There lies the attraction of gold. With interest rates low or negative, the opportunity cost of holding the metal is negligible. When most other investments look expensive or simply unattractive, its lure is hard to resist. In effect, it provides a hedge against the mistakes of central bankers and monetary dysfunction. And what is the current market background if not dysfunctional?

Unconventional central bank policies have thoroughly distorted markets. Nobody can be sure that the central bankers will find a way out of this uncharted monetary maze without precipitating financial chaos. All we do know is that the recent experiment with forward guidance showed with painful clarity how little central bankers understand about the workings of the post-crisis economy.