Syrian Humanitarian Crisis – As Food, Fuel Prices Soar al-Assad Desperately Attempts To Get Gold
Today's AM fix was USD 1,614.50, EUR 1,305.60, and GBP 1,028.34 per ounce.
Yesterday’s AM fix was USD 1,622.25, EUR 1,317.30 and GBP 1,035.33 per ounce.
Silver is trading at $27.91/oz, €22.70/oz and £17.86/oz. Platinum is trading at $1,408.75/oz, palladium at $575.60/oz and rhodium at $1,060/oz.
Gold fell $12.10 or 0.75% in yesterday in New York and closed at $1,608.30/oz. Silver fell to a low of $27.73 and finished with a loss of 1.28%.
Gold began to recover losses from yesterday and is being supported by concerns of another global economic downturn, potentially a sharp one. Central banks in the US, Europe and China look set to unleash further ultra loose monetary policies in order to prevent recessions or a Depression.
Germany and France both came out with very weak but slightly better than expected economic growth data which helped alleviate concerns about the eurozone debt crisis - temporarily.
We covered the Bloomberg report yesterday from SANA, Syrian state TV, that Syrian President Bashar Al-Assad announced measures facilitating imports of gold bullion coins and bars.
On Sunday, al-Assad issued Legislative Decree No. 53 "on exempting crude gold imports from the importation fees and the domestic costs according to the Law No. 35 for the year 2007".
All custom duties and storage, insurance and administrative costs levied on gold imports will be replaced by a single fee of $100 per one kilogram, SANA said citing the presidential decree.
Gold bullion imports no longer require a special permit and travellers are allowed to bring gold bullion coins and bars with them into the country, the decree said.
The move is a sign of desperation due to the immense economic difficulties facing Syria as its economy is being suffocated through economic sanctions and the civil war.
The western economic and currency war has crippled Syria and the move is a desperate one by the regime to try to get much needed hard currency into Syria.
“Syria’s currency and foreign reserves have collapsed,” U.S. Secretary of State Hillary Clinton said in July, urging a further tightening of the financial vice. “Sanctions on oil alone have deprived Assad of billions of dollars in lost revenues, and his ability to finance his war grows more difficult by the day.”
The European Union began imposing sanctions in May 2011 on top of U.S. restrictions that date to 2004.
The Syrian pound has indeed fallen sharply in recent months from below 48 to the US dollar to 65.4 today or a loss of over 36% in the last 12 months (see chart).
As is being seen in Iran, the banking sector in Syria has largely been cut off from the global financial system by western sanctions.
Like Syria’s economy as a whole, its banking industry is severely damaged and some parts of it are close to stopping functioning.
Now that rebels have carried Syria’s civil war from remote villages to the capital and the commercial hub, a banking system that survived nearly 18 months of unrest faces its biggest test.
In most of the country, banks have barely managed to stay open but the spread of major fighting to Damascus last month, and now to Aleppo, Syria’s biggest city and top commercial centre, marks a new, more destructive period for the economy, putting banks under fresh pressure.
As was seen in Iraq, it is the people who suffer most from sanctions and economic and civil war and the Syrian people are indeed facing increasing hardships.
Hunger is a problem that is growing more acute by the day. As the prices of what little food is available soar, there are increasing signs of desperation among parents seeking to feed families.
Prices of fuel and medicine have also soared amid shortages compounding the misery of Syrians and leading to another humanitarian crisis.
Professor Nouriel Roubini and other financial experts have pointed out that “you cannot eat gold.”
However, people in nations suffering from currency and economic wars can testify as to how they can use gold in order to buy food, fuel and medicine for their families in difficult times.
Gold is, as it has done throughout history, protecting them and their families from the ravages of currency devaluation and economic collapse.
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(Bloomberg) -- UBS Says Silver Will Average $31.60 an Ounce This Year
Silver will average $31.60 an ounce this year, platinum will average $1,565 an ounce and palladium will average $670 an ounce, UBS AG said in a report e-mailed today.
The bank had revised forecasts last month, it said.
(Bloomberg) -- UBS Says Commodity Favorites Are Gold, Corn, Soybeans
UBS AG said its favored commodities are gold and those affected by supply disruptions, such as corn and soybeans because of drought.
It also prefers raw materials that are least exposed to China’s “underperforming fixed capital formation,” such as fertilizers, UBS said in a report dated today. Those that face deteriorating demand and few prospects of production cuts include nickel and aluminum, it said.
(Bloomberg) -- UBS Sees Central Bank Gold Purchases at 350 Tons This Year
Central bank gold purchases will total 350 metric tons this year, UBS AG wrote in a report e- mailed today.
The metal will average $1,680 an ounce this year, it said. Gold traded at $1,615.95 by 8:32 a.m. in London today.
(Bloomberg) -- Omega Advisors Sells Entire Stake in SPDR Gold in Second Quarter
Omega Advisors Inc. sold its entire stake in SPDR Gold Trust during the second quarter, a filing with the U.S. Securities and Exchange Commission showed.
Omega held 519,100 shares as of March 31, the filing showed. SPDR is the biggest exchange-traded product backed by gold.
Johannesburg (AP) -- URGENT: Violence At South Africa Mine Kills 9
Officials say ongoing violence at a platinum mine in South Africa has killed at least nine people. The violence is happening at a Lonmin PLC mine near Marikana, a town about 70 kilometers (40 miles) northwest of Johannesburg. In a statement Monday, Lonmin said at least four of the mine's workers have been killed in ongoing attacks. That includes two security guards who died Sunday when their car was set ablaze by angry miners.
Police Brig. Lindela Mashigo said two officers and three others were killed in more violent protests Monday.
Lonmin said the violence started when workers walked off the job Friday over pay, and it has escalated between two rival mining unions.
Lonmin is the world's third largest platinum producer. South Africa is one of the world's coal, platinum and gold- producing giants.
(Bloomberg) -- Lonmin Says Policemen Killed in Clashes, Raising Death Toll to 7
Lonmin Plc said two policemen and a suspect were killed in a violent clash at its Karee mine hostel in South Africa today, raising to seven the number of people killed in suspected union rivalry.
Barnard Mokwena, Johannesburg-based Lonmin’s executive vice president of human capital, commented by mobile phone today.
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