Any possible manipulations of the inflation rate will therefore turn investments in precious metals much more attractive. The scenario of a gold price rise is very often misunderstood. Gold rises exactly when interest rates and inflation are very low thus making the gold price a leading indicator for inflation. This is the time when money is printed and the future inflation risk is the highest. When inflation is already very high it is time to sell gold.
Gold always works as a leading indicator for inflation.
As we will now very likely experience a period of very low interest rates and very high M1 monetary growth in the dollar, it is time to buy gold and precious metals. This year we think the current economic and monetary situation represents an excellent opportunity to invest aggressively in gold and silver companies. Nevertheless, the last three companies have already a high market capitalization, which limits the future potential gains. The only event, which could now really hold down a gold mining share rally is government fixing of precious metals, which is a realistic scenario. Let us hope this will not happen once again.