Archives May 30, 2016

Why You Should Buy Gold If You Foresee Deflation, Not Inflation (CGL)

Last update on May 30, 2016.

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Conventional wisdom says that we should buy gold when we expect to see high inflation. The argument is simple: gold prices generally keep up with the rate of inflation, so when inflation is high, gold prices  should rise.

Five years ago, as gold prices approached $1,900 USD/oz (U.S. dollars an ounce), a stream of endless talking heads appeared on business TV channels and newspapers to promote the idea that gold was headed to $4,000 USD/oz or more.

Their reasoning was simple.

The Federal Reserve, which is ...

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