Wednesday, 8 February 2012
Gold price growing with balance sheet of FED and ECB
The chart of Strategas shows that there is a reasonable correlation between the endless expanding of the balance sheets of the central banks and the gold price. Overliquidity ought to lead to higher gold prices. The connection between currency reserves in the world and the gold price is even stronger and longer (before 2006 the gold price didn’t move in tandem with the balance sheets of central banks).