It’s happening again. A small firestorm has started in the media and it will only intensify through the coming months. Yes, we are talking about the media coverage of gold. If history repeats itself, then it’s quite possible gold may hit new highs.
In August of 2011, news of gold was everywhere. Turning on the TV meant opening yourself up to a visual and auditory barrage of investment news dedicated to gold. Even the well known financial advisor Suze Orman was predicting gold would break $2000.00 per ounce. Soon thereafter gold had no trouble repeatedly breaking the $1850.00 per ounce mark.
Does media coverage cause gold to boom? It’s not very likely, yet it undoubtedly raises people’s awareness of the yellow metal, which in turn may encourage more people to buy. Strong media coverage is typically a subtle precursor to a raise in gold prices. Keeping your ear to the ground is always a good idea and you may want to heed a few media warning signs happening now.
CNBC has been running multiple stories about gold over the past few days. They’ve even recently highlighted the founder of Bridgewater Associates – Ray Dalio, explaining how we all need to have at least some portion of our investment portfolios represented by gold. When a hedge fund guru openly talks about gold in such a positive light, it’s definitely something to take note of.
Additionally, CNBC has been publishing some very bold headlines such as, “Fed’s ‘QE-Infinity’ Will Push Gold Up to $2,400” and “Gold to Hit $2,000 by Year End”. Let’s think about this for a moment. Again, it’s not whether or not these numbers will come to pass, but the fact that this level of attention is being directed toward this precious metal.
A vital underlying issue here is the fact that this new round of quantitative easing is open ended. This means buying $40 billion in mortgage-backed securities each month until the labor markets improve. When exactly will this massive amount of buying come to an end? It’s hard to say and even the experts only have speculative guesses.
Pay attention to the media coverage of gold as this year comes to a close. We will see plenty of stories fuel this fire even further. The question is, do you wait and watch? Or will you take action and start investing in gold today?
Feel free to contact us here at American Bullion and discuss your options. Are you interested in rolling over your 401(k) to a precious metals IRA? Do you own any hard, physical gold or silver? Give us a call today at 800-326-9598 to discuss your options.