“Cornerstone Worldwide”: Gold is likely to head higher if more disappointing US earnings reports further weaken the dollar and increase demand for the metal as a hedge against the world’s reserve currency.
A source familiar with strategy at Cornerstone Worldwide speculated that the relationship between gold and the dollar is firming and with both Wachovia and Washington Mutual reporting large losses in their Q2 results, the consensus is that there is more woe ahead for the US banking system.

Cornerstone Worldwide sources have often cited the $447 billion of write-downs and credit losses that have been revealed by the world’s largest banks and financial companies as heralding a sharp and deeply damaging recession.

Silver has been identified as an additional play on the upside expectations for precious metals by sources close to Cornerstone Worldwide for some time and this confidence has seen silver rise significantly to as high as $19.13 last week.