Gold "socks it" , Silver "rocks it"

Gold and silver prices are zooming in the commodity market, with prices of these metals hitting their highs!

Prices of gold today in the spot market are at 1505$ and silver is at 45.6$.

We need to understand what is driving these prices up in the markets. Here are a few points.

• Gold and Silver are good hedges against inflation which has started to rear up its ugly head across the world.
• Banks have started raising rates across the globe ( all except the US). The Bank of England raised rates yesterday, China's central bank has raised rates at least 10 times in the last 12 months
• The Standard and Poor ( S&P) put the outlook for the US to negative because of the very high debt that the US government has ( if they stop using their money to fight battles across the globe - it would help tremendously!)
• The $ is falling against most currencies in the world. Yesterday the euro gained more than 1.5% against the $ which again helps bring the prices up of commodities.
• Political turmoil in libya is making the environment unstable and quite profitable for commodities

What these events are doing is that they are causing fundamental concerns on the world economy, to the fact that we have started to hear about the dip in world economy in this year ( you heard the infy results).

Keeping some money in gold and silver ETFs makes a lot of sense. It should be part of your portfolio!

Here are some old posts which you may find interesting
http://simplefinancialsense.blogspot.com/2011/04/make-15-tax-free-investments-at-low.html


Happy investing!
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(http://www.freedigitalphotos.net/images/view_photog.php?photogid=2140 for the pic link)