{"id":20236,"date":"2016-12-06T11:54:22","date_gmt":"2016-12-06T19:54:22","guid":{"rendered":"https:\/\/goldcopreciousmetals.com\/?p=18415"},"modified":"2016-12-06T11:54:22","modified_gmt":"2016-12-06T19:54:22","slug":"protect-coming-recession-using-gold","status":"publish","type":"post","link":"https:\/\/goldco.com\/protect-coming-recession-using-gold\/","title":{"rendered":"Protect Yourself Against the Coming Recession Using Gold"},"content":{"rendered":"<p>Economists and financial experts agree: another recession is on the horizon. The markets are unstable, housing and real estate are experiencing problems, and the oil industry is still suffering the effects of the debt bomb from a few years ago.<\/p>\n<p>Much like in 2008, the elements are once again coming together to create a perfect storm of economic chaos. Raoul Pal, founder of Global Macro Investor, believes a recession will occur within the next twelve months. Fortunately, he also sees a solution: Investing in gold can help you protect yourself against the crisis to come. Due to a variety of factors, right now may be the <a href=\"http:\/\/www.marketwatch.com\/story\/a-recession-is-coming-so-hide-in-gold-says-influential-investor-raoul-pal-2016-10-14\" target=\"_blank\" rel=\"noopener noreferrer\">perfect moment<\/a> to get in on this safe haven.<\/p>\n<h3><strong>The Evidence for a Recession<\/strong><\/h3>\n<p>Raoul Pal\u2019s prediction of a recession is based on more than just the current economic climate. It comes from his observation of a precedent going back over 100 years. Since 1910, every President who has served a second term has seen it followed by a period of recession within a year of their leaving office.<\/p>\n<p>The prosperous Reagan years were followed by economic hardship under the first President Bush. The economy began to revive under Bill Clinton, but quickly fell again once he finished his second term. Then at the end of George W. Bush\u2019s eight years, we were plunged into the worst financial crisis since the Great Depression. For the moment things are finally starting to turn around. But what will happen when President Obama leaves office? The writing is already on the wall: we\u2019re headed for another downturn.<\/p>\n<h3><strong>The Mispricing of Gold<\/strong><\/h3>\n<p>How does buying gold help guard against this impending crisis? At first glance, it would seem to be a rather risky choice at the moment. The price has been on its way down in recent months. How does that make it a good investment?<\/p>\n<p>The important thing to remember is that gold is an asset for the long term. It may be down 6% in the last few months, but it\u2019s up 18% for the year overall. What\u2019s more, experts agree that the price of the metal is currently much lower than it should be.<\/p>\n<p>Given our current economic state, and based on past trends it should be trading at a considerably higher price. What\u2019s more, when the recession hits, this disparity is expected to reverse itself, and gold will go up again. Essentially, we\u2019re in a very narrow window wherein gold can be purchased more cheaply than normal, right before its demand, and then price, skyrockets.<\/p>\n<h3><strong>Gold in a Recession<\/strong><\/h3>\n<p>As a nation enters into recession, central banks try to slow the economic downturn through quantitative easing\u2014essentially artificially injecting money into the financial system. It sounds like a good thing, until you realize it\u2019s effectively devalued the dollars you were already holding, and the dollars in which most of your investments are denominated.<\/p>\n<p>As paper- and market-based investments destabilize, more people turn to precious metals, due to their generally stable pricing and ability to preserve wealth. In addition, as investors rush to gold, logically enough, its price goes up. Pal believes once the recession hits the price of gold could double.<\/p>\n<p>Another factor in play is the decline of other world currencies, including the pound and the euro, in comparison to the dollar.\u00a0 Pal believes this will continue over the next year or so. Additionally, the negative interest rates that have plagued Europe and other parts of the globe could serve to boost the value of both gold and the U.S. dollar.<\/p>\n<p>Many experts, however, warn that the dollar\u2019s increase in value is <a href=\"https:\/\/goldcopreciousmetals.com\/goldco-precious-metals-blog\/18118\" target=\"_blank\" rel=\"noopener noreferrer\">merely a bubble<\/a>, which will burst before long and send it plummeting. So that leaves gold as the smartest and safest investment to guard against the coming recession.<\/p>\n<p>With its price still artificially low at the moment, now is the optimum time to stock up on gold in preparation for what\u2019s on the horizon. When its price goes up as everything else begins coming down, you\u2019ll have a safe haven to keep you from losing your savings, your IRA, 401(k) and more. You can even set up your own <a href=\"https:\/\/goldco.com\/precious-metals-ira\/gold-ira\">gold IRA<\/a>.\u00a0 But if you wait too long to make the investment, you might see that \u201csale\u201d price on gold evaporate in the rush.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Experts are jittery coming into the new year. Now one market guru is putting his cards on the table about the decline he sees coming.<\/p>\n","protected":false},"author":5,"featured_media":32591,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[207],"tags":[],"class_list":["post-20236","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economy"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.8 (Yoast SEO v26.8) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Protect Yourself Against the Coming Recession Using Gold<\/title>\n<meta name=\"description\" content=\"Experts are jittery coming into the new year. 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