Bill Zielinski

Analysts Are Bullish on Gold: Should You Be Worried?

Great article and although I am a long term gold stock and bullion investor, I get nervous when everyone is shouting to buy gold and predicting big price increases. Nonetheless, I don't believe the timing is important here; the smart move is to increase your positions on sell offs. The central banks of the world will engage in "quantitative easing" to whatever extent necessary in an attempt to provide more credit to an already over leveraged world, ultimately debasing the value of most currencies.
Gold investors have been laughed at for years and there have been long periods of declines and/or under performance in price versus other asset classes. Gold, however, is the only monetary asset where the ultimate value of your investment is not subject to someone’s else’s promise or ability to pay. I view gold as the ultimate insurance hedge against a government’s propensity to spend itself into insolvency and, accordingly, I believe that gold should constitute 10 to 20% of one’s core investment assets. Historically, governments have regularly and repeatedly defaulted on their sovereign debts. In every such case of default, the citizens of those nations would have been far better off holding gold rather than government paper.