In a recent web event, Doug Casey said, “You want to keep what you have, and the best way to do that in today’s world is to actually buy gold…”
I couldn’t agree more…
Gold is set for a massive rebound in coming months, easily handing you one of the best opportunities in over 30 years to invest in gold…
Stock prices are being pumped up to bubble levels by the Federal Reserve’s massive, $85-billion monthly quantitative easing program.
Since the market bottom in 2009, the Dow has jumped 143%, the S&P 500 is up 165%, and the Nasdaq has soared a massive 213%.
Bob Shiller, one of the winners of this year’s Nobel Prize for economics, recently told a German magazine that the boom in the US stock market “could lead to a dangerous financial bubble and may end badly.”
Because the fact is… we have financial markets hitting record highs in spite of the overall stagnant economy, leading many people in the investment community, including myself, to start to worry about a market bubble that is about to burst…
Despite assurances from the Federal Reserve and the mainstream media that everything is just fine.
Market research firm TrimTabs calls the S&P 500 “very overpriced,” while earnings and revenue growth “are low” and the economy “is basically stalling.”
Forbes adds that the stock market is now “overvalued and overbought.”
And according to a recent article in CNBC, “As investors feel emboldened by the seemingly unstoppable stock market rally, they’re borrowing money at record levels to keep things going,” sending margin debt to a record high, skyrocketing 50% higher than its level in January 2012.
The last time margin debt – a measure of how much market participants are borrowing to buy stocks – soared like this was just before the financial crisis of 2008.
“When the tablecloth gets pulled out from under the place settings, you’re going to have a lot of them crash and smash on the floor,” said Uri Landesman, president of Platinum Partners hedge fund. “That margin’s going to get pulled and everyone’s going to have to cover. That’s when you get really serious corrections.”
And that’s when you’ll see investors fleeing to gold as a market hedge, as the stock market bubble bursts and comes crashing down.
Stock prices are artificially inflated, and the fact that many on Main Street believe in the economic recovery has further bolstered the market, adversely affecting the price of gold.
But that’s only temporary – no free lunch lasts forever.
As we’re forced to face the consequences of our government’s excessive money printing, incredible debt, and corresponding inflation, gold will inevitably rebound.
It could be at the end of the week or the end of the year… but it’s coming.
And when it does, I want you to be there to reap the rewards.
That’s why now is the perfect time to buy gold.
Because the fact is, even though 2013 was a brutal year for gold with over a 26% price drop, the factors that drove gold to soar 645% from 2001 to 2011 are still in force, including…
|✓||The US’s massive $17-trillion national debt. This clearly is not sustainable. Excessive debt is the root cause of our financial crisis. And yet we continue to pile it on. The good news is that whatever form the fallout takes, it will almost certainly be very positive for gold.|
|✓||The enormous annual deficits. In fiscal year 2013, the US deficit hit $680 billion, which means the federal government took in $680 billion less revenue than it spent this year. That’s less than the $1 billion-plus deficits of the last four years, but it’s still a massive, unsustainable figure.|
|✓||Nearly $3 trillion in unbacked paper dollars printed out by the Fed. They’re still contained on bank balance sheets, potentially ready to crush the dollar and drive gold and silver through the roof at any moment.|
|✓||The Fed’s unlimited money-printing scheme continues. In fact, Forbes notes, “Some people think the Fed could be printing money at double the present pace by the end of 2014.” Which means investors could flock to gold to hedge against rising prices.|
|✓||A world in turmoil and unrest. Think riots in Argentina, Ukraine, Thailand, Iraq, and so on. Unrest that could drive gold higher as investors search for a safety net.|
And here’s the critical point: none of these issues have yet been resolved!
Make no mistake: Any weakness we see in gold prices here is nothing more than a short-term circumstance – and a perfect buying opportunity for the medium to long term.
Just because gold doesn’t seem to be reacting to Fed money printing at the moment doesn’t mean it won’t.
Sooner or later, reality trumps fantasy. Reason says that you can’t quintuple your balance sheet in five years and expect no repercussions.
The Fed keeps hinting it will taper its money printing, but it still has not.
We’ve had QE1, QE2, Operation Twist, and now QE3… none of them has worked, and the new Fed chair wants to print even more money.
It’s pure fantasy to believe there will be no consequences to these actions – and the reality is that whatever else happens, gold will soar.
It’s hard to fathom how we’ll escape the dire fiscal and monetary conditions in much of the developed world’s economies without some serious fallout – and a strong response from gold.
Never before has such an enormous monetary experiment taken place on a global scale. If ever there was a need for monetary insurance, it is now.
Doug agrees, saying, “You buy gold, the metal, because you’re prudent. It’s for safety, liquidity, insurance.”
The point I want to make is this: unless the government makes some DRASTIC changes soon (and we’re likely already past the point of no return)… gold isn’t going anywhere – except up.
But first let me make this critical point: gold is the ultimate “insurance” to protect your wealth once paper currencies start to collapse the world over.
That’s why central banks and governments worldwide are hoarding gold… because they believe it’s the best way to protect themselves against the debasement of currencies around the globe.
You should follow their lead… while there’s still time.
Article written by Doug Casey from Casey Research
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