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.
"A year ago, the mood in Europe was horrible and nobody could see how on earth stocks could go up," says Gloom, Boom & Doom author and money-manager Marc Faber, who urged CNBC anchor Maria Bartiromo to buy gold earlier this week.
Gold was off its seven-month high on Monday but the recent wave of central banks who started printing money and bond buying again is very supportive for the yellow metal and euro gold remains close to record highs.
Gold is slightly higher today and is being supported by investor concerns not just about ‘stimulus’ but about “open ended” QE or ‘QE to infinity’. Gold and silver have this week consolidated on their recent sharp gains which is a healthy development.
This year has been eventful for the oil patch. Natural disasters, revolutions, terrorist attacks and political maneuvering kept oil bouncing around $100 per barrel and 3.8% higher on the year at the end of June.