Why Gold? Why Now?
FACTS YOU NEED TO KNOW
From 1921 to 1981, gold and gold mining shares made up 25% of the world’s financial assets and today they make up less than 1%. We currently live in a fiat world gone insane. Gold is real money, but the world has been brainwashed into believing pieces of paper backed by nothing are money.
When the world wakes up and realizes how fast fiat currencies are being debased, the world will lose trust in fiat currencies and will demand sound money. Gold would have to rise to $31,000 per ounce for gold assets to make up 25% of the world’s financial assets and $10,000 if non-gold assets fell by 2/3 in value.
Gold has been recognized as real money for thousands of years. These past few decades have been the exception. All central banks are battling to devalue their currencies. The current fiat currency experiment is going to end in a complete disaster. Bernanke is going to create quantitative easing all the way to hyperinflation.
Gold is the ultimate safety asset because it is globally traded, tangible, durable, easily liquid, and finite in supply. It is the purest form of wealth. Gold has outperformed and outlasted every paper currency ever printed. Governments simply cannot manipulate it, and the fed obviously cannot print Gold. Metals have no debts, no board of directors, no derivatives exposure and best of all, absolutely zero counter-party risk. That’s why gold has survived every economy in history, and preserved investors’ purchase power over a span of over 5000 years.
The US dollar will continue to lose significant value over time due to excess government spending and our rapidly growing US National Debt. The dollar has lost more than 25% of its purchasing power since 2001. Central banks around the world have turned from “net sellers” to “net buyers” of gold for the first time in over 20 years, driven by Chinese stockpiling and worries of a global currency crisis.
Since 2002, the U.S. dollar index has lost 23% while, during this same time period, gold has gained more than 350%. With excess government spending, the U.S. dollar will continue to lose purchasing power as the more money you print, the less the currency is eventually worth.
The average life span of a paper currency is 85 years. The U.S. dollar is now on borrowed time. Inevitably, the dollar will become worth less and less until one day it becomes absolutely worthless. We are now accumulating more than $$ ONE MILLION DOLLARS PER DAY $$ in interest alone. The dollar is nothing more than a promise to pay and I.O.U. Dollars are printed and Gold is minted. Which one would you prefer to have during a global currency crisis?