Editor’s note: Occasionally, we come across ideas that we simply have to forward to you. This one comes courtesy of our friends at Fat Tail Media. |
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Dear Reader, Anyone who reads mainstream news sources will know that the big concern for financial pundits is massive central bank money printing…and how it will cause inflation. Then why has gold been falling? Isn’t gold meant to go up when inflation does? Well, let me tell you something you will not hear from papers like the Australian Financial Review... Inflation is NOT caused by money printing. It’s caused by how fast that newly printed money moves throughout the economy. You may go to the shops and see prices edging slightly higher. That’s not proper inflation. We haven’t yet seen the real inflation. That’s still to come. And it will come when all the newly printed money begins to accelerate, chasing the fewer and fewer goods we’ve been producing. Here’s how my colleague, bestselling author Jim Rickards, puts it: ‘The driver of inflation is velocity, the turnover of money caused by lending and spending, which has been plunging for over ten years. ‘Still, an external catalyst of velocity will arrive soon and last for decades in the form of higher wages needed to offset declining working-age populations in China, Japan, Europe, Russia and the U.S. This wage increase will be driven in part by the diversion of workers to healthcare for seniors, which is needed work but not amenable to productivity increases. ‘Once this demographic wave hits, saver psychology will shift quickly, and cost-push inflation will feed on itself.’
Jim’s 100% correct. In short, if you think prices are rising now, you haven’t seen anything yet. And in my opinion, the time to prepare for this — by investing in gold and speculating on gold related stocks — is now. As Jim says: ‘The worst position was rising rates on inflation expectations with no actual inflation. That’s over. Now it appears we have declining rates and no inflation. That’s good for gold. If inflation shows up, that’s good for gold too. ‘It’s heads we win, tails we don’t lose.’
And although any stock market investing carries risk, in my view it doesn’t get more compelling than this for gold investors. Click here to learn more. Regards, Brian Chu,
Editor, Rock Stock Insider | 
