Fed Chairman Admits Unsustainability Of Federal Deficits; Claims No Risk

As unsustainable government spending and debt raised alarms in Washington this week, precious metals markets showed some signs of firming up.

After last week’s price drubbing, gold and silver were at risk of breaching major support levels. And while they aren’t out of danger just yet, the metals markets appear to be attracting buyers at these levels.

Gold and silver turned in a weekly gain of roughly 1%, but the platinum group metals are significantly outperforming, with platinum and palladium up over 5% for the week.

Palladium has seen a surge in demand in recent years from the automotive industry, which uses the metal in pollution-scrubbing catalytic converters. Platinum could soon see a surge in demand from hydrogen fuel cell technology which serves as a viable alternative to gasoline and battery-powered vehicles.

In the rush to roll out electric vehicles, problems have emerged such as a lack of grid capacity for battery charging. California officials recently asked EV owners to refrain from charging during peak hours as the state copes with a heat wave.

A full-size car’s batteries can take hours to charge depending on the source and will deliver degraded performance during extreme temperatures. Batteries also generate a large amount of toxic waste during their production and eventual disposal.

Hydrogen, by contrast, is a zero-emission fuel that can be pumped into vehicles as quickly as a fill up at a gasoline station. Hydrogen-powered cars have longer ranges and lighter weight loads than battery-heavy cars. 

The main problem, of course, is the current lack of hydrogen fuel stations.

This necessary infrastructure is sorely lacking in most places. The automotive industry along with politicians and “green” activists have bet everything on promoting a transition to electric vehicles – even though they’re powered by an outmoded, overburdened, and in many ways inferior technology.

The World Platinum Investment Council forecasts increasing adoption of fuel cells in the years ahead. It notes that Korean automaker Hyundai is developing hydrogen systems for cars and trucks as well as investing in refueling stations. Importantly, these technologies currently use platinum as a catalyst to release hydrogen electrons.

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