Is Gold a Good Investment?

While gold and silver can be looked at as investments, I consider them to be insurance. Their purchasing power over the long run stays constant whereas the value of our dollars is being inflated away more and more with each trillion dollar bailout that is funded with an increase in the money supply.

Since our politicians want to get reelected they will not raise taxes to fund their programs…

Since China and other foreign sources of capital have dried up (who wants to buy dollars that are being devalued daily) we can no longer look to them to fund our buying spree…

And since the public demands that the government “fix” the economy and continue to keep filling the trough from which so many feed…

…It is almost certain that the source of funding for these programs will come from printing more and more dollars. Money created out of thin air. Monetary inflation will be followed by price inflation. Your dollars will buy less and less.

At some point people (here and abroad) will lose faith in the dollar. At that point you will be glad that you have purchased some gold and/or silver. An ounce of gold still buys approximately the same amount of basic commodities as it did in Roman times. Over the centuries gold has proven to be a reliable store of value.

I believe it is prudent to hold a gold and silver reserve sufficient to provide basic living expenses for 2-3 years. It can’t hurt and may turn out to be the best decision you ever made.