What is happening to Platinum?

Video transcript:

Today is Sunday 26th July 2015 and we are briefly going to cover what is happening in the Platinum Marketplace.

On the 17th July platinum prices fell below $1,000 oz and currently stand at $987 oz - a low last seen back in 2009 and almost 50% down on its $1900 peak.

Now much is made of gold and silver price manipulation so we wondered whether the same applied to platinum.

Well, Dave Govett, head of precious metals at investment brokerage Marex Spectron, told the Financial Times that the platinum price dip is almost entirely related to supply outages and also partly contributed to by a gloomy outlook for the Chinese and European Car Markets.

Bloomberg also confirmed a similar view on the 18th June this year.

So what have been the repercussions of these price falls and weakening demand?

Well let's take Anglo American for example - the largest platinum miner in the world. They recently announced that they will cut some 53,000 jobs over the next 5 years hopefully resulting in a cost saving of $500 million - much needed after their $3 billion loss before tax for the first half of 2015.
The company pointed out that weaknesses exist in other commodity areas too, such as: iron ore, down 41%; copper down 18% and coal down 15%.

Lonmin, a London Stockmarket listed mining company announced cuts of 3,500 jobs in May and these may increase to 5,000 jobs. At one stage, Lonmin had a market value of £7 billion - now it stands at just £437 million.

Impala Platinum, based in South Africa has seen its value slip some 84% in the last 7 years - and there are numerous other examples.

So what did the precious metals gurus advise investors only 2 years ago - let's listen to one on the Ellis Market report published 11th August 2013............

Yes David Morgan the so called Silver guru recommending Prophecy Platinum at 60 cents (which has incidentally since changed its name to Wellgreen Platinum) down from its high of $1.80 and what does it stand at now? You guessed it just 31 cents - great call David - lets guess better 2 years too early than 1 day too late huh? His inference on buying the metal fared only slightly better in that we have seen Platinum prices fall from $1500 then to $987 today - who the hell buys his reports? Geeeeesh. Remember this is the guy who called bottoms in silver at $26, $20, $18 and now just under $15 - but it's all manipulation right? Right.

So what's our take on this? - well it's pretty straightforward :

Gold is down, silver is down, platinum is down, palladium is down, zinc is down, copper is down, iron ore is down oil is down, coal is down - we are in a global recession - we shall say it again, we are in a global recession and in recessions prices tend to fall.

Will the markets recover, yes in time, but we suggest when the experts tell you to buy think twice, when they tell you prices fall solely because of manipulation, think twice, when they say buy the miners as well as the metals, think twice. Yes one day they will be right. But in our view not yet and not very soon.

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Silver Illuminati owners come from a background of Banking, International Wealth Management and Economics. Having now retired from these worlds we are not qualified to give investment advice. Therefore, this and other productions must not be deemed to be giving such advice and merely represent the personal views of its owners.