By Steven Russolillo
Bloomberg
Gold’s two-year tumble off record highs is ugly no matter how you slice it.
Gold futures tumbled to $1,229.80 a troy ounce on Wednesday, the lowest settlement price since August 2010. The precious metal is now down 35% off its record settle high of $1888.70 in August 2011.
Gold has pulled back more than 10% on seven separate occasions dating back to 2001, according to the World Gold Council,  an industry association which is funded by mining companies. As WGC’s chart shows, gold has recovered from each of these troughs and went on to make new highs.
The worry now, however, is this time may be different. This particular pullback is deeper than any of the previous six occasions and it’s also been one of the longer plunges, time-wise, dating back to the turn of the century.
As we noted earlier today, gold was once considered a refuge from economic uncertainty and a means of safeguarding wealth, which played a big role in its multiyear rise. But the investors who for years purchased the yellow metal as a hedge against higher inflation and a weaker dollar have since reversed those bets in earnest.
With the Fed more likely to start pulling back QE sometime this year, gold’s declines may be far from over.