It makes me sick to hear friends and members of my family tell me how much they've lost in the stock market in the past year.  Folks are telling me they've lost 30% to over 50% of their life savings. They tell me things like, "Well, I don't need the money now" and "Stocks always go back up" and my favorite comment is– "Well, everyone got hurt."  When I remind them that we have been writing and warning them about stocks since early 2000, they just shake their heads.

Not everyone got killed in the stock market because many people sold off a portion of their stocks years ago and were wise enough to buy Gold– the only product that has provided a safe haven during these turbulent times of recession and depression.

If you or anyone you known is still heavily invested in stocks and short-term bonds, then here's my warning for 2009:  Stocks will probably fall 20% lower than they ended 2008 before all of the excesses have been wrung out of the stock market.  We can't imagine why anyone would be optimistic about corporate growth or corporate profits getting stronger in 2009.  Naturally, there are many exceptions.  But after the wild volatility and huge losses from late 2007 to 2008, many investors aren't left with any risk tolerance.
 
Even when we look past the 2009 recession, it may take years or decades for investors to wade back into the corruption-filled, high risk, unstable world of stock investing.

That leaves investors wondering where to move their money to a safe haven that could reduce stock losses, diversify their portfolios, and make up for the lost years in the stock market.

Precious Metals Will Continue to Roar in 2009
While the major stock indexes in U.S. Markets are trading near the same level they did 10 years ago, the price of Gold has more than tripled.

The 21^st Century has been THE CENTURY for Gold!  Gains have been nothing short of remarkable for precious metals. The profits for Gold 2000 to 2007 averaged 23% annually.  Then in 2008 when the values of real estate, stocks, and high-yield bonds were falling through the floor, somehow, some way, Gold ended the year 6% higher than where it started.

Despite the long-term success this century, we continue to feel that Gold remains in a “Stealth Bull Market.”  The high flying profits are quietly passing by most people who remain invested in the riskiest proposition in history– the U.S. and Global Stock Markets.

In the third quarter of 2008, the demand for Gold was at record highs and there were severe shortages of physical Gold bars and Gold coins. Worldwide, people were moving out of world stock markets and moving into Gold.

That implies that the second phase of this bull market has arrived.  That still leaves phase three where there’s a mad rush of investors into Gold and skyrocketing prices are still ahead of us.  Frankly, we’d love Gold back over the $1,000 by April.  And we fully expect that to happen.  We're also looking at what happens next.  With no resistance levels for Gold over the $1,011 high of 2008, some experts are forecasting Gold to top $1,500 in 2009. 

Frankly, we don't care what price Gold trades at next week or next month.  We are buying Gold for the coming waves of inflation that have certainly not arrived and that are virtually guaranteed as the U.S. government goes on an historic spending spree.  My dear friends, even if you’re a bit late discovering that Gold is in a powerful, long-term bull market, even if you don't fully understand why and how Gold will protect your in the days to come, put away 5%, 10%, or more of your liquid assets into precious metals as soon as possible.

We Live in a Doom and Gloom World
There's no real reason for us to make long lists of why you must own Gold today.  Just turn on the radio or TV, listen to the newspaper, or watch the volatile stock markets struggle along without one single ounce of enthusiasm or optimism.  The truth is unfolding exactly as we began warning about it in early 2001.  The U.S. has borrowed money and spent our way to prosperity, a false prosperity based on debt.  Individuals, corporations, the Federal Government, and local governments have continued to borrow and spend money they can never repay.

This is the time of reckoning. The time unemployment will continue rising.  Home prices will continue falling. Consumers will continue in 2009 to spend less– they have to since they can no longer use their homes as ATM machines.  Banks are flat broke, the vaults have been emptied out. What little money they do have is taxpayer money given to them by the U.S. Government in what is sure to be a failed attempt to bailout the financial and banking sectors.

Be Smart, Plan Ahead for the Worst to Come
Investors today should be thinking ahead 12 to 18 months. People with money will be required to repay all the debts that other Americans and the government are currently accumulating.  The only possible way the U.S. Government can continue to produce fresh new "save the economy" bailout plans is to take away money from the haves and pass it along to the have-nots.  Do not be blind to the fact that the government has already seized the world's largest insurer, the two largest mortgage lenders in the world, and is in the process of dumping $750 billion dollars into banks plus another Trillion Dollars in pork barrel spending. The government plan is well underway to print an unlimited amount of U.S. Dollars and use inflation to pay off the debt.

Inflation acts as a tax, not like an income tax that only taxes wages and profits.  But inflation has the magic power to tax every single U.S. Dollar in existence, whether they are in stocks, in bonds, in the bank, in CDs, or stuffed under the mattress.  Inflation taxes the $1.2 Trillion Dollars of U.S. debt that is currently being held by China.  Inflation taxes oil sheiks too.  Best of all for the U.S. government, inflation transfers massive amounts of individual wealth to the control of Washington politicians.

Gold is the one single investment we can trust to retain its buying power in a stock market crash, when real estate prices are falling, in deflationary periods, and most importantly in the coming years of inflation and hyperinflation.  Remember this one fact: the government never fixed anything.  The current inflationary and debt laden bailout bills are proof of exactly how incompetent our leaders can be.  As I recall, the U.S. got into this problem to begin with by borrowing and spending. We can't solve the problem with more borrowing and more spending. 

If you did not heed our advice before to sell stocks and buy Gold, there's still time to act.  As we welcome the new administration to Washington, we will also extend a word of advice: 

President Obama and Washington politicians, listen carefully, "You simply cannot borrow your way to prosperity.  That's what we've done since the 1980's and it has done nothing more than create $10 Trillion Dollars of debt and the problem we're in today."    

Questions?  Call a Gold Specialist at 1-800-928-6468

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Austin Rare Coins, Inc.
Serving Investors & Rare Coin Collectors since 1989
7200 North Mopac • Austin TX  78731

Disclaimers: Austin Rare Coins & Bullion has prepared information on this site for the private use of our readers.  It should not be taken as personal financial advice.  The information herein is obtained from a variety of sources that we believe to be reliable, but we cannot guarantee the accuracy or that information has not been condensed or may be incomplete.  All opinions expressed by the editors of The Austin Report and those expressing opinions are subject to change without notice.  We are not financial advisors.  The information about future predictions, projections, or financial advice could prove to be unprofitable.  This firm is specifically in the business of selling Gold, Silver, platinum and rare coins to the public and offers its opinions from that viewpoint.  We generally make available news and opinions that relate positively to our markets and do not seek to present a balanced view of the investment markets.  We advise that you seek out information from a variety of news sources before making any investment decisions.  It’s important to always remember that past performance is no guarantee of future value. These products may not be suitable for every individual as the value of Gold, Silver, and rare coins go down as well as up in value.

Last edited:  07/19/2010  Copyright 2010 Austin Rare Coins, Inc. All Rights Reserved