For all those investors out there who remained uncertain about the forward trajectory of gold and silver prices, Federal Reserve chairman, Ben Bernanke, has just offered you a hand-written, embossed, and gilded invitation to participate in the greatest secular bull market of our time.

With his open-ended pledge to purchase additional mortgage-backed securities at a rate of $40 billion per month, and his simultaneous extension of the zero-bound interest rate through at least mid-2015, Bernanke has launched his third QE rocket to send gold and silver on yet another explosive ride to the upside.

Operation Twist will now extend through the end of this year, yielding a combined increase of $85 billion per month in the Fed's holdings of longer-dated securities. Economists at BNP Paribas project that the Fed is likely to tack-on additional purchases before long to sustain that $85 billion monthly expansion rate through 2013, and that QE3 is therefore likely to result in a $1.17 trillion expansion of the Fed's balance sheet.

How gold and silver are likely to respond
For a hint at how this latest Fed action is bound to impact precious metal prices and the performance of related bullion, mining, and royalty equities, let's turn our Foolish gaze to Bernanke's last big balance sheet expansion that's now known ubiquitously as QE2. That $600 billion bond buying program was announced in early November 2010, and ran through the end of June 2011 at a pace of about $75 billion per month. Gold traded for $1,355 per ounce prior to the announcement, though the market's anticipation of further easing -- which I noted at the time -- obviously played a role in the metal's preceding strength from around the $1,250 mark. Silver stood near $25 per ounce at the start of the program, though some portion of the metal's preceding rally from beneath $20 per ounce can be fairly attributed to anticipation of the Fed's intervention.

Following the launch of QE2, I offered my own prediction that gold and silver would "continue through near-term price targets of at least $1,500 and $30 per ounce" as a result of that monetary blitz. Sure enough, by the end of June 2011 gold stood precisely at $1,500 per ounce, while silver delivered a remarkable 38% surge to land just about where it stands today near $34.50 per ounce. A position in my preferred gold and silver bullion proxy -- Central Fund of Canada (AMEX: CEF) -- would have returned 16% during QE2. And although the mining stocks at large struggled to outshine the metals during this period for reasons I've discussed before, several noteworthy performances like Sandstorm Gold's (NYSE: SAND) 85% advance and Endeavour Silver's (NYSE: EXK) 74% ride nonetheless permitted successful stock pickers to share in the Fed-borne bounty.

Finally, before we move to my specific projections for the effects of QE3, one more prediction from my 2010 discussion of QE2 warrants our attention here. At the time, I shared my outlook that "additional rounds of quantitative easing" remained a "foregone conclusion." My confidence in that macroeconomic outlook, furthermore, is precisely what permitted me to weather the storm through the deep trailing correction in mining equities and remain in position for this ongoing resumption of momentum. Looking forward from the recently announced QE3, I continue to perceive "an unseemly vicious circle" that is likely to trigger a continuum of (global) monetary intervention that Tanzanian Royalty Exploration (NYSE: TRX) chairman, Jim Sinclair, has aptly termed "QE to infinity."

The big picture for silver and gold
The Federal Reserve's latest easy money action does not occur in a vacuum. It comes, rather, right on the heels of a key German court decision that cleared the way for the proposed $645 billion European Stability Mechanism. With the central banks behind the world's two primary reserve currencies now expanding their balance sheets in tandem, we've entered a new chapter in the global saga of competitive currency devaluation. As an extension of the resulting downward pressure on both currencies, these actions create an imperative for other nations to prevent their own currencies from gaining ground and thwarting their own respective efforts to promote economic growth.

Switzerland has been perhaps the most vocal example of a country committed to defending a specific exchange rate to the euro. China has already signaled its intention to spawn another round of stimulative infrastructure investment. Mere hours after the Fed's announcement, speculation is already swirling around additional easing likely from both the Bank of Japan and the Bank of England. What we're witnessing here is truly a global monetary event whereby the nations of the world are engulfed in a furious "race to debase" their respective fiat currencies essentially in lockstep with each other. Only one currency exists that stands to gain as this all unfolds, and that currency is gold. And since silver is harnessed to gold by a permanent yet flexible elastic band, it too comes along for the ride (and often with even greater percentage moves). The broader monetary outlook here is what supports my long-term expectation that gold will ultimately continue to Jim Sinclair's target of $3,500 per ounce.

Follow this latest action to fresh all-time highs
Although it may be difficult to predict the precise scale of QE3 given its open-ended structure, I think we can make some safe presumptions about the program that render fresh new all-time high prices for gold and silver an extremely likely near-term outcome. For starters, I think it's safe to expect QE3 to eclipse the $600 billion scale of QE2, and in fact I consider BNP Paribas' anticipation of a $1.17 trillion tally quite reasonable under the circumstances (even if any follow-on announcement may be dubbed "QE4"). Second, I expect related monetary interventions from other major central banks to add more fuel to gold's fire. And finally, I think it won't be long before public consensus grows around the inevitability of additional global monetary easing since few seem to view this latest set of moves as a quick fix for an immensely challenging global economic condition.

With those and a host of additional factors in mind, I am following up on my successful prediction of the impact of QE2 on gold and silver prices by offering $2,000 gold and $50 silver as comfortably conservative interim targets for this latest major rally of the ongoing precious metals bull market. And as a bonus recommendation of a specific vehicle for gold, I like IAMGOLD's (NYSE: IAG) chances of mounting a major advance. For silver, Aurcana (NASDAQOTH:AUNFF.PK) could perform beautifully if the company delivers a smooth ramp-up at its new Shafter mine, while First Majestic Silver and Endeavour Silver offer the industry's top management teams paired with some truly gorgeous mineral assets. I own each of these stocks myself, and have issued corresponding bullish CAPScalls at Motley Fool CAPS. To join our regular discussions of these and other compelling gold and silver picks, please bookmark my article list or follow me on Twitter.

Looking for more ideas? Download The Motley Fool's special free report " The Tiny Gold Stock Digging Up Massive Profits ." Our analysts have uncovered a little-known gold miner that we believe is poised for greatness; find out which company it is and why we strongly believe in its future -- for free!

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.