Here is some information about how investing in Gold can help deal with
inflation worries.
Gold Fortunes Surge on Inflation Concerns.
(Bloomberg), June 26, 2008
Gold surged the most in 16 months on speculation the Federal Reserve won’t rush to raise borrowing costs to curb inflation. Silver jumped the most since
March.
The Fed yesterday kept its benchmark interest rate at 2 percent, even as policy
makers acknowledge heightening inflationary expectations. An OPEC official said
crude oil may reach $170 a barrel soon. Gold reached an all-time high of
$1,033.90 an ounce in March as fuel, corn and other commodities soared and the
dollar fell to a record low against the euro.
“The Fed said that inflation is a major concern, but they’re not going to do anything about it, which made gold go ballistic,” said Leonard Kaplan, president of Prospector Asset Management in Evanston,
Illinois.
“The dollar is going to get slammed again.”
Gold futures for August delivery jumped $31.10 or 3.5 percent, to $913.40 an
ounce at 12:18 p.m. on the Comex division off the New York Mercantile Exchange.
A close at that price would mark the biggest percentage gain for a most-active
contract since Feb. 21, 2007.
Silver futures for September delivery soared 75.3 cents, or 4.5 percent, to
$17.36 an ounce. A close at that price would mark the biggest increase since
March 5.
Before today, silver advanced 11 percent this year, while gold climbed 5.3
percent...
Commodity Rally
The Reuters/Jefferies CRB Index of 19 raw materials rose to a record today and
has gained 29 percent this year. In May, U.S. consumer costs climbed at an
annual rate of 4.2 percent and wholesale prices rose 7.2 percent, according to
date from the labor department.
“The Fed seems to have decided to protect growth by holding rates low and to
accept the fact that this period of inflation is inevitable and unstoppable,
” said Patrick Chidley, an analyst at Barnard Jacobs Mellet in Stamford,
Connecticut.
“Inflation is the lesser of two evils. Investors will increase their positions in
gold, and it
’s likely to continue upward.”
