Your Number One Reason to Buy Gold

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Digitally Enhanced photo of gold bars stacked
3d render Gold bars stacking
Digitally Enhanced photo of gold bars stacked
3d render Gold bars stacking

People buy gold for a variety of reasons. Some people buy gold because of psychological reasons. It gives them a sense of psychological well-being in an uncertain market. Other people buy gold because of its industrial uses. Gold is a safe bet because there is a solid industrial demand that stabilizes its price over the long haul.

With that said, the number one reason you should buy gold is the fact that equities markets today are primarily government creations. Whatever rally or market stability you see is created primarily by stimulus money. If you ever need proof of this, just look at the Bank of Japan, the European central bank, and until recently, the policies of the U.S. Federal Reserve. There is just so much cheap money floating in equities market, thanks to aggressive bond buying by the U.S., Japanese and the European Union.

This is not real money. Any market performance based on this money is based on illusion. It is based on a lie. The only real basis for market performance should be economic realities. These economic realities, of course, involve companies making money, products being sold, and people working.

Unfortunately, we live in a world where a lot of these financial signals are created out of the thin blue air by government fiat. There is really nothing of fundamental value backing up all this money being printed out. It has been several decades since the global financial system was taken off the gold standard. Given current patterns and the recent European Union use of a 1.1 trillion economic stimulus, it is only a matter of time until the other shoe drops.

This is why you should be looking at gold. Your number one reason to buy gold is that funny money can only go so far. Unfortunately, a lot of the market analysis up this point has been too focused on calling the bottom of gold or timing when people should get into gold.

I believe this is mistaken. The focus should not be on calling when to buy, but buying now while prices are still low. You can do dollar-cost averaging to reduce your overall expenses when buying precious metals. It is only a matter of time until the economic stars line up and the all too predictable consequences of cheap liquidity arrive. Don’t get caught flat-footed by these developments.

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