Central Banks Are Preparing for More Aggressive Measures in the War on Cash
by Phoenix Capital Research
ZeroHedge.com
10/13/2015
For six years straight, the Fed has been trying to “trash” cash.
First it cut interest rates to zero… making it so that savings deposits produced almost nothing in the way of interest income. Consider that at current rates, a retiree with $1 million in savings earns a measly $2,500 per year in interest income.
The Fed’s hope was that by making it painful for savers to sit in cash, said savers would move into risk assets such as bonds and stocks. This has worked in that stocks are now in one of, if not THE biggest bubbles in history… while bonds are trading at yields never before seen outside of wartime.
However, the Fed overlooked two outlets for investors who didn’t want to be forced into risk. They are: Gold bullion and physical cash.
Bullion and Cash represent two of the best means of “getting your money” out of the system. They are a way of saying “no” to Central Banking madness (at least unless hyperinflation sets in).
How is this?
Warren Buffett once noted, Gold doesn’t do anything “but look at you.” It doesn’t pay a dividend or produce cash flow. However, the fact of the matter is that Gold has dramatically outperformed the stock market for the better part of 40 years.
I say 40 years because there is no point comparing Gold to stocks during periods in which Gold was pegged to world currencies. Most of the analysis I see comparing the benefits of owning Gold to stocks goes back to the early 20th century.
However Gold was pegged to global currencies up until 1967. Stocks weren’t. Comparing the two during this time period is just bad analysis. And once the Gold peg officially ended with France dropping it in 1967, the precious metal has outperformed both the Dow and the S&P 500 by a massive margin.
The Rest…HERE
