Chaos in the stock market and massive stimulus spending has many investors looking for a safe place to ride out the financial storm. Scottsdale Bullion & Coin advisors Curtis Frank and Damian White appeared on the Mike Broomhead show to talk about the role precious metals play when it comes to protecting your assets, including:
- Why gold performs well amid economic turmoil
- The impact of COVID-19 stimulus spending on the economy
- Why a mix of gold and stocks is a smart move
“In uncertain economic times, gold is always going to perform well,” Frank says. “So if you thought you missed the boat on gold or are buying late, you’re actually buying early.”
He adds that historically, when the GDP to debt ratio grows, so does the price of gold. The current ratio of GDP to debt is 108 percent and many experts say it could grow as high as 150 to 200 percent amid the current financial difficulties.
“When you hear these predictions that gold is going to go up to $2,500 or even as high as $10,000 an ounce, that doesn’t seem so crazy anymore,” Frank said.
Damian White adds that stimulus spending might not be as effective as it was during the Great Recession of 2009 because there’s a lot more damage that happened much faster this time around, with businesses closing and millions unemployed in a matter of days.
“The Fed is artificially trying to prop up assets during a time when we are already seeing inflation grow,” White says. “We are going to see a lot more inflation and that inflation is going to pull gold up.”
Both White and Frank recommend a mix of gold and stocks to keep assets diversified, particularly when the stock market is so unpredictable.
“If you are smart in balancing your portfolio, you should have seven to 10 percent in gold,” Frank says. “It doesn’t have to be a zero sum game where gold has to lose for the stock market to win and vise versa.”
To learn more about balancing your portfolio and protecting your investments, call SBC Gold at 1 (888) 812-9892.