Gold Realizes the Sad Truth… the Fed Screwed Up
The Fed is Officially Screwed.
The Fed has maintained rates too low for too long. Historically any time this has happened we’ve had an inflationary disaster soon after.
The Fed claims to be data dependent, but if you’re talking about inflation data this is a lie.
Core inflation hit the Fed’s “target” of 2% back in October 2015. The Fed has hiked rates only once since then. And inflation is rising, NOT falling.
Sticky inflation has been above the Fed’s target rate of 2% since mid-2014.
And yet, rates remain at 0.5% with only one rate hike in the last decade. Meanwhile commodities have bottomed from their 2014-2016 shellacking and are now moving sharply higher.
The CRB index is up 21%.
Oil just broke above $50 per barrel.
What happens to the inflation data once it starts picking up on these moves? What happens when the 2014 and 2015 prices are no longer the year over year comparisons and energy prices are up 10% year over year?
Gold is already picking up on it. Once this current correction ends, the precious metal will be clearing $1500 per ounce.
We believe the next leg up is about to begin for Gold. Those who remember form the last Gold bull market in the ‘70s, it was the second leg of Gold’s bull market that saw the most gains.
From 1970 to 1974, Gold rose 550%. It then took two-year breather before beginning its second, much larger leg up. During that second leg, it rose over 900% in value.
If Gold were to stage a similar move now, it would rise to over $10,000 per ounce.
On that note, we just published a Special Investment Report concerning a secret back-door play on Gold that gives you access to 25 million ounces of Gold that the market is currently valuing at just $273 per ounce.
The report is titled The Gold Mountain: How to Buy Gold at $273 Per Ounce
We are giving away just 100 copies for FREE to the public.
To pick up yours, swing by:
Chief Market Strategist
Phoenix Capital Research
The article, "Gold Realizes the Sad Truth... the Fed Screwed Up", was syndicated from and first appeared at: http://feedproxy.google.com/~r/zerohedge/feed/~3/HSzd7w2Ya30/gold-realizes-sad-truth-fed-screwed.
You may find more great articles by Phoenix Capital Research on http://www.zerohedge.com/fullrss2.xml/sites/default/files/images/user5/imageroot/draghi/CBO%20August%201.png/%2A%7CFORWARD%7C%2A.