Dr. Allen Sinai, Chief Global Economist at Decision Economics said in an interview with Bloomberg that you “gotta buy gold.”   The reason?  He sited the Federal Reserve’s statement Tuesday that inflation is below levels consistent with the central bank’s mandate for price stability.  “That’s code for we don’t want to go the way of Japan so we’re going to print money,” said Sinai.

When central banks continue to print money it is good for gold.  We have seen this over the past decade, as money printing reached all-time highs, so has gold.  Gold has risen over 350% in the last ten years and has increased over 63% since the collapse of Lehman Brothers in September of 2008.

The Fed’s Open Market Committee said yesterday it was “prepared to provide additional accommodation if needed” to support the recovery and boost inflation.  Meaning another round of quantitative easing could be around the corner.  The dollar is losing steam as the world responds to this news by selling dollars (lost close to 160 basis points in last 3 days).  Gold often moves counter to the dollar, because it is priced in dollars, and has advanced 17% this year and is set to close higher for the tenth consecutive year.

When asked about his predictions for the price of gold Sinai responded, “inflation adjusted it’s still cheap as odd as it sounds.”  He is targeting $1,500 per ounce.

Decision Economics was founded in 1996 by Dr. Allen Sinai for the purpose of providing Clients with accurate, objective, timely, focused and actionable information to assist in making bottom-line tactical and strategic trading, investment, business and planning decisions (according to DE website).