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If the gov’t stimulus package passes what investment has a bigger upside Commodities or Gold (by itself)?

December 2, 2010 by  
Filed under Silver Investment FAQ

Right now the government wants to pass a stimulus package in the “Billions”!!! If the gov’t stimulus package passes what investment has a bigger upside Commodities or Gold (by itself)?

Where would you put your money in:

1) Commodities Index (ETF)
2) Gold (by itself)
3) Silver (by itself)
4) Gold and Silver
5) Gold mining stocks
6) Agricultural Commodities Index (ETF)

Comments

One Response to “If the gov’t stimulus package passes what investment has a bigger upside Commodities or Gold (by itself)?”
  1. enoriverbend says:

    Gold, and to a lesser extent silver, are what some people hold as a protection against tough economic times and inflation; use of gold in industrial and decorative capacities is secondary. (I am leaving aside the issue of whether it’s really a good hedge for that purpose or not.)

    Commodities, on the other hand, respond almost entirely to demand fluctuations based on actual use — even though there has been a lot of speculative influence in prices recently.

    So if the stimulus works, or even if the economy shows signs of recovering with or without a stimulus, then commodities will do well. If the stimulus causes inflation (or fear of inflation), then gold will do well. In either case the timing of price movement is difficult to predict and volatility will continue.

    I am fairly cynical about the degree to which the stimulus package will do any good, but I also feel that the economy will/would have recovered on its own, so in either case commodities are attractive. Since we currently show every sign of deflation rather than inflation, gold is less attractive, but I would not underestimate the impact of fear on the equation.

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