Advertise | Bookmark | Contact Us | E-Mail List |  | Update Page | UraniumSeek.com 

Commentary : Gold Stock Review : Markets : News Wire : Quotes : Radio : Silver : Stocks - Main 
  
 GoldSeek.com >> News >> Story  Disclaimer 
 
Latest Headlines

GoldSeek.com Radio: James Turk, John Williams, Martin Armstrong, Listener's Q&A, and your host Chris Waltzek(encore show)
By: radio.GoldSeek.com

Preparing for the Crash - S&P500 index analysis - INVERSE ETFs & PUTS TIMING...
By: Clive Maund

Commodity Slump Signals Slow Growth Outlook
By: Dan Norcini

The Gold Raid of July 19
By: Craig Hemke

When China Stopped Acting Chinese
By: John Mauldin

The Silver Manipulation Con Continues at the Highest Levels of Government
By: Bix Weir

Fear Spreading In The Global Financial System Pushes Gold & Silver Eagle Sales To New Highs
By: Steve St. Angelo, SRSrocco Report

The 10th Man: Floor Monkeys and Decentralization of Risk
By: Jared Dillian

Metals Continue To Setup For The Next Leg Lower
By: Warren Bevan

Gold Seeker Weekly Wrap-Up: Gold and Silver End Near Unchanged on the Week
By: Chris Mullen, Gold-Seeker.com

 
Search

GoldSeek Web

 
What Happens to Gold if We Enter a Recession or Depression?



-- Posted Friday, 6 April 2012 | | Disqus

By Jeff Clark, Casey Research

Mayan prophecies aside, many of the senior Casey Research staff believe that economic, monetary, and fiscal pressures could come to a head this year. The massive buildup of global debt, continued reckless deficit spending, and the lack of sound political leadership to reverse either trend point to a potentially ugly tipping point. What happens to our investments if we enter another recession or gulp a depression?

Here's an updated snapshot of the gold price during each recession since 1955.

Clearly, one should not assume that gold will perform poorly during a recession. Even in the crash of 2008, gold still ended the year with a 5% gain. And with the amount of currency dilution we've undergone since that time, it seems more likely gold will rise in any economic contraction than fall. Indeed, if the response of government to a recession is more money printing, precious metals will be a critical asset to have in your possession.

Even if the gold price ends up flat or down this year, the CPI won't. Gold's enduring purchasing power is why we hold the metal.

How about gold stocks?

In spite of the debilitating 1970s that suffered from stagflation, price controls, three recessions, and the Vietnam war, gold producers rose over 600% while the S&P was basically flat. And that includes a roughly 65% fire-sale correction, much like we saw in 2008. To be clear, gold and silver stocks won't be immune to selloffs if a recession or worse temporarily clobbers our industry. But in the end, we're convinced they will prevail.

Don't lose patience with, or confidence in, your gold holdings. What happens to the price over any short period of time is only one chapter in the book of this bull market, and we think you'll be happy by the time that last chapter is written.

[If you have questions on how to invest in gold in the current market conditions you aren't alone. If you act fast, you can be among those who get to hear Jeff Clark discuss his thoughts and answer selected audience questions. The Gold Investing in 2012 and Beyond: Your Questions Answered! call is absolutely free but you must sign up by midnight EDT on April 6.]


-- Posted Friday, 6 April 2012 | Digg This Article | Source: GoldSeek.com

comments powered by Disqus



 



Increase Text SizeDecrease Text SizeE-mail Link of Current PagePrinter Friendly PageReturn to GoldSeek.com

 news.goldseek.com >> Story

E-mail Page  | Print  | Disclaimer 


© 1995 - 2015



GoldSeek.com Supports Kiva.org

© GoldSeek.com, Gold Seek LLC

The content on this site is protected by U.S. and international copyright laws and is the property of GoldSeek.com and/or the providers of the content under license. By "content" we mean any information, mode of expression, or other materials and services found on GoldSeek.com. This includes editorials, news, our writings, graphics, and any and all other features found on the site. Please contact us for any further information.

Live GoldSeek Visitor Map | Disclaimer

The views contained here may not represent the views of GoldSeek.com, its affiliates or advertisers. GoldSeek.com makes no representation, warranty or guarantee as to the accuracy or completeness of the information (including news, editorials, prices, statistics, analyses and the like) provided through its service. Any copying, reproduction and/or redistribution of any of the documents, data, content or materials contained on or within this website, without the express written consent of GoldSeek.com, is strictly prohibited. In no event shall GoldSeek.com or its affiliates be liable to any person for any decision made or action taken in reliance upon the information provided herein.