By Chris Vermuelen
Resource Investor
Last year was one of the worst years for gold in a generation and the strangest part of it is that this loss came during a time in what should have been a banner year for gold.
When the Fed launched its QE1 and QE2 programs, gold posted huge gains but with QE3, we only had a brief rally in late 2012, it’s been all downhill for there.
The price of gold over the last year highlights just how much Europe has become a powerful driver behind gold vs. the U.S., which has historically been the main mover. When the European debt crisis started a few years ago, people fearing a financial meltdown in Europe put a lot of their money into gold as it was the safe haven of choice.
However, with financial and political risk in Europe subsiding, we have seen money leave gold and move into other markets, hence the big outflows from gold ETFs.