Newt Gingrich just gave all the gold bugs some great news. While on the campaign trail he said, “look at the whole concept of how do we get back to hard money.”
What he means is that we need to get back to the Gold Standard. The gold standard requires Congress to be fiscally disciplined, meaning they cannot continue to print money indefinitely. The gold standard requires a certain amount of gold “on reserve” for an amount of paper money in circulation.
For example, let’s say we had a gold standard of one ounce of gold for $1 million in circulation. That standart would require us to stay within that ratio. Congress could not just print an extra trillion dollars without first going out and securing more gold.
This is great news for gold bugs. That’s because if Gingrich were to get in office and re-institute the gold standard (President Nixon a fellow Republican, by the way took us off the gold by in the late 1960s) the US Treasury would be in the business of buying more and more gold.
This could drive gold prices through the roof! Imagine the largest economy in the US gobbling up more and more gold? This would be a boon for gold investors. Investors might have anticipated this move. From 2010 gold has risen over 50%!!! But it might not be too late to get invested.
The best way for investors to take advantage of gold it to invest in a Precious Metal ETF. An ETF is an exchange traded fund (a fund that trades like a stock) so you can purchase it in any retirement or brokerage account. ETFs are the best investment for commodities because they do not require margin or an account at the CME (Chicago Mercantile Exchange).
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