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Which Is Better: Gold Or Gold Stocks?

November 10, 2011 by  

Which Is Better: Gold Or Gold Stocks?

“The impact of the rate of inflation on the price of gold is like tracking the footprints of an animal.”  — Julian M. Snyder (quoted in The Maxims of Wall Street by Mark Skousen)

The Midas metal has been on a tear since 2001. Since then, the world has witnessed two major stock market collapses, a boom-bust in real estate, the Great Recession and a European debt crisis. Throughout it all, gold has increased from $300 an ounce to nearly $2,000, before retreating (it currently is around $1,750 an ounce).

Above all, remember that political and economic crises mean more government and more inflation. The central banks have been busy printing a lot of new dollars, euros and yen since 2001. It was clearly catch-up time for commodities in general and the precious metals in particular.

Gold Is Now A Superior Inflation Hedge

What have we learned about gold? First, gold has maintained its purchasing power for centuries. Business professor Roy Jastram did the original research on this fact in The Golden Constant. The following chart demonstrates this fact:


Source: www.thechartstore.comWhat’s interesting is how gold has broken out on the upside of its long-term purchasing power ever since 1971, when the United States and the world went off of the gold standard.

Gold is now a superior inflation hedge by a considerable margin, especially if you buy it when it’s cheap (1971, 2001).

It always was said that a $20 Saint-Gaudens double eagle gold coin could buy a tailor-made suit in New York in the 1920s. Today, at $1,750 an ounce, you can buy three tailor-made suits.

The same holds true for the silver dollar. In 1960, a silver dollar was worth $1 in paper dollars. Today, it costs $38.

However, it also is important to remember that since going off of the gold standard, precious metals prices are volatile. Gold went through a 20-year bear market from 1980 to 2000.

What About Gold Stocks?

If you thought gold was volatile, gold mining stocks are even more so. Typically, in a bull market, if gold doubles in price, you would expect gold mining stocks to triple or quadruple in price.

However, recently (see the preceding chart), just the opposite has happened. Gold bullion (GLD) has risen sharply, and the gold stocks (GDX) have failed to keep up.

What gives?

To find out, I called the world’s expert on mining stocks, Rick Rule. Rule is president of Global Resource Investments, a brokerage firm specializing in natural resources that is wholly owned by Sprott Inc., one of the world’s preeminent natural resource investment firms. I’ve known Rule for more than 30 years as a friend and as a valuable adviser.

Five Reasons Why Mining Stocks Have Lagged

Rule offers five reasons for this disparity:

  1. The introduction of the gold exchange-traded fund (GLD) has made it easier for investors to invest in pure gold. Before GLD was available, investors had to buy physical gold through coin dealers or foreign banks.
  2. Gold equities anticipated the run up in gold prices five years ago, and the metal had to “catch up” to expectations already built in to the equity markets.
  3. Mining companies have disappointed investors; they have failed to perform in increasing free cash flow and profitability, relative to the rapid rises in commodity prices. Rule blames this lack of leadership on the 20-year bear market in gold (1980 to 2000); the best managers went to more profitable opportunities (high technology, etc.).
  4. The mining industry has gone through its own version of inflation, through share dilution. Market capitalization has risen much faster than share prices, as companies have resorted to issuing new stock to raise capital. (We’re seeing this share dilution especially in the “rare earth” and “uranium” stocks in the past few years.)
  5. Up to 90 percent of all junior mining companies — all heavily diluted — are “no good,” according to Rule, and investors are heavily discounting their value.

Why The Gold Market Is About To Change

But Rule has good news. While the competition with gold and silver exchange-traded funds will continue, mining companies are now inexpensive relative to bullion. Investors will be rewarded accordingly.

Here are the reasons why mining stocks are about to soar in the next few years:

  1. After a 10-year bull market, good managers have returned to the mining sector.
  2. Top mining companies are generating dramatically higher profit margins. Free cash flow is now “gushing” and will double in the next year as huge capital investments by the major mining companies paid off.
  3. Expect enormous consolidation as major mining companies start buying up smaller producers at startling premiums to current market prices.
  4. New discoveries are expected as 10 years of exploration pay off. The gains accruing to successful exploration efforts can be explosive.

Where To Invest

Rule is constrained by regulation from making recommendations, but his clients report a fondness for Barrick Gold, Goldcorp and Kinross, among the majors; Royal Gold and Franco Nevada among the royalty companies; Perseus, Lydian and Esperanza among the developmental juniors; and Vista Gold as an undervalued takeover target. I also like IAMGOLD (IAG).

And if you like to hedge your bets and earn a dividend yield of more than 10 percent while you wait for mining stocks to go up, consider investing in the Gabelli Gold and Natural Resource Income Fund (symbol GGN).

–Mark Skousen
Editor, Forecasts & Strategies
www.markskousen.com

Mark Skousen

, Ph. D., is a professional economist, investment expert, university professor, and author of more than 25 books. He earned his Ph. D. in monetary economics at George Washington University in 1977. He currently holds the Benjamin Franklin Chair of Management at Grantham University. He has taught economics and finance at Columbia Business School, Columbia University, Barnard College, Mercy College and Rollins College. He also has been a consultant to IBM, Hutchinson Technology and other Fortune 500 companies. Since 1980, Skousen has been editor in chief of Forecasts & Strategies, a popular award-winning investment newsletter. He also is editor of three trading services, Skousen Hedge Fund Trader; Skousen High-Income Alert and Turnaround Trader. In 1995, he served as editor of the investment series, "Secrets of the Great Investors," with Louis Rukeyser as narrator. He is a former analyst for the Central Intelligence Agency, a columnist to Forbes magazine (1997-2001), and past president of the Foundation for Economic Education (FEE) in New York. He has written articles for The Wall Street Journal, Liberty, Reason, Human Events, the Daily Caller, Christian Science Monitor and The Journal of Economic Perspectives. He has appeared on ABC News, CNBC Power Lunch, CNN, Fox News and C-SPAN Book TV. In 2008-09, he was a regular contributor to Larry Kudlow & Co. on CNBC. His economic bestsellers include "Economics on Trial" (Irwin, 1991), "Puzzles and Paradoxes on Economics" (Edward Elgar, 1997), "The Making of Modern Economics" (M. E. Sharpe, 2001, 2009), "The Big Three in Economics" (M. E. Sharpe, 2007), "EconoPower" (Wiley, 2008) and "Economic Logic" (2000, 2010). In 2009, "The Making of Modern Economics" won the Choice Book Award for Outstanding Academic Title. His financial bestsellers include "The Complete Guide to Financial Privacy" (Simon & Schuster, 1983), "High Finance on a Low Budget" (Bantam, 1981), co-authored with his wife Jo Ann, "Scrooge Investing" (Little Brown, 1995; McGraw Hill, 1999), and "Investing in One Lesson" (Regnery, 2007). In 2006, he compiled and edited "The Completed Autobiography, by Benjamin Franklin (Regnery)." In honor of his work in economics, finance and management, Grantham University renamed its business school, "The Mark Skousen School of Business." Dr. Skousen has lived in eight nations and traveled and lectured throughout the United States and 70 countries. He grew up in Portland, Ore. He and his wife, Jo Ann, and five children have lived in Washington, D.C.; Nassau, the Bahamas; London, England; Orlando, Fla.; and New York.

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  • s c

    Why are people so reluctant to respond to the question? The question itself is flawed. It equates apples and oranges. In a world that made sense, it wouldn’t make any difference if you possessed gold or gold stocks.
    In this world, it’s better to have physical possession of the gold. If you have so much money that you can invest it and not get hurt, then flip a coin.
    Otherwise, take possession of the gold you want, and leave ‘paper gold’ to starry-eyed dreamers. In case some of you starry-eyed yahoos have more money than common sense, I’d be glad to “hold” your money for you. Remember, ‘nothing can go wrong,’ ‘nothing can go wrong,’ nothing can go wrong,’ ‘nothing can . . . . . . . . . . . . . . .

    • bob wire

      Well, I question where we might live in a world that makes sense sc.

      But if we did, I’d rather have a piece of cake then a picture of a piece of cake, wouldn’t you.

      I do have faith in my inability to trust other people with my money however and don’t fret over such matters as some seem too.

      I would think, I might be told something like, “If you will accept this picture of a piece of cake instead of a real piece of cake, we will give you “TWO” pictures of two whole cakes and a picture of a big glass of milk!”

      Is that the way it works?

  • Tazio2013

    “We ran out of road” plus some salient comments re Gold at $5,000

    By Bill Bonner
    London, England

    Yesterday, Silvio Berlusconi said he will leave government… once the legislature has agreed on an austerity programme.

    Too bad. We’ll miss ‘The Cavalier’.

    Once in Rome, we heard him speak to a crowd. We didn’t understand a word of what he was saying. But he said it well. He was at ease… friendly… joking… enjoying himself.

    And now what? The poor man will be out of politics. No more will he get to work with the great men of finance, trying to solve the historic problems of the day. He’ll have only his bunga-bunga parties with plenty of alcohol, music and beautiful young women. Poor fellow.

    Our guess is that the great men of finance won’t be able to solve Europe’s debt problems. At least, not without a few blow-ups. And the European Union will probably end up less united than ever. (Gold is trading over $1,800 this morning…looks like investors are worried too).

    Until recently, both economics and politics argued in favour of a more centralised Europe. Now they are pulling it apart.

    But we’ve made so many guesses over the past few months and years… we’ve lost tract of them. Herewith, a review:

    First, back in the mid ‘00s, we guessed that the housing market, stock market, and the financial industry would all blow up. They did.

    Then, we guessed that this would not be followed by the typical recession/recovery pattern of the post-war period. It wasn’t.

    Instead, we had a hunch that the economy had entered a Great Correction… from which it would not emerge for many years. So far, that appears to be what is happening.

    As to what gets corrected, when and how… we admit ignorance. But ignorance never stops us here at the Daily Reckoning; it is like red meat to a hungry dog. We thrive on it.

    We guessed that the main thing to be corrected was the credit bubble. Debt levels are too high. They need to be reduced. That’s why the feds have been unable to turn the situation around. In a recession, they can make credit cheaper and more abundant. That usually does the trick. At lower financing costs, more projects make sense. People begin to invest and spend again. But it doesn’t work that way in a debt correction. It’s not a question of the price of credit… but of there being too much debt. Debt levels need to be reduced.

    The price of credit has been reduced to zero (the fed funds rate)… and the US government is running trillion-dollar deficits. Neither monetary nor fiscal stimulus has worked. Both add debt; instead, debt needs to disappear.

    We also guess that this correction will end with the end of the dollar-based monetary system that was set up in 1971. No paper money has ever survived a complete credit cycle. The dollar won’t be the first.

    De-leveraging will keep prices low while cutting profits and sales. As it develops, stocks, real estate and other assets will eventually be marked down to real bottom-of-the-bust levels. You should be able to get a 5% yield on your stocks… about twice what is available today. That will mean prices at about half what they are today.

    The slumpy economy… combined with periodic liquidity crises (such as is now happening in Europe)… along with falling asset prices will drive investors to the safety of US bonds. This will keep US government financing costs low – despite huge deficits. It will also convince the feds that they can pump large amounts of cash into the system without fear of inflation. This they will do…

    The price of gold may fall in the early de-leveraging phase. Then, it will rise as the late de-leveraging stage begins. This is when the feds’ money-printing will move into high gear. Sophisticated investors – including foreign central banks – will be wary. They will buy gold.

    The price of gold will rise. The Dow will fall. They will intersect at about $5,000.

    But our guesses don’t stop there. We also guess that…

    …the developed countries will find it very difficult to grow. First, because of the weight of debt. Second, because much of their capital is “invested” in unproductive, zombie industries. Third, because their populations are stagnant. Fourth, because they have already gotten most of the above-trend growth resulting from increased use of cheap fossil fuels.

    … since the developed economies cannot grow… and since they are up to their chins in debt… they cannot fulfill the promises made to their citizens. The grand bargain of the modern, social welfare state will begin to look more and more like a bad deal. Young, unemployed men will become increasingly fed up. They will look for radical solutions… and more radical leaders with jingo – answers.

    … governments, which are inherently reactionary even in the best of circumstances, will respond with repression. They will not adapt peaceably. They will not throw their zombie clients under the bus. Instead, like the Ancien Régime, they will dig in their heels and protect them. The defence industry, for example, will try – probably successfully – to direct the citizens’ rage against imaginary foreign enemies… and thereby increase its own power and wealth…

    … the real economy will weaken. Revolution will begin… probably coincident with hyperinflation. Finally, the middle class will be broke (the poor are already broke) and the US, the world’s most powerful country, will be ruined.

    There, that pretty much sums it up. Any more questions?

    • Lastmanstanding

      Tazio…great post…it is just that simple. It ALWAYS happens that way.

      If one looks at their own life and the lessons that they have learned, there is always a path. if you hit a wall and have a choice, one of two things happen…you will repeat the path or “take the fork in the road.” If you repeat the path, you get the same lesson. Unfortunately, most people repeat the path.

      “the fork in the road” (or the road less traveled) has always provided us with great results. It is often tense but with hard work, patience and diligence it ALWAYS comes through.

      History reveals this time after time. Unfortunately, most people in the US don’t even care and just continue to demonize the haves.

      A life without risk is no life at all.

      “don’t go down without one helluva fight.”
      “give me liberty, or give me death.”

      • Bruce

        Lastman & Tazio,

        As you may have seen my many post about the repeal of the 14th Amendment oddly this topic extends to that very issue, let alone all other issues we face today as well have faced since 1860 when the very unit of measure of the Law was removed from the People.
        That being the “ORIGINAL Constitution and Bill of Rights.”

        Thus the term “Ignorance of the law is no excuse.”

        As I am sure you both understand that the laws pre Civil were based on the Amendments pre 1860, as well whats written within the text of the Constitution, thus based on that principal we know what the value of $1.00 is; (357 some odd Grams of Silver.)
        Yet today that very 357 Gram’s of silver is how many paper greenback?

        So, do any of us really make more money than say what someone pre 1860 made?
        No, its just the PAPER “Dollar is Inflated” to such absurd levels that its worthless now but yet we all think we are breaking the bank. LMAO as I am sure anyone with pure logic is doing.

        So to the author Mark is the value of paper really worth as much as a gold coin?
        Well thats a deep question within a shallow pool don’t you think.

  • DavidL

    The answer is neither.

    • DaveH

      Good for you. I would caution you though to buy a wheelbarrow with which to transport all your worthless cash when the hyperinflation hits:
      http://zimbabwe.com/currency.htm

      • Old Henry

        Yeah DaveH, I am way ahead of the game as I got a “contractor size” wheels barrow in the Spring of 2010. (Wheels b/c it has two tires, not one)

  • herb

    While I like this article, the chart by Business professor Roy Jastram would seem to indicate that gold is at the top of its range.

  • Average Joe

    I am no Einstein in the thought department, but I’ll take physical gold in my hand over paper gold any day of the week. Two words of caution though…do not buy any gold that has a “face value” printed on it…period…buy ingots or jewelry and do not keep it in a “bank”. Why would I say this? Let’s take a short trip down memory lane to 1934 when FDR outlawed the ownership of gold reserves ( http://www.the-privateer.com/1933-gold-confiscation.html ) to the American people. When this happened, everyones safety deposit boxes were locked up and the government had to be with you to open those boxes. All gold was confiscated by the government and compensation (in wothless Federal Reserve Notes) was given at “face value” and not a the actual value of the precious metals…the American people lost 40% of their savings in one fell swoop (thanks Uncle Sam). Anyone who believes that the government won’t try to do this again is delusional at best or a complete idiot at worst. Ignore this advice at your own peril.

    Human beings, who are almost unique in having the ability to learn from the experience of others, are also remarkable for their apparent disinclination to do so.
    Douglas Adams

    • Average Joe

      “Let’s take a short trip down memory lane to 1934″ oops….1933 Before someone else points it out….sorry, I didn’t proof read before posting.

    • bob wire

      Oh ! if I bought a gold bar, I’d insist that “We God We Trust” be struck on it ! LOL ! ~ Face value , hahahah ! That’s funny Joe.

      I gave up on my first million and now working on the second.

      It’s like getting behind as soon as possible gives one more time to catch up.

      • bob wire

        Talk about typo’s ~! My dyslexia is running strong this morning. ~Proofing does not help, ~ My eye doesn’t see it and reads it correct.

        Oh well, one on many chinks in my armor.

      • Average Joe

        While I expect anything rational to sail over your head BW,please pay close attention to section 4…the last line.

        Section 3. Until otherwise ordered any person becoming the owner of any gold coin, gold bullion, and gold certificates after April 28, 1933, shall within three days after receipt thereof, deliver the same in the manner prescribed in Section 2; unless such gold coin, gold bullion, and gold certificates are held for any of the purposes specified in paragraphs (a),(b) or (c) of Section 2; or unless such gold coin, gold bullion is held for purposes specified in paragraph (d) of Section 2 and the person holding it is, with respect to such gold coin or bullion, a licensee or applicant for license pending action thereon.

        Section 4. Upon receipt of gold coin, gold bullion, or gold certificates delivered to it in accordance with Section 2 or 3, the Federal reserve bank or member bank will pay thereof an equivalent amount of any other form of coin or currency coined or issued under the laws of the Unites States.

        In other words Bo(o)b, the government paid in FRN’s… the face value of those coins confiscated….a one ounce $10 gold piece was actually worth approx. $20.67 dollars in 1933, but the owners of that gold were paid the Face value….which effectively robbed the American public of appoximately 40% of their wealth and savings. My grandfather was one of those people that had their savings stolen in this manner, so I know this happened from first hand accounts. Again, ignore my warnings at your own peril…it’s no sweat off my back…or money from my pocket for that matter…enjoy your delusions of granduer. It’s nice that you are a legend in your own mind…everyone deserves to be a legend …to at least one person…even if it’s themselves.

        To be matter-of-fact about the world is to blunder into fantasy – and dull fantasy at that, as the real world is strange and wonderful.
        Robert A. Heinlein

    • bob wire

      “Human beings, who are almost unique in having the ability to learn from the experience of others, are also remarkable for their apparent disinclination to do so.”

      Maybe that’s why “Guilty as Cain” has been repeated so often.

      • Average Joe

        Bob,
        Did you get lost in the toy department again? The quote means…that even though you “know” the result of a certain action will bring bad consequences…you do it anyway and then continue to repeat the same action over and over….while knowing the outcome in advance. I am guessing that reading comprehension is not your strong suit? Maybe this will help you to understand (doubtful, but worth a try).

        Insanity: doing the same thing over and over again and expecting different results.
        Albert Einstein

      • Average Joe

        “Maybe that’s why “Guilty as Cain” has been repeated so often.”

        Isn’t that the mantra of leftwing progressive liberals… against Herman Cain?

        I believe the correct quote is, “As guilty as sin”.

        • bob wire

          No Joe.

          Cain was the 1st documented murderer known to mankind. Cain killed his brother Able.

          So it has always been , “Guilty as Cain” Sin have not guilt. ~ Sin is to be “off target” , off the bullseye, a miss, sin is an early Saxton artery term.

          and Line #4 still left a lot to the imagination with matter of currency and exchange. But I thank you for pointing it out.

    • Old Henry

      Very good advice AJ. I developed that school of thought several years ago when the banks had to begin reporting to the guvment personal information of all box holders. Sexual penetration on George W. Bush.

  • FreedomFighter

    I like gold/silver in my hand, I like the feel, I like the look.

    Laus Deo
    Semper Fi

    • Average Joe

      And when you clank them together, they make such a pretty sound…almost like music to my ears….right up there with Bach, and Beethoven.

      • bob wire

        almost feels like 357 cartridges don’t they.

  • Maidenamerica

    Personally, I recommend buying small bottles of booze. They can be traded, consumed, or stashed. They retain their value, are impervious to infestation, and don’t need to be stored in a cool, dry place. They can be traded for gold, silver, or any other commodity, and are not likely to be confiscated in a clamp down.

    • Average Joe

      Guns and ammo are another good thing to stock up on as well….and for the same reasons….they have value and can be traded easily…as well as self preservation.

      An armed society is a polite society. Manners are good when one may have to back up his acts with his life.
      Robert A. Heinlein

      • Old Henry

        Yep, you can “trade” a small piece of lead, say .44, for your instant safety. Priceless…

  • James T.

    THere is about 165,000 tons of gold ,Not much to go around(6.5 Billion people)And its getting harder to produce.Right along with silver(which by the way has been kicking Gold in the Butt.)Iwould say ,in long tream Have the actual gold and not the paper.This is not just my view,but also the view of those people who are in the know.If people are intrested in investting in gold and silver,should do their home work, and some very strong resreach .I’ve also heard that so-called “Junk-Silver” (coins)are good investment when it comes to silver.Also ,for those people who may not know it,is that the demand for silver has out done its production ,at least for the last two years.I have silver that I bough at 17.88 cents An Ounce.And just for the record,At one time Silver had almost triple. ( $52.47 I think)Where gold has not in the same time period.Better to have alot more silver,than Gold.(again noy just my opinion)Because it is “easier To Trade.”I also Bough some gold(1,034.95).

  • Jay

    Critics who currently condemn the monetary system almost universally suggest that the only solution is to restore a gold backed currency. Such a system will be open to abuse by those very people who abuse it today. Indeed if we introduced a currency backed by chairs, I believe we would find ourselves with nothing to sit on!

    The only monetary system that seems to have worked in history is one which is backed by the goodwill of a government and is debt free, such as President Lincoln’s, “Greenbacks.” Fortunately, the Nobel Peace Prize winning economist, Milton Friedman came up with an ingenious solution of wresting back control of the money supply from the bankers, paying off all outstanding debt, and preventing inflation or deflation whilst this process is completed.

    Using America as the example here, Friedman suggests that debt free United States notes be issued to pay off the United States Bonds (debts) on the open market. In conjunction with this, the reserve requirements of the day to day bank the regular person banks with, be proportionally raised so the amount of money in circulation remains constant.

    As those people holding bonds are paid off in United States notes, they will deposit the money in the bank they bank with, thus making available the currency then needed by these banks to increase their reserves. Once all these United States bonds are paid off with United States notes, the banks will be at 100% reserve banking instead of the fractional reserve system and then fractional reserve banking can be outlawed.

    If necessary, the remaining liabilities of financial institutions could be assumed or acquired by the United States government in a one-off operation. Therefore these institutions would eventually be paid off with United States notes for the purpose of keeping the total money supply stable.

    The Federal Reserve Act of 1913 and the National Banking Act of 1864 must also be repealed and all monetary power transferred back to the Treasury Department. The effects of this will be seen very soon by the average person as their taxes would start to go down as they would no longer be paying interest on debt based money to a handful of central bankers.

    A law must be passed to ensure that no banker or any person in any way affiliated with financial institutions, be allowed to regulate banking. Also the United States must withdraw from all international debt based central banking operations ie. the IMF; the BIS; and the World Bank.

    If all the countries of the world adopted the conclusions above, then humanity will at last be free of these central bankers and their debt based currency. It’s a lovely idea, but first we have to get it past our corrupt politicians many of whom are quite aware of the scam that plays us on a daily basis, however rather than do the job we have elected them to do, they keep their mouths shut and instead look after themselves and their families, whilst the rest of us continue to be exploited.

    http://www.iamthewitness.com/DarylBradfordSmith_Bankers.htm

  • Joseph T Babbo

    Who knows, someday a large gold deposit will be unearthed…?

  • newspooner

    Hafnium is even better than gold.

  • Marty S.

    I would have agree with Average Joe that lead and the ability to accelerate it will become more priceless than the other precious metals as Obozo’s OWS-ers come a knockin in the next several months or years. God help the USA.

  • jim capy

    Keep plenty of dried food and water tablets. Gold and Silver don’t make good fare!

  • jopa

    Did any of you folks buy your gold through Beck, Ingraham, Levin and Huckabees Goldline by chance.They were just indicted for bait and switch tactics?People thought they were getting an investment in gold bullion and it turned out to be overinflated coinage.

  • jopa

    I think madeinamerica has it right by investing in small bottles of booze.There will always be a demand especially in hard times.

  • James T.

    Don;’t hole your breath Joseph,its highly unlikely that will happen.(again that is not just my opinion)

  • Pathos 11

    Excellent commentaries gentlemen, but we must take a breath and focus on the big picture other then a shiny piece of metal. We are currently living in a totally new world wide negative laced socially controlled environment that or parents and forefathers never experienced that is driving us toward a survival mode where security as defined by the political leaders actually means insecurity to the people. TSA has replaced the brown shirts of Nazi Germany thus affecting air travel down 20 to 30 per cent and is continuing downwards.

    The near future will dictate that food and water will be paramount in our lives whether you have gold or not. If you are fortunate to own gold put it back in the ground in the form of growing unadulterated food crops and water wells. Todays foods are laced with GMO chemicals and unknown additives that don’t have to be reported in the list of ingredients on food packaging labels, resulting in a slow kill to humanity. Just take a look at the statistics which don’t lie, the increase of cancers, Alzheimer’s cases, autism, birth defects and the list goes on and on. It’s
    much more then the haves verses the have nots, we are all involved and not given the option of having a choice in this most serious matter. This is just my opinion, but I’ll stand by it.

  • James T.

    oN THE TOPIC OF BUYING GOLD AND SILVER,APMEX, AND LEAR CAPITAL ARE THE TWO BEST COMPANIES ON THE INTERNET.YOU MAY ALSO TRY Mint Products .com. or Millers Mint.(for old coins.)There is also Modern coin mart. You mightfind that on some of their items,they are lower in cost than the USmint. I agree with you compeletly Pathos. and I respect your opinion But its nice to have both The food As well as the gold and silver.Just think gentlemen I said all this without calling anyone any names or spouting out any rude comments.Always remember; this is ,after all a free country.We may never always agree with each other but That doesn’t mean we have to start name calling.its also nice to have a large area where you can grow a good size garden,that away a person has more control over what he,or she eats.

  • James T

    Tune in next week,same Bat channel same Bat time.

  • http://gillysrooms.blogspot.com gillysrooms

    Everything looks so easy to fix according to most readers responses and too many people are trying to protect their assets worrying about losing it all and trying to find a safe store of value in times of inflation which gold has proven to be, problem is, it still can be stolen from you by criminals or confiscated by government decree unless you can hide it and remember later where you put it. Throughout the ages people have hidden their treasures and died and then no one in their families knew about it and it was lost for years until a stranger discovers it by chance again. So there are many risks associated with hiding gold or other precious metals or diamonds. Land is hard to lose but is subject to taxes and most times its better to have a land asset you cant lose than forget where you hid the gold bars when you start getting memory loss. But whats the point of gold if you cant use it for the betterment of your family? Shares are also a big risk of theaft by strangers, CEO’s, smart accountants and just the normal risks of running any business…and even shares in gold stocks wont GUARANTEE the best results. Do you really trust corporate strangers to look after the best interests of shareholders or themselves? If your really concerned then best thing to do is use any cash resources to pay out debt…but remembering that if you have a cheap long term loan…inflation will help you pay out that loan as money diminishes in vale during periods of hyper inflation. So i really dont have any answers for you good folk.

    Everyone is worried about the world economy and the American economy which is bad…but everyone is in the same boat with very few options really. But is it really that bad?

    Now let me ask…does anyone know what Asset backing is behind the loan liabilities which the USA owe to the outside world?

    Has anyone added up the value of all the land and buildings they own but dont use and all the buildings they own and do use? What are the other assets and reserves they own overseas. Then what percentage of taxes goes to pay for the interest on loans. How much could the USA raise if it sold its unused land and building assets? Then would it be cheaper to sell all other government assets and rent them back or is it still cheaper to pay interest on the loans vs renting the schools, the local government facilities, the various federal buildings etc….These question are NEVER discussed or information made available for debate. Im sure that the USA has $trillions of dollars in unused assets it could sell to others to repay the debt everyone seems so fearful about. How much gold does your ferderal government own? Could that be sold off to pay debts…considering that gold does not earn income and the sales could be used to repay debt and save billions in interest payments every year. Why does your federal government need to own gold…taxes should not be used for investment gambling purposes waiting for the gold price to rise and fall as it does. I’m sure more gold could be mined in california or some other areas if you really wanted to get more of it by giving tax incentives for prospectors to get their hands dirty again….With all the arm chair experts and politicians writing posts in this forum…surely some of you might have some answers to my questions?
    from Australia

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