Twice.
That is the number of times the Federal Reserve has raised rates in a decade. Ten years. This is not how a normal economy works. It is also evidence that we are far from having escaped the shadow of the financial crisis of 2008.
So what happens over the next decade? That is the subject of a lot of electronic ink being spilled. Rising rates are not friendly to $20 trillion in US government debt. Nor is it friendly to the tens of trillions of debt on the books of other world nations.
But what happens when the market forces rates higher? When the Fed is not in the front seat driving, but rather in the back seat watching?
It’s commonly thought that the price of gold and silver fall with rising rates. That correlation holds early in the cycle. However, if either deflation or inflation begins to rear it’s ugly head the price of gold and silver take on a life of their own.
With the glut of debt around the world, it is not out of the realm of possibility that we see one or the other. Just the possibility will send gold bullion prices higher until this situation is truly and finally resolved, and that may take years.