"The debt problems in the U.S., Europe and Japan are real," says Don Dion, founder of Dion Money Management and senior contributor for TheStreet. "They will not be solved any time soon. Gold will remain a safe haven until these issues are resolved"
News that the U.S. grew only 1% in the second quarter versus the 1.3% previously reported also underscored double dip recession fears.
Hurricane Irene is also picking up steam and starting to slam the east coast. Its path is expected to extend from North Carolina to Canada. Natural disasters or events of this kind are also another reason some investors buy gold, as a panic hedge.
Gold mining stocks were volatile but headed higher. Kinross Gold (KGC - Get Report) was up 1.93% to $17.39 while Yamana Gold (AUY - Get Report) was adding 1.48% at $15.76. Other gold stocks, Agnico-Eagle (AEM - Get Report) and Eldorado Gold (EGO - Get Report) were trading higher at $67.80 and $19.24, respectively.Miners were also in the spotlight Friday as Peru raised taxes on the industry by $1.1 billion, which was much less than expectations. With Hugo Chavez, president of Venezuela, nationalizing gold mines, companies in precarious parts of South America and Africa could have been met with a similar fate or much higher taxes. This certainty coming out of Peru eliminates this risk.
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