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A lot is being written today about the fact that oil, gold and other commodities have pulled back over the past several days.
Some say that, with the U.S. economic recovery slowing, global demand for energy and food will decline, driving their prices lower — and falling prices will reduce demand for gold as a hedge against inflation.
In the short term? Maybe. But the long term? Sorry — but that’s crazy talk!
The trillions of dollars that Washington blew trying to buy jobs has now run out. And just as we’ve been warning you, the illusionary recovery those dollars bought us is fading as well.
Last week, we learned that job growth … the growth in consumer spending … and the growth in the gross domestic product … are all slowing.
With Congress clearly OUT of the stimulus business, there’s no way in hell the Federal Reserve is going to stop printing money when its quantitative easing program — QE II — is supposed to end next month.
Look: The only man on Earth who can demand Fed Chairman Ben Bernanke’s resignation and a change in U.S. monetary policy is running for re-election. The only prayer this president has is for the economic recovery to gain steam. Instead, it’s losing steam.
Thanks to last November’s elections, Congress is now packed with fiscal conservatives who have sworn an oath to oppose any new stimulus bills. That leaves Washington only one stimulus tool in its toolbox: To continue printing money like it’s going out of style!
Heck: Several of the Fed’s regional presidents have even gone on record, saying that job growth is far too weak to stop printing money now.
That means QE III is a virtual slam-dunk. Hundreds of billions more dollars are to be printed.
Consumer prices are already rising faster than they have at any time since October 2008. But the plunge in the U.S. dollar and increase in your cost of living that you’ve seen so far is only a sneak preview of what’s to come.
And the huge profits being spun off by the investments we detail in our America’s Financial Armageddon video are little more than a sneak preview of the profit potential now available to you — but only if you take action right away.
Despite any short-term pauses in the U.S. dollar’s decline — and despite any temporary corrections in oil, gold, food and other tangible assets — the fundamentals that created this crisis are still firmly in place.
Nothing ever rises in a straight line. Corrections are a necessary and healthy part of every bull market and savvy investors use them to buy more of the things that are rising.
Mike Larson graduated from Boston University with a B.S. degree in Journalism and a B.A. degree in English in 1998, and went to work for Bankrate.com. There, he learned the mortgage and interest rates markets inside and out. Mike then joined Weiss Research in 2001. He is the editor of Safe Money Report. He is often quoted by the Washington Post, Reuters, Dow Jones Newswires, Orlando Sentinel, Palm Beach Post and Sun-Sentinel, and he has appeared on CNN, Bloomberg Television and CNBC.
