Gold futures hit lowest level in almost 3 years

Gold has had more than its share of issues in the last year or two, but the woes haven’t stopped yet. Though there is plenty of debate most of the time when gold slips and everyone is looking for a scapegoat, this time, the reason is pretty clear.

The most recent plunge was today, when gold futures fell a staggering 6.4%, ultimately settling down at $1,285.9 an ounce. If you’re scoring at home, that’s the lowest level we’ve seen since way back in September of 2010.

Okay, so why did this happen? What (or who) is the culprit?

It turns out that it’s Ben Bernanke, the Federal Reserve chief. Bernanke detailed a specific plan for the central bank to take its foot off the pedal of the stimulus program, which the Fed is looking to cut back upon later in the year. The ultimate goal is to stop the stimulus entirely by mid-2014, but that’s all contingent upon the Fed’s economic projections panning out.

Furthermore, Bernanke said that if unemployment drops to 7% by that time, the Fed plans to quit buying U.S. bonds and mortgage-backed securities.

Anyway, the revelation led to drops in all three major stock exchanges, with the Dow Jones industrial average sinking 1.3%, the S&P 500 lowering by 1.4%, and the Nasdaq falling by 1.1%.

Gold, however, was certainly the biggest victim of the announcement. Of course, in financial markets there are opportunities even in failure, and many savvy investors with long-term mindsets are jumping on the opportunity to buy low on gold, hoping that in a few years it will pay off.