October 14, 2009

October 13, 2009 – Gold and silver could again prove that they are up to the task of protecting Americans’ portfolios from inflationary pressures and debt-laden corporations’ unstable stock values. The dollar fell against the euro and the yen today, but the inevitable long-term inflationary cycle is not the immediate concern for investors today. The Dow Jones Industrial Average(DJIA) reached 10,000 today, but many investors are disappointed with this number, since it was only three years ago that the DJIA topped 14,000. Many Wall Street economists fear that a major pullback could occur in US stock indexes, which turned in outstanding third quarter performances after bleak returns during the last two years. Household investors and professional market watchdogs are not the only ones who believe that our economy could continue to implode.

The Federal Reserve governor,Daniel Tarullo, made known his thoughts on our economy’s current status at a recent Senate subcommittee hearing. Tarullo stated in this hearing that our national unemployment rate “is unlikely to improve materially for some time.” Tarullo also feels strongly about our nation’s failing banking system, which he says is vulnerable to further deterioration. His straightforward words were like music to the ears of many Americans who have grown weary of our government’s paper-thick argument for a presently-occurring economic recovery. Many investors who want to invest independently of our nation’s banks prefer to invest in gold and silver, since it is a physical asset that can be stored privately.

In addition to the complete privacy that precious metals provide, many market analysts believe that gold and silver will rise until our leaders manage to turn our economy around, instead of merely discussing possible options."Gold has historically had the strongest inverse relationship with the US dollar, and this is likely to continue," analysts at Morgan Stanley said today. Bad corporate and political decisions have wrecked our economy and sucked the life from our currency. Many of our nation’s investors put a great deal of faith in our leaders’ conviction to right the wrongs that have ruined our economy, but they have been disappointed time and time again by self-serving lawmakers and greedy corporate executives. Historically, consumers could blame national financial crises on one of these two entities, but our present recession was fueled, ignited, and fanned by both of these hellish beasts. US investors feel betrayed, so until consumer trust is regained, the demand for safe-haven assets like gold and silver could increase. 

Shannon King

Senior Staff Writer –

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