Fed Talk of Helicopter Money Gave A Little Boost to Gold and Silver Prices

5:42 AM


July 14, 2016 --Gold, silver, and mining stocks all rose during yesterday's trading. The sector got another boost from some weakness in the U.S. dollar, safe-haven investing, and even a bit of speculation.

U.S. stocks finished mixed on Wednesday with the Nasdaq down 17 points, the DOW up 24 and the S&P 500 unchanged.

Federal Reserve policy is back in the headlines. Loretta Mester, a regional president and FOMC member, confirmed that so-called helicopter money is a tool officials will indeed consider if current policy is ineffective.

Former Fed Chairman Ben Bernanke famously argued that the central bank ALWAYS has the power to generate price inflation. If all else failed, they could fly over America dropping money from a helicopter or, in other words, issue new money directly to citizens to encourage spending.

Price inflation and growth in the U.S. remain well below the official targets -- despite years of exceptionally low interest rates and trillions of dollars in bond purchases by the Fed. And similar measures in Europe and Japan have thus far failed. So it's within reason we could see officials start talking about direct payments to citizens through tax rebate checks or other measures.

Live prices at MoneyMetals.com show gold currently trading at $1,326.50 per ounce on the global market, and silver is coming in at $20.20.

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