Can Gold and Silver Keep Going Up?

Posted on by

Of course they can.  People told me that silver was a bubble at 14 USD an ounce (the same people who never saw the housing bubble or the dot com bubble).  It was at 40 yesterday and dropped to 36 today.  This is a great buying opportunity. Everyone should have at least 10% of their investments in physical precious metals, not stocks.  I have much more than that because I intend to make spectacular profits in the future but, 10% should be a safety net that everyone should have just to protect themselves.

Gold and Silver peaked in 1980 and then there was a bear market for twenty years. The reason that gold and silver dropped was Paul Volcker was able to push interest rates into the stratosphere, stopping the the 1970s inflation in its tracks.  Not only has Ben Bernanke said that he will keep interest rates low for years in the future (making the bust that much worse, see Austrian Business Cycle Theory) but, even if he wanted to bring interest rates up he would send the economy into a depression much worse than the one that Volcker caused in 1981.  This is politically unpalatable, the election losses for both parties would be a blood bath.  Therefore, the Fed tries to keep the unsustainable path of the inflationary boom going through even lower interest rates; simply kicking the can down the road to future politicians.

This is the first time in history that massive inflation and low interest rates have not created an artificial boom.  Alan Greenspan was able to do it after the recession of 1991 and the dot com bust.  But, no longer is this a possibility.  This is a bad sign, it implies that monetary expansion has reached its limit and the depression that the United States has been putting off for more than a decade is coming.  However, instead of it being the small storm that it would have been ten years ago, it is now going to be a hurricane that is going to wipe out the entire middle class, retirees, and anyone trusting in government promises.

Remember that when Volcker pushed interest rates up in 1981, the United States was the largest creditor in the world.  Now it is the largest debtor.  The United States had a strong industrial base but, now it has all been shipped overseas due to the dollar’s reserve status giving it artificial buying power.  Simply put, an interest rate hike, although healthy in the long term, would rock our economy to the very core due to the 20 years of malinvestments that would have to be liquidated and the massive economic structural imbalances that would have to be corrected.

This means that gold and silver have a long way to go before this thing is all sorted out.

1,969 thoughts on “Can Gold and Silver Keep Going Up?”

  4. sms türkiye hakkında detaylı bilgi, Oscar Onay’ın sunduğu SMS onay hizmetini keşfetmek için websitemizi ziyaret edin ve ihtiyacınıza uygun planları inceleyin!

    Reply ↓

  6. Accessing hot water has never been easier! Meet your hot water needs in your home with the 30 Gallon Electric Water Heater. For detailed information about 30 gallon electric water heater, visit our website now, don’t miss the advantageous prices!

    Reply ↓

  7. Petra TV is the ultimate IPTV provider. They offer an exceptional viewing experience with a wide variety of channels and outstanding picture quality. Plus, top-notch customer service changes the game. If you want to enjoy your favorite shows and sports, Petra TV is for you. Contact them now for detailed information about iptv angebote!

    Reply ↓

  26. It’s the best time to make some plans for the future and it’s time to be happy. I’ve read this post and if I could I want to suggest you some interesting things or tips. Perhaps you could write next articles referring to this article. I wish to read more things about it!

    Reply ↓

  30. I am really impressed along with your writing talents and also with the format to your weblog. Is this a paid subject or did you customize it your self? Anyway keep up the nice high quality writing, it’s uncommon to look a great blog like this one nowadays..

    Reply ↓

  43. medicalintukiye hakkında detaylı bilgi ve Hayatınızı değiştirecek sağlık çözümleri için Medical in Türkiye’ye danışın ve sizin için en uygun tedavi seçeneklerini keşfedin!

    Reply ↓

  48. izmir havalimanı transfer hakkında detaylı bilgi veya Unutulmaz bir tatil için ihtiyacınız olan her şeyi Pehlivanoglu Turizm’de bulabilirsiniz. Şimdi sitemize girin ve kendinize en uygun tur seçeneklerimizden birini seçin!

    Reply ↓

Leave a Reply

Your email address will not be published. Required fields are marked *