Gold, silver futures tumble after Fed minutes

So gold falls $60 in less than 24 hours because some members of the Fed believe QE should end by the end of 2013 but the stock market is down only mildly. Typical gold market shenanigans. There is no way the Fed will stop QE, unless they want the bond market to crash and drive the economy into free fall. Who is going to buy the $3 trillion in Treasury bonds being issued this year ($1.5 trillion budget deficit, $2 trillion in maturing bonds)? The Fed is the only buyer and will continue to monetize the debt with QE funny money. The buying opportunity of the century may be upon us for gold and silver.-Lou



Gold, silver futures tumble after Fed minutes


FRANKFURT (MarketWatch) — Gold got knocked back below $1,650 an ounce on Friday, extending losses in European trade, a day after minutes of the Federal Reserve’s most recent meeting suggested the Fed’s asset purchases may end this year.

Gold futures for delivery in February GCG3 -2.59% tumbled $44.60 an ounce, or 2.7%, to $1,630 an ounce, adding to the $14.20 loss suffered overnight on the Comex division of the New York Mercantile Exchange, pulling back after recent gains.

The precious metal’s futures had dropped as low as $1,646.80 earlier in the day. In the spot market, gold prices were down $14.50, or 0.9%, at $1,649.30 an ounce.

The declines followed minutes of the Fed’s last meeting, which showed that several Fed officials thought the central bank would be able to slow or stop the purchases well before December 2013.

Some members didn’t set a specific timeframe for ending the Fed’s asset-purchase program, widely known as quantitative easing. Read full story on the Fed meeting minutes.

The Fed’s quantitative easing is generally recognized as a major source of liquidity that weakens the U.S. dollar and helps support prices of a range of assets, including gold.

“The range of views on the likely timing of completion of asset purchases was apparently sooner than market expectations,” analysts at Barclays wrote to clients.


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