Fed raising rates again - what's this mean for our gold?

Donald Nelson

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Fed raising rates again - what's this mean for our gold?

donald_nelson💎Premium (500k-1m)

about 2 hours ago

Key Takeaways

•Another month, another Fed rate hike.
•I know a lot of you out there are glued to the news every time Powell opens his mouth, just like I am.
•Been in gold for over 20 years now, since back when I was still wrenching on assembly lines in Detroit.

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Another month, another Fed rate hike. I know a lot of you out there are glued to the news every time Powell opens his mouth, just like I am. Been in gold for over 20 years now, since back when I was still wrenching on assembly lines in Detroit. Built up a decent little nest egg, somewhere between 500k and a million in my portfolio, and a good chunk of that's held in physical gold in my IRA. So, these interest rate decisions aren't just academic for me; they directly impact the value of something I’ve put a lot of faith and retirement savings into.

My thinking has always been that higher rates usually strengthen the dollar, which can make gold less attractive as an alternative asset. But we've seen some weird stuff lately where gold's held its own, or even gained, despite the Fed trying to cool things down. Is this just because inflation is still running so hot that gold's traditional role as a hedge is overpowering the rate hike effect? Or are we seeing smart money piling into gold because they know the Fed can only go so far before they have to pivot, and when they do, things could get really interesting?

I remember back in '08, even before I retired, seeing how gold reacted to all the uncertainty. It wasn't always a straight line, but it certainly shined when other things were crumbling. This time around feels different though, with the global economy being so interconnected and all these geopolitical tensions. What are you all seeing in your own portfolios? Are you still stacking, or waiting to see how high the Fed is willing to push these rates before something breaks? Really curious to hear some other long-term gold investors' perspectives on this.

5 comments

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Best Answer▲ 10 upvotes

matthew_murphy👑Elite (1m-5m)

While I totally get why everyone's looking at the Fed's moves, and you've definitely got the experience, I sometimes wonder if we give them too much credit for gold's immediate price action. Sure, there's a correlation, especially with the dollar, but gold often dances to its own tune too – geopolitical stuff, inflation expectations that go beyond just interest rates, even just general market sentiment. It's not always a direct cause and effect, ya know?

Comments (5)

jason_morgan💰Established (100-250k)Real Investor✓ Verified•less than a minute ago

Yeah, I hear you! It feels like Groundhog Day with these announcements. Honestly, I've kinda stopped trying to predict the immediate impact on my gold. I had a similar experience back in '08 where I thought the sky was falling and considered selling, but then things stabilized and my gold actually held its own pretty well. It's more of a long-haul play for me now, less about the day-to-day Fed pronouncements.

janet_cook📊Growing (50-100k)•less than a minute ago

Hey, interesting perspective! You mentioned being in gold for over 20 years. Are you generally seeing a different correlation between Fed rate hikes and gold now compared to, say, 10 or 15 years ago?

matthew_murphy👑Elite (1m-5m)Real Investor•less than a minute ago

While I totally get why everyone's looking at the Fed's moves, and you've definitely got the experience, I sometimes wonder if we give them *too much* credit for gold's immediate price action. Sure, there's a correlation, especially with the dollar, but gold often dances to its own tune too – geopolitical stuff, inflation expectations that go beyond just interest rates, even just general market sentiment. It's not *always* a direct cause and effect, ya know?

barbara_white🏆Advanced (250-500k)Real Investor✓ Verified•less than a minute ago

Hey, totally get the anxiety with these rate hikes. It definitely makes you wonder about the long-term play for gold. Something that really helped me understand the bigger picture beyond just the immediate Fed decisions is looking at gold's role as a hedge against inflation and currency debasement, especially in the context of increasing national debt.

There's a great podcast called "The Gold Standard" that often breaks down these macro-economic trends in a super accessible way. It might give you some solid insights into how these rate changes fit into the larger economic puzzle and what that could mean for your gold holdings down the line. Keep at it!

ruth_perez📊Growing (50-100k)•less than a minute ago

Totally agree, the Fed's moves are definitely top of mind right now for anyone with gold. It's a bit of a head-scratcher with how it plays out sometimes.

I'm newer to the gold game than you, only about 8 years in, but I've noticed a similar, albeit shorter, pattern where the initial knee-jerk is one thing, but the long-term impact on the metal can be quite different depending on other global factors. It's never as simple as "rates up = gold down" every single time.

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