From dawn in Tokyo to dusk in New York on Friday, fear lifted gold to a record high -- its fifth such day in a row -- and boosted silver, too, as investors around the world succumbed to the accumulated effect of one emerging danger after another.
The list of economic and financial threats driving traders to the safety of precious metals was long: A slowdown in China; the prospect of European banks freezing up over their exposure to the increasingly costly debt of struggling nations like Greece, Portugal and Italy; the stagnation of Germany's economy; and fresh evidence the U.S. may be headed for a double-dip recession.
U.S. stocks began the day following European and Asian markets down but then turned upwards as bargain hunters began buying the heavily discounted shares of large tech companies. But the rally was short-lived and by the end of the day, all three major stock indexes had fallen more than 1 percent.
Throughout the day gold prices rose, at one point jumping $30.20 to hit a record $1,881.40 per ounce, before settling at $1,852.20. Silver climbed $1.74 to close at $42.43. Gold has now risen about 30 percent since Jan. 1.
Right now, gold is inversely correlated with fear and nothing else. When stocks are down, gold's up, said Frank McGhee, head precious metals trader at Integrated Brokerage Services LLC. If we see the stock markets rally, I would not be surprised to see profit-taking starting to set in.
Gold's rise was aided by dollar weakness against the yen, a development that lifted other commodities as well.
Throughout the week U.S. headlines were relentlessly negative.
The Philadelphia Federal Reserve Bank's survey of regional manufacturers showed an alarming downturn and reinforced a similar survey from the New York Federal Reserve. Jobless claims rose more than expected, the Labor Department said Americans who still have jobs are getting paid 1.3 percent less than about a year ago and core inflation has been accelerating over the last three months at an annualized rate of up to 3.1 percent.
There's more inflation than the Fed has been expecting, UBS economist Drew Matus told the Wall Street Journal.
Despite record low mortgage rates, sales of previously owned homes languish below levels of a decade ago.
At the end of the day you have to find a place where your money is safe and it goes back to the ultimate currency, the ultimate safe haven, and that's gold, Graham Leighton, director of precious metals at Newedge, told Dow Jones.