There has long been an argument regarding how a trader should view gold: A precious metal, a currency, a hedge against inflation, a store of value in a world of fiat money or the ultimate risk asset. Regardless of where you fall on that spectrum, there has always been a sense among traders that gold is a good thing to own when the world, either through economic crises or geopolitical risk, is facing greater uncertainty.

However, the biggest factor most of our experts follow regarding gold is the massive central bank interventions in the form of quantitative easing around the globe.

“The big driving force for gold is going to be what the monetary authorities do,” says Dennis Gartman editor and publisher of the Gartman Letter. “The talk is that they will slow their experiment in quantitative easing but the fact of the matter is, they haven’t. Europe is not curtailing their expansionary policies.”,

Gartman says that even in the United States the policy is still expansionary despite hints by the Federal Reserve of reducing its balance sheet. “I don’t think the ECB wants to take their numbers back to negative but are they going to be raising rates? Not for several years. Their balance sheet will continue to grow for another two years,” he says. “The Bank of Japan has no choice but to continue its experiment with [QE] and the [U.S.] Fed may be slowing its experiment with QE but it is certainly not exiting QE. The Fed’s balance sheet is still going to be in excess of $4.5 trillion at the end of this year (see “Piling up assets,” below). That’s still an expansion from $1 trillion a mere eight years ago and it is going to take years [to unwind].”

Hedge fund and investing legend Jim Rogers agrees that global central banks remain in an expansionary cycle. “The Japanese central bank owns 40% of all bonds in Japan,” Rogers says. “Japan has been printing money and using it to buy stock. It is the largest shareholder in Japan. In Switzerland, the Swiss Bank keeps printing money. When you and I were young ,the Swiss bank was backed by gold and integrity, now it is backed by Amazon and Apple.”

Neil Azous, CIO at Rareview Capital LLC., agrees in principle, but sees the tide turning, at least in the United States. “Our long national nightmare with negative real interest rates is almost over and the higher that real interest rates go, the lower the gold price should go,” Azous says. “Of all the factors that are credited with driving gold currently, U.S. real interest rates have the most explanatory power.”

George Gero, Financial Advisor, Senior Consulting Group at RBC Wealth Management and long-time gold trader says, “Gold buyers are concerned about, #1 inflation, #2 depreciation of currency and #3 destabilization of financial institutions. That is what is driving gold.”