• Gold - $1,732.90 – Down $14.00.
• Silver - $34.02 – Down $0.25.

Precious metals prices have remained relatively steady in overnight trading. Greece’s difficulty in reaching an agreement on its debt crisis continues to be an albatross around the neck of the global economic outlook. Commodity strategist Jeff Friesen said, “If Greece were to agree on everything right away, I don't think it would solve everything, because they will still have to implement the measures. …There are plenty of land mines left.” Basically, with all the European economic uncertainty and the far-reaching global impact, central banks will push more accommodative monetary policies to offset recession fears. Those central banks also will most likely be buying Gold.

The problems persist over the terms of the initial agreement for the bailout package for Greece. An agreement on austerity measures must be reached by March 20, when a 14.5 billion-euro bond payment comes due. As of now, Greece is not able to make that payment without the bailout. Greek Prime Minister Lucas Papademos is set to meet with Greek political leaders today after late-night meetings with the European Commission, the European Central Bank and the International Monetary Fund. In an interview today, German deputy floor leader Michael Meister said, “The situation is getting more problematic for Greece day by day. … A day wasted in failing to tackle Greece’s administrative, budget and competitive problems is a bad day.” He said this reform was “not for Brussels, Berlin or the IMF, but for their own sake.”

Iran continued its threatening rhetoric toward the U.S. The U.S. has imposed its financial sanctions against Iran. However, in a news conference in Russia, Iranian ambassador Seyyed Mahmoud-Reza Sajjadi said, “The  Americans know very well what Iran is like  and what our potential is. … Iran is in a very good position to deliver retaliatory strikes on America around the world. … An attack on Iran would be suicidal for them.” Russia continues to stand behind its Middle Eastern allies, Iran and Syria.Bombing continued in Syria, and Turkey looks to be stepping up its effort to secure a united Western-, Arab- and U.N.-backed effort to remove Syrian President Bashar al-Assad from power. Russia and China oppose that course and are hoping for a more diplomatic resolution that would allow Assad to stay in power.

At 8:01 a.m. (CST), the APMEX precious metals spot prices were:

• Gold - $1,741.90 – Down $4.90.
• Silver - $34.25 – Down $0.02.
• Platinum - $1,652.40 – Down $3.40.

U.S. stock futures are trading lower this morning, as  investors await Federal Reserve Chairman Ben Bernanke’s testimony  before the Senate Budget Committee. Analysts are expecting a message similar to the one Bernanke gave to the House Budget Committee last week. UBS strategists said, “A more upbeat tone can be expected in the wake of the latest unemployment report.” Investors also are focusing on meetings in Greece between Prime Minister Lucas Papademos and party leaders. The goal, as it has been for months, is an agreement on austerity measures that will secure a second bailout for the struggling country.

The euro slipped earlier this morning but has since regained traction, pulling Gold with it. Gold neared $1,730 in overnight trading, then neared $1,710 earlier this morning, and has regained enough traction to settle right in the middle as of this writing. Late last year,  China hoarded Gold in record amounts. In a note, UBS analysts wrote, “While December’s activity is the lowest since July, it’s still 245.2 percent higher year-on-year. Here’s a statistic that should lay to rest any doubts over Chinese Gold consumption: the 2011 trend of imports from Hong Kong was up 258 percent from 2010.”

Syrian forces have been attacking Homs, which had become a hub of rebellion against President Bashar al-Assad’s rule. Russia’s foreign minister reportedly told Assad, “Every leader of every country must be aware of his share of responsibility. You are aware of yours. It is in our interests for Arab peoples to live in peace and agreement.” Russia’s government holds weight in Syria as a major arms supplier for the country. Russia and China recently vetoed a U.N. resolution on Syria, but Russia contends it still wants to broker peace between the two sides in the Syrian crisis.

At 8 a.m. (CST), the APMEX precious metals spot prices were:

• Gold - $1,720.00 – Down $3.40.
• Silver - $33.51 – Down $0.31.

Prices for  Gold  dropped today in response to a rise in the dollar fueled by Greece’s lack of progress in coming to a bailout agreement. Along with other U.S. equities, Gold’s decline comes amid renewed worries that a Greek default could be in the offing and that debt contagion would spread to other European countries. Jason Schenker, president of Prestige Economics LLC, said, “The dollar’s up because of worries over Greece and optimism surrounding the U.S. economy after the jobs report. In the long run, there are still a lot of downside risks to the dollar.” Gold historically has a negative correlation with the U.S. dollar, increasing in value as the dollar’s value drops. Silver, Platinum, and Palladium prices ended the day down, as well.

U.S.  stocks  also dropped today, weighed down by concerns over the ongoing debt crisis in Europe and the continued failure of political leaders in Greece to come up with a definitive plan for avoiding a national default. After advancing for five weeks in a row, the Standard & Poor’s 500 Index was down by 0.1 percent Monday afternoon. S& P’s Banks Industry Group Index was down nearly 1.14 percent. The Dow ended the day down 0.13 percent. In an interview today, chief market strategist Stephen Wood of Russell Investments said, “It’s an ongoing Greek tragedy. We’re in the hands of the best efforts of European politicians. That’s a source of risk that’s difficult to forecast.” The S& P 500’s drop today comes in what had been the market’s best year-opening start in 25 years.

Last week’s unexpected improvement in jobs numbers could result in an equally unexpected  tax increase  for many U.S. citizens. Due to the better-than-expected employment figures released Friday, speculation is growing that lawmakers in Washington will find themselves in another battle over the payroll tax cut, as some politicians may be reluctant to agree to another extension. The last showdown over the tax cut in December ended with an extension almost failing to pass the House of Representatives, despite passing the Senate with bipartisan support.

At 4:10 p.m. (CST), the APMEX precious metals spot prices were:

• Gold - $1,720.80 - Down $18.00.
• Silver - $33.75 - Down $0.07.

For too many weekends in a row, the market has been led to believe that a deal was imminent betweenGreece and its private creditors. Today, another deadline has passed without a deal, and the European Union (EU) and the International Monetary Fund (IMF) are losing patience. French President Nicolas Sarkozy simply said, “We want an accord.” He continued, “Greece’s leaders have made commitments, and they must respect them scrupulously. … Europe is a place where everyone has their rights and duties. Time is running out. It needs to be concluded it needs to be signed.” If Greece fails to get bailout money from the EU and IMF, it could default, which could threaten the existence of the eurozone.

Iran continues to be in the news, as the world waits to see if Iran will react aggressively to  tightening international sanctions. These sanctions are designed to shrink the Iranian economy, increase inflation and drive down the value of its currency. Two questions arise on these international actions. Will these measures actually be enough to deter Iran from pursuing its nuclear ambitions? Will they provoke Iran into taking harsh retaliatory measures? There has been much speculation of late that Israel may be planning an  attack on Iran. In an interview with Matt Lauer on NBC yesterday, President Barack Obama indicated that Israel has not made up its mind, but the international community is mobilized in the event action is necessary.

At 8 a.m. (CST), the APMEX precious metals spot prices were:

• Gold - $1,717.10 – Down $21.70.
• Silver - $33.22 – Down $0.60.