By J.P. Dahdah, Founder & CEO of Vantage
A lot of economists say that inflation is inevitable. Have you thought about the impact to your spending power in the face of inflation? How can you protect your investments in the face of inflation?
Enormous government debts throughout the world in major economies, including the United States, are placing tremendous pressure on currencies. Bailout funds derived from government printing presses threaten a rise of money supply greater than the rise in real economic growth. Added to this deepening debt have been major tax cuts and less government revenue. This incredible debt bubble can burst, currencies can plummet, and rising inflation can follow.
A Precious Metal IRA is one way a growing number of investors are protecting themselves. One of the investment options of a Self-Directed IRA is gold. Here are some reasons why gold has shown to be a good inflationary hedge:
- Gold Holds Its Value. This is one constant over decades, even centuries. The real worth of gold does not decline over the long term.
- As Inflation Increases, the Price of Gold Increases. The Appeal of the Precious Metal IRA.
During the highest years of post WWII, U.S. inflation, the average real return on Dow Industrial stocks, equated to 12.33%. During those same years, the average real return on gold was 130.4%.
- Oil Prices Affect Gold Prices. Inflation in the modern era has been led by the price of oil. With the current instability in major oil producing regions led by the “Arab Spring”, widespread unrest, and the threat of civil wars, oil prices could jump off the charts. Remember what happened during the first Iraq war? Between 1972 and 1974 when oil prices climbed 325%, quarterly average gold prices rose 268%. Between 1978 and 1980, oil prices increased 105% while quarterly average gold prices rose 254%.
If you are concerned about the possibility of inflation, there are ways you can utilize a Precious Metal IRA as a way to minimize your risk and exposure. Investing in precious metals can help guard against inflation.
What are your investment strategies for beating inflation?
For more information on how you can discover your IRA investing alternatives, contact our team at (866) 459-4590 or ClientService@VantageIRAs.com.