Euro Pacific Precious Metals

Efforts are once again underway to discontinue the US penny due to the rising cost of zinc. But it is not zinc that is becoming more precious, but rather the dollar that is losing value relative to all commodities. A comparison of product prices over time shows that a dollar just isnt what it used to be.

One of the striking ironies of our modern economy is that government bonds are considered safe-haven investments, while gold is a barbarous relic to be avoided at all costs. Since the 2008 financial collapse, the bond market has been on a tear, thanks to the Federal Reserves endless interest rate suppression. This has only served to reinforce the traditional notion that government bonds are safe.

The European Central Bank's (ECB) decision to charge a negative interest on overnight deposits is not going to lead to a higher targeted inflation rate, despite ECB President Mario Draghi's insistence that it will. Like all cases of central planning, this decision will have unintended and costly consequences - some of which are already starting to play out. In this particular case, instead of stimulating business lending or higher prices, the decision will only stimulate the increased buying of insolvent government debt - leading us all one step closer to the economy's eventual unravelling.

Even investors who typically eschew precious metals have been hard-pressed to ignore the platinum industry this year. The longest strike in South African history paired with surging Asian demand is set to push the metal back into a physical deficit in 2014 - and could have repercussions for years to come. While gold remains the most conservative choice for saving, the "industrial precious metal" platinum is a compelling investment for those, like me, who are bullish on global net economic growth.

We can't ignore it anymore - the markets are rigged. The LIBOR scandal broke almost two years ago, and the banks found responsible for manipulating that key index are still dealing with lawsuits. Meanwhile, allegations of gold market manipulation have been simmering for over a decade and grew into an inferno after the spot price dropped dramatically last spring.

So far, 2014 has been a paradoxical year for gold. Many investors aren't even aware that it has rallied almost 8%. On the rare occasion that the financial media mentions the yellow metal, it is only in the context of comparing the recent rise to last year's decline.

Before Bear Stearns and Lehman collapsed, the market for physical gold was limited to a relatively small group of investors who understood the havoc inflation was wreaking on our savings and the US markets. As the financial crisis took hold, a flood of new and inexperienced buyers entered the market, creating an opportunity for unscrupulous metals dealers to swindle their way to massive profits. This is what drove me to launch my very own gold dealer, Euro Pacific Precious Metals, to provide a safe alternative for those who were taking my advice to diversify into sound money.

Gold is the simplest of financial assets - you either own it or you dont. Yet, at the same time, gold is also among the most private of assets. Once an individual locks his or her safe, that gold effectively disappears from the market at large. Unlike bank deposits or stocks, there is no way to tally the total amount of gold held by individual investors.

There are two types of gold investors: those trying to make money on short-term market timing and those looking for long-term asset preservation. It was the fear-driven trading of the former that helped gold break $1900 in 2011, and for good reason - stormy markets steer investors to safe havens.

Having replaced savings with debt on both the national and individual levels, I think its well past time for Westerners to take a few lessons from our creditors in the East. Many Americans consider gold a "barbarous relic," but in Asia, the yellow metal remains the bedrock of individual savings plans. This means that either greater than half of the worlds population are barbarians, or theyve held onto an important tradition that our culture has forgotten.

Its starting to feel like we are part of a giant poker game against the US government, whose hand is the true condition of the American economy. The government has become so good at bluffing that most people feel compelled to watch how the biggest players in the game react to determine their own investment strategy.

Anyone who bought the media buzz about a September reduction of QE - called the "taper" - was very surprised when the Federal Reserve announced that stimulus would continue unabated. According the the official narrative, inflation is under control and the labor market is steadily improving. Why wouldnt a modest taper be announced?

Summer is traditionally a slow season for precious metals, but this summer started with a rout. In the last week of June, gold and silver hit 2-year lows of $1,192 and $18.61 respectively. Fortunately, after staggering along the lows, the precious metals are off to the races once more - with gold rallying more than 18% and silver 31%. This remarkable performance continues even in the face of the Feds sustained tapering threats.

Ive been emphasizing for months that the current correction in the gold price is a result of speculative money fleeing the market and not any reflection of golds long-term fundamentals. Unfortunately, there is so much money to be made (and lost) by day trading that my cautions have once again fallen on deaf ears.

I am a well-known "gold bug" because of my strongly voiced opinion that gold has been one of the best assets for protecting yourself from the US dollars prolonged decline.