Do Gold and Silver React to QE Anymore?Submitted by Smaulgld.com on Tue, 06/18/2013 - 18:01
Hard Assets Investor made the observation – The QE trade is over, noting that price fluctuations in gold have been disconnected from monetary policy for a while.
As a practical trading matter, Hard Assets Investor is correct. It seems now QE (quantitative easing) impacts the bond, stock and real estate markets but not the gold and silver markets. This is a reversal from the early years of QE when gold and silver soared as a result of QE and real estate was stuck in a rut.
The prevailing trading wisdom seems to be:
-if a handful of doses QE hasn’t created price inflation by now, it won’t ever and hence there is no need to own an inflation hedge like gold or silver; and
-QE only impacts the bond, stock and real estate markets.
Is this true?