Gold is showing some signs of a correction. If it goes below $1000 it might be time to buy. Gold Quote for 10/29/09
Also, take a look at this video. Euro Pacific Capital Peter Schiff explains why gold is going up and the proper way to look at inflation. Mr. Schiff's notes that inflation starts with the printing of cash and that is certainly underway. Also, watch the video, which was taped in September and note the talk of gold reaching and staying at $1000 something it has done; a major concern of those debating Mr. Schiff's position.
Showing posts with label inflation. Show all posts
Showing posts with label inflation. Show all posts
Wednesday, October 28, 2009
Wednesday, August 5, 2009
Protecting Against Inflation
Inflation, it is seemingly looming and investors everywhere are trying to protect against inflation. As the recession continues, the nation continues to print out money in hopes of paying off the deficit. This will eventually drive the value of the dollar down and inflation upward. There are ways to protect against this.
1.Look at investing into something called TIPS or Treasury Protected Securities. TIPS are adjusted to protect against inflation by using the Consumer Price Index (CPI), which signals the cost of living. This critical, protecting from prices raising faster than the interest on the investment.
2.get into I series saving bonds. The I series, like the TIPS were created to protect against inflation. They are compounded semiannually and come in $50, $100, $500, $1000, $5,000 and $10,000
3.3.Switch from individual stocks to ETF's. These are similar to stocks but are essentially a collection of stocks, bonds and other investment tools. They normally are based on one segment of the economy such as financial, commodities etc.
4.4. Gold, gold and more gold. Head straight for precious metals, because unlike paper money they have real value. Precious metal value is not based on government or the impressions investors may have of economy.
Sunday, June 7, 2009
Inflation Knocking at the Door. Gold and Silver Looking Better Each Day
The bond market is in panic and it is all because of one word; inflation. The reason for the panic is inflation. Higher inflation destroys the return on the bond, because the dollar is less valuable.
That's a very simplistic explanation, but cuts to the core of the situation. Bond investors see the risk of inflation growing the day and a government unwilling to control it, because doing so would to curb consumer spending, which would sour the perception of the economy.
As the minting presses roll out the dollar, the money floods the market, the value of the dollar will go down. This will sink the bond market as their potential return falls. This in turn limits the money available to the government, who it appears will simply print more money. The other option is a crushing blow to staggered housing market; raise rates to lure investors back into bonds. However, the increase in rates will stymie consumer spending, refinancing and mortages, not too mention the political ills of bad consumer spending reports.
It is a nasty cycle with every action causing a reaction and a perfect example why the concept of central economic planning is purely abstract.
So what does this all mean for the common investor? It means keep collecting the gold and silver, because with the meltdown in the bond market, all sectors are now unstable at best. The rush for gold and silver has only just begun.
That's a very simplistic explanation, but cuts to the core of the situation. Bond investors see the risk of inflation growing the day and a government unwilling to control it, because doing so would to curb consumer spending, which would sour the perception of the economy.
As the minting presses roll out the dollar, the money floods the market, the value of the dollar will go down. This will sink the bond market as their potential return falls. This in turn limits the money available to the government, who it appears will simply print more money. The other option is a crushing blow to staggered housing market; raise rates to lure investors back into bonds. However, the increase in rates will stymie consumer spending, refinancing and mortages, not too mention the political ills of bad consumer spending reports.
It is a nasty cycle with every action causing a reaction and a perfect example why the concept of central economic planning is purely abstract.
So what does this all mean for the common investor? It means keep collecting the gold and silver, because with the meltdown in the bond market, all sectors are now unstable at best. The rush for gold and silver has only just begun.
Subscribe to:
Posts (Atom)