Jun 25 2010 11:10AM

Gold - Bubble or Peak?

A recent article in the USA TODAY raised the issue of whether or not gold has peaked out. I won’t decide gold has peaked out until the fundamentals change. The fundamental has always been government spending and printing a lot of money as gold responds to “monetary inflation,” which eventually becomes “price inflation.”

Wall Street is concerned that price inflation is peaking out and we are going through a deflationary period. True enough! But that has nothing to do with monetary inflation, which is continuing unabated.

Also, consider the fact that unlike the fellow who wrote the article for USA TODAY, gold is not just driven by fear but by rational concern over the monetary inflation and the fears government is creating. The real fear-mongers are government officials, not gold buyers.

Also remember that silver is a better buy than gold. From a strictly profit point of view, it will make the investors three dollars for every dollar they would make in gold, because gold is much more affordable for the average person. When the precious metals awareness hits the broad middle class, silver will be where their money will go.

One comment by Tom Muldowney, manag-ing director of Savant Capital Management, was typical of Wall-Street Advisor thinking when he said, “Mostly, the advocates of hard currencies are either selling gold or they're pushing a political agenda. They spend their time scaring people.”

As a financial publisher, I make money on renewals when people decide if my advice has been profitable. I recommend gold and silver because the conditions are right to make a lot of money.

At the end of last year when we evaluated my A la Carte Investment Menu, we were up about 80% for the year. That should make a lot of people very happy. I do not want to scare people; I want to make them some money.

By Howard Ruff
The Ruff Times


Howard J. Ruff, the legendary author and financial advisor, has re-edited and re-issued his 1978 mega best seller, How to Prosper During the Coming Bad Years, still the biggest-selling financial book in history, with 2.6 million copies in print. He is founder and editor of The Ruff Times financial newsletter.

The newsletter is much more comprehensive and deals with a broad spectrum of middle-class financial issues and includes an Investment Menu from which you can build your portfolio. (You can learn about it here). The Ruff Times has served more than 600,000 subscribers – more than any financial-advisory newsletter in the world. His updated and revised book, How to Prosper During the Coming Bad Years in the 21st Century.

You can get it free when you subscribe to The Ruff Times (www.rufftimes.com), or if you buy the book at your favorite bookstore, you can deduct $10 from the subscription price.


Kitco Contributed Commentaries 2006
Latest Commentaries by
James Turk
Brien Lundin
Eric & David Coffin
Lawrence Roulston
Howard Ruff Howard Ruff
The Aden Sisters
Frank Holmes
Roger Wiegand