Traders Are Dumping Stocks and Buying Gold and Silver

Wednesday, June 8, 2011
By Paul Martin

By: John Melloy
CNBC.com

Gold [GCCV1] and silver [SICV1] have outperformed the S&P 500 by 8 percentage points over the past month as traders choose precious metals over stocks to stash cash.
The move is fueled by a number of worries: The European Union is planning its second Greek bailout, the Federal Reserve is angling to keep interest rates low while the second round of quantitative easing runs out—and global economic growth is slowing.
“Gold is more valuable at this juncture as the flight to quality accelerates,” said Stephen Weiss of Short Hills Capital. “Global equity indices will all be in decline as multiple growth engines sputter: US, China, Eurozone and Japan. Only place is commodities, and specifically gold, because that is where perceived safety and momentum will be.”

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