Precious metals have been one of the market’s best-performing areas this year.
Recently, silver was up for six weeks in a row — its longest winning streak since peaking back in April 2011. Silver gained more than 16% from its late May low going into its mid-July peak thanks to a combination of Chinese commodity financing fraud (increasing demand for physical metal), bubbling inflationary pressures, Eurozone contagion concerns and ongoing geopolitical hotspots in the Gaza Strip and elsewhere.
Gold hasn’t been far behind, nor have the related mining stocks. All have been building a base of support since late 2013 and look ready for a sustained rise higher. Any dip should ultimately prove to be a buying opportunity for investors looking to get in on the action.
Mainly, this is because of the Federal Reserve’s ongoing reluctance to raise short-term interest rates from 0% — where they’ve been since 2008 — despite the fact the unemployment rate has fallen to 6.1% (only 0.3% away from the Congressional Budget Office’s estimate of full employment) while consumer price inflation is growing at a 2.1% annual rate.
The Fed is risking falling behind the curve on inflation, which given the massive increase in the monetary base from around $800 billion pre-recession to nearly $4 trillion now, could quickly get away from them.
Here are the four best options for investors who are considering investing in gold and silver.