The myth that the Fed is somehow more reckless than everyone else in printing money has been cited again and again as a reason to buy gold. No doubt about that, as the Fed starts QE-Infinity, these talks are back. Of course, we showed that the scale of Fed’s balance sheet expansion is nothing compared with some of the Fed’s peers. Still, there has been a large expansion of the Fed’s balance sheet. So exactly what does central banks’ balance sheet expansion do to gold prices?
The chart below shows the year-on-year change of Gold priced in US$ and the year-on-year change of Fed’s balance sheet.
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The chart below shows the year-on-year change of Gold priced in US$ and the year-on-year change of People’s Bank of China’s balance sheet in Chinese Yuan.
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The chart below shows the year-on-year change of Gold priced in US$ and the year-on-year change of People’s Bank of China’s balance sheet, converted into US dollar.
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at http://feedproxy.google.com/~r/AlsosprachAnalyst/full/~3/k2aGM5hJicY/gold-price-and-central-banks-balance-sheet-expansion.html#ixzz278B4jpSc
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