Market News Today

Chavez said on Wednesday he plans to nationalize the gold industry and to pare illegal operations and boost international reserves. Venezuela is not going to allow illegal miners to continue exploiting deposits rich in gold and coltan.

Bloomberg reports that Chavez blames mafia saying “The area is run by the mafia …We’re going to nationalize gold. We can’t keep allowing them to take it away.”

UPDATE AUG 18

Gold hits a fresh record high as confidence in paper money is at its lowest. Spot prices touched $1,625.54 an ounce as market gets more and more nervous daily over the lack of a consensus on a debt ceiling deal. US could lose its top credit rating even if a deal is reached. We are seeing a pullback at the technical $1,625 resistance level as mentioned earlier.

Surging dollar is working against gold prices but price of the yellow metal will likely trend even higher as the talks between the White House and Republican Party leaders drag on.

Wall Street Journal reports that the talk between President Obama and House Speaker John Boehner that were going on for weeks to fix the U.S.'s budget woes broke on Fridaysending Washington into a weekend of negotiations over how the world's top financial power can make good on its debt obligations.

Gold hit a new record high on Wednesday following the dismal job report and Bernanke comments on providing “additional policy support” if the economy remains weak. The hint for QE3 is highly bullish for gold and gold stocks. We forecast a $1600 gold soon and see gold stocks rise rapidly. Expect a short term profit taking and a gradual move to new highs.

Gold prices posted a new 2.5-month high and rose above $1,570 as safe-haven investment demand rose on the European Union sovereign debt crisis. Moody's downgraded Ireland to junk, surprise surprise, and news came out that Fed officials had suggested more stimulus if economic growth slows. The last employment decline was inline with the expectation of more stimulus. Italy is playing an important role in pushing gold prices higher. Italian shares were down 5% this morning pulling down other markets with them and sending investors to a risk off trade.

This is an exciting time for gold investors as the yellow metal is nearing it’s all time high. With what is going on in Euro-zone, U.S. dollar will not likely fall any time soon , putting pressure to gold gains, but a lower dollar equals a new record high for gold and talk of more stimulus is good enough to send the currency lower.

Gold prices rose to a two-week high above $1,550 an ounce on continuing concerns about Europe’s sovereign-debt crisis and that the issue might spread to Italy. Prices were volatile as U.S. debt ceiling talk made headlines during day.

Reports say that European leaders are willing to accept a Greece default as part of the solution for the sovereign-debt crisis. Fear of a default supported dollar but the yellow metal managed to climb higher on investment demand.

A strike at the world’s largest gold mine brought the production to a complete halt. Reuters reports that talks between Indonesian workers and Freeport McMoRan management broke down Thursday and the production is completely stopped. Over  8,000 workers have been protesting outside the company’s Papua headquarters more than 300 blocked the mine’s main route on Wednesday.

Freeport's Grasberg mine is also one of the world's top suppliers of copper, and the production disruption could support prices of the metal and potentially lead to a force majeure on shipments if the strike continues, analysts say.