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By Pham-Duy Nguyen~BLOOMBERG
Gold surged the most in eight years as investors sought the safety of precious metals on concern that the credit crisis will deepen, leading more financial institutions to fail. Silver jumped more than 8 percent.
The U.S. government took control of American International Group Inc. in an $85 billion takeover to prevent the biggest financial collapse ever. The cost of borrowing dollars for three months jumped the most since 1999 as banks hoarded cash. In March, gold reached a record after the Federal Reserve backed JPMorgan Chase & Co.’s purchase of Bear Stearns Cos.
“Gold is going to be the beneficiary of a global move toward a safe haven,†said John Licata, the chief investment strategist at Blue Phoenix Inc. in New York. “There’s a gigantic fear factor. Most people are concerned another bank is going to fail.â€
