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Have you ever stopped to ask yourself, “If the U.S. and other economies are as strong as
governments claim they are, why are interest rates still effectively zero—or even negative?” This
is not a sign of a healthy fiscal and monetary system.
It’s hard to fathom how anyone can believe the global economy will escape the dire fiscal and
monetary conditions around the world without some serious fallout—and a strong response
from gold. Never before has such an enormous monetary experiment taken place on a global
scale. If ever there was a need for monetary insurance, it is now.
Mainstream money types have declared that gold is dead and sold all they could. And yet,
global finances remain tenuous at best. That makes it imperative for investors to own physical
gold and have exposure to gold’s upside in their portfolios.
THE #1 REASON TO BUY GOLD TODAY.
Excessive debt is the root cause of the ongoing crisis that became visible to all in 2008. And yet
the world continues to pile it on.
In spite of massive debt loads shouldered by most G20 countries, the deficit spending
continues.
Think about that for a moment: Almost no country in the entire world even tries to balance its
budget anymore. Everyone seems convinced that spending is the key to prosperity. This can’t be
resolved without some pain.
Some argue that deficits are necessary to counter periods of slow or negative economic growth.
History shows that debt levels over 90% of GDP result in higher inflation. When the ratio was
90% or higher, inflation rose to around 6%, as opposed to the 0.5-2.5% range that’s typically
below 90%. History also shows that the link is not simultaneous, yet higher inflation always
follows.
Total U.S. government debt recently crossed the proverbial line in the sand and now equals
104% of GDP. This is higher than crisis-stricken countries like Brazil and Spain.
Further, the Fed’s official figures exclude the nation’s swelling yet politically untouchable
unfunded liabilities, Medicare and Social Security. Add these in, and public debt is more than
sky high.
The sad truth is that U.S. debt is so high, it will never be paid. At least not in dollars with
today’s purchasing power.
Instead, the Fed and other central banks around the world are devaluing currencies, supposedly
to prop up their economies but also in order to reduce the burden of debt repayment. This is
a central thesis to investing in gold: There is no way out of this level of debt overhang except
currency dilution.
The #1 catalyst for precious metals for the foreseeable future is currency debasement. It’s
staring us right in the face, begging us to protect our assets and hedge our future standard of
living by saving in gold and silver.
WHEN WILL GOLD RESUME ITS UPTREND?
Timing any market is difficult. Doing so reliably is all but impossible. But we know there are
clear and unavoidable consequences to wildly energetic money creation. Sooner or later, there
will be rampant price inflation.
The U.S. dollar is far from healthy, due to massive U.S. government debt and enduring weakness
in the economy. The perceived value of the dollar has been high over the last two years; any
American tourist who’s been to Europe recently will vouch for that. But just because the euro is
in worse share does not mean the dollar is actually strong.
Just ask yourself:
What if banks begin deploying the excess reserves the Fed has been paying them to keep?
What if the Fed decides we need another round of QE, or whatever they call it next?
What if the Fed continues raising interest rates?
What happens when—not if—the New York Stock Exchange enters a true bear market
and mainstream investors start losing money? This may have started already this year…
and many investors who remember 2008 will decide to bail.
What will be the mainstream reaction if the real estate market goes flat or reverses?
How will the Fed respond?
What happens if the economy does grow—and kick-starts inflation?
What happens if the debt load overwhelms the Fed’s printing efforts? Will they give up
or double down?
What if a developed country defaults on its debt?
What if we reach a tipping point where other countries tire of dollar dilution and slow
or reverse their U.S. Treasury purchases?
What happens if the markets lose confidence in the Fed or other central banks’ ability to
manage economies and markets?
How will global central bankers respond if real deflation takes root?
What happens if geopolitical conflicts deteriorate and lead to war?
What happens when—not if—control of the gold market shifts to China, away the U.S.
paper gold market?
The key point is that the world is awash in serious systemic risk.
Central bankers have printed themselves into corners, and there is no easy way out. These
issues have not been dealt with effectively, and political leaders show no sign of ever doing
so. Systemic risk has reached truly historic proportions. Sooner or later, there must be a
reckoning—the math doesn’t work, and history has demonstrated the outcome of such fiscal
crises again and again.
This is a major reason why I continue to buy gold and silver, and why I recommend you do, too.
It’s not a speculation on rapid gains but on essential wealth insurance. In fact, I believe that the
need to own gold is greater now than it was in 2008.
Here are the three best ways to invest in gold….
BEST WAY TO OWN GOLD #1: PHYSICAL GOLD
Given the non-zero risk of a catastrophic failure of the global banking system, and all the chaos
that would follow, we recommend that all investors place 10%-20% of their portfolio in gold
bullion.
I don’t mean 10%-20% of your gold portfolio; I mean 10%-20% of all your liquid assets.
This may sound extreme to some. But even if the global economy remains in a deflationary dip
and the gold price struggles for a while, bullion remains the safest of safe harbors during a true
upheaval.
Remember, it’s not simply a question of inflation or deflation; it’s crisis. And that’s exactly what
gold ownership is for.
Nothing replaces having physical gold in your possession and under your control.
WHERE TO BUY PHYSICAL GOLD.
If you know an honest, reputable coin dealer in your area, that’s a good place to start for smaller
purchases. Our editors buy their gold either with a local dealer or online, but either way, it’s
important to find a reputable dealer... as in every line of business, there’s no shortage of crooks.
In our experience, the best places to buy physical gold are:
1. MilesFranklin.com (1-800-822-8080). Miles Franklin has some of the deepest contacts nin
the industry. It can source metal when many other dealers can’t. With some of the best prices,
it’s one of our top picks.
2. FisherPreciousMetals.com (1-800-390-8576). A national bullion dealer that offers highly
competitive pricing and a full Authentication Guarantee to protect against counterfeit products.
They are also ISA certified precious metals appraisers.
3. DavidHall.com (1-800-759-7575). We go to one place for rare coins: Van Simmons at
David Hall Rare Coins. He actually helped create the Professional Coin Grading Service.
We don’t recommend entering the numismatic world unless you are (or plan to become) a
knowledgeable investor.
4. Money Metals Exchange (1-800-800-1865). Reasonable prices on common gold and silver
coins like American Eagles and Canadian Maple Leafs.
Keep in mind that premiums and delivery times will fluctuate according to market conditions.
There are other online dealers out there, and some may have good prices, too. The things to
watch for are total costs (including product, shipping, and insurance) and availability; if a dealer
claims it will be several weeks to “locate” the product, we advise you to look elsewhere. It’s also
not uncommon to find salespeople who try to talk you into other products, such as proof sets or
rare coins (this is especially true with the dealers that advertise on TV), so beware of the hard
sell. We haven’t had that experience with our recommended dealers.
Where do you store your gold? There isn’t a magic bullet for safekeeping, as each form has
its own risks. Physical gold is subject to theft and fire; paper gold is subject to fraud and
mismanagement.
The most prudent approach is to own more than one form of gold, in more than one location,
with an emphasis on physical ownership.
You can get started owning physical gold with as little as $50 a month, thanks to a new savings
programs that can automatically withdraw the money from your bank account.
So, instead of shelling out $1,200 or more for an ounce of gold, you can start buying that ounce
and more in monthly installments. These programs store your gold and silver as well, and you
can take delivery any time.
P.S ) THERE IS A BETTER SOLUTION , Upgrade to entrepreneur one. This is the best and biggest thing you can do right now to advance Markethive and your own financial interest. D.S )
Best Regards,
Goran B Edstrom - SWEDEN - Proud - MarketHive - Entrepreneur 1 Member.
