Many are turning to gold in these times of inflation and economic uncertainty. Gold hedges your money from the risk of inflation. If you assume that gold is just a piece of pretty metal that people strap on their bodies, then you are sorely mistaken.
Gold has been money for over 6,000 years. Gold and silver were the first forms of real money that met the requirements of sound money. Plato and Aristotle spoke of sound money to be
1. The ability to be durable. It must stand the test of time and not wither.
2. The ability to be portable. Good money needs to hold value in a small space.
3. The ability to be divisible. Real money should have the ability to be divided evenly and still hold its value. Also known as fungibility. Diamnonds are not fungible because each diamond has it’s own value.
4. It must hold a rare value or quality.
Aristotle was aware of something about money that most people today would struggle to comprehend. Paper money has no value, and that is what Aristotle described in his qualities of money.
Paper has very little value. It can be printed on demand. Paper has no rare or durable features. The value that the dollar has is only held up by our faith in it.
A dollar bill is nothing more than a piece of paper with ink stamped on it. That’s it. It would be the same thing if someone gave you a sheet of writing paper to mow their lawn. There is no difference between the two. The two are paper.
If someone gave you oil, silver, copper, or gold to wash their car then it is different. Those are real assets. It indicates hard work and sweat to bring those assets about.
Our money becomes more worthless each day our government prints more money. A dollar crisis is happening right now, and most don’t know it. Gold and silver were the first real established currencies that stood the test of time. This is because gold cannot be printed at will.
Gold and silver exploration companies have to survey and drill sites, and then they must mine the ore out of the ground. All of this takes energy and time. Only until relatively recently have governments used paper money as currency. It is important to not that there have been hundreds of paper currencies in history, and they all effectively went to zero.
Buying gold coins and silver coins are the only proven way to protect your assets during times of inflation. Gold will hold its value while paper money falls in value.
Not only is our dollar falling in value, but gold is in the middle of a 20 year bull market. The gold price is at an all time high of over $1,100/oz. People flock to gold in times of Inflation. Why do people do this? It’s because gold can not be inflated. What does inflated even mean?
Think of a balloon that you inflate. Basically, you are making that balloon bigger by blowing air into it. Well, our dollars are being inflated in much the same way. The more dollars that our government prints at will means more dollars in circulation. In this situation you have more dollars chasing the same amount of goods, which results in higher prices.
If you print more money then you have inflation, but inflation does not mean higher prices. Higher prices are the result of inflating the money supply. Basically, you should be diversifying out of dollars as soon as possible.
You should only be invested in gold bullion, silver bullion, gold coins, silver coins, and mining stocks over the next few years at least. India, China, Arab states, and several other countries are dumping dollars and buying gold. You decide if it’s time to get invested in gold and silver.
God bless you.
Garrett Strong can give you more information on how to buy gold.
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