King World News: "With gold and silver consolidating recent gains, King World News interviewed James Turk out of London. When asked about the action in both gold and silver Turk stated, “I think the important point today is that gold has moved back above its short-term moving averages. This should bring a great deal more buying into the market. I was very impressed today that gold was strong in spite of the fact that the US dollar was up a full point. Jim Sinclair has been bringing up this point, and it looks like he nailed gold separating from the dollar in terms of the action.”
Turk continues:
“The big shock here in London is the Irish bailout. Many were not expecting it, and when it was announced, the size of the bailout was the second shock. The implications are now that everyone is starting to look at Portugal and Spain. Portugal is a small player, so therefore its impact will be limited. Spain on the other hand is a big economy, it is larger than Ireland, Portugal and Greece put together.
So the interesting thing is once the Irish bailout is finished and a bailout is put together for Portugal, more than 50% of the 750 billion Euro stabilization fund will be used on these periphery countries. The question therefore becomes will there will be enough left in the fund for Spain? And don’t forget about Italy, who’s economy is as big as Spain’s.
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