Why own gold in uncertain times: Protection From Disaster

"Why own gold in uncertain times

Why own Gold in Uncertain Times

Updated March 2023

Hot money and data manipulation are the main driving force behind this illusory economic recovery.  According to Government stats, inflation is nonexistent, but anyone with a grain of grey matter understands this is false.  Rents, education and medical costs are soaring, and salaries drop when inflation is factored in. But, you are working more and more for less and less.  This is not the American dream; it sounds like an American nightmare.  The purchasing power of the dollar has been eroded dramatically over the years.  According to usinflationcalculator.com, an item that set you back $20.00 in 1913 would cost you over $485 in 2016, for a cumulative inflation rate of 2320%.

Owning Gold A safety against Future Financial Catastrophe

Source www.usinflationcalculator.com

Hedging against inflation

When it comes to uncertain times, one may ask, “why own Gold in uncertain times?” The answer is simple: historically, gold has been an excellent hedge against inflation. With chaos and instability being driven by hot money, cutting this supply could end economic recovery. It is essential to note that central bankers are aware of this, so they embrace negative rates as the only way to maintain the illusion. Despite many awakenings, the vast majority is still deep in slumber, and Central bankers have been highly adept at conning the crowd.

It is conceivable that the US dollar will remain strong relative to other currencies even after embracing negative rates because we will join the party late. Our rates, even though negative, will be relatively higher than those nations that have already jumped on the negative rate bandwagon. This illusion of economic prosperity could last longer than most experts are willing to admit.

So why own Gold in uncertain times? Gold and Silver bullion should be considered insurance against a future financial disaster because we will experience another catastrophe sooner or later. We are not advocating that you back the truck and load up on bullion, but a balanced portfolio makes sense to allocate some funds to the Gold and Silver bullion. It is like purchasing insurance against another financial crisis that has the potential to be larger than the 2008 financial crisis. You buy insurance not because you know something wrong will happen, but if something terrible happens, you know you are covered.

Owning Gold in uncertain times is essential as it hedges against inflation and is a reliable insurance policy against future financial crises. It is wise to have a balanced portfolio and allocate some funds to Gold and Silver bullion, especially in economic uncertainty.

 Price targets for Gold

Investors with money idling around and Patience can use strong pullbacks to add to their position.  We tend to favour Silver more than Gold as the gains on a percentage basis will be far more significant on Silver than Gold.

Once Gold closes above $2200 on a monthly basis, we see it trading to the $3500-$3500 range. If there is a feeding frenzy stage, and there usually is, our absolute high-end target for gold is $5,000.  Those issuing targets of $20,000 and higher need to get off their medication, for they are simply leading novice investors astray.

AUY Yamana Gold Inc. daily Stock Chart

Another positive signal will come from GLD. A monthly close at or above 190 will signal that Gold bullion is ready to challenge the 2200 range.


These five research articles discuss why it’s good to own gold in uncertain times

  1. “Gold as an investment in uncertain times” by Zdeněk Červinka and Pavel Kříž. Link: https://www.researchgate.net/publication/319970585_Gold_as_an_investment_in_uncertain_times
  2. “Why Gold Shines in Uncertain Times” by Michael Kahn. Link: https://www.barrons.com/articles/why-gold-shines-in-uncertain-times-1535422400
  3. “The Role of Gold in an Investment Portfolio” by Juan Carlos Artigas. Link: https://www.spglobal.com/en/research-insights/articles/the-role-of-gold-in-an-investment-portfolio
  4. “Gold: A Safe Haven in Uncertain Times” by Tom Lydon. Link: https://www.etftrends.com/gold-a-safe-haven-in-uncertain-times/
  5. “Gold: A hedge against inflation” by Debolina Bose. Link: https://www.financialexpress.com/market/commodities/gold-a-hedge-against-inflation/2121875/

Other Articles of interest

Negative rates will fuel the biggest Bull Market rally in History (25 May)

Media Manipulates Financial Markets via Good & Bad News (21 May)

Negative rates in Denmark mean banks Pay you money for taking a mortgage (20 May)

Good Money management-Better Solution than Gold Standard (14 May)

Most Hated Bull Market ever not Ready to Crumble (May 10)

$1 trillion worth of shorts set to drive Dow higher (May 5)