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Investing in gold coins just got a lot more popular as the policy being made in Washington supplied several boosts to an already hot gold market over the past week.

February 6, 2012 – Investing in gold coins just got a lot more popular as the policy being made in Washington supplied several boosts to an already hot gold market over the past week. Gold, ironically, has been the biggest beneficiary of the policy in Washington for a decade, and now that the Federal Reserve is stuck with chronically low interest rates and no way except printing money to stimulate the economy, gold coins will continue to be the investment of choice for serious and fiscally prudent investors.

Regardless of politics, one can quantify public opinion about Ben Bernanke very easily by looking at the gold market. The spot price of gold surged from $1,747 per ounce to about $1,758 per ounce in the hour of trading immediately following Mr. Bernanke’s comments to the full committee House Budget hearing entitled “The State of the U.S. Economy.” Whatever the substance of Mr. Bernanke’s comments, gold bugs, or gold investors, were quite happy with the market reaction.

Unfortunately, generally, the better the state of the economy, the less one would expect the price of gold coins to rise significantly. However, as we all know, the economy has been in a horrific state for about four years now with increasing and harmful stimulus needed from Washington to keep even private businesses afloat. The effect of these policies is an increase in the nominal value of tangible commodities, gold being the most effective historical tangible commodity known to man. No matter what Washington does to the money supply, they cannot change the inherent value of gold coins because they cannot change the amount of gold in the supply.

This is the entire thrust behind the gold movement and the reasoning behind the higher valuation of gold in the face of monetary policy out of Washington. Last week we saw the raising of the debt ceiling yet again and what amounts to Quantitative Easing 2.5, as some pundits have dubbed it. More Quantitative Easing, inflationary monetary stimulus, and low interest rate policy is the only thing to be expected out of Washington in the coming year, given the state of the economy. That makes investing in gold coins the best thing you can do with your money now.

Kevin Johnson

Senior Staff Writer – GoldCoin.net

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