How can we tell if we’re in a short-term bearish trend, or in a bullish trend? by Chris Vermeulen of The Technical Traders In this section of our multi-part research […]
The post Chris Vermeulen: How To Tell Where The Stock Market Is Headed Next appeared first on Silver Doctors.
The Fed creating trillions of new dollars out-of-thin-air makes everything much worse. A return to sound money is an absolute necessity, and only a… by Ron Paul of Ron Paul […]
The post Led By Coronavirus Fake News, The Fed’s Depression Is Here…The Market Says ‘Buy Gold’! appeared first on Silver Doctors.
As the economy crashes, many millions could be left suffering and dying. The number could easily dwarf those killed by the novel coronavirus… by Cory D. Carpenter via Mises As […]
The post Life and Health Are at Stake as the Economy Grinds to a Halt appeared first on Silver Doctors.
If the government lifts all restrictions today, are you going to fly abroad? How about a cruise voyage, or a stadium concert? Maybe even a crowded cinema with… by Arkadiusz […]
The post Will The Fed and Trump Save the US Economy And Sink Gold? appeared first on Silver Doctors.
The economic collapse is here… by David Morgan of The Morgan Report I Told You So | www.themorganreport.com Some day, maybe next year, maybe in 10 years, the economy will […]
The post David Morgan: I Told You So appeared first on Silver Doctors.
Collection posted by Christy-Danielle Mrs-b started a FANTASTIC thread filled with pics of her pretty PriceScopers bling and other joy bringing beauties on the Show Me the Bling forum at PriceScope! PriceScopers support each other, and right now the morale of the world may be a bit low; but we are enjoying heaps of […]
The post Sharing Beauty while Socially Distant appeared first on PriceScope.
If you follow financial news, you know low or negative interest rates historically have been good for gold. But why? How is a tangible asset like gold related to a percentage that’s set by the Federal Reserve? Follow along for the explanation.
In March 2020, the Federal Reserve—which sets monetary policy for the U.S.—cut the Fed funds rate by 1%, to a range of 0–0.25%, in response to worries about a weakening global economy. The Fed funds rate is the interest rate that banks and credit unions charge each other for overnight loans. In turn, this rate trickles down to impact your credit card rates, savings and CD rates, mortgage rates, and sometimes auto loan rates.
In a low-interest-rate climate, gold tends to attract buyers hunting for a safe-haven asset, MarketWatch reports. George Gero, managing director of RBC Wealth Management, told MarketWatch that the Fed funds rate cut and the global economic pullback aided the uptrend for gold.
In early April 2020, the price of gold was hovering around $1,675/oz., close to the high for 2020 so far.
The World Gold Council notes that the Fed rate cut should further support demand for gold among asset holders, even if consumer demand for gold declines.
All of this underscores the correlation between interest rates and gold.
Treasury bond yields also have a relationship with gold.
In tandem with the March 2020 drop of the Fed funds rate, the yield for a benchmark 10-year Treasury bond sank to a record low. In early April 2020, that yield sat below 0.7%.
“When interest rates fall, bond prices tend to rise—driving down yields—as [asset holders] chase a better return by moving money into government bonds instead of keeping their cash in the bank and collecting paltry interest,” Business Insider reports.
But in a low-bond-yield environment, asset holders often seek portfolio alternatives like gold.
“Gold enjoys a number of advantages over Treasury bills, making it a welcome supplement to a portfolio’s liquid-asset holdings and an effective diversifier…. Bullion is an anonymous asset independent of any government’s policy and an international currency free of national boundaries,” according to a report from the World Gold Council.
Some analysts believe gold represents a go-to safe haven amid the current economic turmoil.
“I think the only thing you can own right now is gold,” Adam Button, managing editor of Forexlive.com, told Kitco News in mid-March 2020.
“Right now” could last for a while.
In early April 2020, Jordan Eliseo, senior investment manager at The Perth Mint, said that in light of the current monetary environment and amid economic and market risks, he doesn’t think the long-term upward trend of gold prices will change anytime soon, reports Kitco News.
“The yellow metal looks set to remain an important asset in well-diversified portfolios,” Eliseo said.
In a CNBC interview published in early April 2020, well-respected gold analyst George Milling-Stanley made a case for gold as an attractive asset in uncertain times. He recommends that gold make up as much as 10% of a portfolio.
“In my view, gold is a hedge against the unexpected, whether it is a hedge against macroeconomics or geopolitical [issues] like wars or pestilence,” Milling-Stanley said. “It has always been protection against the unexpected, whatever that might be. Gold tends to perform whenever anything unexpected happens.”
Low interest rates can be good for gold and good for you. Call U.S. Money Reserve at 844-307-1589 to learn more about current gold prices and the precious metals landscape.
The post Gold and Interest Rates: What’s the Correlation? appeared first on U.S. Money Reserve.
“”silver price”” – Google News
Silver Price Forecast – Silver Markets Break Out Again FX Empire
The post Silver Price Forecast – Silver Markets Break Out Again – FX Empire appeared first on WorldSilverNews.