Money and Metals

Bloomberg reports on golds' comeback. "Gold prices closed at the highest in more than 25 years as the dollar dropped to a seven-month low against the euro, boosting the precious metal's appeal an alternative investment. Silver also gained."

"'It's a concerted attempt to diversify out of dollar denominated assets,' said Stephen Platt, a commodities analyst in Chicago. 'There's still underlying fund support for gold and silver.'"

"Gold futures for June delivery rose $7.80, or 1.2 percent, to $642 an ounce on the Comex division of the New York Mercantile Exchange, the highest close since December 1980. Silver for May delivery rose 25.5 cents, or 2 percent, to $12.815 an ounce. Prices have surged 44 percent in 2006."

"The euro touched $1.2471 against the dollar, the highest since Sept. 7. The dollar dropped after U.S. reports showing higher-than- expected new home sales and orders for durable goods failed to allay expectations interest rates will rise faster in Europe than in the U.S. 'Any dollar weakness is supportive for gold,' said Frank Lesh, a futures analyst."

"'Everybody is looking at the end of the Fed tightening cycle,' Lesh said. A 5.25 percent rate won't be high enough to stop investment in precious metals, he said."

"Holders of the benchmark 10-year U.S. Treasury have lost 4.3 percent this year. Gold has gained for five straight years, outperforming returns on the 10-year bond in four of those years."

"Australia's BHP Billiton Ltd. said production will fall at its Cannington mine, the world's largest silver mine, driving prices of the metal higher."