How Obama and Manmohan will drive up the price of gold

If Obama wins and our government continues to worsen the budgetary gap - as seem likely - gold bulls should be in high spirits ‘Miss deMaas,’ Van Veeteren decided, ‘if there’s anything I’ve learned in this job, it’s that there are more connections in the world than there are particles in the universe.’ He paused and allowed her green eyes to observe him. At its last meeting held on 31 July-1 August, the Federal Open Market Committee led by Bernanke said in a statement, “The Committee will closely monitor incoming information on economic and financial developments and will provide additional accommodation as needed to promote a stronger economic recovery and sustained improvement in labor market conditions in a context of price stability.” The phrase to mark here is additional accommodation, which is a hint at another round of quantitative easing. In a speech titled Monetary Policy since the Onset of the Crisis, made at the Federal Reserve Bank of Kansas City Economic Symposium at Jackson Hole, Wyoming, on 31 August 2012, Bernanke said: “Taking due account of the uncertainties and limits of its policy tools, the Federal Reserve will provide additional policy accommodation as needed to promote a stronger economic recovery and sustained improvement in labor market conditions in a context of price stability.” Central bank governors are known not to speak in a language that everybody can understand. As Alan Greenspan, the Chairman of the Federal Reserve before Bernanke took over, once famously said, “If you think you understood what I was saying, you weren’t listening.” But the phrase to mark in Bernanke’s speech is “additional policy accommodation,” which is essentially a euphemism for quantitative easing, or more printing of dollars by the Federal Reserve. I think it Paul Ryan, Romney’s running mate, also echoed his views when he said “Sound money… We want to pursue a sound-money strategy so that we can get back the King Dollar.” This has held back the Federal Reserve from resorting to QE-3, because come November Bernanke will be working with Romney or Obama.