Watch Powell’s presser live right here at 2:30 p.m. EST, see the replay if you’re reading this at a later time, and come on in for an update regardless…
Going into today’s FOMC statement release and the Fed’s interest rate decision, the CME Group was putting the probability of a rate hike at .5%:
For quite some time now, the probably has been certain, or nearly certain, that the Fed would hold.
And hold they did.
The Federal Reserve said it will be “patient” on any future interest-rate moves and signaled flexibility on the path for reducing its balance sheet, in a substantial pivot away from its bias just last month toward higher borrowing costs.
The Federal Open Market Committee “will be patient as it determines what future adjustments to the target range for the federal funds rate may be appropriate to support” a strong labor market and inflation near 2 percent, the central bank said in a statement Wednesday following a two-day meeting in Washington.
It’s ironic really, because January was what, the best stock month for stocks, like ever?
Now I’m exaggerating because I actually don’t know how the stock market performance this January compares with other Januaries, but this one is certainly up there as one of the best Januaries ever, if not the best.
I just don’t know ’cause I ain’t done the stinkin’ research.
Yet we have a Fed that is on hold.
What a freakin’ circus side-show mixed in with a circle-jerk but without the common courtesy of handing out some circus peanuts.
But I digress.
Here’s gold & silver the moment the news “hit the tape”:
Remember, knee-jerk reactions are not always the actual direction of the eventual move, so we’ll just have to see.
I think that no matter what happens with the Fed Funds Rate going forward, holds, cuts, or increases from here on out, however, it will all be bullish for gold & silver.
Here’s the thing: If they hold rates steady because they’re dependent on the incoming data, as they
lie claim they are, well, holding is an indication of weakness somewhere in the US economy, which would be dollar negative and good for gold & silver.
Here’s the other thing: If they cut rates, well, that’s debasement of the currency with easy money policy, and that’s good for gold & silver.
Here’s the final thing: If they hike, they’re trying to get in front of inflation, and that’s good for gold & silver because gold & silver are inflation hedges.
So it’s win-win-win for gold & silver investors, cartel be danged.
It’s a trifecta, and it’s only a matter of time now.
Here’s one last thing: Since no matter what the Fed does is bullish for gold & silver, since the cartel is waiting until basically the physical gold & physical silver markets blow-up the fraudulent paper markets before allowing a more natural price discovery of the metals at much, much higher price levels, then that’s all the higher those price levels will ultimately be.
So it’s fine by me.
Here you can watch Powell’s press conference live (if you can stomach it):
Thirty minutes in and we see gold & silver are looking good here:
Let’s see if we can manage a close above $16 on the week.
I think we can.
What’s the bottom line?
The bottom line is that nothing has changed.
There is a dog-n-pony show, a circus side show, Kabuki Theater, WWE Wrestling, or whatever you want to call it coming out of Washington DC politics and coming out of the Fed.
And in that environment, gold & silver can’t lose.
Because we know how the show ends.
It is not even a very good show.
They’ve burnt the popcorn.
And the soda is flat.
– Half Dollar
About the Author
U.S. Army Iraq War Combat Veteran Paul “Half Dollar” Eberhart has an AS in Information Systems and Security from Western Technical College and a BA in Spanish from The University of North Carolina at Chapel Hill. Paul dived into gold & silver in 2009 as a natural progression from the prepper community. He is self-studied in the field of economics, an active amateur trader, and a Silver Bug at heart.