Buy GLD or DGP not the gold stocks

"A nation can survive its fools, and even the ambitious. But it cannot survive treason from within. An enemy at the gates is less formidable, for he is known and carries his banner openly. But the traitor moves amongst those within the gate freely, his sly whispers rustling through all the alleys, heard in the very halls of government itself. For the traitor appears not a traitor; he speaks in accents familiar to his victims, and he wears their face and their arguments, he appeals to the baseness that lies deep in the hearts of all men. He rots the soul of a nation, he works secretly and unknown in the night to undermine the pillars of the city, he infects the body politic so that it can no longer resist. The traitor is the plague."
- Cicero, Rome's Greatest Politician

Gold Reaches Another Record High

Gold is money. Currencies of countries are promissory notes. You have have heard that California is issuing IOU's since it's basically bankrupt. Well, that's what money already is, anyway. So, in a way, California is issuing its own money, debt free. When that's that case, overprinting always occurs. But that only speeds up the complete devaluation of a currency rather than a slow process over 100 years like the US dollar down 96%.

In some ways, it should be celebrated. It's the only way an honest money can return to the land. Wall Street will never ever give up its grip on the US dollar. The only way to the return of a gold and silver standard is for the dollar to completely implode. It might not take long. At 3% a year, there is a total of 34% inflation over a 10 year period. At 5% a year, that's 62%. Your $3.50 latte could cost $5.67. Hmmm. That's not gonna be enough. I am going to guess it's gonna be when a latte costs around $19.00 that people will freak out. So, that would mean 12% inflation for 15 years.

It could take a while. That's also a lot of money printing. And, don't dismiss that possibility of "new money" being created. Such that you trade in your "old" money for "new" money and all prices are divided by 10. Then, it's only gonna be $1.90 for a latte! Totally reasonable. Then the banks will say, "Ha! I can't believe the people continue to buy this old scam!"

If you held old US dollars for "savings", then you're sort of out of luck. But if you buy gold today, you're gonna be better off than US dollars. That's my opinion. TONS of countries have had mass inflation and printed new currencies. Except the US. Look at the Brasilian Real, that's only about been around since 1994! http://en.wikipedia.org/wiki/Brazilian_real

How to Win the Game

A $300,000 house at 5.5% on a 20 year mortgage is about $2000/month.

In 20 years you own the house.

If you invested $500 per month, at 10% annually, you'd have about $378,000 in 20 years.
(If you invested $500 per month, at 3% annually, you'd have about $165,000 in 20 years.)

Now, this is assuming 10% a year.

So, since the goal is to own the house, since it has real value, if you can rent it for $1500, and pay the extra $500 yourself, you win the game. And, in 10 years, inflation could drive up the rent, anyway.

Nowhere I know of in the world can you lock in a mortgage rate for more than 10 years, except in the US.

How Real Estate Millions Were Made

Before the internet, people would go up in small planes, with cameras, and fly around towns. See where they are expanding, take pictures, and look at maps. You see where the town is expanding, and you buy cheap real estate in the outside. People laught at you, and in 10 years you sell it to them for a hefty profit. I would imagine this could really work in Northern California, Idaho, Montana, and other places with "wide open spaces" near mountains and rivers. How many people do you know who do this? None? Ok, so it continues to work then.

Good Trading,