| Over the years, I have written occasionally about the connection between the demand for U.S. government debt and quantitative easing. My contention is straightforward. The primary determinant for quantitative easing is not, as we are constantly told, to keep the unemployment rate down, nor is it to stimulate the economy.
(I emphasize the word “primary” as opposed to the word “only”) It is to support the government debt market and keep government in business – not just in the United States but wherever it is employed. So when you see the price of gold suddenly shoot up over $20 in a single day, these days you look in the direction of the debt market and by extension interest rates to see if that is what driving interest in the metal.........................................Full Article: Source
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