Wednesday, August 17, 2016

A Happy New Year for Metals

December 31, 2009 by · Leave a Comment 

By Jeffrey Lewis, GoldSeek

In welcoming 2010, the stars could not be better aligned for precious metal investors. Stimulus spending, coupled with a low federal funds rate and a new jobs program, should put plenty of money in the hands of precious metals holders.

Stimulus and Silver

2009 was just the beginning for federal stimulus programs.¬†¬†Although the American Reinvestment Act was pushed through Congress in a matter of days, the money has moved much slower.¬†¬†Currently, only 58% of the allocated $158 billion has been awarded to start work on ‚Äúshovel ready projects.‚Ä̬†¬†However, of all the money awarded, only about $37 billion has actually been spent thus far.¬†¬†Many more projects are slated to start early 2010, and nearly all of the money will have been spent by 2011.

This creates an excellent environment for precious metals investors who will be well served riding the tides of $260 billion in fresh cash for the economy.  With so much money being spent in such a short time frame, inflation is nearly guaranteed.

One beneficial part of the stimulus is that much of the contracting is given to small, local firms that exist in each Congressman’s district.¬†¬†¬†By allocating funds to smaller companies, it is likely that the funds will be spent quicker and in the locality that the project was requested, allowing for quick infusion of cash into local economies.

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