Inflation has arrived.
While the mainstream financial media and government data continue to ignore it, inflation has begun to erupt around the globe. The signs are already clear:
- Civil unrest due to higher costs of living (the Arab Spring, China, Africa, etc.)
- Demands for higher wages (US, Germany, South Africa, Middle East, etc.)
There are three primary reasons for these inflationary trends:
- We live in a global financial system of fiat or paper money, which permits endless money printing by global central banks.
- The Financial Crisis of 2008 brought production and development of many natural resources to a halt as credit dried up.
- Since the Crisis hit, the global central banks have printed over $10 trillion in new money and pumped it into the financial system.
As a result of these items, inflation has been rising dramatically around the globe. In poorer areas of the world, where as much as 50% of income is spent on food, this has resulted in civil unrest and outright riots.
However, even in the developed world, inflation is seeping into the financial system in multiple forms whether it be companies providing less product for the same price, substituting less quality ingredients for their products, or simply raising prices.
We get additional proof of inflation in the form of Central Banks buying Gold. Indeed, starting in 2010, Central Banks became net buyers of Gold. Since that time, the buying has not relented. In 2010, Governments worldwide bought 77 tonnes of Gold. In 2011 it was 457 tonnes. And last year it was a whopping 535 tonnes.
Isn’t it a little strange that the very entities who proclaim that inflation is “contained” have bought over 1,000 tonnes of Gold since 2009?
In an environment such as this, smart investors are allocating at least some of their capital to Gold and Silver bullion.
And whatever you do, don’t store it with anyone else. As Cyprus has just shown us, when the Crisis hits… you can’t get access to your money.
Personally, we distrust safe deposit boxes because part of the reason for having Gold or Silver on hand is in case there’s a run on the banks or a bank holiday is declared. For that reason, we prefer having at least some bullion in a personal safe somewhere. You can get a decent safe for anywhere between $100 and $1,000. Both Target and Wal-Mart sell decent models for $50-$300.
On a side note DO NOT tell people about your bullion stash OR your safe. Trust virtually NO ONE with this information except your closest loved ones (and we mean CLOSEST).
This concludes this article. If you’re looking for more information on the threat of inflation, we’ve just released a Special Investment Report outlining the threat of inflation to your financial well-being. It’s titled, The Inflation Secrets Your Broker Won’t Tell You and it outlines three HUGE secrets that 99% of the investment community don’t know about inflation.
These include
- The surprising industry that suffers as prices soar, despite being considered "inflation proof" by many investors...
- Which investment Warren Buffett loves even more than gold...
- Why U.S. Treasury Inflation-Protected Securities (or TIPS) don't work — and what investment could be your best alternative.
This Report is a $79 value, but we’re giving it away for free to investors today. To pick up your free copy, swing by:
http://gainspainscapital.com/the-inflation-secrets-your-broker-wont-tell-you/ [8]
Best Regards,
Graham Summers
PS. We also offer a FREE Special Report outlining, What Europe Means For You and Your Savings.
In this report, we outline the risks Europe’s banking crisis holds not only for those in Europe, but for savers around the world. We also explain how this crisis will most likely unfold, including which areas are most at risk in the financial system. And we cap it off by listing multiple backdoor plays on Europe that investors can use to profit from Europe’s Crisis.
You can pick up a FREE copy here:
http://gainspainscapital.com/what-europes-collapse-means-for-your-savings/ [9]