Tags: Obama | gold | debt ceiling | continuing resolution

4 Extraordinary Events This Fall Impacting Gold

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Friday, 30 Aug 2013 12:53 PM Current | Bio | Archive

In addition to the regular economic indicators like the unemployment rate and housing sales, there will be four extraordinary events this fall that will impact gold prices.

The federal government needs to be funded by Oct. 1, either through another continuing resolution or passing a budget.

The Republican-led House has passed two budgets only to be stymied by the Democratic-led Senate, which finally has passed its first this year. The Senate budget has big tax increases and modest spending cuts, while the House budget has no tax increases and big spending cuts, making the reconciliation process a near impossible one.

This makes another continuing resolution more likely, which is basically continuing the same spending as the last passed budget.

The federal debt ceiling will need to be raised by mid-October. President Obama refuses to negotiate over increasing the debt ceiling and the Republicans in Congress want to use the debt ceiling debate to push for spending cuts, but are divided about whether to include defunding Obamacare.

Another round of sequestration cuts goes into effect Jan. 1 if the outcome of the federal debt ceiling and budget debate does not result in significant cuts. While Obama tried to make the first round of sequestration painful for ordinary Americans in order to put political pressure on Congressional Republicans, the strategy backfired, as most Americans did not feel the pain directly.

Because sequestration comes out of discretionary spending (basically everything but Medicare, Medicaid and Social Security), expect the second round of sequestration cuts to have a bigger negative impact on our struggling economy.

Finally, Federal Reserve Chairman Ben Bernanke's term ends on Jan. 31, 2014, which means Obama should nominate a candidate this fall. Expect the hearings to be a public referendum on the president and the Fed's handling of the economy and a bumpy ride for the nominee.

Because the resolution to all these four extraordinary events is anyone's guess, it creates uncertainty, which is good for gold.

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Ed-Moy
In addition to the regular economic indicators like the unemployment rate and housing sales, there will be four extraordinary events this fall that will impact gold prices.
Obama,gold,debt ceiling,continuing resolution
326
2013-53-30
Friday, 30 Aug 2013 12:53 PM
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