Australia's central bank cut interest rates for the second time this year on Tuesday, seeking to buttress the economy against sliding mining investment while heading off a harmful increase in the local dollar.
Even after five years of the Fed’s most aggressive accommodative policy in history, there is still a lack of hoped for quality credit creation in the economy, which could be a sign that the greatest deleveraging of the U.S. economy since the Great Depression is still not complete. The Fed’s unrelenting dovish policy appears to support this concern.
By December, the most recent month for which statistics are available, the U.S. dollar Fiat Money Quantity (FMQ) had grown to $12.48 trillion. This is $5.05 trillion more than if it had grown in line with the established average monthly growth rate from 1960 to the month before the Lehman Crisis.
Tuesday Sept. 6, 2011 was wet and windy, both in London and gold. Late Asian trade had seen the wholesale gold price rise 1.4%, reaching $1,921 per ounce. Prices then turned lower, and by the time New York opened the air was hissing out of gold futures.
Western economic commentary on China and Russia is usually colored by monetarist assumptions not necessarily shared in Moscow and Beijing. For this reason, Russian and Chinese fiscal and monetary policies are misunderstood in financial markets, as well as the reasons their governments buy gold.
Don't fall for propaganda from the Federal Reserve about tapering quantitative easing, says ShadowStats editor John Williams. His corrected economic indicators show the U.S. is nowhere near a recovery and the Fed will have to increase bond buying to prop up banks and push off inevitable dollar debasement.
Throughout history many fortunes have been made and lost in real estate. Luck has of course played a part in these outcomes, but the main reason for changing fortunes is the decisions that were made, whether good or bad.
Interpreting China’s economic future as having only two possible paths is an oversimplification. China’s economy is complex and, with an uncertain global backdrop, several in-between scenarios are possible.
So far, gold and silver have been the main beneficiaries, rising in the week before the FOMC meeting in anticipation of more stimulative monetary policies, and then, after the announcement, reacting to the aggressive monetary stimulus.