Larry Bellehumeur

Inflation Ahead: What's an Investor to Do?

The reality is, buyitcheap, that the only metal that has value in the form of a currency is Gold. Silver often gets lumped in, and while it could very well benefit indirectly from a run up in Gold, I wouldn't advise it as an inflation hedge. People simply do not store it in the same manner. It should be a good investment longer term, though, but for different reasons.

I know Platinum better than Palladium, and it should have a good rebound once car production picks up, due to its strong use in Catalytic Converters. Again, while the value of the metal may go up with a declining US dollar, this is simply because it is VALUED in US dollars, and I wouldn't advise to think of it as a US Dollar hedge. It will have some rebound against Inflation, but only because all hard assets tend to rise with inflation.

Inflation Ahead: What's an Investor to Do?

Not sure why people lump Silver and Gold together. Gold has little industrial value, and is traded like a currency. Its value is pegged to things such as inflation, the US dollar, etc.

Silver is generally traded more like an Industrial metal (except for its tie to Gold, which is more sentimental than practical). Silver's usage has fallen since we started using Digital photography, although it has picked up with some of the recent Green Energy usage. It is not held in the same manner by Central Bankers, so why people link it with Gold to the extent that they do is beyond me.....

Disclosure -- Long Gold (physical bullion and GLD), and long Silver (SLV), but not as an Inflation hedge...