Gold Investment – A Potential Lifesaver of the Collapsing Financial System
If you are a keen observer of our financial system and the crises arising therein, you might have realised that the factors managing today’s financial crisis namely politicians, governments, central banks and corporations would also be managing the forthcoming financial crisis of 2016-17, and what they do is only put band aids on the wounds caused to the system with lame solutions like printing more money, increasing spending, trying to manage the excessive debt problem with increased borrowing, making complex and difficult laws and at the same time, pushing in more funny money in the financial mess going on at a global level.
It’s quite simple to understand that the financial solutions are not going to last for long when we take a look at the official national debt of the US that is increasing at the rate of more than its compounded interest rate of 9% per year.
Another factor is that due to currency wars between dollars, Japanese Yen, Euro, and other currencies, values of these currencies are dragged down, with the values of real assets to add to it, which further bring down the stock markets. Because of this, central banks see the only solution of printing more currency which further devaluate the currencies. This in turn will flow through the already lowered prices of commodities which will worsen as central banks would aggressively pursue currency devaluations.
In summary, currencies have devalued. What they want now are not the collapsing stock markets, over-valued bonds and papery promises, but something like gold and silver that can save the day. Prices of these two precious metals have rallied with the start of 2016 because of the grown demand from investors from a short stack supply market and this clearly indicates an approaching crash. Looking at the totally crazy things happened so far, one cannot guarantee that they wouldn’t happen again.
Between gold and silver, it seems that silver market is less manipulated because silver is a less popular metal and the impending hyperinflation and enormous currency devaluations would give rise to a condition where silver would reach a 4-digit value. Another fact remains that the prices of these precious metals would largely depend on the gestures of major gold buyers, central banks and governments, who should take measures immediately as the situation is soon going to be totally out of control.
The consequence of the deflationary crash would certainly be the increase in buying power of silver; however, the complication would still persist when the prices in dollars, yens, Euros and other currencies would be thrown into equation. Only time can tell what would happen; but it’s also worth remembering that time won’t be always friendly to the investors, rather it is the worst enemy and the best friend of an investor at the same time.
The source of the article is Gold Buyers Brisbane Blog which has more informative articles on gold investment.