Any claim that overexposure and unsustainable growth make buying gold coins a bad idea is pure bunk. Period.

December 16, 2010 – Any claim that overexposure and unsustainable growth make buying gold coins a bad idea is pure bunk. Period.

In the first place, look at gold’s performance. As cited by Dave Brown in the International Business Times Eric Sprott, CEO of Sprott Asset Management, points out that “there is not a currency in the world that it hasn’t appreciated against by at least 300 per cent. And it has beaten every stock market.”

Secondly, there is plenty of headroom for future exposure because as Sprott says, gold “is under- owned” representing “only 1 per cent of people’s money.”

Finally, the primary reasons for buying gold coins – preserving wealth and countering inflation – become more pressing every day. For that we need look no further than the Congressional Budget Office (CBO) August update.

The report’s debt projections were predicated on the expiration of tax cuts and no expansion of stimulus spending, but it also offered a “hypothetical” scenario if that weren’t to be the case wherein deficits would escalate to 8% of the real GDP by 2020 and publicly held debt would reach a staggering 100% of GDP. Servicing such an enormous debt is a clear invitation to runaway inflation.

The report’s current-law projection had interest payments reaching $778 billion over the next ten years. Factor in the deficits from changes to that law and from future government excesses and that could climb to $1 trillion or more – money which is 100% wasted with 0% added to the economy. It all adds up to what the CBO calls “slow income growth as well as lost wealth.”

Sprott says that “You can’t even rent a safety deposit box in Germany because they are all full of gold and silver.” If people in Europe’s healthiest economy are finding haven in gold, we should be even more compelled to invest in gold coins.

Kevin Johnson

Senior Staff Writer – GoldCoin.net