by Adam Crum
The money floodgates have begun to open. The Federal Reserve is now printing money—hundreds of billions of dollars worth—like never before. So the only logical question left is‚ “What are the long-term consequences?”
Warren Buffett’s answer…
“Their precise nature is anyone’s guess‚ though one likely consequence is an onslaught of inflation.”
This echoes a point that I’ve been making in many of my recent oral updates and articles I have written‚ long before even this legendary investment guru sounded any alarms. The truth is that the money supply has grown at a substantial rate for years to support the spending spree of our growing welfare state and the war in the Middle East. In my opinion‚ the recent explosion in debt due to the “bail out” has only served to guarantee the eventual collapse of most‚ if not all‚ western currencies.
Deflation appears to be in the driver’s seat at the moment‚ and “cash is king‚” according to the “talking heads” on Wall Street.
But when things do turn‚ I believe the central banks will remain behind the curve‚ as they have been all along.
And that means renewed inflation… and possibly‚ substantial inflation.
Famed billionaire investor Jim Rogers says we have an “inflationary holocaust on the horizon.”
You may ask‚ “Who is Jim Rogers?”
Jim Rogers is perhaps one of the most successful investors of the past 30 years. He is a self-made billionaire‚ and he did it through smart investing and predicting trends. He is not a billionaire who made it through building a company and taking it public. He has created his wealth by staying WAY ahead of the “pack” and simply investing wisely. Often controversial and always outspoken‚ Jim Rogers has told investors for years now that investing in commodities and tangible assets should be the primary place for your money over the next 20 years.
What is the “tangible advantage?” Well for starters‚ tangibles are not likely to go from $28 to $1 like Citigroup… or $148 to $2 like Las Vegas Sands Corp. (LVS)… or worse‚ $54 to ZERO like the one-time darling of Wall Street from 2008‚ which used to be called Wachovia. Putting their performance into the proper perspective‚ $300‚000 invested evenly into these three stocks‚ once all high-fliers on Wall Street‚ would be worth approximately $4‚500 today.
And people ask me‚ “Why do you collect rare gold coins?”
Tangible investments‚ like those in rare gold coins (and especially‚ key date rare coins)‚ have substantially outperformed the likes of equities and real estate for decades‚ and for that matter‚ for centuries. They are easy to store and manage‚ and they are hard tangible assets unencumbered by the likes of more traditional leveraged assets.
Maybe it is time to do what Jim Rogers is doing. And that is‚ stop listening to the talking heads who are educated and controlled by the very institutions that got us into this mess. Of course they want you to keep your money in their banks‚ their investment firms‚ their mutual funds and the like. They are the ones making the most money with your money. And when they lose‚ it is only your money that goes away; they still get paid!
I am absolutely disgusted by the recent bonuses reportedly paid out to money managers employed by the firms who just screwed taxpayers out of over $1 trillion. One I read about‚ actually paid by a company who received billions in bail out money‚ was $138 million… and that was to one manager! This is crime of epic proportions!
If you do not yet own tangibles now‚ I have to ask you‚ “WHY NOT?”
If Jim Rogers and countless other non-Wall Streeters are right‚ and all this newly printed money leads us to a round of high inflation‚ then I believe that rare gold coins will lead the pack of winners to success. But even if that doesn’t occur‚ the worst thing that could happen to you in my opinion is that you would still own a proven winner with centuries-old value and outstanding long-term investment potential.
And that‚ as we say in Texas‚ is the “proof in the pudding.”
WAKE UP PEOPLE! The inflation bells are ringing.