I’ve posted a chart in the past that shows clearly gold can go up or down when interest rates are rising. It can go up or down when rates are falling. It’s less about the direction rates are going and more about expectations. If rates are rising, and everyone is confident that it’s a good thing and it’s going to achieve its aim – perfect, what’s the problem ? If rates are rising as some sort of panic measure, that’s different. How about where we find ourselves today ? As a reminder, this is what we were told to expect less than 12 months ago…

 

A path beyond 3%. Many have been warning for a very long time that it can’t happen for one simple reason. DEBT. It doesn’t matter until it does. Well, we’re there now – IT DOES MATTER. All of a sudden, just like that, everyone knows it. We’ve reached the point where rates can rise no more. The US would collapse under its own debt burdon. So there you have it. The Emperor has no clothes, The Fed has no bullets. The Dollar will suffer badly as a result, and gold will fly (the miners will mean-revert). All my own views of course, and you may disagree, but I suggest the facts speak for themselves.