Don’t you get the feeling that everything is falling apart in slow motion? Europe’s problems are worse than ours, and that is saying something. Japan is a basket case. China can’t hold everything together by herself. Congress is in gridlock. The economy is not creating enough new jobs to reduce the unacceptable unemployment rate.
I keep reading about “deflation”, but you can’t prove it by my checkbook. Down here, in South Florida, it costs a fortune to go out to eat. I am still paying between $70 – $90 to fill up the gas tanks in my cars. And trust me, our new condo was not cheap. Real estate in general may be in decline, but the prime properties still command a premium. At least our business at Miles Franklin is robust and we will have a record year. My portfolio is doing fine, but unlike most people, I am totally invested in gold, silver and mining shares. In the next year, if it doesn’t double, I will be surprised and disappointed. Well, a 50% rise wouldn’t be so bad, and I may have to wait for two years to get the double, but I am patient.
My friend Eugene, who occupies the penthouse in the condo we just moved into, is curious about gold and we talk about it often. He listens to what I have to say and then asks me, “Can you guarantee me that gold will go up?” Why is it that people need a guarantee for gold’s performance but they never ask for nor expect one when it comes to the dollar? So, I say to Eugene, “Can you guarantee me that the dollar won’t fall dramatically in the next year or two?” It’s a great ploy to answer a question with a question, but in this case my response is perfectly valid. Most people have blind faith in the dollar and no trust in gold. The fact is no one can guarantee you anything when it comes to your investments, to the future price of gold and silver or even the future of the dollar. We all have to make educated guesses, based on the past and the present policies of the Fed and our government. I have no trouble putting all my eggs in one basket, and it is filled with gold, silver and mining shares. I may not have a “guarantee” of future gains, but everything I study and follow tells me my philosophy is correct. It sure has been for the past 11 years but now, the problems are bigger and less likely to be corrected than they were in the past, so I see no reason to bail out now. Frankly, to me it looks like the Golden Express is just getting ready to leave the station and my advice to you is hop aboard before you are left standing on the platform and out of luck.