Platinum Price May Outperform Gold and Silver As Strike In South Africa IntensifiesWe are seeing some healthy profit taking in precious metals after making an explosive breakout over the summer. Investment demand after QE3 is increasing as investors seek alternatives to fiat currencies which are being devalued by Central Banks all over the world. We may see consolidation and volatility in the markets until after the U.S. Presidential Election, when most investors realize that not much will change. All over the world governments are looking to boost unhealthy economies and this will continue regardless of who is in office.
Major infrastructure projects will probably be announced after the election both in the U.S. and China to boost employment. Additional means to boost the velocity of money and encourage risk on investments will be promoted by punishing hoarders of cash and treasuries. In addition, we have serious supply concerns as the majors delay large mines and South Africa one of the largest producers of gold, platinum and palladium is facing the worst and most violent labor crisis in decades. This will not end quickly and may continue to plague the South African mining industry. This will not only put pressure on the supply of gold, but could cause pl “…Jeb Handwerger, a natural-resource analyst and editor of GoldStockTrades.com, said that reduced supply from South Africa, combined with rising investment demand from emerging markets, could spur platinum prices to outpace gold. “Platinum is still 20% below pre-credit-crisis highs, while gold and silver are approximately 80% higher,” he said. “This deviation from historical means will not last forever….Meanwhile, gold output in South Africa is a worry too. As of mid-October, strikes among Africa’s largest gold producers have cut the nation’s gold production by half, according to Bloomberg.” atinum to spike as more than 80% of the world’s supply originates from this questionable jurisdiction