silverdoctors.com / ByMorris Hubbartt / December 2, 2012
Many market pundits seem to have forgotten how strongly QE can affect the price of gold. This gold chart highlights those effects, with a broad green “chart brush”. Note the thick green bars. They highlight the gold price action during QE1 & QE2. I believe QE3 (and possibly QE4) will produce very similar results. When the Fed purchases bonds in the open market with printed money, gold tends to rally for a significant period of time.
Quantitative easing is positive for gold, and the effects on silver are even more powerful. This chart highlights the enormous gains that silver achieved during both QE1 and QE2. My focus is physical silver, because of concerns about the banking system and growing volatility.
My short term target is $44, which should be acquired at about the time that gold reaches $1850. To put that in perspective, I expect silver to gain about 29%, while gold gains 7%. That’s an outperformance ratio of about 4 to 1!
US Dollar Pillars Of Blood Chart
Gold Report Sign Up Below