With gold prices nearly doubling in the past 3 years—recently surpassing $1500 an ounce—one might be wondering: How high can it go? The Daily Reckoning believes gold prices still have the potential to reach even higher numbers and are urging people to invest in precious metals sooner rather than later:
We don’t expect the gold price to soar because gold is such a great thing; we expect it to soar because the world’s major currencies are not such great things. A dollar bill looks good, only when you place it next to a euro or a yen. But all three look sickly when you place them next to a bar of gold.
Gold has a 3,000 year track record compared to the terrible paper trail of inflation by fiat currencies and central banks. The problem with the dollar is, as The Daily Reckoning states, “there’s too much credit and not enough faith.”
Even as Moody’s and Standard & Poor’s threaten to downgrade the United State’s credit rating, politicians in Washington seem to be ignoring the signs that spell out the end for the dollar. David Galland points to five signs that point to fiscal disaster for the United States if drastic cuts are not enacted very soon:
- Europe is becoming more fragile and desperate for bailouts.
- Politicians will not admit the scope of the debt problem and refuse to abdicate Keynesian economics.
- China’s faulty economy can set off large consequences for the United States.
- Japan is caving under their debt and nuclear problems.
- The Middle East is in chaos.
These signs warn of tough times ahead for future generations if the debt problem isn’t taken seriously. The government has steered the economy straight into an iceberg; only the market can effectively navigate a course towards prosperity.Published in