There are tectonic plates pushing against each other in Washington these days, and I’m not talking about yesterday’s 5.8 magnitude earthquake felt along the East Coast. Rather, the tension is a product of the government’s rising levels of debt and a printing press pumping out money and weakening the dollar.
In an excellent video, James Turk, founder of GoldMoney.com, and James Rickards, senior managing director of Tangent Capital, converse about gold’s role in this ongoing monetary issue. They discuss the tension building between “natural deflation coming from the depression†and “inflation coming from policy.†Eventually there will be a break, and the outcome is either deflation or hyperinflation.
Either way, because gold is a monetary problem hedge, Rickards explains, the yellow metal wins. He states, “Gold is not a commodity. It’s not an investment. It’s not a trade. Gold is money. If you want some money, you better have some gold.â€
But at what price should investors buy in? Perhaps up to $7,000, says Rickards. Watch the video to see his reasoning.
None of U.S. Global Investors Funds held any of the securities mentioned as of 6/30/11.
The Consumer Price Index (CPI) is one of the most widely recognized price measures for tracking the price of a market basket of goods and services purchased by individuals. The weights of components are based on consumer spending patterns. M1 Money Supply includes funds that are readily accessible for spending.
