Ordinarily, the summer is a slow period for the gold and silver markets.
Additionally, the summer is normally a period of low prices for gold and silver, and that is the case this summer. Both metals’ prices are significantly below what they were in March when gold topped $1,000 and silver $21. But, this is not a slow summer for gold and silver. Presently, there is more than normal interest in both metals.
One reason, undoubtedly, is the widespread fear that Bush administration has plans for military action against Iran. If so, that military action would most probably be bombings of Iran’s suspected nuclear facilities, which Iran asserts are for peaceful purposes but the Bush administration says hold the capabilities for advancing Iran’s uranium enrichment program, which is necessary for the building nuclear bombs.
However, there is speculation that covert operations inside Iran have already begun. Seymour Hersh, a regular contributor to The New Yorker on military and security matters, wrote for the weekly magazine a piece titled Preparing the Battlefield.
Additionally, Hersh was interviewed on CNN where he reasserted his position that covert operations inside Iran have begun. Hersh further asserts that the Bush administration is determined to see to it that before it leaves office, Iran has no nuclear capabilities.
What would be Iran’s most likely response if Bush bombs Iran? According to many military strategists, that would be the closing of the Strait of Hormuz, through which 17 million barrels of oil flow daily. If you think that the price of gasoline is high now, try calculating the price if approximately 20% of the world’s daily consumption of oil no longer can make it to the market.
If the Bush administration takes military action against Iran, gold and silver prices will remain active this summer, very active. Actually, just the talk of the Bush administration attacking Iran will keep people interested in gold and silver this summer. Seasonally, the summer has been a favorable time to do some silver and gold investing. This summer looks better than past summers.
