Precious Metals Investing

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Throughout history, gold and silver has been used as both jewellery and currency. In fact, many economic policies were centered around hoarding gold, thinking it was a way to “preserve your wealth”. Mercantilism was one of the most prominent examples of this kind of thinking.

Today, despite not being on the gold standard anymore, our economy is based on fiat currency, or “belief” that paper money has the value it says it has. Central banks control money supplies typically by increasing or decreasing nation interest rates, as well as the amount of actual paper money in circulation.

With the US economy still struggling after years of recession, more and more investors are opening up to the idea that gold and silver should be the way to invest going forward into the next decade. Many are starting to believe that our insane debt levels (currently $17 trillion) is too high and our deficit of $1 trillion is only growing every second. Soon, our debt service payments will outgrow total taxes collected, which will lead to the collapse of the world’s financial system.

That is if you want to believe this.

Platinum and palladium is also another way to get into precious metals, even though it isn’t talked about nearly as much in the financial industry or typical news circuits. They are nearly as valuable in terms of price as their more popular counterparts and can be just as correlated as well.

Here are some ways you can invest in precious metals without having to purchase the actual physical asset themselves:

  1. Stocks or mutual funds of mining companies such as Barrick Gold Corp.
  2. GLD the gold spdr etf
  3. Platinum etf – PPLT
  4. Palladium etf – PALL
  5. Silver – SLV
  6. Antique coins where its rarity may be worth more than its meltdown value
  7. American precious metal eagles, Canadian Maple Leaves, Austrian Philoharmonics, or South African Krugerrands
  8. Bullion bars from Credit Suisse or Johnson Matthey

I still recommend that you hold the physical metals in your hands, in a safe, or in a depository since I do not really trust the stock market to be an accurate representation of value these days. When things hit the fan, you may have trouble getting your money out of the stock equities markets, if at all. That is the risk you take if you choose to invest in metals indirectly.


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