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Precious metals are often one of the least understood sectors of investing. In part, because of the unique role Gold and Silver historically serve in an investment portfolio.
This Austin Report is a primer on Gold. We hope to show you why you must own Gold today...and a little Silver too. Inside, we'll discuss the role of holding precious metals as insurance, a portfolio stabilizer, and wealth-generating vehicles. At times, we will refer to Gold alone– but the benefits will most often apply to both precious metals, Gold and Silver.
To start, let's compare and contrast Stocks and Bonds with investing in Gold.
Gold is a Different Kind of Investment
Gold is unlike a bond. Gold pays no interest. But, Gold cannot become worthless like a bond can. The values of both rise and fall in free market trading.
Gold is also not a stock. Unlike corporations, Gold has no employees, no unions, pays no health insurance, has no overpaid CEO, no need to borrow money from a bank, and is recession-proof. Gold simply sits there in your vault quietly doing its job. You can see why for the average stock broker or financial advisor, Gold remains a total mystery.
Sadly for their clients, stock brokers seldom recommend investing in Gold or Silver. Despite the remarkable year-over-year gains they continue to ignore the gains being generated during the current bull market.
We believe there is a time and place in every portfolio for Stocks, Bonds, Real Estate, Commodities, Cash, and Precious Metals. There are very good reasons why this is true.
Gold is a True Diversifier
Stocks and Bonds prosper in strong economic times and bear higher risks in bad times. By contrast, Gold ignores recessions and does well when these and other traaditional investments fail.
Gold also acts as an anti-currency. Here at home, Gold soars in value when the U.S. Dollar is falling. Better still, Gold loves and thrives on inflation– events that Bonds hate and destroys the buying power of cash, Bank CDs, or other debt instruments.
And last, but not least, Gold is one of the last private investments– safe from the prying eyes of Government agencies.
Maximum Profits for Gold
In uncertain times, like we find outselves in today, precious metals will act more like a currency– preserving wealth and resisting deflation forces. There have always been unique periods in American history in which Gold and Silver suddenly act if they were the most scarce commodity on the planet!
During those decades, the investment demand for precious metals exceeds the supply, prices are bid up, and the profits can be dramatic. Let's take for example the last bull market for pecious metals in the 1970s. the price of Gold multiplied by 24 times while Silver multiplied over 30 times. With gains on that scale, Gold and Silver are hard to resist as pure profit plays.
Gold Survives & Prospers in Bad Times
In fact, in recent years, the price of Gold and Silver have more than quadrupled. Impressive indeed! Yet, those gains are far from the 24-30 times of the past leaving us with the opinion that there are still substantial gains still ahead in this bull market.
By contrast, Stocks, Bonds, and Real Estate all depend on the U.S. and World economy to be strong and growing. Right now, it's not. The U.S. is barely struggling out of a severe two year recession, the mortgage crisis still continues, the Government still owns huge chunks of the nation's banks, runs the entire mortgage industry, manages the world's largest insurer, and barely saved General Motors.
The Best of Times, the Worst of Time
With apologizes to Charles Dickens, these are clearly not the best of times. That is exactly why Gold and Silver make remarkable gains during the worst of times.
1. Wartime – Historically, precious metals rise in price during times of war, acting much like a commodity. The more uncertain the future, the better Gold performs. The Federal Goverment increases deficit spending and borrowing to pay for expensive wars. At present, the U.S. continues an 10? year war in Iraq, a war in Afghanistan, and the seemingly never-ending war on terrorism.
2. Recessions – Precious metals increase in value during periods of persistent recessions or depressions. During weak economic times when there's high unemployment, the Government borrows heavily to stimulate the economy. Debt is justified in an attempt to replace the lack of consumer/business spending with inefficient Government spending programs.
3. Monetary Inflation – Politicians typically create pork-barrel spending programs, expand the monetary supply dramatically, increase the debt of future generations, and eventually create rising inflation problems.
4. Low Interest Rates – Anyone with savings held in banks suffer today from artificially low interest rates. In times like these, many investors turn to Gold and Silver to replace the missing returns from traditional cash investments.
At this point in our nation's history, investors face an uncertain future. Liberal spending this year has multiplied the budget deficits far beyond what we declared was "out-of-control Bush Republican spending."
We All Will Pay for the Bailouts
Wealthy Americans realize they will be forced to pay for Washington's excessive spending with dramatically higher income taxes.
What other Americans have failed to realize is that they also be paying the bailouts, stimulus programs, and health care. All tax rates are bound to go up. But that often ignores "hidden tax" called inflation is coming. Inflation is a result of excess Government spending, borrowing, and money creation. All Americans will be hit with inflation resulting in a loss of buying power. Simply put: today's dollars will be worth less tomorrow.
Gold, the Financial Insurance
No matter how much you've put away for retirement or education funding, if inflation is rising faster than the returns on your money– you lose. Food will cost more, gas prices will rise, energy prices will soar, and anyone on a fixed income will be in big trouble.
Gold Has Quadrupled in Value
Nowhere has the need to hold Gold been more obvious to the average American than in the past year.
1. Gold Thrived, While Stocks Crashed– Gold was one of the few investments that prospered in 2008 rising in value by 6% while Stocks, Bonds, and Real Estate all crashed. Americans lost over $14 Trillion Dollars. Less than one-third of the losses have been recovered with rising U.S. Stocks.
2. Gold Survived the Financial Shock– In response to the massive financial crisis, the Federal Government seized control of the U.S. Banking industry, Mortgage Bankers, the world's largest insurer, and General Motors. After the financial shock subsided, massive debts and bailout costs were transferred from the worst run businesses in America to the U.S. taxpayer.
Stock and Bond Risks Became Apparent
For the past two decades, the markets have played down the inherent risks every investor faces. The perception before the financial crisis was the U.S. economy was strong and vibrant. Therefore, U.S. Stock and Bonds were safe, no risk investments.
The crisis exposed the true nature of the risk and rewards. But not before Americans had lost some $14 Trillion Dollars in financial assets.
While the major U.S. Stock indexes have failed to grow and prosper during the 21st Century, the price of Gold has quadrupled since 2001. Likewise for Silver.
A comparison on $100,000 invested in each of the major U.S. Stock indexes versus Gold versus Silver may be quite surprising to you.
While that is impressive, during the last Bull Market for Gold in the 1970s, the price of Gold multiplied by more than 24 times its starting price. While past performance is no guarantee of future value, even stock brokers and financial advisors will be challenge to find a safer or more profitable investment than gold has been in the 21st century.
Now is the Time to Buy Gold
We belive that the facts and figures we've presented are quite persuasive in reporting the benefits of owning and holding Gold in recent years. You and I both know that past performance is no guarantee of future results.
But, at some point, everyone must decide for themselves whether Gold makes sense for 5%, 10%, or a larger portion of their immediately liquid assets. Like any investment, your core holdings in Gold should be balanced in a way that makes sense for you.
How to Buy Gold
If you've never purchased Gold, Silver, or other hard assets before, let's walk you through the process.
Gold bullion can be purchased in many forms including modern Gold bullion coins and bars. You can make purchases in virtually any amount, ranging from a fraction of an ounce upward. We prefer Gold Coins over Gold Bars because there's no paperwork or Government reporting required with the types of Gold Coins that we recommend.
The weight and purity of Gold Coins are precisely controlled and standardized by internationally-recognized refiners and official government mints, allowing you to buy with confidence and sell with ease. This is true for Gold Coins minted in the 1800s to 1933 and for all modern issues.
This link to "Today's Best Gold Buys" will lead you to our online catalog of the most popular forms of physical gold, in stock, for immediate delivery. You can can online using your credit card right now. Once your order is accepted, your package will be shipped to you registered and insured via the U.S. Postal Services where it will be delivered directly to your door or P.O. Box.
Our Austin shipping team has carefully secured each package and it is identified on the outside only as coming from ARCI. No one, not even your postman, will have a hint of contents.
Call for Cash & Quantity Discounts
Typically, new buyers of Gold will have questions they need answered before they buy. Our team of Austin Gold Specialists is on call seven days a week from 9am till 9pm. You can call them at 1-800-668-8771.
We will be happy to recommend today's best gold buys that are completely private, non-reportable, and not subject to confiscation. You'll also received the lowest prices when you pay with check or bank wire on larger orders.
20 Years of Outstanding Service
Our firm is absolutely devoted to building a strong, honest relationship with out clients. Our goal is walk you through all the steps to getting started, stay with you along the way, and to be here anytime you get ready to sell your Gold and take your profits.
 The Gold Information Network is a division of Austin Rare Coins & Bullion serving investors, collectors, and fellow coin dealers since 1989. In the past 20 years, we have never had a single outstanding complaint. We proudly maintain an A+ standing with the Better Business Bureau. That's the best indication we can find about how we do business.
In conclusion: Once you understand the value of Gold and who easy it is to buy, sell, and trade, we urge you put away Gold, Silver, and other hard assets while the bull market is strong and the opportunity is ripe.
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Call 1-800-668-8771 to speak with a Gold Specialist
Disclaimers: Austin Rare Coins & Bullion has prepared information on this site for the private use of our readers. It should not be taken as personal financial advice. The information herein is obtained from a variety of sources that we believe to be reliable, but we cannot guarantee the accuracy or that information has not been condensed or may be incomplete. All opinions expressed by the editors of The Austin Report and those expressing opinions are subject to change without notice. We are not financial advisors. The information about future predictions, projections, or financial advice could prove to be unprofitable. This firm is specifically in the business of selling Gold, Silver, platinum and rare coins to the public and offers its opinions from that viewpoint. We generally make available news and opinions that relate positively to our markets and do not seek to present a balanced view of the investment markets. We advise that you seek out information from a variety of news sources before making any investment decisions. It’s important to always remember that past performance is no guarantee of future value. These products may not be suitable for every individual as the value of Gold, Silver, and rare coins go down as well as up in value. |
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