Market Update 15 Feb 2013


In a week when most assets turned in excellent performances, bitcoin once again outshone all others. The only things that lost ground this week were mining stocks and silver.

Currencies were all higher, led by bitcoin, which added an astounding 24.6% to close at 520.7 mg, within spitting distance of its all-time high of 598 mg.  In fact, in all of bitcoin's history, there are only 3 days on which it was traded at higher levels.

Among government issued currencies, the Yen gained 3.7%, more than recouping last week's losses, and the USD rose 3.5% to close at 19.3 mg. This puts the USD 14.4% above its half-life curve, and solidly in overvalued territory. Keep in mind that just because it's overvalued don't mean it can't get even more overvalued! Back in 2005 and 2008 it was more than 20% overvalued.  Still, for the long term investor, this is a great time to be moving out of dollars and into precious metals, farmland, and other anti-dollar investments.

Bonds were up, but did not rise as strongly as USD cash. The short term SHY rose 3.4%, slightly less than the underlying USD, while the longer term TLT was up "only" 2.9%.

Stocks were mostly higher, with the gold miners being the exception. The big mover was the Nikkei Index, which rose 3.7%, recouping all of last week's loss and then some. The S&P 500 added 3.6% while the Dow Jones Industrials gained 3.4%. The Gold Bugs Index lost 2.7%, wiping out all of last week's small gain, and setting a new post-2008 low of 7.32 g. With gold stocks this cheap, and the USD so overvalued, this is a great time to be adding to your high quality gold stock positions.

Commodities were all higher except for silver, which lost 0.9% this week. Crude oil made the greatest gains, rising 3.6% to close at 1.85 g/bbl. Copper was also strong, up 2.9%. Platinum continued its rally, finishing up 1.2% at 32.33 g, now 4% above gold parity.

Table of prices in gold for week ending 15-Feb-2013

Leave a Comment

Fields marked by an asterisk (*) are required.

Subscribe without commenting