Wise investors keep a level head and buy gold and silver when others panic.

March 22, 2011 – Wise investors keep a level head and buy gold and silver when others panic. Don’t get me wrong, our hearts and prayers go out to Japan – but when big money reacts irrationally to disaster, there is no sin in taking advantage of it.

The world’s third largest economy has taken an enormous hit, so it is natural for investors to seek safe haven. Japan has been in trouble for some time now, their credit rating has fallen to AA- and their debt is double their GDP. But the Japanese are a resilient people. They will pull together and do what it takes to survive. One thing they must do is repatriate their foreign investments. As the second largest buyer of US Treasuries, next to China, that should be an enormous red flag. Yet Treasuries are up. In order to replace their lost nuclear energy they will need a huge increase in oil imports, yet oil futures are down. And through it all, the yen has risen against the dollar.

Meanwhile, the rest of the world scrambles for safe haven. The Swiss franc has risen to record highs against the dollar, but their tiny economy cannot come close to satiating the demand. The euro and pound have fallen, despite signs that the underlying economies are far more sound than our own. And even precious metals have suffered. “Money is being taken out of commodities and is looking for a safer haven," said Phyllis Nystrom, energy analyst with Country Hedging in a Dow Jones Newswire.

Does that make sense? Of course not, and in that lies opportunity. The value of gold and silver transcends that of currency – it always has and always will. So it won’t be long before investors come back to their senses and realize that safe haven is still where it always has been.

Put emotions aside and buy gold and silver now, while the advantage is on your side.

Shannon King

Senior Staff Writer –

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