Gold Jumps $42 per Ounce as Oil Gains 15%, Dollar Sinks with Stocks, on US Bail-Out Plan

From Chris Mullen a GoldSeek.com...

Gold and silver steadily rose throughout most of world trade on Monday, jumping in New York as crude oil put in its biggest-ever one-day leap and ending at about their highs of the session with gains of 4.89% and 8.22% respectively.

Both metals continued to gain in after-hours access trade as the supposedly necessary US “Toxic Bailout” plan highlights the advantages of having sound investments.

The Gold Price in Euros rose to about $610, platinum gained $95.50 to $1234, and copper gained another 8 cents to about $3.26.

Gold and silver equities again soared higher throughout most of the session and ended with roughly 8% gains.

Oil topped $120 on short covering and the continued rush to hard assets as the US Dollar index fell substantially on worries over Treasury actions and the success of the bailout plan.

The October contract for oil expired today and a massive short squeeze appeared to push prices markedly higher at the close. While the October contract closed Monday at $120.92, Tuesday’s trading will be based on the November contract which closed near $109.

Treasuries traded mostly lower as the flight to safety bid was overcome by the massive issuing of new debt and worries about how it will continue to be serviced.

Goldman Sacks converted to a commercial bank from an investment bank to avoid the investment risk that has caused the demise of so many others. Morgan Stanley joined Goldman in the conversion this past weekend and both can now ask the fed to access the discount window.

The Dow, Nasdaq, and S&P fell for most of the day and ended over 3% lower in reaction to the dramatic steps deemed necessary to be taken to ensure stability.

There were no major economic reports, and there are none due out tomorrow, but there was plenty of talk over the $700 billion bailout plan that will likely gain congressional approval in an effort to rescue financial firms who made bad bets and want the taxpayer to pay for their losses.