Gold Approaching $600 and the Fed in Denial (Suppressing M3!)

The Federal Reserve Bank is about to quit reporting the measure of the money supply known as M3. This measure is one of the most useful ones for gauging the expansion of the money supply through deficit spending, one that shows how we are printing money like wild and devaluing our currency. It shows that the Fed's allegedly anti-inflationary efforts are delusional. And so the Fed, of course, is doing away with that important statistics so we will believe the doctored numbers we get about tame inflation. The reality is that spending is out of control and money supplies are inflating rapidly.

So what does that mean for investors? Stocks will ultimately disappoint, unless one takes steps to preserve wealth in light of rampant inflation. Gold is one of the best ways to preserve wealth. A year ago you could buy gold for around $400 an ounce. Now we are approaching $600 an ounce. Last August you could buy silver for $7 an ounce. Now it is over $11 an ounce. But it's still cheap compared to historical levels. Both metals will rise over the long term as M3 - hidden or not - continues upward, and as other nations seek for places safer than the dollar to invest their money. Now is the time to be in precious metals, mining stocks, energy, and some other commodities (for copper, think of stocks like PCU or PD, for energy, consider COP or XOM or many others, for uranium consider CCJ, and for cement - yes, cement - think of Cemex, CX).

links: digg this    del.icio.us    technorati    reddit