Because of these risks, for the past 13 years I have been recommending that physical gold and silver should be accumulated on a long-term cost averaging plan. That is the best way to run in an investment marathon. Also, I continue to recommend this strategy because both precious metals remain undervalued. Both gold and silver, when you own them in physical form, avoid counterparty risk. They are tangible assets, and not some promise of a government or some bank.
As we know from the 2008 financial collapse and various collapses since then – like the one earlier this year in Cyprus where bank depositors lost a lot of money – avoiding counterparty risk is important. Counterparty risk is something everybody needs to avoid until more normal times return, and I expect that 2014 is not going to be normal – far from it.
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