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Despite all the recent concern and talk about the gold and silver market possibly entering bear territory, investors and buyers could just look at the numbers.

Gold and Silver Performing Well Year on Year

December 23, 2011 – Despite all the recent concern and talk about the gold and silver market possibly entering bear territory, investors and buyers could just look at the numbers. Technically, a correction is at least a 20 percent move lower in price. We are now around 15 percent on the month in gold. Nouriel Roubini’s twitter account aside, gold is already rebounding and the fundamentals in the market have not changed since last month.

It’s also something to keep in mind that following the September correction, central banks began buying gold in record amounts. Central banks have not bought gold in the quantities they did in the third quarter of this year since the end of Bretton Woods in 1971. If the people making the fiscal policy are buying gold, it deserves some consideration from you and I.

Now, let’s assume I bought gold in 2008 after the collapse of Lehman Brothers. The price dipped after that crisis, surprisingly to $681 an ounce. If I’m looking at 15 percent drop on the month, I’m still a very happy investor with gold at $1,607.40. Every ounce of gold I bought then earned me $1,000, just by being. I like those numbers.

So, all this talk about a bear market, Dennis Gartman selling his gold, and the price of gold dropping 15 percent doesn’t really matter considering gold is still up roughly 14 percent from the 2010 settlement at $1,421.40. If you bought gold last year, your investment is still performing. And gold is not only the best performing asset of the year; it is the best performing asset of the decade.

As a bit of insight into the future, consider now that the problems in Europe have not reached an equitable solution and for all intents and purposes are still pending, despite all the billions that have been thrown at the fire already. Each time a bump in the European road comes along, investors across the planet have to find instant liquidity and a lot people have been doing that in the past three months by liquidating their positions in gold. Unfortunate for them as investors, but that’s generally what has to be done when their paper goes bad. They have to sell the thing that actually has value—gold.

Gold and silver are set to perform quite well in the coming months and that is becoming increasingly clear in the markets.

Shannon King

Senior Staff Writer – GoldSilver.org

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