Tag Archives: qe3

Is the economy addicted to stimulus? How can we protect ourselves from government policies and market volatility with gold? The Federal Reserve is preparing to end its third round of bond buying next week. In this edition of the Market Report, Precious Metal Specialists Will Hart and Jake Kennedy discuss Quantitative Easing, inflation, dollar devaluation, and gold as a safe haven asset. Listen to the full report here.

Ranging across the marketplace, gold spent the week defying common wisdom and forcing the hands of crystal ball gazers all over the world. On Friday gold closed at $1,648, with silver walking alongside, closing down 2.8% at $29.32. These swings proved too much for paper gold, creating an illusion that the yellow metal was collapsing. Technical sell-offs caused many to scratch their heads as gold stayed above $1,600. The jobs report, a stronger dollar, and an announcement by the Fed that QE3 may end sooner than expected were used as explanation for the bearish bull. Something to watch, however, is the Indian government seeking to balance its trade deficit by raising taxes on imported gold. India is the world’s biggest buyer of gold. If these consumers are priced out of gold, what could we expect from silver? Only time will tell.

With the US elections over and maintaining the status quo for the most part, are we back to square one, or can we expect reverse motion away from the fiscal cliff? The markets didn’t think so last week, with gold closing up at $1,738 and silver at $32.16. As indicated last week by astute analysts, the election was a non-event for the markets, though it has made it clear that hedging in gold and silver is a very good idea. Have you talked to one of our precious metals specialists yet? It’s time to ready yourself for the likely paper burn as inflation picks up. You may reach us at (800) 355-2116.

Fueled by continued chatter surrounding the indefinite duration of QE3 and the nearing “fiscal cliff”, gold reached fresh 2012 highs last week, nearly hitting $1,800 before settling at $1,784. All metals were up for the week, and we continue to see calls across the board for precious metals to continue their upward trends.

On the heels of the Fed’s announcement of QE3, Morgan Stanley is already predicting a fresh round of quantitative easing to be thrust on top of the $40 billion to enter the economy each month. What does it mean for your investments? And for gold and silver?