Oh, that interest hike drive markets crazy, month after month, day after day. And that is what is happening with gold. With the last Wednesday Federal Reserve talk, saying that Fed isn't that away for pulling the trigger as market may think (markets, for the major part, thinks it's over to see any hike in 2015), gold got lower as they see the raise in the USD value as a threat more than something positive. Meanwhile it got unchanged for October, they made clear they could do the hike. For information, for the last 5 days, Gold did -1.82% as a result of these news. with Wednesday being the peak of the week $1,181.62/oz meanwhile it is now at 1,142$/oz.
Good news for investors I suppose. As gold prices fall they should continue buying more gold because while the value of money will always keep dropping [thanks to inflation] precious metals like gold will always be valuable. At the present though gold shouldn't be the first choice for someone who wants to profit from it in the short term.
Numbers released on Friday fly in the face of the Fed's hawkish statement two days earlier (http://www.cnbc.com/2015/10/30/janet-yellen-just-got-some-pretty-bad-news.html). I wouldn't be surprised if Yellen and company push off any rate hike decision well into 2016. It's time to pay even closer attention to our choices of sectors and investments in the markets. Earnings reports have been a mixed bag and the overall market seems choppy to me.
I'm not sure it is the best news for investors, it depends what point of view you take. These investors already invest their money and so are not that much affected by the loss of the wealth of a money because of inflation: I'm often wondering if, after all, all that inflation phenomenon isn't just there to keep people investing and not keep the money on their account. But the two phenomenons are often tied: a stronger USD will mean a "weaker" gold, automatically. And the hike would "stop" the easing (it is already ended, but interest rates still allow some kind of "free money"), making USD more valuable. The last Wednesday statement was made only 2 days ago, with all the earning in mind and with the oil price in mind as well. I don't think they're stupid enough to fully change their views two days after, they're looking at doing monetary policy, not market stimulus.
I didn't suggest Yellen and company are stupid. Your words, not mine. I said, in my opinion, the newly-released numbers make it increasingly difficult for the Fed to increase rates in the near term. Excelsior (Henry Wadsworth Longfellow).
It's not because you don't say something that you don't imply it. You basically imply that Fed's communication is wrong, somehow, since they hold the speech of "it is likely it could hike" while it looks like (in your opinion) that the hiking isn't really going to happen, and that's what you say since awhile. Basically, that would mean the speech and so on is a masquerade, since you're almost convinced it can't happen, but they still make it appear it could. You see the point? That's why I go ahead and act as if you said they're. I know you don't say that but I tend to focus on the meaning, not on the words.
No, I don't. My opinion doesn't need over-analysis. It isn't that complicated. Simply put, in my opinion, data released Friday *after* the Fed's Wednesday statement may contribute to forestalling Fed action into 2016. Therefore I'm not buying into banks and related sectors at this time; I consider them to be mediocre investments for the near term. There's money to be made elsewhere. Now where did I put that list of penny stocks? Oh yea, over here...
Doesn't the interest hike would affect more the currencies and the gold than it affects banks? I mean, in the middle term, it is directed to banks, obviously, since the interest rates applies to bank, but I would rather thought the most immediate effect could be made on FOREX. I wonder if much profit can't be made by the sudden strength that could happen over the dollar because of that hike. So you think that, until the interest rates goes up, any bank investment is pointless, since as soon as it happens, it would put stocks of the banks in a not so good shape?
