Originally Posted by Arkie
9/11 had very little to do with gold's trajectory. It slowly went up about $25/yr after 9/11. It was around 2006 when more and more savvy investors began to see the upcoming financial crisis that accelerated the rise in gold. It was becoming clear that quantitative easing was inevitable, that government would have to pick winners and losers, that the debt ceiling would have to rise higher and more frequently, etc. Our economic model is flawed. The markets will crash if they pull back on QE, but that can't go on forever. The debt will only decline through inflation or default, and both make gold more expensive.
Only if the quarterly data doesn't justify the easing.
The market has been expecting a correction for a few months now, and since the Fed announcement, bonds will likely take a dive....as will equities, but a crash would mean more significant
bad news. ie, unemployment rising or stagnant, manufacturing, housing numbers dropping etc.
Time will tell if the Feds are right about the economy, and there is no guarantee they won't continue to support bonds if the data looks fragile.