Gold Investment: The Path Ahead

How and when will the gold market respond to the fresh flood of money inflation…?IMAGINE YOU are traveling through a desert…searching for a famous oasis and its promise of riches, rest and drink, write the editors of Big Gold for Casey Reasearch.

Your journey has grown long, and you are weary. Indeed, you have begun to doubt the oasis really exists.

But then signs appear from those who have gone before…signs that your course is true, and the reward you seek in fact lies ahead. Your spirit is renewed and you press on – just as long-term investors in gold should press on today.

Although gold’s had a good run, rising from a monthly average of $760 an ounce in November 2008 to $924 in March 2009, when will it take off? That’s still going to happen, right?

Well, in their thrashing attempts to get their economies going again, governments around the world have pounded interest rates into the floor and flooded their banking systems with liquidity. Take a look at the monetary actions from the G7 leading economies.

Interest rates have plunged while the money supply has surged. Now the returns paid to cash – before inflation and tax – stand at historic lows, an artifact of the robust, worldwide efforts to debase currencies. New money creation by central banks everywhere, meantime, signals that tomorrow’s inflation is being baked in the cake today.

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