Gold, Silver and Choices – Good and Bad

A few bad choices come to mind:

  • 1971: President Nixon refused to exchange dollars for gold subsequent to August 15, 1971.  He claimed it was “temporary” and blamed speculators.  Gold prices and inflation soared.
  • Mid-1990s: The Federal Reserve dramatically increased debt and the money supply and encouraged the NASDAQ “dot.com” bubble.  The bubble crashed in 2000 and destroyed $Trillions in assets and retirements.  Investors preferred stocks and bonds until after they crashed.  Gold and silver soared after 9-11.
  • 2001: “Unknown” people created the 9-11 disaster.  That event became the excuse for the Patriot Act and wars in Iraq and Afghanistan.  History shows that a number of empires collapsed following their attempts to conquer either Bagdad or Afghanistan.  American foreign policy chose to ignore history and invade both.  The costs have been outrageous with questionable results.  Gold doubled and silver prices tripled between 2001 and 2006.
  • 2004 – 2008: Banks and politicians encouraged the real estate bubble with easy money, “liar loans,” various derivative products, and delusions such as “real estate always goes up.”  The real estate market crashed and partially caused the 2008 financial collapse.  Pension underfunding, welfare expenses, food stamp participants, disability income, and the number of workers no longer in the job market have increased since then.  Gold doubled and silver prices tripled between 2004 and 2008.
  • 2009 – 2015: Hope and change, QE, and ZIRP have been disappointing.  Those Americans in the bottom 90% are still hoping for better days but expecting little change.  ZIRP has destroyed earnings from savings, damaged pension funds, and encouraged mal-investment.  More ugly consequences of both QE and ZIRP will manifest in the next five years.  Gold and silver will soar in the next 2 – 5 years.

The common elements in those “BAD CHOICES” were:

  • Increased debt;
  • Politicians;
  • Bankers;
  • And good timing for purchases of gold and silver.

Good Choices:

  • 1971: Buy gold at $42 and silver at $1.50
  • 1999: Buy gold at $280 and silver at $5.00
  • 2001: Buy gold at $260 and silver at $4.15
  • 2008: Buy gold at $800 and silver at $9.00
  • 2015: Buy gold at $1,100 and silver at $15.00

Of course we can point to many other bad and good choices over the past 45 years.  Buying gold in early January 1980 and for much of the next 19 years was probably a bad choice, so do your own research to make good choices.  While trading paper currencies for gold is, in my opinion, currently a good exchange, it is not always a good choice.

 SUGGESTIONS:

  • Physical gold and silver instead of unbacked debt based fiat currency.
  • Physical gold and silver instead of bonds that will eventually default.
  • Less foreign military involvement instead of more wars, expanded military actions, and the resulting increased taxes and inflation.
  • A 3rd party not owned by bankers and the military instead of a Republicrat or a Democan.

Make your own choices.  Consider real money, not the digital and paper stuff.

Read:

Steve St. Angelo: The Silver Supply Crunch

Alasdair Macleod:         Gold Remains Money

Doug Casey:                  Three Reasons Why the US Govt. Should Default

 

Gary Christenson

The Deviant Investor

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