His influence has had some credibility issues this last year after he experienced massive losses. Still, gold itself wasn’t necessarily one of those assets that did poorly. Even then, he’s not the only billionaire saying to buy gold.

His firm, Paulson & Co, is the largest investor in the SPDR Gold Trust, the largest bullion-backed exchange-traded product. U.S. futures speculators are joining him in investing in the golden metal.

The Paulson & Co. stake in SPDR Gold Trust is valued at $2.9 billion. According to Bloomberg, its investors hold 2,389.719 metric tons of exchange-traded products, which is just 0.2 percent shy of the December record. This figure exceeds the holdings of all but four central banks on the planet. With 12 of the 22 analysts surveyed by Bloomberg expecting gold prices to increase next week, U.S. futures speculators are also becoming quite bullish.

Central banks have also been on board, adding 439.7 tons of bullion to their reserves in 2011, the largest increase in nearly five decades. Yesterday, the World Gold Council reported that the banks may purchase a similar amount this year. Mark O’Byrne is the executive director of GoldCore, Ltd., an Irish brokerage selling gold coins and bars. He stated that the precious metal is a “crucial diversification” based on the current economic risks according to Bloomberg.

On the New York Comex, the precious metal has already increased 11 percent to reach $1,734.60 per ounce. Since mid-January, money managers have increased their price predictions by 57 percent. Data from the Commodity Futures Trading Commission revealed that their net-long position on futures and options recently increased to its highest level since the middle of September.

Central banks are trying to keep interest rates low and are expanding their stimulus measures, while Greece seeks additional aid and ratings of six European countries were recently cut by Moody’s. Gold prices will probably already have increased before the inflation resulting from all of this becomes evident.

According to Bloomberg, this led Mr. Paulson to advise his investors to develop a position in the precious metal now. This, despite the fact that holdings in the SPDR Gold Trust dropped 15 percent during fourth quarter 2011, leading his $23 billion company to experience its worst year.

In New York trading during 2011, the precious metal increased ten percent, marking the 11^th consecutive year of gains. However, during the three months through December, bullion declined 3.4 percent, its first quarterly fall since 2008. The global markets started strong this year, noted Troika Dialog chief strategist Chris Weafer, but there is still an underlying sentiment of fear. Mr. Weafer believes that every asset, the golden metal included, has risk until the euro zone crisis is resolved.

Mr. Weafer is not alone in his wariness. In early February, Berkshire Hathaway Inc. chairman and billionaire Warren Buffett advised investors to avoid this precious metal. In his annual letter to shareholders, he stated that it has limited uses and does not have the potential to create new wealth like companies and farmland do. During fourth quarter 2011, several investment groups sold their shares in the SPDR Gold Trust. At the same time, billionaire George Soros nearly doubled his shares.

According to estimates from the World Gold Council, record investment in the metal increased demand to 4,067.1 tons in 2011, which is the most since 1997. With so many experts divided, 2012 should be an interesting year. Commerzbank AG Frankfurt analyst Daniel Briesemann told Bloomberg that central banks should be a supporting factor for commodity prices as they initiate additional quantitative easing. However, the uncertainty and risk aversion regarding the Greek debt crisis should temper any notable price increases.

Billionaire John Paulson Says “Buy Gold” is a post from Live Gold Prices.

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1. China May Become Largest Gold Market Worldwide This Year

There have been plenty of theories as to why they’re buying gold. Some believe it’s to debase the dollar further. Others believe it’s just for the sake of having some recession or inflation insurance.

As the country develops, incomes are growing and causing demand for investments and jewelry to increase. The World Gold Council believes that India gold demand may not be enough to fend off China this year.

In 2011, Chinese demand for the precious metal was 769.8 metric tons, a 20 percent increase from 2010. At the same time, India experienced a seven percent decrease in consumption that left demand at 933.4 tons. The World Gold Council released these figures today and managing director of investment Marcus Grubb predicted that China would grab the throne as the largest gold market globally this year, a first for the country.

Economic growth within China has increased its consumption of many commodities, from foodstuffs to base metals. The country is the most populated in the world and incomes have been increasing. For 11 years, the golden metal has rallied based on increased purchases from central banks and increasing jewelry and investment demand, most of it stemming from Asia. In addition to being a major consumer of the golden metal, China is also a huge producer.

Chinese citizens have an affinity for luxury items and the precious metal falls into this category. Society Generale SA Commodity Strategist Jeremy Friesen told Bloomberg that there was much “pent-up demand” according to Bloomberg.

Last September, the sovereign debt crisis in Europe pushed the metal to a record high of $1,921.15 per ounce. In Shanghai at 4:13 PM on Thursday, bullion for immediate delivery was trading at $1,718.57 per ounce, which is a 25 percent increase from one year ago.

During fourth quarter 2011, Chinese demand was 190.9 tons, exceeding India gold demand of 173 tons. According to the World Gold Council, Chinese demand for golden jewelry increased each quarter last year and the country represented the largest global market for the precious metal during the second half of 2011. Demand continues to grow as investors look for refuge from inflation exceeding four percent and a restricted environment for property investment.

According to Capital Futures Co. analyst Liu Xu, stock markets have not been impressive. The analyst reported that investors are more interested in preserving value than making profits. To that end, the precious metal has been performing well during the past 11 years.

Imports of the metal from Hong Kong skyrocketed from 119 to 431 tons between 2010 and 2011, reported the governmental Census and Statistics Department. In the meantime, the government has attempted to slow inflation by maintaining its benchmark rate for lending at around a three-year high.

Last year, investors in China purchased 258.9 tons of golden coins and bars, a 38 percent increase from the year earlier. Demand for gold jewelry increased 13 percent, reaching 510.9 tons, according to the report from the World Gold Council. The trend is not predicted to end any time soon. Mr. Friesen reported that there is strong prospective demand from both China and India due to wealth and population growth. He also noted that sales within China could be quite resilient on the consumption end.

The World Gold Council, which is funded by producers, is considered an authority on the precious metal trends. Members of the council represent 60 percent of worldwide output for the metal. Continued population growth, increasing income levels, and high inflation are the magic formula leading Chinese investors to protect their wealth in the golden metal.

China May Become Largest Gold Market Worldwide This Year is a post from Live Gold Prices.

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1. Chinese Gold Demand is Increasing

After working for the Union Bank of Switzerland, Zurich, for several years and serving on the executive board of a medium-sized financial organization for two years, he founded Zulauf Asset Management.

From 1990 to 2001, Mr. Zulauf grew his company, eventually selling it to two staffers-turned-partners in 2001. Acting as an advisor since 2002, he was perfectly positioned for the spring 2009 split of Zulauf Asset Management and now owns Zulauf Asset Management AG.

Mr. Zulauf recently sat down with James J. Puplava, president and chief investment strategist at PFS Group, to talk about the stock market and all things golden…the precious metal, that is.

What Felix Zulauf Believes About the Future of Physical Gold

Mr. Zulauf believes that everyone should own the physical form of this metal. He believes the price of the commodity will increase to two to three times its current level. He is also very clear about the difference between paper and physical forms of the metal. If everyone follows his advice, physical gold demand should increase.

The remainder of the decade should mirror the roller coaster ride that we have experienced over the past two years.

Stimulus generates economic activity, which will eventually wear off and the markets will soften, requiring some form of correction. January has been stronger than expected but late within the first quarter or early in the second quarter, a change should take place. This will result in a correction through the late summer.

Gold is one of the three investments that Mr. Zulauf recommended in a recent Barron’s interview.

This year, gold is up 12 percent, representing its 12th consecutive year of gains. Experts have shown that they have trouble understanding this precious metal. Gold is one of only two markets where the highs are consecutively topped each year.

Looking for an Inflationary Safe Haven

According to Mr. Zulauf, what is going on with this precious metal is different than what is taking place in the bond market. Gold represents one of the few escape from a problematic situation of money printing. The other examples of escapes have, so far, been farmland, commodities, and other hard assets like silver.

As more paper money is created, inflation comes into play. As this currency floods the market, the price of the precious metal expressed in this currency increased. This happens because we are unable to create as much of the metal each year as we can create paper currency.

Therefore, physical gold demand will continue to increase as long as central banks print money at the current rate. Eventually, the balance sheet of these banks will reach GDP levels, which means the price of the metal expressed in those currencies has a long way to go. China and India gold demand are also major factors to focus on, as these developing countries are known for being fond of the precious metal.

Mr. Zulauf qualified this by saying that 2012 may be “tricky” because market changes during the second half of the year could lead to renewed deflationary fears. Therefore, the metal may experience a longer consolidation. He noted that the current rally could merely be an “interlude” within a long-term congestion according to Financial Sense. Mr. Zulauf recommended that everyone own this metal as a long-term investment and anticipated that the net opportunity to buy would occur during the summer.

More investors are realizing that the central banks are cheating them and if they switch a small percent of their savings into this precious metal, this would greatly affect physical gold demand and thus, the price.

Physical Gold Demand is a post from Live Gold Prices.

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Which asset is best depends on which economic event is occurring. Every economic environment is beneficial to some assets and absolutely brutal to others. Let’s focus on the one on many investors’ minds — the best for inflation.

First, it’s important to know which level of inflation we’re talking about, because low inflation, moderate inflation, and hyperinflation all have different responses that can be good calls or horrible calls — it really depends.

For example, if inflation hits a level of 25%+ per year, the political fall out could mean that literally nothing is safe. A scared and frightened government might even try to ban gold like they did back in the 30s.

If we’re talking about 3-5% inflation, a well-balanced portfolio might be perfectly fine. It really depends on the severity of the inflation. I’ll break it down below.

• Low-Inflation Hedges.

Low inflation can usually be countered with long-term bonds and mutual funds that track stock indexes, like the S&P 500. It’s literally that simple. A little inflation is much more managable to a portfolio than a lot of inflation.

Honestly, when inflation is 1-3%, that’s not really much of a worry and any typical portfolio should usually do fine.

• Moderate-Inflation Hedges.

Moderate inflation is typically handled best by a nice well-balanced portfolio with resource stocks, hard assets like gold and silver, and other “real world” assets like land. Real estate is generally seen as a good inflation hedge, though that market has been incredibly bumpy for the last few years — for obvious reasons.

My favorite moderate inflation hedge is gold, hands down. When inflation is 4-15%, these are the best assets to have.

It’s important for me to make a little disclosure — I don’t believe hyperinflation is going to be coming to America soon, unless something huge and political occurs. Moderate inflation or deflation are the big risks. Hyperinflation is a different animal.

You can learn more in my Hyperinflation in America article.

• Hyperinflation Hedges.

Runaway inflation is much more dangerous. Cash can become destroyed after just a few years. Depending on how bad it gets, hyperinflation is likely best handled with pure hard assets within one’s control, if not just for the sake of financial security.

Gold coins, silver coins, scrap copper, coal, farmland — these are examples of hyperinflation-proof assets. My favorite hyperinflation hedge is gold, hands down.

If you want to learn more about gold being a good inflation hedge specifically, check out my article that asks “Is Gold Really a Good Inflation Hedge?”

You also need to likely check out the gold prices and fear article, that explains that gold does NOT react to inflation in the short run — it reacts to inflation fears in the short run.

By the way, if you’d like to learn more about economics and economic liberty, don’t forget I have an entire website dedicated to discussing capitalism. Check out my What is Capitalism? article over at Capitalism Institute.

Best Assets to Own During Inflation is a post from Live Gold Prices.

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1. Is Gold Really a Good Inflation Hedge?
2. After Inflation, is Gold Actually Expensive Right Now?

Americans are expecting some market fallout based on the bailout of Greece, but the impact may be more than many bargained for if things do not go smoothly.

RBC Capital Markets estimated that central banks, asset managers, and sovereign wealth funds held the largest portion of Greek sovereign debt as of October 2011. Commercial banks held 23 percent, while the European Union and International Monetary Fund held 19 percent and the European Central Bank held 13 percent. These Greek creditors will face quite a haircut under the comprehensive plan developed by leaders of the eurozone.

Of the commercial banks holding Greek public sector debt, most of them are domestic. Germany is second, with France and the rest of Europe holding the same amount. Then comes Italy, which is followed by banks located in other parts of the world, and then Spanish banks.

According to Bloomberg in October 2011, Greek debt holdings of North Carolina-based Bank of America Corp totaled 6.89 million euros, which is more than that held by Swedebank AB, was 5.56 million euros as of October.

On the list of top institutions with Greek sovereign debt ownership are U.S.-based BlackRock Fund Advisors and Franklin Advisers, Inc., a division of Franklin Templeton. These are only two of the dozens of institutions that stand to lose tens to hundreds of millions of euros if Greece is unable to repay the debt it has accumulated. Accepting that Greece is insolvent is a bitter pill to swallow. Its debt has become the problem of countries across the globe.

Though the fact that the U.S. holds Greece debt is not pleasant, things look far worse for the French and German banks that have exposure of over five billion euros each. European governments, the ECB, national central banks in the eurozone, and the IMF hold over 50 percent of the public debt. If Greece does not fully repay its accumulated debt, the burden will fall to taxpayers in those areas. The IMF has preferred-creditor status, leaving only national central banks, the ECB, and European taxpayers on the hook.

Much of the talk has surrounded the role of the private sector in restructuring Greece despite private bond holdings representing only a minority of the total Greek debt. Even if no additional Greek bonds are purchased by the ECB, the amount of Greek debt held by the public will increase steadily because privately held bonds will mature. Additional bailout loans must be issued by European governments and the IMF in order for the Greek government to redeem those bonds.

Though the U.S. has not directly participated in discussions regarding the new Greek bailout package, it is keeping a close eye on the developments. The American economy is vulnerable and is affected by events happening across the globe, as was illustrated by the Japanese earthquake last year. The U.S. is interconnected with other countries and global events can bring our already slow economy to a standstill or worse.

It remains unclear whether the austerity measures Greece must take in exchange for this second bailout will be successful. History shows that a rescue package does not always work. In addition, the eurozone countries bailing out Greece will have less money to purchase U.S. goods. If a default occurs, bondholders will also have less money for American purchases and other troubled nations could default, affecting every major economy on the planet.

U.S. Holds Greece Debt is a post from Live Gold Prices.

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1. Why is Greece Affecting Gold Prices?

However, the joy was short-lived, as increasing doubts regarding the bailout deal caused the price of the metal to edge lower on Tuesday. At this point, gold is tracking the weakened euro.

Investors are warily eyeing Greece, wondering whether the country will be convincing enough in its bailout plea. By Wednesday, Greece must convince its international lenders that it will follow the parliament-endorsed austerity and reform measures.

Uncertainty regarding this, coupled with a recent warning from Moody’s regarding ratings of other European nations, caused contagion fears to resurface. Rioters are already demonstrating in downtown Athens.

UBS Wealth Management commodity research head Dominic Schnider reported that the poor track record of the country has led to questions surrounding implementation of the approved measures.

In the meantime, Moody’s warned that the AAA ratings of Austria, Britain, and France might be downgraded. The result was a weakened euro and increase in the dollar index, which made dollar-priced commodities more expensive for foreign investors.

By 07:17 GMT on Tuesday, spot price for the precious metal had decreased 0.4 percent, falling to $1,715.70 per ounce. Gold in the U.S. declined 0.4 percent, settling at $1,718.20. The metal has repeatedly tried, and failed, to break the $1,765 key resistance. This has weakened the near-term technical outlook, while the bullish long-term trend remains. In a research note, Standard Chartered analyst Dan Smith predicted that the spot price would fall.

Wang Tao, a market analyst with Reuters, commented that the 24-hour spot price could drop toward $1,698 per ounce. Dealers reported “lackluster” physical trading in Asia on Tuesday [according to Reuters]. Most participants were awaiting a price break from the current range.

Peter Fung, dealing head with Wing Fung Precious Metals of Hong Kong, reported, “There’s little interest as gold is rangebound between $1,700 and $1,750 [according to Reuters].”

China gold demand continues to increase and the Shanghai Gold Exchange plans to launch gold exchange-traded funds and over the counter trading of the precious metal. Dealers in Hong Kong report that whenever the price dips, Chinese traders make a purchase. Their attitude is not affected by worldwide developments.

Though the market focus is currently on China and India gold demand, demand is present in most Asian nations where investors concerned about local paper money are purchasing the metal as a store of wealth.

Large Asian countries like Indonesia, Malaysia, Vietnam, and Thailand have all caught gold fever. According to experts, keeping a stash of the metal at home rather than holding cash in a bank has long been habit in Vietnam. The recent rush is worrying the Vietnamese government, which is dealing with an unstable national currency and an inflation rate of 18 percent. One ounce of bullion can cost as much as $100 more in Vietnam than anywhere else on the planet.

Golden ETFS are being viewed as an investment opportunity on the Stock Exchange of Thailand (SET). Trading prices for all SET-listed gold exchange-traded funds are aligned with net asset values and prices within the global market. These ETFs were listed on the exchange late in 2011 and domestic investors have found them very attractive. An ETF is considered an innovative way to meet investor demand for trade of the metal. Traded in the Thai currency of baht, there is no currency risk, and investors enjoy returns similar to those realized from trading the physical form of the metal without having to deal with storage issues.

Gold Drops as Greece Riots is a post from Live Gold Prices.

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1. Greece Causes Live Gold Prices to Dip Slightly

This makes copper prices good indicators of the overall health of the global economy.

Global demand for this metal is increasing but surprisingly, most of it is not from the United States or even Europe. It is from emerging economies like China, where living standards are increasing and new infrastructures are being built. When a middle class rises rapidly within an emerging market like this, demand increases drastically.

Within China, up to 25 percent of the population is categorized as middle class and this figure could double during the next ten years.

When people move to a higher class status, they take steps to better their lives. This includes upgrading their housing, which leads to more residential construction. As a result, more plumbing, electrical wiring, and appliances are needed, which requires more copper. China has committed $585 billion to infrastructure projects in the near future.

During the next 20 years, China may account for more than 28 percent of worldwide infrastructure spending. However, it is not the only emerging economy—India is right on its heels and anticipates more than $500 billion in infrastructure spending by 2015.

On the continent of Asia alone and excluding Japan, infrastructure projects may represent $1.4 trillion in spending during the next few years.

Over the past year, copper prices have tended to fluctuate with the Chinese economy. When China attempted to restrict lending by increasing reserve levels for banks, both the real estate and copper markets suffered. Things have since recovered, though China continues to be a major influence on the price of the metal.

Because copper is so heavily tied to demand, many investors are looking to copper for positive gains while China gains as well. Others, pessimistic about China are as equally pessimistic about the copper price in general.

Copper Prices Today is a post from Live Gold Prices.

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However, this doesn’t mean some people haven’t given it a huge attempt — take, fore example, the junior miner Sagebrush Gold.

Even billionaire investor Philip Frost thinks so and he put his money where his mouth is by purchasing a large portion of the company for 50 cents per share.

Whether that’s a good price or not depends on how the risky speculation is pulled off. There’s no telling at all. Sagebrush recently equipped itself to handle its finds by closing on a processing plant valued at $20 million.

Over the weekend and today, investors are likely to receive alerts regarding this opportunity — I’ve probably received 3 already. Sagebrush is considered a long-term play for junior miners and a strong company due to backing from the legendary investor, at least according to those who are fans of buying into junior miners.

Many experts are not only reporting on this opportunity but will be purchasing shares on the open market. Investors should always conduct their own research before making a purchase but this should be an easy task because plenty of information will be available.

Billionaires and the Price of Gold

The billionaire stampede toward the precious metal began last spring and summer. These are among the investors who have lost faith in the dollar and other major currencies. As a result, they are moving to real assets like gold. According to billionaire investor Jim Rodgers, everyone will own this metal by the end of the decade.

Along with Rodgers, billionaires Warren Buffett, George Soros, John Paulson, and David Einhorn have invested in this precious metal, positioning the price to reach much higher prices than it currently is at. To see more of what Rogers has said, read this article on gold, land, and silver according to him.

Prices of this precious metal have reached record levels and are expected to continue their climb. When consumers lack confidence, they turn to commodities, with precious metals being a favorite. The dollar and major currencies are still declining, while China and India gold demand is surging as these countries become new global economic powers.

It’s Harder to Find Gold to Mine

Though demand is increasing, supply of the precious metal is not. It is becoming more difficult to find mineable golden metal, which puts miners like Sagebrush in an excellent position. Over the next three years, price of the precious metal is expected to soar, according to Merrill Lynch and other analysts.

As the supply-demand gap widens, sales of scrap versions and supplies held by central banks will not meet this demand, at least not while they are still in buying mode. This leads many to wonder where the needed supply will be found. Of course, nothing is certain.

The “Golden Triangle” located in Arizona, Eastern California, and Nevada is one source. The Sagebrush Gold Relief Canyon mine project is located in northwestern Nevada. This company already controls one of the largest claims in the Greater Cortez District of the Battle Mountain area of Nevada. It’s been speculated that as much as $52 billion worth of the precious metal is located near Battle Mountain. Also located here are multi-billion dollar miners like Newmont Mining and Coeur d’Alene Mines.

More than 80 percent of U.S. gold has been produced in the Golden Triangle. The highest concentration is found in the Walker Lane Gold Belt. As far back as 1859, people became millionaires from the over $1 billion ore discoveries in the Comstock Lode located there. Even more exciting than this is the amount of the precious metal that has yet to be discovered. According to the U.S. Geological Survey, approximately 40 percent of the precious metals deposits in the U.S. are yet to be discovered.

Billionaires are some of the investors participating in this renewed rush. By investing early in exploration companies, these already wealthy individuals have earned returns of 150 to 220 percent. They have invested in ETFs, miner ETFs, and companies like Barrick, Newmont, Anglogold Ashanti, and NovaGold. These investors know that historically the best place to find the precious metal is within the Golden Triangle. They are betting a portion of their fortune that this happens.

In the interest of full disclosure, I don’t own any junior miners myself — I stick to boring stocks or the Permanent Portfolio Fund when buying stocks and funds. For gold, I like physical stuff.  But that’s just me.

Billionaires Buying Gold is a post from Live Gold Prices.

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So why is the Greece crisis making gold prices take a dive every few days? Is there any end in site? Does this mean you should buy, wait, or sell?

To answer these questions, we first need to be able to understand what’s causing the Greek crisis, what that is doing to the economy, and why gold prices are reacting negatively to that entire situation.

To summarize, the Greek crisis threatens the European economy which makes the markets drop in price, and that impacts gold because gold reacts to fears of recession.

That’s the extremely shortened answer to the question. But let’s answer it in more detail, because there are principles here that will let us understand the US economy better as well.

What’s Causing the Greek Crisis

The Greek crisis is essentially caused by the Greek government running out of money. It’s literally that simple. Their taxes were hit during the recession, and they have incredible amounts of spending.

Greece spends huge amounts of money on welfare programs that are usually just bad for the economy — but right now, they’re just deadly. They can’t handle the recession.

Unlike other countries that have control over their currency, Greece is in the Eurozone. This means that the European Central Bank — which is the bank for the 17 Eurozone member countries — controls their currency. This is bad for Greece because — unlike the US and other countries that have their own currency — they can’t create a little inflation to pay for stuff later.

Inflation is bad, but it’s even worse when your government doesn’t have inflation and is so stupid that it spends money like it does. That’s what Greece is doing. Greece is the epitome of economic and financial insanity. They’ve come a long ways since Aristotle.

Why the Greek Crisis Hurts Markets

The Greek crisis is hurting markets because they’re part of Europe — an important part — and many other national economies are tied directly to their economy. After all, if the entire East Coast went bankrupt and spending was drastically cut, the entire US would be thrown into recession — and the stock market of the US and the world would follow.

The markets would follow because if they economy is doing poorly, that means businesses and bonds are suddenly more risky with a little less profit being likely — they’re not worth as much as they were when the economy was doing great.

That’s why prices begin to drop and reflect the loss of income and increase in instability.

Why Gold Prices Are Reacting

Gold is a long-term safe haven. Gold is not a short-term safe haven. I can’t stress this enough. This means that gold could drop or go up in price in the short run… but over the very long run, it’ll likely stay flat or go up a little per year.

It’s been this way since the beginning. If you look at pretty much any gold price chart of the historical price of gold, you’ll see that this is true. Over a long enough period, gold does fine. But in the short run, it’s extremely volatile. This is why long-term gold investing is the best strategy, especially for non-economists or non-day traders.

What This Means for Us

As explained above, gold prices in the short run are volatile. That’s why you should adapt a long-term investing strategy. The best strategy for most people is the fail-proof portfolio that I discuss here.

Of course, it really depends on your understanding of the markets and whether you think you can succusfully navigate the economic news. Most people can’t, of course.

Soon, I’ll be discussing why Greece is different than the US. Our spending problems will have different problems in the future, because we have something Greece doesn’t have — the printing press. And that’s more than a little scary.

Why is Greece Affecting Gold Prices? is a post from Live Gold Prices.

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1. U.S. Holds Greece Debt

At 3:04 PM in Singapore, the spot price had changed little, resting at $1,730.93 per ounce. After the metal gained 0.3 percent earlier, it was poised for a weekly advance.

Bloomberg data also revealed that gold in exchange-traded products was just 0.2 percent under the December 13 record.

Everbright Futures Co. research head Ye Yanwu commented to Bloomberg that investors seeking a safety net were continuing to supplement their portfolios with gold. He expected more buyers to enter when the price fell. He also noted that general market sentiment will be driven by the problems in Europe, which will get better and worse.

Fitch Ratings reported that without the bailout, the country could default. Evangelos Venizelos likened the upcoming parliamentary vote to a ballot regarding euro membership. So far this year, gold has rallied an impressive 11 percent, while the dollar fell 1.8 percent against a basket of six currencies including the euro.

On the New York Comex, bullion for April delivery declined by 0.5 percent and the initial margin on futures was lowered by CME Group Inc. The new margin of $10,125 per contract will take effect on February 13 after close of business.

Despite this, the largest gold miner in Australia, Newcrest Mining Ltd., predicts “strong” prices for the precious metal. For the next two to three years, it expects the metal to trade between $1,500 and $2,500 per ounce.

Newcrest itself is in a great position, reporting record profit for the six months ending December 31, according to company CEO Greg Robinson.

That was the situation very early this morning but by 5 AM, things had changed. The Standard & Poors GCSI 24-commodity gauge dropped 0.5 percent at 6:05 PM in Singapore. Gold for immediate delivery declined to $1,720.13 per ounce, a 0.5 percent drop, by 9:09 AM London time. The price is down 0.4 percent of the week.

On the New York Comex, the metal for April delivery declined 1.1 percent to $1,722.10. Silver followed suit, with silver for immediate delivery dropping 0.7 percent. However, silver is still the best-performer of all precious metals this year.

Everything seems to be up in arms due to Greece. Just one day ago, the euro climbed after political leaders in Greece announced they had come to an agreement regarding the bailout austerity measures. It reached a two-month high against the yen and the dollar following announcement by European Central Bank President Mario Draghi that collateral requirements for the upcoming three-year loan auction would be lowered.

By 5 PM New York time on February 9, the euro climbed 0.2 percent to reach $1.3286. After it reached 103.29 yen, it rested at 103.19 yen. The yen declined 0.8 percent against the dollar, settling at 77.67 per dollar. Central banks are holding their breath to see what happens following the latest announcement regarding the Greek bailout.

Though the discussions regarding Greece successfully concluded, the responsibility rests on the Greek government to prove that the second bailout will work. Legislative and other actions will be necessary to convince European partners that this go-round will have a different outcome.

GFT Forex Director of Currency Research Kathy Lien told Bloomberg that investors are hesitant to aggressively purchase euros prior to the Greek parliamentary vote and several other intermediary events. By expanding collateral, the European Central Bank is acquiring riskier assets, which Ms. Lien said is definitely not a positive thing.

What’s Happening to Gold is a post from Live Gold Prices.

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