Obama’s Victory Ensures “Four More Years” of Gold-Friendly Policies
By jturbin | November 8, 2012 8:21 AM EST
The outcome of yesterday’s U.S. election is likely to produce “the best of all possible world’s for gold investors,” according to Jeffrey Nichols, Managing Director of American Precious Metals Advisors.
In his latest commentary, Nichols – who has been correctly bullish on gold for the better part of the past decade – argued that President Obama’s re-election, coupled with a Democrat majority in the Senate and a Republican majority in the House, will lead to “four more years of recession-like economic activity or worse, four more years of fiscal gridlock with annual trillion-dollar federal deficits.”
“Most importantly for gold-price prospects,” Nichols added, “four more years of accommodative Federal Reserve monetary policies.
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He went on to say that “With the election now behind us, the market’s short-term attention will re-focus on possible Federal Reserve policy initiatives that may be discussed or even initiated at the December 12th FOMC policy-setting meeting. There is already talk of further quantitative easing, expectations of which could soon become a strong up-side price driver.”
As for the prospects of a new Fed chairman – as Ben Bernanke is not expected to seek another term when his current one ends in 2014 – Nichols asserted that Obama is very likely to appoint another ultra-dovish individual to the head of the central bank.
Nichols concluded by writing that “These and other positive price drivers and physical market fundamentals could form a ‘perfect storm’ for gold in the closing weeks of 2012 – and, quite possibly, we could see the metal approach or even surpass its record high by year-end or early 2013.”