The US has maladie monétaires, a money sickness, and it may spread to the rest of the world. Unless treated properly it is a sickness unto death. The problem as always is those who carry it and spread the infection, the perversion of public policy and economic thought. Western capitalism is slowly destroying itself. This is my diagnosis, and the outlook is not good.
Gold gained $40 to 1660 and silver was up $1.56 to 40.86 as traders fled out of US equities, selling the news of a faux debt deal, and the prospects of a slumping US economy.
Part of the trigger was the decline in consumer spending, but rest of it was a flight to safety, with money going out of stocks and riskier assets, and into gold, silver, the dollar and Treasury bonds.
I think the short term trend may have reached its nadir today, but we probably will not have any clear indication on this until the Non-Farm Payrolls number comes out on Friday. ADP Jobs tomorrow, but its a flaky indicator.
I expect that gold will undergo a consolidation and correction somewhere between now and 1700, and have indicated some rough parameters on the gold chart. It may not, if the crisis deepens. Silver will remain volatile. The silver futures market is an accident waiting to happen, and a scandal of major proportions, in the process of slowly unfolding.