Anybody watching the market???!

[user name]

I know most of us watch gold..., but whats going on with platinum? Its been going down like mad! Any insights?

 

[TECHARTISAN]

Platinum while precious is also an industrial metal....40-60% of its annual consumption is attributed to industrial catalyst usage. A large portion of that usage is found in the automotive industry. US auto sales are down, Japanese auto manufacturing was seriously effected by the disaster there, and the current european economic crisis has further weakened demand and prices.

This "industry effect" can be seen clearly by observing the chart data for gold and platinum in 2008, while gold maintained, the great recession drastically affected platinum prices.


Ultimately, Platinum is superior to gold in both scarcity and utility so while prices may continue to drop for a bit it will rebound....so it isnt a bad time to buy.

If Platinum is too rich for your blood, Palladium suffers/benefits from the same sort of industrial tied accounting....so its also in a similar situation at present...

 

[user name]

Platinum has fallen almost 25% in the last 30 days. If my memory serves, platinum has always been way more expensive than gold. I could see the recession be the factor if gold and platinum both went up or down together, but whats the reason for the big fall of Pt in just the last month??? Platinum Prices - Platinum Price - Platinum Spot Price - Price of Platinum

 

[TECHARTISAN]

Platinum has fallen almost 25% in the last 30 days. If my memory serves, platinum has always been way more expensive than gold. I could see the recession be the factor if gold and platinum both went up or down together, but whats the reason for the big fall of Pt in just the last month??? Platinum Prices - Platinum Price - Platinum Spot Price - Price of Platinum

1st its a 21.5% drop and lets not downplay golds 15% drop in the past 30 days....
but..........
Gold and platinum are not intrinsically tied for exactly the reason I stated. Gold is NOT considered an industrial metal as less than 18% of golds utilization is industrial applications. So when industry tanks gold demand does not suffer as much.
Additionally, In times of economic unrest many turn to gold as it maintains stability better than most other assets.
The 5 year chart I showed in my previous post illustrates this difference....when the global recession struck in 08 gold only slightly faltered then continued its rise where platinum took a pretty hard hit.

while gold has traditionally traded lower than platinum....


A swap in position, or even trading, is not unheard of, as seen in the chart of the platinum to gold ratio....



however it is generally a good indicator of Gold hyperinflation....and a coming "bubble pop". Given the near vertical rise in gold prices over the past 5 years...not a big surprise.