July 9, 2009

Gold And Mining Stocks Are Poised For A Spectacular Rise

"Gold prices are poised for a spectacular and prolonged rally as the recession deepens and investors finally become disillusioned with the U.S. dollar. So says renowned Wall Street financial forecaster and economist Peter Schiff.

In a recent interview, Schiff suggests that the looming prospect of a hyper-inflationary environment in the U.S. will severely debase the greenback over the next few years. And the global investment community will realize that gold represents the ultimate “store of value” as a safe haven replacement for a discredited U.S. dollar.

Hence, gold bullion and gold-related investments, such as gold equities, will prove to be the best way to shield one’s money from the ravages of a protracted and severe inflationary environment, Schiff says.

“If you really want to grow your wealth, you should own gold in the mining sector,” he adds, while also suggesting that gold equities (companies that are already in production) offer the greatest leverage to rising gold prices.

“With gold stocks, there’s obviously a lot of leverage to higher gold prices. As millions or billions of people discover gold as a store of value and as a way to escape inflation, there’s going to be tremendous demand and somebody’s going to have to supply that demand. It’s obviously going to have to be mined,” he says. “So the companies that have gold and mine it are going to see profit margins explode.”" in Resource Investor
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