Gold and Silver Prices Volatile on Opposing Views from FED Members

Jon Banking, Blogosphere, Economy, Fiscal Policies, Gold, Government, Market Commentary, Precious Metals, Silver

The FED has made the booms and busts much more exaggerated than they otherwise would be. Their ability to unilaterally dictate interest rates rather than allow the free markets to determine equilibrium, has generated an incredible amount of volatility for investors.
Gold and silver have enjoyed a powerful rally in 2016, which started right after the FED last raised interest rates. Yet, the fear of the FED raising rates by another 25 basis points has paralyzed gold investors. Equity investors are also hanging on every word that comes from our overlord central planners.
Yesterday when Federal Reserve bank president Eric Rosengren said that he thought it might be appropriate for the U. S. central bank to start raising rates, the stock market crashed hard yesterday, having the second worst day of the year behind the BREXIT panic.
Then today, Fed Governor Lael Brainard delivered a dovish speech in Chicago. Of particular note is the fact that she deviated from the FED’s message of needing near-term rate hikes and instead mentioned several reasons that the FED should not raise rates yet. These included low inflation, labor market slack, and volatile foreign markets.
Her opinion is not new, but she re-iterated her stance and the market took notice. Stocks climbed from an morning decline to close the day up 1.5%. Gold and silver also reversed earlier losses to close the day in the green.

This post was published at GoldStockBull on September 13th, 2016.