Gold Prices Heading Back Up
Gold and silver are back on the rise. And that means gold and silver buyers are back in the hunt for good deals. But it’s also an indicator of risk for our economy. After a week of doom and gloom in precious metals related to the Greek debt crisis, prices have begun to turn. The million dollar question: Is gold too high? Is it a risky investment?
And of course the answer is yes, buying and selling gold in Houston or anywhere else has some risk. Although we think it’s a great time to buy, when any commodity moves 15% in a week, it can give you the jitters. But at Houston Gold Merchants, we try not to lose sight of the big picture.
We try to focus on the fundamentals. After the wild swings are done, at the end of the day, the market is usually governed by fundamentals. Though instantaneous trading and the effect of certain investment banks and/or government intervention can move the market, it will always eventually return to fundamentals. And the fundamentals of this economy are not particularly good.
Although the city of Houston and much of Texas has been shielded from the recession by energy production, unemployment is still high, housing starts are low and there is still too much real estate inventory. Retail sales are a little better, but the engines that have driven this economy for years, namely housing and consumer spending, are sputtering. But does anyone even notice? Economic information gets barely a yawn from the general public and short shrift from the non-financial media, the place where most Americans get their news. Does the plumber know that banks like Citi, BofA, JPMorgan and Goldman Sachs stand to make 35 BILLION in the completely unregulated derivatives market? Does anyone even care that these banking clowns are putting our economy at risk again, gambling with trillions of dollars? With one in nine banks currently at risk of failure, you’d think folks would put down their credit cards and notice. Bozo the Banker is about to steer the economy off the cliff again.
But I suppose with soccer practice and job worries, lawn mowing and other daily tasks, it’s hard to focus on the economy. When I talk about these things, people’s eyes glaze over and they go elsewhere, even though they’re standing right in front of me.
I get that. It’s boring. We’d all rather shop, or bike ride, or hunt or play with our friends than concern ourselves with the economy.
But this is a real danger. That’s what the rising price of gold is showing us. It was down recently because of the Greek debt crisis, but as the smoke clears and Greece goes slowly and peacefully (we hope) into insolvency, gold will begin it’s climb back toward $2000/ounce. And the price of gold is an indicator of our overall economic health…and right now, we are not well. The prognosis is not good. I encourage you to consider buying gold and buying silver to add to your portfolio in order to preserve wealth. Contact Houston Gold Merchants for more details.