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President Romney "Would Be Bad News for Gold"
TMO ^ | 10-30-2012 | Ben Traynor

Posted on 10/30/2012 9:28:49 AM PDT by blam

President Romney "Would Be Bad News for Gold"

Commodities / Gold and Silver 2012
Oct 30, 2012 - 07:05 AM
By: Ben Traynor

THE SPOT MARKET gold price traded just below $1715 an ounce during Tuesday morning's London session, little changed from last week's close, while European stock markets recovered their losses from a day earlier and UK and German government bond prices fell.

"Downside targets will be in focus while the gold price stays below the 17 October high at $1753.86," says Commerzbank senior technical analyst Axel Rudolph.

The silver price climbed above $32 an ounce shortly after London opened, holding above that level for most of the morning, while other commodities were broadly flat.

Markets in the US are due to remain closed for the second day running as a result of Hurricane Sandy. Monday's trading saw gold futures volumes "far below normal", one analyst said, with another adding the market remained "pretty quiet" on Tuesday morning.

Press reports suggest that this Friday's US nonfarm payroll report could be delayed as a result of the storm.

The Bank of Japan meantime increased the size of its quantitative easing program Tuesday for the second time in as many months, from ¥80 trillion to ¥91 trillion. Of the additional ¥11 trillion, ¥10 trillion will be used to buy government debt while the remaining ¥1 trillion will be put into riskier assets, with half being earmarked for exchange traded funds.

The Yen rallied nearly 1% against the Dollar immediately after the decision, while the Yen gold price fell by 1%.

"Most people had forecast and priced in further easing this time," said Soichiro Monji, chief strategist at Daiwa SB Investments in Tokyo, shortly after the decision was announced.

"Investors are selling to lock in profit after the announcement, learning lessons from September, when a rally lasted for only a few hours."

The BoJ "aims to achieve its goal of 1% [inflation]" said a statement issued jointly by the central bank's governor and Japan's finance and economy ministers.

"The government strongly expects the Bank to continue powerful easing," it added.

"The question that inevitably arises," says Neil Mellor, senior currency strategist at BNY Mellon, "is to what extent government pressure, and the presence of economy minister Maehara, influenced the decision?"

Here in Europe, Spain's economy shrank by 1.6% year-on-year in the third quarter, the fifth successive quarter of contraction, according to official GDP figures published Tuesday.

Spain's parliament is to invite European Central Bank president Mario Draghi to discuss the Outright Monetary Transactions program he announced last month, Reuters reports.

Under OMT, the ECB could buy sovereign debt on the open market conditional on the beneficiary country being in a bailout program.

A victory for Mitt Romney in next week's US presidential election would be bad for the gold price, according to an article published by the Financial Times today.

"[Romney] would replace Ben Bernanke with a more hawkish chairman of the Federal Reserve when the latter’s term expires in January 2014," the FT's Jack Farchy writes.

"If that means a change in direction from the Fed’s current experimental and super-accommodative monetary policy, gold could suffer."

"The Dollar might strengthen regardless of the election result," says Matthew Turner, precious metals strategist at Mitsubishi.

"Political uncertainty would be reduced if there is a clear election victory."

"Should Mitt Romney win, the attitude towards monetary measures is...likely to change " says a note from gold bullion refiner Heraeus.

"In the short term [though] we still expect that [gold] falling below $1700 an ounce would fuel fresh purchases."


TOPICS: News/Current Events
KEYWORDS: economy; gold; recovery; romney

1 posted on 10/30/2012 9:28:51 AM PDT by blam
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To: blam

Guns and ammo will fall too.


2 posted on 10/30/2012 9:30:11 AM PDT by moehoward
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To: moehoward

Bomb shelters, survival gear, windup radios, zombie-bite antivenon...


3 posted on 10/30/2012 9:32:45 AM PDT by SpaceBar
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To: blam

Exactly the opposite will happen.


4 posted on 10/30/2012 9:33:00 AM PDT by STD (“Cogito, ergo armatum sum)
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To: blam; All
well...in economic terms: I've heard (smart :) Bears & Bulls do very well, the (opportunistic) pigs get slaughtered...

5 posted on 10/30/2012 9:33:50 AM PDT by skinkinthegrass (Anger a Conservative by telling a lie; Anger a Liberal by telling the truth. - RWR 8-)
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To: blam

Since a collapsed economy would be good for gold, bring it on...


6 posted on 10/30/2012 9:34:15 AM PDT by babygene
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To: STD

Exactly the opposite will happen.


I tend to agree. With all the money printing, we haven’t seen that money start moving yet, because it’s scared of Obama. The money likes Romney, and will start flaying shortly, at which time all the pent up inflation will be realized. The only way to stop it is to destroy the money, which ain’t gonna happen.


7 posted on 10/30/2012 9:37:06 AM PDT by Atlas Sneezed (Hold My Beer and Watch This!)
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To: babygene

I am significantly invested in gold, but I would rather have the economy rebound and financial markets stabilize, than have the gold price soar.


8 posted on 10/30/2012 9:38:07 AM PDT by Sicvee (Sicvee)
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To: blam
With QE1, QE2,and QE3 inflation will inflate Gold prices and deflate the value of the dollar... The opposite will happen especially with any major market/bank collapse.
9 posted on 10/30/2012 9:40:58 AM PDT by mountainlion (Live well for those that did not make it back.)
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To: blam

Why is someone THIS STUPID allowed to write articles?

Gold goes up as a protection against bad money policies.

It is a CONTRA-INDICATOR of a good economy

When things are humming along nicely Gold is cheap. When they are going to heck in a handbasket gold soars...

Duhhhhhhhhhh........

(not you blam, the article writer)


10 posted on 10/30/2012 9:42:37 AM PDT by Mr. K ("The only thing the World would hate more than the USA in charge is the USA NOT in charge")
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To: Beelzebubba

All that’s holding back inflation now (though I still assert that it’s being hidden through various means) is that there is no money velocity.

Everyone is hoarding their money out of fear of 0bama policies.
When the velocity picks up, whoa, Nelly! Too many dollars chasing too few goods.


11 posted on 10/30/2012 9:43:10 AM PDT by MrB (The difference between a Humanist and a Satanist - the latter admits whom he's working for)
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To: SpaceBar
Bomb shelters, survival gear, windup radios, zombie-bite antivenon...

Anti-depressants..

Gun sales to Mexico..

zombie-bite antivenon...
heheh I laughed when I read that. :)
12 posted on 10/30/2012 9:50:56 AM PDT by MeOnTheBeach
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To: blam

If Prez Romney implements a fraction of what he promised, our economy will take off. There is a lot of pent up demand and corporate cash waiting for the right moment.

With the rest of the world in a slump, the foreign investors will bring trillions of dollars back to U.S. markets.

The lib media will howl as inflation takes off. U.S. equities, RE, and PMs should rise as well.

There is normally a time lag between increases in money supply and resulting inflation. Romney will get blamed for Bernanke’s and Obama’s folly.

BTW, Blam, thanks for your continuing excellent coverage of financial news. You perform a valuable service for your fellow Freepers.


13 posted on 10/30/2012 9:52:02 AM PDT by darth
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To: blam

Loose money policy is what Bernanke and Obama love. Romney getting in would mean a tighter money policy...bad for gold. No one can be as loosey goosey, as spendthrift and financial illiterate Obama. Obama only cares about spending Federal tax dollars on buying votes, affirmative action programs,food stamps, welfare, green energy and other idiocies

Bernanke just might resign if Romney gets in. Bernanke Fed term runs until 2014 but if Romney wants him out, I think he will accommodate


14 posted on 10/30/2012 9:53:48 AM PDT by dennisw (Government be yo mamma - Re-elect Barack Obama)
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To: Sicvee
I am significantly invested in gold, but I would rather have the economy rebound and financial markets stabilize, than have the gold price soar.

A voice of sanity in a sea of craziness.

Didn't Romney mention going back to a gold standard? That would do wonders for your investment, I would think.

15 posted on 10/30/2012 9:57:59 AM PDT by Jane Long (Soli Deo Gloria!)
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To: blam

It concerns me that there are so few who follow John Williams of Shadowstats, Jim Sinclair of Mineset, Dan Norcini on Trader Dan and the many voices on King World News. After 50 years of market watching I feel these folks are quite as wise as possible and they are pretty close to unanimous in being bullish for the gold and silver side and bearish on the fiat currency. They dont think we conservatives can turn our sinking economy around in time which is why one should hedge deeply as possible with physical bullion...


16 posted on 10/30/2012 10:01:59 AM PDT by the Lord Blessyouall
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To: the Lord Blessyouall
QE3, A Light On The Future For Investors
17 posted on 10/30/2012 10:09:21 AM PDT by blam
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To: blam

Bad news for gold is good news for the world.


18 posted on 10/30/2012 10:09:37 AM PDT by cynwoody
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To: blam

The massive money printing and balance sheet expansion should ensure dollar devaluation under an inflationary depression with 0bama, and economic expansion, hopefully, under Romney. If Romney wins, all the dollars sitting on the sidelines will flood into the economy and likely produce inflation. The big question is whether a lot of the money sitting on the sidelines will be taken out of gold and into productive investments so that the gold price falls. I think at least in the short run, gold will fall with a Romney win as many switch from gold to energy investments.


19 posted on 10/30/2012 10:41:37 AM PDT by grumpygresh (Democrats delenda est; zero sera dans l'enfer bientot)
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To: blam

already read this but thanks anyhow! much seems in accord with thinking shared by ‘wise men’ I follow and nice to think some other good voices out there!


20 posted on 10/30/2012 10:41:52 AM PDT by the Lord Blessyouall
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To: blam

It’s a bit crass to worry about gold when so many Americans are worried about food and fuel if Romney doesn’t win.


21 posted on 10/30/2012 10:57:48 AM PDT by douginthearmy
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To: douginthearmy
"It’s a bit crass to worry about gold when so many Americans are worried about food and fuel if Romney doesn’t win."

I understand your point, but it's NOT wrong for people who have worked hard and done the right things over the years to want to protect their savings against inflation and/or financial collapse. None of that is their fault, after all.

22 posted on 10/30/2012 11:42:10 AM PDT by Mich Patriot (PITCH BLACK is the new "transparent")
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To: blam

So since you know all this.....SELL! Take your profits and move on. Did you invest in gold, or did you marry it? If you want to always have something “bullet-proof” to frall back on, leave some in the safe and take your profits on the rest. Life’s full of trade-offs. We NEED a new POTUS, and a new Fed Chairman..... In fact, we need a house-cleaning! You manage your gold as you think best. You would be well-advised to lay up some treasures in Heaven, too.
Mark 8:36 For what shall it profit a man, if he shall gain the whole world, and lose his own soul?


23 posted on 10/30/2012 12:28:23 PM PDT by Tucker39
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To: Mich Patriot; All

What an idiotic, short-sighted article.

In the event of a resurgent US economy, those who’ve wisely protected themselves with gold these past years could now stand to make even more money now by intelligently investing its growth.

Economics is not a zero-sum game.


24 posted on 10/30/2012 3:41:31 PM PDT by Utmost Certainty (Our Enemy, the State)
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To: Beelzebubba

http://www.shadowstats.com/alternate_data/money-supply-charts


25 posted on 10/30/2012 3:46:53 PM PDT by EBH (0bama is guilty of willful neglect of duty.)
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To: blam

I wonder how long after the election the hangover will occur. Most of the people active in politics are dependent on recirculating debt without adequate, sustainable revenues from manufacturing on US soil. Could be a consumer spending spree after the election, but look at the demographics of those who’ll spend. Maybe an inflationary bulge followed by a terrible slowdown. [Little understatement there.]


26 posted on 10/30/2012 4:51:50 PM PDT by familyop (We Baby Boomers are croaking in an avalanche of rotten politics smelled around the planet.)
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To: familyop
"Maybe an inflationary bulge followed by a terrible slowdown. [Little understatement there.]"

That's my expectation.

27 posted on 10/30/2012 6:45:09 PM PDT by blam
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