FOMC to Give Gold & Silver Markets Direction

Gold and silver prices bounced around a bit in early morning trading before eventually settling just above even around 3pm Texas time Monday. Gold finished the day up $2.10 to $1241.80 while silver increased an impressive $0.33 to $19.99 per ounce. Silver’s 1.6% gain for the day represents that metal’s biggest upward moves in weeks and could serve to spark a rally in silver prices as analysts have been predicting a decrease in the gold/silver ratio for months.

Gold and silver aren’t the only investments that rose sharply before leveling off today. The Dow Jones Industrial Average shot up over 140 points due to rumors of what could happen in the upcoming FOMC meeting. At the time of this writing the general consensus seems to be that no new actions will be taken by the Fed, including tapering of quantitative easing or raising of interest rates.

U.S. stock markets have benefited greatly from the Federal Reserve’s booster packs of low interest rates and corporate stipends, but some lawmakers have said that the flow of free money needs to cease no matter the state of the economy. Their attitude of “if it hasn’t worked by now it’s not going to work” is shared by many Americans who have watched their personal savings shrivel while corporations and their directors bask in billions of dollars in bailouts and bonuses.

The Fed may not change course right now, especially with a new chief coming in next year. Experts generally agree that interest rates will have to be raised in 2014, and once the Fed pulls the reins in on Wall Street some say commodities could take off again. For now, however, all we can do is prepare for the imminent day that Washington’s house of cards comes falling down.

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