Today, the S&P 500 is at 1208. The first time it hit 1200 was in 1998. That means the S&P 500 is at roughly the same level it was in 1998.
Unfortunately, that doesn’t mean you break even over 13 years — after inflation, you lose a ton. The official inflation rates between 1998 and 2011 equal to about 2.4%.
That means if you put $100,000 into the S&P 500 in 1998, and waited for 13 years, you’d have about $73,560. After waiting about 13 years. That’s pathetic.
That’s also using government data, which grossly underestimates the inflation rate — they lie to make themselves look good. It’s actually worse.
Over that same time period, gold prices were up about 325%.
Over that same time period, silver prices were up about 600%.
If this isn’t enough to convince popular financial minds to consider encouraging investors to have 20-25% of their portfolios in gold and silver, then nothing will. Unfortunately — I don’t think they’ll be convinced.
Does this mean you shouldn’t own stocks? Of course not — cashing in gold and silver while stocks start increasing in value is a fantastic way to make money when their wealth cycle is in play. But they shouldn’t be more than 50% of any portfolio. Gold and silver should be at roughly 25% — that’s what they’re at in my portfolio.
Next week, I’ll be emailing you about how you can buy gold online cheaply with low overhead fees — I’ll let you know who my contact is. He ships anywhere in the US and some places internationally. Subscribe for free here and I’ll let you know next week when he’s willing to take any more orders.
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