expansion will remain moderate as the economy contends with weak construction spending and high unemployment”.
Despite the global recession, China’s gold and jewelry consumption still maintained a 10m percent increase last year. China’s leading jewelry department store “CAIBI”has increased 60% year on year. It is projected gold and jewelry exceed $58 billion annually by the year 2020. There is an expectation that the Chinese will raise rates again. China’s GDP rose 11.9% in the first quarter from a year earlier This week the buying of bullion from the jewelers of India has been sluggish due to the recent escalation of prices.
As of this posting we are trading over $1160 per ounce in gold and over $18 an ounce in silver. The Indian jewelers were Responsible (in my opinion) for single handedly supporting the Gold market the first 3 months of the year. They were buying almost every price dip in attempt to purchase gold at “bargain prices” in order to stock up for insatiable demand for their April-May wedding season as well as their upcoming “Akshaya Tritya festival falling on May16th . this a Hindu Holy Day in which the giving of Gold and Silver as gifts can be exhaustible jewelers have been known to actually run out of stock. The jewelers thus far have been showing great patience in hopes off a price drop. However, the demand is there and they’ll have to pay up if the market does not fall.
Let’s Talk Gold………….
Mike Daly / Gold Specialist
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