FED Funds, At the High?
Posted on June 30th, 2006 by MoverMike
Is this why the market surged, the USD swooned and Gold took off like a rocket?
Chart of the Day says
While the last Fed tightening cycle (gold dashed line) fell a touch short of average, this tightening cycle has already witnessed a run that is a touch more than average.
To me it means the FED has reloaded. We now are at a point where interest rates can be reduced, after all, that debt has to be repaid and interest is a big expense. When it comes down to a choice between an economic collapse or inflation, the FED is going to flood the world with liquidity. This is great for Gold, lousy for the USD!
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