Close X Cookies are necessary for the proper functioning of 24hGold.com. By continuing your navigation on our website, you are accepting the use of cookies.
To learn more about cookies ...
EnglishFrench
Gold & Silver Prices in
In the same category

Time to Accumulate Gold and Silver

IMG Auteur
Published : March 09th, 2012
621 words - Reading time : 1 - 2 minutes
( 5 votes, 4.6/5 ) , 2 commentaries
Print article
  Article Comments Comment this article Rating All Articles  
0
Send
2
comment
Our Newsletter...

 

 

 

 

Do you own enough gold and silver for what lies ahead?


If 10% of your total investable assets (i.e., excluding equity in your primary residence) aren't held in various forms of gold and silver, we at Casey Research think your portfolio is at risk.


After speaking at the Cambridge House conference last month and talking with many attendees, I came away convinced that most investors fall into one of two categories: those that hold an abundance of gold and silver (which tends to be physical forms only), and those with little or none. While both groups need to diversify, I'm a little more concerned about the second group. Here's why.


Regardless of what you think will happen over the remainder of this decade, one thing seems virtually certain: the value of paper money will be affected, perhaps dramatically. Even if the economy slips into deflation, the deflation wouldn't last long. A panicked Fed would print to the max and set off a wild rise in prices. This is why we're convinced currency dilution will not only continue but accelerate.


Let's take a look at what's happened so far with the value of our currency vs. gold, after accounting for the loss in purchasing power.






Both the US and Canadian dollar, after adjusting for their respective CPIs, have lost about a quarter of their purchasing power just since 2000. Concurrently, gold has increased dramatically in buying power, far outpacing the effects of inflation.


This is the core reason why I'm convinced we should hold our savings in gold and silver instead of dollars. Let's take a brief look at how gold and gold stocks might perform if the economy takes a turn for the worse…


What If We Enter a Recession or Depression?


Mayan prophecies aside, many of our panelists last month, including most of the senior Casey staff, believe economic, monetary, and fiscal pressures could come to a head this year. The massive build-up of global debt, continued reckless deficit spending, and the lack of sound political leadership to reverse either trend point to a potentially ugly tipping point. What happens to our investments if we enter another recession or – gulp – a depression?


Here's an updated snapshot of the gold price during each recession since 1955.








Clearly, one should not assume that gold will perform poorly during a recession. Even in the crash of 2008, gold still ended the year with a 5% gain. And with the amount of currency dilution we've undergone since that time, it seems more likely gold will rise in any economic contraction than fall. Indeed, if the response of government to a recession is more money printing, precious metals will be a critical asset to have in your possession.


Even if the gold price ends up flat or down this year, the CPI won't. Gold's enduring purchasing power is why we hold the metal.


How about gold stocks?








In spite of the debilitating 1970s that suffered from stagflation, price controls, three recessions, and the Vietnam war, gold producers rose over 600% while the S&P was basically flat. And that includes a roughly 65% fire-sale correction, much like we saw in 2008. To be clear, gold and silver stocks won't be immune to selloffs if a recession or worse temporarily clobbers our industry. But in the end, we're convinced they will prevail.


Don't lose patience with, or confidence in, your gold holdings. What happens to the price over any short period of time is only one chapter in the book of this bull market, and we think you'll be happy by the time that last chapter is written.




[For more information on how to invest in gold, download our free report: 2012 Gold Investor's Guide.]

 

 



Data and Statistics for these countries : Vietnam | All
Gold and Silver Prices for these countries : Vietnam | All
<< Previous article
Rate : Average note :4.6 (5 votes)
>> Next article
Jeff Clark is the editor of BIG GOLD, a Casey Research publication focused on the safest ways to profit from the current bull market in gold.
Comments closed
  All Favorites Best Rated  
IT IS IMPOSSIBLE TO OWN TOO MUCH GOLD, EVEN IN COMPARITIVE WEIGHTING TO THE REST OF YOUR ASSETS.
Rate :   3  3Rating :   0
EmailPermalink
If you can't hold it in your hands it isn't really yours! Time to hold Food, water, Guns, ammo,Gold and Silver!
Rate :   5  4Rating :   1
EmailPermalink
Latest comment posted for this article
IT IS IMPOSSIBLE TO OWN TOO MUCH GOLD, EVEN IN COMPARITIVE WEIGHTING TO THE REST OF YOUR ASSETS. Read more
S W. - 3/11/2012 at 10:13 AM GMT
Rating :  3  3
Top articles
Latest Comments
Farage Interviews Le Pen: “Prison of the EU”
21 Marneville
BRITANNIA RULES THE WAVES AND NOW BREXIT WAIVES THE RULES. GO FOR IT FRANCE AND RID YOURSELVES FROM THE CHAINS OF IDIOTS. NOT SIN...
How the Fed Operates — And Why It's a Problem
20 Marramasart
In a nutshell, the Fed facilitates the theft of the value of the dollar, as they can control the increase in supply which at the same time inverts ...
How the Fed Operates — And Why It's a Problem
20 Marneville1
With all due respects for outlining how the crooked american Fed works or should work. From all our research we find the following the Fed...
Sparta - Gold prohibition in a collapsing economy
18 Markevthorne
You've answered none of the authors points: your comment is flat rubbish.
America Too Broke to Fix Crumbling Infrastructure? “Bridges, Roads,...
16 MarCameron Waugh1
Just like the leaders of the Bolshevik revolution were not Russians, those formulating belligerent US foreign policy are not Americans, and they ha...
POTUS at SOTUS
16 MarDRGEORGE1
Try explaining that to my patients dying on public waiting lists or getting ripped off by exorbitant private specialist fees!
POTUS at SOTUS
08 MarS W.0
I don't know what hallucinogens Dr G is on but my experience, both working in, and using the health system in Oz is that it is very bloody good.!
POTUS at SOTUS
07 Marstew temby
The best way around costs in the Aussie health/dental care systems in Australia is to travel to SE Asia for whatever you need to have done. Insurer...
Most commented articlesFavoritesMore...
World PM Newsflow
ALL
GOLD
SILVER
PGM & DIAMONDS
OIL & GAS
OTHER METALS