Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
Silver Long-term Trend Analysis - 28th Nov 21
Silver Mining Stocks Fundamentals - 28th Nov 21
Crude Oil Didn’t Like Thanksgiving Turkey This Year - 28th Nov 21
Sheffield First Snow Winter 2021 - Snowballs and Snowmen Fun - 28th Nov 21
Stock Market Investing LESSON - Buying Value - 27th Nov 21
Corsair MP600 NVME M.2 SSD 66% Performance Loss After 6 Months of Use - Benchmark Tests - 27th Nov 21
Stock Maket Trading Lesson - How to REALLY Trade Markets - 26th Nov 21
SILVER Price Trend Analysis - 26th Nov 21
Federal Reserve Asks Americans to Eat Soy “Meat” for Thanksgiving - 26th Nov 21
Is the S&P 500 Topping or Just Consolidating? - 26th Nov 21
Is a Bigger Drop in Gold Price Just Around the Corner? - 26th Nov 21
Financial Stocks ETF Sector XLF Pullback Sets Up A New $43.60 Upside Target - 26th Nov 21
A Couple of Things to Think About Before Buying Shares - 25th Nov 21
UK Best Fixed Rate Tariff Deal is to NOT FIX Gas and Electric Energy Tariffs During Winter 2021-22 - 25th Nov 21
Stock Market Begins it's Year End Seasonal Santa Rally - 24th Nov 21
How Silver Can Conquer $50+ in 2022 - 24th Nov 21
Stock Market Betting on Hawkish Fed - 24th Nov 21
Stock Market Elliott Wave Trend Forecast - 24th Nov 21
Your once-a-year All-Access Financial Markets Analysis Pass - 24th Nov 21
Did Zillow’s $300 million flop prove me wrong? - 24th Nov 21
Now Malaysian Drivers Renew Their Kurnia Car Insurance Online With Fincrew.my - 24th Nov 21
Gold / Silver Ratio - 23rd Nov 21
Stock Market Sentiment Speaks: Can We Get To 5500SPX In 2022? But 4440SPX Comes First - 23rd Nov 21
A Month-to-month breakdown of how Much Money Individuals are Spending on Stocks - 23rd Nov 21
S&P 500: Rallying Tech Stocks vs. Plummeting Oil Stocks - 23rd Nov 21
Like the Latest Bond Flick, the US Dollar Has No Time to Die - 23rd Nov 21
Why BITCOIN NEW ALL TIME HIGH Changes EVERYTHING! - 22nd Nov 21
Cannabis ETF MJ Basing & Volatility Patterns - 22nd Nov 21
The Most Important Lesson Learned from this COVID Pandemic - 22nd Nov 21
Dow Stock Market Trend Analysis - 22nd Nov 21
UK Covid-19 Booster Jabs Moderna, Pfizer Are They Worth the Risk of Side effects, Illness? - 22nd Nov 21
US Dollar vs Yields vs Stock Market Trends - 20th Nov 21
Inflation Risk: Milton Friedman Would Buy Gold Right Now - 20th Nov 21
How to Determine if It’s Time for You to Outsource Your Packaging Requirements to a Contract Packer - 20th Nov 21
2 easy ways to play Facebook’s Metaverse Spending Spree - 20th Nov 21
Stock Market Margin Debt WARNING! - 19th Nov 21
Gold Mid-Tier Stocks Q3’21 Fundamentals - 19th Nov 21
Protect Your Wealth From PERMANENT Transitory Inflation - 19th Nov 21
Investors Expect High Inflation. Golden Inquisition Ahead? - 19th Nov 21
Will the Senate Confirm a Marxist to Oversee the U.S. Currency System? - 19th Nov 21
When Even Stock Market Bears Act Bullishly (What It May Mean) - 19th Nov 21
Chinese People do NOT Eat Dogs Newspeak - 18th Nov 21
CHINOBLE! Evergrande Reality Exposes China Fiction! - 18th Nov 21
Kondratieff Full-Season Stock Market Sector Rotation - 18th Nov 21
What Stock Market Trends Will Drive Through To 2022? - 18th Nov 21
How to Jump Start Your Motherboard Without a Power Button With Just a Screwdriver - 18th Nov 21
Bitcoin & Ethereum 2021 Trend - 18th Nov 21
FREE TRADE How to Get 2 FREE SHARES Fractional Investing Platform and ISA Specs - 18th Nov 21
Inflation Ain’t Transitory – But the Fed’s Credibility Is - 18th Nov 21
The real reason Facebook just went “all in” on the metaverse - 18th Nov 21
Biden Signs a Bill to Revive Infrastructure… and Gold! - 18th Nov 21
Silver vs US Dollar - 17th Nov 21
Silver Supply and Demand Balance - 17th Nov 21
Sentiment Speaks: This Stock Market Makes Absolutely No Sense - 17th Nov 21
Biden Spending to Build Back Stagflation - 17th Nov 21
Meshing Cryptocurrency Wealth Generation With Global Fiat Money Demise - 17th Nov 21
Dow Stock Market Trend Forecast Into Mid 2022 - 16th Nov 21
Stock Market Minor Cycle Correcting - 16th Nov 21
The INFLATION MEGA-TREND - Ripples of Deflation on an Ocean of Inflation! - 16th Nov 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Inflation Fuse has Been Lit, Protect Your Wealth With GOLD

Commodities / Gold & Silver Jul 04, 2008 - 11:37 AM GMT

By: Money_and_Markets

Commodities

Best Financial Markets Analysis ArticleLarry Edelson writes: First things first: Your family and your health. With a long holiday weekend coming up, enjoy both!

Then, when you get back on Monday, I want you to make darn sure you have plenty of gold in your portfolio. Why? Because your wealth is at stake. The Federal Reserve has lit the inflation fuse, and is bound and determined to devalue the U.S. dollar even more than they already have.


Let me expand upon this by putting it in the words of a few names you might recognize ...

Ernest Hemingway, in September of 1932 ...

"The first panacea for a mismanaged nation is inflation of the currency; the second is war. Both bring a temporary prosperity; both bring a permanent ruin. But both are the refuge of political and economic opportunists."

Ayn Rand, in Atlas Shrugged ...

"Destroyers seize gold and leave to its owner a counterfeit pile of paper. This kills all objective standards and delivers men into the arbitrary power of an arbitrary setter of values. Gold was an objective value, an equivalent of wealth produced. Paper is a mortgage on wealth that does not exist, backed by a gun aimed at those who are expected to produce it."

Macroeconomists including Ben Bernanke, the current chairman of the U.S. Federal Reserve Bank, have agreed that cheap credit in the 1920s was one of the root causes of the Great Depression.
Macroeconomists including Ben Bernanke, the current chairman of the U.S. Federal Reserve Bank, have agreed that cheap credit in the 1920s was one of the root causes of the Great Depression.

Ben Bernanke, in November 2002 ...

"The U.S. government has a technology, called a printing press — or today, its electronic equivalent — that allows it to produce as many U.S. dollars as it wishes at essentially no cost."

"Under a paper-money system, a determined government can always generate higher spending and hence positive inflation."

George Bernard Shaw ...

"You have to choose between trusting to the natural stability of gold and the natural stability of the honesty and intelligence of the members of the government. And, with due respect to these gentlemen, I advise you to vote for gold."

John Maynard Keynes, in 1920 in the Wealth of Nations ...

"By a continuous process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. The process engages all of the hidden forces of economic law on the side of destruction, and does it in a manner that not one man in a million can diagnose."

I'm going to ask you a question now, and I want you to think about it over the holiday weekend:

Which one are you going to be ...

A.) One of the 999,999 people who do not understand, or worse yet, are ignoring what the government is doing to your money?

Or

B.) The one in a million who does, allowing you to protect your wealth, and even profit from the government's actions?

How you answer will not only determine your investment results over the next 12 months, but may prove to be the deciding factor in your long-term financial future. And now's the time to decide because ...

The Dollar's Eight Year Slide Looks Like It's About To Get A Heck Of A Lot Worse!

The supply of money in the U.S. is suddenly surging at an annualized growth rate of more than 16%. By some estimates, that's the highest rate of growth in the money supply since 1971!

The scary part — things will only get worse ...

  • There is no way the U.S. dollar can hold its current value when fiat money is being created with abandon out of thin air.
  • There is no way the U.S. dollar can hold its current value when the Fed refuses to raise interest rates ... while other countries around the world are actively raising rates to bolster their currencies and put a damper on inflation.
  • There is no way that the U.S. dollar can hold its current value when foreign economies are outgrowing the U.S. economy by miles.
  • And there is absolutely no way that the U.S. dollar can hold its current value when so many overseas investors — who have lent Washington hundreds of billions of dollars to prop up the economy — are now waking up to the fact that holding dollar-denominated assets is a losing proposition.

Foreign investors are losing loads of money on their investments in U.S. Treasury bonds. They're even further in the red on mortgage bonds, real estate and stocks.

The dollar has lost 10.5% in the past 12 months ... and it's flat march through june performance bodes more and sharper declines.

As a result, I believe the U.S. dollar is now reaching that critical point. If its recent lows are tested and key support levels are breached, all heck will break loose. Foreign investors will head for the hills, en masse, driving the dollar into its worst decline yet.

But it's not just overseas investors who are getting creamed in the dollar ...

SO ARE YOU!

Take a look at some stats I've compiled for you on the dwindling dollar. And keep in mind that most of the loss of purchasing power you see below doesn't even include the dollar's recent losses, which take from 12 to 18 months to work their way through the pricing mechanism (in other words, prices are about to explode higher) ...

Category 1980 2007/2008 % Change
Median price of a home in the U.S. $62,200 $196,300 215%
Average monthly apartment rent $300 $1,082 260%
Per capita food expenditures (at home) $828 $1,935 134%
Per capita food expenditures (dining out) $529 $1,842 248%
Per capita healthcare $1,086 $7,129 556%
College Tuition - 2-year public college $391 $2,361 503%
College Tuition - 4-year public college $804 $6,185 669%
College Tuition - 4-year private college $3,617 $23,712 556%
Annual average household spending on gas $885 $2,950 233%
Average U.S. movie ticket price $2.69 $6.88 155%
Average cost of new car $7,200 $26,950 274%
Average cost per year of car maintenance (15k miles per year) $165 $739 347%
Cost of postage stamp $0.15 $0.41 173%

 

If You Haven't Already Increased Your Gold Holdings, I Suggest You Do So Immediately ...

As a result of the plunging dollar, the Dow Jones Industrial Average has now also been hit hard with selling, breaking through the key 11,600 support level that I've been warning you about. That means — and I'm not mincing words here — U.S. stocks, and by default the U.S. economy, are going over the cliff.

As I've told you in previous issues of Money and Markets , stay out of all stocks except natural resource plays.

Also continue to steer clear of all long-term government and corporate bonds. They are the next disaster on the horizon. Their prices will plummet as investors flee the dollar in droves.

Instead, think about keeping your liquid money safe in short-term money market funds. But first, make sure your gold portfolio is up to snuff.

Since the beginning of gold's bull market way back in 2000, my position has been that all investors should have a minimum of 5% in gold. That was when gold was trading under $300 an ounce.

In September 2007, I suggested doubling that to 10%, when gold was trading at the $660 level.

And in February of this year, when gold hit $900, I advocated doubling the allocation to 20%, with half of that in gold bullion or the equivalent in terms of an exchange-traded fund, and the second half in gold mining shares.

Now, because of the imminent next phase of the decline in the dollar, I urge you — if you have not already done so, to seriously consider allocating 20% of your net worth to gold investments. You might want to put half in pure gold investments, and the other half in mining shares.

Here are four of my favorite gold investment vehicles ...

1.) The SPDR Gold Trust (GLD). This exchange-traded fund owns physical gold on your behalf, but without the storage hassles. Each share of the GLD equals 1/10 of an ounce of gold.

2.) The Tocqueville Gold Fund (TGLDX). I consider this one of the very best gold funds around. It boasts a five-year average annual return of 24.59%. Plus there are no front-end charges, and its expense ratio is about 1.43%. Minimum initial investment: $1,000.

3.) U.S. Global Investors World Precious Minerals Fund (UNWPX). Another one of my favorites, I think this is also one of the best gold funds around. Manager Frank Holmes truly understands what I've been talking about in this article.

The fund's five-year annualized return is a hefty 36.49%. Again, it has no front end charges, and has a low expense ratio of just 0.99%. The minimum initial investment: $5,000.

4.) Gold Mining Shares. Consider buying the Market Vectors Gold Miners Index ETF (GDX) , an Exchange Traded Fund that holds a basket of the top gold miners.

Some of the top gold mining stocks on Wall Street are best suited for the well-honed timing signals I issue in my Real Wealth Report . If you don't already subscribe, and want to get my specific buy and sell recommendations, join now .

Best wishes,

Larry

This investment news is brought to you by Money and Markets . Money and Markets is a free daily investment newsletter from Martin D. Weiss and Weiss Research analysts offering the latest investing news and financial insights for the stock market, including tips and advice on investing in gold, energy and oil. Dr. Weiss is a leader in the fields of investing, interest rates, financial safety and economic forecasting. To view archives or subscribe, visit http://www.moneyandmarkets.com .

Money and Markets Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Comments

Goldbug
06 Jul 08, 18:01
Gold ETF's

What good is it when right there in the GOLD etf prospectus it allows the fund to LOAN gold out for shorting purposes? Isnt that the same as shooting yourself in the head?

When will people learn that ETF's are another WALL STREET scam? READ THE PROSPECTUS.

The best GOLD BUSINESS model out there and not many have discoverd it's value is ROYALTIES.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in