Jackson Hole Reaction: Gold, Silver & Miners Slump as the Dollar Rallies
Warsh’s hawkish Jackson Hole speech sparked Friday selling in gold, silver, and miners as the dollar rallied. Home prices kept falling, GDP jumped without much job growth, and September hike odds rose.
Source: Peak Prosperity
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DW NOTE
Kevin Warsh gave a Jackson Hole speech hawkish enough to knock gold down 3% in a session — during a year in which the Strait of Hormuz has been shut for six months, inflation is running well above target because of a war the Fed can't control, and the Treasury is still running a 6%-of-GDP deficit. The dollar rallied because the market heard "September hike." That would take rates to 3.90% in an economy where home prices are already falling and months of supply are rising. Tightening into a war-driven stagflation is not prudence, it's proceduralism dressed up as resolve.