I Have A Humbling Confession To Make…
I have to come clean…
I was completely wrong about how much Fed Chairman Ben Bernanke would taper in last Wednesday’s FOMC meeting.
You see, in a Commodity Profit Hunter trade alert sent out the day before this historic Fed announcement, I predicted Bernanke would start paring back the Fed’s stimulus program.
My conservative estimate had the Fed Chairman announcing $10 billion a month in reduced bond purchases. The number would be just enough of a reduction to let the markets know that QE3 isn’t going to last forever.
Boy was I wrong…
Mr. Bernanke shocked investors when he announced there would be NO reduction in US bond and mortgage backed security purchases for the foreseeable future.
In other words, my tapering estimate was $10 billion too high. The Fed will continue pumping $85 billion a month into the US economy, as it has done for just over a year now.
But here’s the deal…
I also made a carefully calculated bet in Tuesday’s Commodity Profit Hunter trade alert that silver would react to Wednesday’s FOMC meeting with a shocking rally.
Even though I thought Bernanke would taper, I was confident it would be less than Wall Street’s expectations.
Oh boy did that call ever come through!
Silver surged nearly 6% in Wednesday afternoon trading.
Now I can’t tell you precisely what trade we made in the Commodity Profit Hunter to profit from this situation. Nor can I reveal the remarkable short-term percentage gain we’re sitting on right now. Revealing that data just wouldn’t be fair to my loyal subscribers.
But what I can tell you is this…
Now that Bernanke is admitting the US economy isn’t performing as well as he’d like, he’s keeping his foot on the monetary gas pedal. And that means inflation worries may start creeping back into the marketplace.
Due to this unexpected development, precious metals will likely see continued bullish momentum in coming months.
In fact, I’m willing to bet gold, silver, platinum, and palladium all break to new multi-month highs in the near future.
Now, there is a risk to my prediction…
We could see economic data start coming in so strong over the next few months that Bernanke has no choice to start paring back Fed bond purchases.
…but I seriously doubt that will happen.
With the holiday shopping season fast approaching, tapering would put consumer confidence at risk- right when it counts the most. As you may know, the holiday shopping season is a crucial period for the US economy.
Bottom line…
Bullish precious metals investors have renewed hopes thanks to Bernanke’s shocking announcement. You’ll likely be sitting on solid profits come December if you buy precious metals now.
Until Next Time,
Justin Bennett
***Editor’s Note*** If you’d like to discover how to capitalize on commodity price fluctuations without the enormous risks of opening a futures account, take a look at my breakthrough service… Commodity Profit Hunter.
Category: Precious Metals
