Oil prices are near where the IMF projected the average price to be for the year, though analysts recently surveyed by The Economist believe equilibrium levels should be lower, more like $10 a barrel and under. Despite higher oil prices and continued tightness in the labor market, consumer prices rose only 0.2% in March according to Labor Department figures.

Federal Reserve Bank governors have expressed ambivalent opinions regarding the significance of current economic figures and trends. One governor, giving an interview to The Financial Times last week, said that persistent trends of low-inflation growth are prompting the re-evaluation of existing tools of analysis for determining Fed policy. Yesterday, however, one Fed governor pulled the old Philips Curve tool off the shelf - one that holds there is an inverse relationship between unemployment and inflation. This governor warned that continued low unemployment might warrant a raising of interest rates soon, though he may have to abandon those views. It is not altogether clear that more people working than before - that is, more people employed and providing goods and services - necessarily drives inflation higher.

This week taxes owed to the United States Federal government were made due. The Wall Street Journal, citing a study by the Tax Foundation, reports that on average, taxpayers will have to work a record two hours and 51 minutes out of each eight-hour workday this year just to pay all federal, state and local taxes. As was recently pointed out by The Wall Street Journal's Amity Shales, most people are not explicitly aware of the degree of these takings. Thanks to the clever packaging of salary and wage withholdings on a per-paycheck basis, which makes the tax burden appear smaller than if people had to write a single check every year, attitudes toward taxation are more complacent and compliance is higher. It is arguable that the phenomena is similar to the stock-split premium: a company's worth should be the same pre-split as it is post-split, but people seem happy to be paying more when the amount is in smaller increments.

The Balkan fighting seems to have helped support platinum group metals prices, with reports that Russian leadership has become distracted by current diplomatic wrangling, thus decreasing the likelihood of a signoff on Russian exports any time soon. The yen has strengthened a bit against the dollar, usually another factor that would support platinum prices. Iridium has inched upwards in price, indicating a tightness of supply in that market.

According to Dow Jones Newswires, Norilsk Nickel, one of the world's largest nickel producers and the largest palladium producer, announced it will invest $3 billion in its facilities over the next 10 years. Interestingly, however, the Norilsk announcement made it clear that it has no plans to shut down subsidiaries or to make cuts in its significant expenditures on providing social services for the local economy. Located in the Arctic mining region of Krasnoyarsk in Western Siberia, many in the region are entirely dependent upon the company for services normally provided by other firms or the local government. Norilsk Nickel has had to make difficult choices in trying to extract itself from the old Soviet company model, where the company bears responsibilities such as providing schools, roads, and health services. While Norilsk had no immediate plans to close any of its major subsidiaries, a company spokesman said that the Kola peninsula operations Severonikel and Pechenganikel would be subject to an interim review in 2005. The emphasis of the investment plan would be "not on increasing production volumes, but on cutting the costs of production," he said.

The New York Times reports that the Clinton Administration is preparing to announce plans for tighter federal emissions standards for automobiles. The plans reflect proposals made two months ago by the EPA, themselves following the trend set by the state of California. The effect of the plans, while open in detail, would most likely require more extended use of platinum group metals in autocatalysts.

Uncertainty in Europe caused by the Balkan conflict also helped to back gold away from the $280 level. India's imminent wedding season is seen as to the upward move, since India is the world's largest consumer of gold and bridal adornment figures largely in Indian gold demand. Dollar weakness has also helped. In the silver market, Warren Buffett announced he would not be providing further information on his Berkshire Hathaway investment fund's silver position unless required, according to Reuters. Past Buffett announcements have added considerable volatility to silver prices.

In a recent editorial in The Wall Street Journal, former Fed governor and current chief economist for Bear Sterns, Wayne Angell, argued that Japan needs to fix its exchange rate to the dollar to cure its economic woes. Such a fix would eliminate foreign currency risk for domestic savers, effectively bringing the funds resulting from Japan's high savings rate out into the global capital market. In making the case, Angell argued that rather than fixing the yen to gold - which he claimed would present formidable practical difficulties - the dollar should be used as the yen's fixed anchor, with gold as a benchmark for setting the rate. Setting the appropriate rate would be crucial. Testing various possibilities against its outcome gold price, Angell proposed a rate that would bring the price of gold up to 40,000 yen per ounce, a rate that would imply an exchange rate of about 140 yen to the dollar. This fixed lowering of the yen, Angell postulates, would ameliorate pressures for commodity deflation and help offset the continued rise in unemployment in Japan as businesses and banks get on with their restructuring tasks. Angell's argument demonstrates once again gold's continuing utility as a monetary asset and benchmark of value.

April 9^th, 1999 - the 99^th day of the 99^th year - came and went without any major Y2K-type problems reported. Preparations by individuals and households for a major mishap at the year's end continue at a brisk pace, nevertheless. Precious metals sales are strong, as people buy to ensure they have a trusted liquid asset available for contingencies. There are reports that stored food sales and gun sales are up sharply as well. As the end of the year approaches, it is important that people maintain perspective. There is a whole spectrum of scenarios that might play out, with varied probabilities. When preparing for contingencies, one should keep an eye to preparations that serve double duty. Whether things go well or badly, it is best to make preparations that are useful in both situations. That is why it is important to include platinum in those preparations, for the metal faces a strong demand outlook in both good market situations and bad.