#1. Federal Reserve is likely to start tapering
Comments from Chairman Bernanke, as well as other members of the Federal Reserve, strongly suggest that September will be the month when the long-anticipated tapering will begin. Up until now, the market has been jittery. Once the announcement is made, either in September, or later this year, gold and silver prices will have the impetus to break out of their current range and head much higher.
#2. Political unrest is far from over
Precious metals are still the place investors turn to when there is war and political uncertainty in the world. Whether you are talking about Egypt, Syria, Iran or North Korea, there is always great potential for a big event that will send gold prices soaring.
#3. Stock market is due for a correction
If you have not noticed, the stock market has been on a more than four year bullish run since it hit its lows in March of 2009. There are signs that the economy is still struggling, and when the market sells off, that is good for anyone who holds gold and silver.
#4. Higher interest rates can lead to inflation
You do not have to be an economics major to realize that when interest rates go up, that will lead to inflation and higher prices for everything we buy. Silver and Gold offer protection against inflation risk. Already, the 10 year Treasuries are up to almost 3 percent and mortgage rates are approaching 5 percent. Inflation, like a bad tooth, will be back.
#5. Long-term trend of gold and silver is up
If you are willing to buy and hold for the long-term, it is hard to imagine a scenario where you will not be well rewarded in the future. The trend, which started about 10 years ago, is up. Use the slight blip this year to accumulate more gold and silver at a low entry point.
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