Gold and Silver Surge as Standard and Poor's Downgrades U.S. Outlook to Negative

Gold is approaching $1,500 an ounce this morning as it hits a new record, while silver surpasses $43, as fiscal pressures weigh on U.S. markets. The Dow has fallen almost 200 points in early trading.

S&P maintained the AAA rating of the United States, but cited the continued unresolved budget deficits as the reason for its statement that there is a one-in-three chance that it would lower its rating on the U.S. within two years

“Because the U.S. has, relative to its ‘AAA’ peers, what we consider to be very large budget deficits and rising government indebtedness and the path to addressing these is not clear to us, we have revised our outlook on the long-term rating to negative from stable,” the agency said in a statement.

This announcement will put further pressure on the dollar, and will most likely give weight to discussions held by George Soros and crew at Bretton Woods II about managing the global economy in the face of a U.S. dollar collapse.

Sources for this story:

Rueters/CNBC: http://www.cnbc.com/id/42643384

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