Is Gold Finally Headed For A Bubble?
With the United States and the world economy as well heading for a possible collapse or at the very least some serious trouble, many are wondering if gold will soon be experiencing a bubble and moving to an ever increasing price.
The main cause of this would be complete irresponsibility in the governments of the world, especially from the United States Government. With 2 economic stimulus packages under its belt that can never work and talk of another on the horizon, hardly any of our elected officials in Washington DC see the utter folly of trying to get out of debt by creating even more debt. Anyone with even an ounce of sense understands that you can’t pay off your bills by creating even more bills. This current financial thinking is spelling a fast track disaster for our nation.
Much of the smart investing public is seeing around this insanity and are buying gold coins, bullion, silver and other precious metals. Gold coin dealers and auction sites such as eBay are experiencing an upsurge in sales of these commodities. Gold has not always been the best investment because it has lost as much as 40% of its value in the 1980’s, but economic times are looking seriously different now and into the future of the world economy.
To finance the senseless stimulus packages, the Federal Reserve and other central banks of the world are creating liquidity by simply printing more money. Unfortunately they don’t seem to understand that every dollar they create out of nothing devalues every other dollar already in circulation. As all other dollars lose value this is essentially what causes inflation and results in higher prices. As prices go up gold becomes more valuable and the wealth you have invested in it is preserved.
As the gold bubble is created it is obviously smart to buy now and sell when the price reaches the top. That’s not always easy to do, but when people are employed, central banks stop printing money and the economy starts to really recover, not when President Obama just hopes and says it will, that will be a good sign the gold bubble is going to burst and it’s time to move back to cash. But, all indications are that isn’t going to happen for several years, at least not until the current financial wizards in Washington stop their orgy of irresponsible spending.
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