Monday, March 23, 2009

The Gold-en Years?

You are no doubt hearing a lot about gold lately. The internet pop-ups for gold dealers are ubiquitous (everywhere), and it seems every other commercial on talk radio urges us to buy gold bullion, gold ETFs or gold coins.

If you are a contrarian, you might conclude that with all the hype about gold it is exactly the wrong time to buy. The again, after hearing that the Fed is about to monetize our debt by asking the Treasury to print up to a thousand billion dollars, not to mention the next trillion dollar bank bailout plan announced just today, on top of the $5 to 7 trillion of bailouts, guarantees and the like since last fall, one might feel justified in hearing a massive inflationary timebomb ticking away. Inflationary pressures are bullish for precious metals.

Is this the right time to buy gold? I have no idea, but in case you are interested you ought to watch this 4 minute interview with Ambrose-Evan Pritchard, international business editor of the U.K. Telegraph and a man who closely follows the gold market.

For a note of caution on gold in the short-term check out this from the Wall Street Journal on Friday. For a more bullish take, see this article from Bloomberg.com.

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