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“Ignore The Noise” & Focus On The Fact That Central Banks “Remain Extremely Accommodative”
“Ignore The Noise” & Focus On The Fact That Central Banks “Remain Extremely Accommodative”
The primary focus this week is again on the “all powerful” Fed. If the Fed leans toward a rate hike in December, gold could come under pressure again in the short term. However, if it leans toward raising rates next year, then gold would be expected to eke out further gains.
Bank of England - Interest Rates - 1694 to Today
Most physical buyers will ignore the noise and focus on the fact that the Fed's monetary policies, along with the Bank of England, the ECB and most central banks in the world, remains extremely accommodative.
The perception and narrative is that a rise in rates, even by a very marginal 25 basis points will be negative for gold. This may be true in the short term as perception, even misguided perception, can drive markets in the short term.
However, rising interest rates per se are not negative for gold. What is negative is positive real interest rates and yields above the rate of inflation. This is unlikely to be seen any time soon.
Gold will also be vulnerable towards the end of an interest rate tightening cycle as was the case in January 1980. Today, central banks including the Fed are having difficulty raising interest rates in even a small nominal way.
BIS via Business Insider
Given the massive global debt bubble of today, it will likely be impossible for central banks to increase interest rates in any meaningful way. We are not going to see an interest rate tightening cycle akin to that which snuffed out gold’s bull market in the 1970s.
Unless, central banks lose control of the bond markets and a new breed of bond market vigilante enforces monetary discipline and pushes bond yields higher in the coming years.
Gold should be supported by data which suggests that economic growth braked sharply in the third quarter in the U.S. and that global demand for physical bullion remains very robust - particularly in India, China and Germany.
A gauge of U.S. business investment plans fell for a second straight month in September. Core capital goods orders fell 0.3 percent in September, August core capital goods were revised sharply down and durable goods orders dropped 1.2 percent.
DAILY PRICES
Today’s Gold Prices: USD 1171.50, EUR 1058.98 and GBP 765.94 per ounce.
Yesterday’s Gold Prices: USD 1165.74, EUR 1054.55 and GBP 759.52 per ounce.
(LBMA AM)
Gold in GBP - 1 Month
Gold closed at $1166.40 yesterday, a gain of $2.70 for the day. Silver was also up slightly yesterday, by $0.02 closing at $15.88. Platinum lost $9 to $984.
Gold has retained small overnight gains today ahead of a Federal Reserve policy statement later in the session as investors wait for more clues on the timing of a potential U.S. rate hike.
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I think gold is at a price level that benefits the big guys. At 1550 here in Canada, its kindve out of the question for the average person to even pick up an oz or two, yet it still can be considered undervalued based on the expansion of the money supply. Wouldn't that be the perfect situation for someone trying to acquire it in its physical form? Just thinking out loud
Gold is not money, if you mean what you buy food and drink with on a regular basis. gold is insurance against government abuse of your common sense - they have none; and no regard for yours. gold offers and secures a common ground of value when it is needed most - when others panic, and start pulling the gold out of their teeth to eat, you will have less to worry about; but only if you have kept it in a safe place. There are many schemes for such; but if you live in a big city, you will potentially but likely be subject to extreme violence or government relocation - both without acess to internet free of government surveilance. your ability to travel will be greatly restricted. yo u will be a captive, and strip-searched for weapons or contraband = gold and "old" cash. Why? Because the new order will have new currency and your access to it will be extremely limited. Yes, the filthy rich and banksters will be fine, they will be the privileged - as always. So what should you do with your gold now beforeit is too late - same with your weapons and ammo? You bury them deep, at least 6' down - with moisture and varmit and vermin protection - on rural federal lands, e.g., BLM, NPS, etc, while keeping a very accurate "map" in the form of GPS coordinates albeit modified with a simple algorithm that you can never forget, e.g., the zip code of your wife's birthplace. Keep the coordinates in a very safe place,e.g., tatoo them on your children's and pet's skull beneath their hair, carve into rocks in a nearby open park, or engrave them with a small battery engraver, into the metal support stubs of a local billboard. Get it? Be creative; and share with no one. Sound extreme? Guess what? Not one of you would ever have believed what accurately describes world and local finance today - top to bottom, if told to you even 5 years ago. Whatever you believed is now innacurate, and those thoughts are your most dangerous possessions. Good luck.
I dont agree gold is not money. This is why. Something that has been produced = work = money eg. gold=work=money corn=work=money rice=work=money silver=work=money energy=work=money
Gold is currently not our currency, although some coins are legal tender. Gold is hard evidence of work performed it is very liquid, few things are as liquid as gold. That makes it always interchangeable with the latest flavour of fiat, making it "true" money. I agree with most of everything else you say. Our fiat the U.S. D. is currently a large pile of broken promises, worthless other than people still have faith in our gov? Why Ill never know? Gold is one of the only things that functions as true money. Its been universally accepted all across this planet for thousands of years and for the most part still is.
Gold is real money, the dollar is a representation that it is real money, its not though its fiat. https://en.wikipedia.org/wiki/John_Exter NOTICE GOLD (a.k.a. Real Money) at the base of the pyramid, below Paper Money(a.k.a. Fiat or Fake Money).
You are likely to get down-arrowed into the abyss for telling the fact that gold is not money.
If I could have ever afforded to buy gold, then I might follow your advice, though I'm damned if I know how I would "spend" gold in ingot form, when all order has broken down. Who is to assay it? It might only be 9ct, or gold plated lead.
No gold is not money/currency/legal tender unless minted as coinage with a stamped face value in dollars, pounds, euros, etc..
Then I could spend it, if not robbed, though the face value might not represent the price of gold as a PM/commodity.
The only way to store gold is in a leaky boat that sinks.
The boat's not here, the boat's not there.
The boat is lost along with my underwear.
Of course you say " The public, you'll scare ! "
To which I say " Au Contraire. "
Thanks to fake paper money, all is fair.