Gold 401K

Golden Security!

World stock markets from Japan, China, India, and Europe have had drops as big or bigger than the September 11, 2001 drop. The Dow stumbled out of the gate and is still staggering with triple digit losses almost every other day or so. Talk of $1,000 gold and a recession is growing as the Dow has lost more than 1,100 points so far this month and the Nasdaq more than 300 points. Is there anything that’s safe?

Wall Street stock brokers will quickly tell you how stocks are the best buy over a long term position. What they don’t tell you is that the thirty stocks that make up the Dow are not the same thirty stocks today. The majority either went belly up or were looking so bad that they were replaced by other stocks. For example neither McDonalds nor Microsoft were around in 1930 or 1940, or whenever most charts begin to show you how well the Dow has done.

While many stocks have gone bankrupt and been worth ZERO, one commodity has never been value-less and that’s GOLD! Even nations can go bankrupt!

New York gold futures rose sharply to reach a record high on Monday, boosted by a sliding dollar, production halts in South Africa, and the expectation of an aggressive rate cut by the Federal Reserve. Gold closed up $16 on Monday to a new record high of $928 an ounce. That means gold is up 11% for the month so far and up $285 for the last twelve months alone for a 44% return on investment.

When you get your 401k for last year, you might not have done that good! Duh! Dow 6,000 just still might be possible. I doubt it, but more are saying it’s possible.

Bush will give his last State of the Union address tonight and you can bet he’ll be talking in the ear of the U.S. Senate to pass the redistribution of wealth bill that the House passed. It’s otherwise known as the rebate to America. Truthfully, it’s the rich (who will get no rebate) giving to the poor and middle income class. I’ve no problem with that if we’d label the kettle black and not gold. And let’s not pretend that this will keep a recession from our front door.

Once more. The truth is that some will not get their checks until August

About the Author

ernie@lrchouston.com

COLLAPSING