Sarissa Resources Inc (SRSR)

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here's a good one from mine web. New surge takes platinum and gold to new highs
As the dollar continues to fall, precious metals are set for a corresponding rise.

Author: Lawrence Williams
Posted: Tuesday , 04 Mar 2008

LONDON -

Weakness in the US dollar which plunged to the lowest point against a basket of currencies since these figures have been kept in 1973, caused a corresponding upward push in the precious metals sector. Gold and platinum both achieved new highs, while silver ran up to its highest level since 1980. In the case of gold and silver, the correlation with the dollar fall is marked, Gold very much acts as a bellwether to the state of the US currency and tends to drag silver up with it.

The latest view of dollar weakness suggests that observers of the US economy remain uncertain as to whether the country will enter a negative growth phase (recession) and are convinced also that the credit crunch, triggered by the collapse of the house of cards otherwise known as the subprime mortgage sector, still has a way to run. While banks may not actually be brought down by the continuing write-offs on bad loans, this does tend to mean that credit will remain exceedingly tight, with the old adage that banks will only lend money to those who can demonstrate they don't actually need it becoming more fact than legend. This again will contribute to turning the screws on an already reeling domestic economy.

With the expectation of further sharp US interest rate cuts, in turn perhaps leading to further dollar weakness, gold's safe haven status is becoming increasingly popular even among previously non-believing financial institutions. Gold is well and truly headed for the $1,000 an ounce level with most observers now believing, and advising, that this will come soon. There is a view, though, that $1,000 represents a psychological barrier that gold may find it hard to crack, but then previous psychologically important levels have been passed with hardly any reaction at all.

As for platinum, Mineweb was one of the first to point out - maybe actually the first - that the recent disruptions to South Africa's platinum mining sector, which accounts for around 80 percent of world output, would cause a very considerable upwards price impact. With platinum already in short supply, production losses as a result of power shutdowns, and subsequent rationing to 90 percent of the mining companies' needs, have had a further significant impact on supply. Far more so, for example, that the equally stringent gold mining output falls as a result of the power crisis will have had on world gold supplies where South Africa's share of gold output nowadays is small compared with its production dominance back in the early '70s.

So, in trading yesterday (Monday), gold hit a spot price level almost touching $990 an once before falling back a few dollars on profit taking. Silver, perhaps, did even better in percentage terms rising to more than $20.20. Indeed its rise this year has been quite remarkable at around 35 percent.

But among the precious metals it is platinum which has done the best of all, with the SA power factor taking its toll which in turn has led to a rise of a little under 50 percent this year alone.

While the continuing upward movement of platinum, gold and silver can still remain unpredictable, depending so much on investor sentiment. The fact that ETFS, available for all three meals, are now available, makes holding 'physical' metal much easier and more available, brings an element into the market which just wasn't there in the past and can exacerbate upwards, and downwards, movements in metals prices, and hence market volatility.

For the immediate future the precious metals sector prices look ominously strong as external; factors are driving investment into the metals noted above. The US economy is likely to get worse, before it gets better in turn adversely affecting sentiment and helping consolidate the push to precious.



http://www.mineweb.com/mineweb/view/mineweb/en/page32?oid=48577&sn=Detail