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

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.]

 

 



Companies Mentionned : Cambridge | Gold Holdings | Metals X |
Data and Statistics for these countries : Vietnam | All
Gold and Silver Prices for these countries : Vietnam | All
<< Previous article
Rate :Average :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.
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
A Salvo in the Battle for the Go...
27 Febovertheedge
I would argue that the devil is in the details, i.e. the definition of money. What the people of the US are using is currency. Currency bei...
A Salvo in the Battle for the Go...
26 FebFrankinca1
Sort of written for a PHD in economics, which gold believers (myself) are not often that well educated, have difficulty following. The definition o...
A Salvo in the Battle for the Go...
26 Feb07788525833
The dollar has a monopoly over all other types of money which is rammed down peoples throats by gun and drones , any one wanting to change this...
In Search of the Magic Wand: Car...
25 FebDoom
Yes, stay away from University of Phoenix, a school with a 9% graduation rate, that only gets students because it spends $200,000 a day on Google a...
Emails From Kiev: Free Speech Va...
25 Febovertheedge
"The problem is, the asshats associated with Poroshenko are even worse than he is." I'm assuming you mean the predators in the US White Ho...
The Bull Case For Gold This Year...
25 Febdepourcq
You talked about all the wrong reasons that gold will rise or fall, their is only one that everyone should know. The US has a debt of 18.134 trilli...
The Bull Case For Gold This Year...
25 Febneville
The fact that you are very lowly rated might be one of two things .1.You have been playing this card to often (Bear Joker) 2,The other is that you ...
Interventionism Kills: Post-Coup...
24 Febjox
A nice summary of what actually happened. It's sad that few europeans and even fewer americans are going to read it. My opinion is that US...
Most commented articlesFavoritesMore...
World PM Newsflow
ALL
GOLD
SILVER
PGM & DIAMONDS
OIL & GAS
OTHER METALS
Mining Company News
Tinka Resources(Ag)TK.V
Announces AGM Results
CA$ 0.27-12.90%Trend Power :
Corporate news
Silver Standard(Ag-Au-Cu)SSO.TO
Early Glance: Silver companies
CA$ 6.57-0.90%Trend Power :
Corporate news
Pan American Silver(Ag-Au-Cu)PAAS
Early Glance: Silver companies
US$ 9.68+1.04%Trend Power :
Corporate news
Gold Fields(Cu-Ni-Mo)GFI
Early Glance: Gold companies
US$ 4.65+0.87%Trend Power :
Corporate news
Randgold Res.(Au)GOLD
- Total Voting Rights
US$ 79.19+0.24%Trend Power :
Corporate news
Continental Precious Min.(Ag-Au-Co)CZQ.TO
Engages Golder Associates for the Next Step in the Development of the Viken Project
CA$ 0.56-6.67%Trend Power :
Corporate news
Beaufield Res.(Ag-Au-Ni)BFD.V
Reports Annual General Meeting Results
CA$ 0.04-11.11%Trend Power :
Corporate news
Probe Mines(Ag-Au-Cu)PRB.V
Leading Independent Advisory Firms ISS and Glass Lewis Recommend Shareholders of Probe Mines
CA$ 4.94+0.82%Trend Power :
Corporate news
Newmont(Cu-Le-Ni)NEM
Why the Earnings Streak Will Continue for Newmont Mining (NEM) - Tale of the Tape
US$ 26.33+0.08%Trend Power :
Corporate news
Newmont(Cu-Le-Ni)NEM
Increased Earnings Estimates Seen for Newmont Mining (NEM): Can It Move Higher? - Tale of the Tape
US$ 26.33+0.08%Trend Power :
Corporate news
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
Subscribe to 24hGold’s daily market briefing
  • Prices and data of precious metals in 119 currencies and world mining companies
  • Daily analysis of the economy, markets and more
  • Free, daily and indispensable
Stay informed, subscribe now !
* Your email will never be shared.