Should I buy gold now? We have some thoughts.

Here is a very interesting article written by Connie Madon in December of 2008, a little more than a month after the November presidential elections. The word was already out that Obama intended to increase the monetization of our national debt (code for "printing money"). We submit this article because of its historical value as a predictor of the current financial circumstance. Understand - as a side note - that the monetizing of our debt is the predictive factor as one considers the purchase of gold. Most economists we read, tell us that the price of gold will continue to rise as long as this nation practices the monetizing processes needed (as some suggest) in the battle to mitigate a/this recession. We have highlighted what seems important to the current situation"

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From BloggingStocks: Dec 24, 2008 ---Monetizing our debt is happening as I write this. When a central bank prints money in excess of the revenue coming in, we refer to this as monetizing the debt. It has the effect of debasing that country's currency.

Let's look at what our central bank is doing right now. Since Labor Day, the Fed's assets have exploded to $2.31 trillion dollars from $905.7 billion dollars. Add to this President-elect Obama's plans to add another $700-800 billion dollars to this already bloated balance sheet and you are creating the seeds of a new disaster.

The effects of keeping interest rates near zero and monetizing the debt at the same time will create a double whammy. We saw what happened when Greenspan kept interest rates near zero for too long and created the housing bubble that has burst into skyrocketing unemployment and ever-rising home foreclosures. The Federal Reserve has done this, plus monetized the debt at the same time. It doesn't take a genius to figure out that we are headed into one of the greatest inflationary cycles in history and creating a new and even bigger bubble. end of quote.

Editor's notes: We have made our point about gold. Understand, also, that there would have been no housing bubble but for two circumstances: 1) the demands of the Democrats as regards a multitude of factors having to do with "Affordable Housing," and 2) artificially reduced interest rates that increased buying "opportunities " for those who normally could not afford the luxury of home ownership.

Conclusions tying gold investment to the current economic circumstance.

Two years later, here is what is critical: NOTHING OF SUBSTANCE HAS CHANGED. Just this morning, Gerald Driscoll, an ex Chairmen in the Federal Reserve system, told FoxBusiness that the Fed is expanding its predictions of a slow housing recovery, extending into the 2012-2013 or beyond. Throughout that period, gold may be a reasonably sound investment. Know that the experts caution against more than a 10% portfolio set-aside for gold investment. Also, it is our experience that when gold prices falls off, they stay down for years at a time. What is not commonly known is the the fact that all purchases of gold exceeding $600 must be reported to the Federal government and in past times, governments have confiscated citizen held gold supplies including this country.