Reasons Why You Must Own Gold
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- 28% average annual gains for 10 years
- As a hedge against coming inflation
- For insurance against Stock/Bond crashes
- To escape the decline of the U.S. Dollar
Investors buy Gold during uncertain economic times while others investments are paying poor returns. Since 2001, Gold has increased in value by 450%. The U.S. Stock Market, as measured by the DOW Industrials are up only 12% since 2001. Parking money on the sidelines, in the bank, will earn only 1.16% in a two year Bank CD and as little as 0.66% in a Bank Money Market fund.
1. Gold is the Ultimate Hedge Against Inflation - Inflation is the excessive creation of new Dollars by the Federal Reserve. The Government's exorbitant spending and $1.5 Trillion Dollar deficit for two years in a row are being paid for by the Federal Reserve's QE1 and QE2 program. Ultimately, a loss of buying power for the U.S. Dollar is virtually guaranteed as prices have already begun to rise for food, commodities, oil, gas, etc. Gold, commodities, and precious metals are investments whose value can, and have, multiplied in value dramatically in anticipation of inflation and during periods of double digit U.S. inflation.
2. For the Long-Term Profits - The price of Gold has increased in value since 2001. The average annual gains since 2001 have exceeded 45%.
3. Gold As Crisis Insurance - Gold performs extraordinarily well as a safe-haven investment against any economic, political or social crisis. In the past, we've recommended a conservative core holding of 5% of liquid assets in precious metals at all times.
4. Gold is Stock Market Crash Protection - During the Sub-Prime Mortgage crisis and Stock Crash of 2008, even the world's best known Stocks like General Electric, General Motors, Chrysler, and A.I.G. suddenly became dramatically worth less.
5. Gold Provides Honest Diversification - During the Sub-Prime Mortgage driven Stock Crash of 2008, the U.S. Stock Market plummeted from a DOW high of 14,164 to touch a low in 2009 of 6,547. Few investors escaped unharmed when Stocks fell 53%. Yet, Gold protected investors, actually ending 2008 up 4.32%. It went on to gain 25% in 2009 and 29% in 2010 and helped many people avoid a total wipe out.
6. Gold is the Anti-Dollar - In a world filled with fiat paper currency thanks to Washington spending, we have a burgeoning national debt crisis. Added to that are massive state and local debts, the risk of a Bond defaults, currency defaults for the Euro, and the U.S. Dollar. As the anti-Dollar investment, Gold rises in value long-term as the value of the U.S. Dollar continues to decline.
7. The Gold Bull Market Continues - Until Federal Government spending is brought under control or until the Federal Reserve stops printing money, the Gold Bull Market will, in our opinion, continue. Only an immediate and rapid reversal of policy can put Americans back to work, and get the country on the right track. Until then, we recommend you consider a core holding of up to 25% of your immediately liquid assets in Gold, Silver, Platinum, and other inflation fighting commodities.