Now is the time to invest in a true physical asset for the future. Gold rose above $1,700 an ounce in early September soon after the Federal Reserve Bank announced its intention to begin a new round of Quantitative Easing. It is another way of saying they will print a lot more dollars. Hovering around $1,750 an ounce, gold continues to be a single investment for the world’s greatest bargain hunters. As time passes, it is becoming apparent that stocks, bonds, and property in America and in many European countries are propped up on borrowed funds and borrowed time.
Bear in mind, the world economies have abandoned the gold standard now for more than four decades from the time Nixon unpegged the US dollar from gold. He did it as a means of fighting recession and inflation at that time. Had we adhered for the gold standard, the paper money backed by gold, the politicians and bankers would have already been facing more difficulties to manipulate the value of paper money to fit their fiscal policies.
Currently, paper currencies are not backed by any tangible assets of intrinsic value. They are only backed by the full faith and credit of sovereign governments. These same currencies are worth only in the eyes of currency traders and speculators feel they really are. Politicians and central bankers since Nixon have absolutely free hands to print fiat money (a piece of paper with numbers on it) at will without restraint. These currencies in fact are playing off one another as in a game of monopoly, one the way to devaluation. Just take notice of the fact that any greedy individuals can now trade currencies on the internet. That is a sure sign for trouble.
As the practice of printing money intensify, countries with manageable debt and natural resources will see their currencies decline slower in relation for the US dollar, but all currencies ultimately will decline in relation to gold.
It will be the minority of savvy and erudite investors who pause to take notice that the emperor has no clothes. It will be the astute who shed themselves of the attractive burdens they have accumulated and put at least some of what is still marketable into gold. It will be the shrewd and brave who have the resources in the form of universally accepted coin, gold, to live reasonably well during the shakeout and to pick up the bargains for literally pennies on the dollar when the storm finally passes.
As a matter of fact, most people regardless of how nicely intended or educated, fail to take the lessons of history seriously. They continue to live with blinders on content and with petty self-interest. Nero fiddles whilst Rome burns. All of these discussed above are amongst the causes why gold is going to go up in a secular bull market. Owning gold bullion or gold coins is decidedly a very smart decision for the long haul.