Gold closed at $ 809.60 and silver closed at $14.50, what happened to gold at $1000 and silver at $21 per ounce? The European Union announced they were considering lowering their interest rates to ease the same kind of economic woes we have in the United States. They need to add liquidity to their markets. Gold and silver can be considered an international currency and commodity. When our US Dollar increases in buying power compared to the Euro (the other world reserve currency), this drives down the price of all commodities denominated in US Dollars.

What does lowering interest rates do to an economy and your investments? When interest rates are lowered, that encourages more borrowing, and more spending. This is orders for inflation. People investing overseas made profits recently because our currency was being devalued (had more inflation) faster than other currencies, but these profits will come to a halt if the foreign currencies have higher inflation than us. An example of this is, the US Dollar was almost 1 for 1 with the Euro in 1999, and then it went to about 1 Euro to 1.6 US Dollars earlier this year. In this time frame investing in the European markets you made money because your assets were denominated in Euros not US Dollars. After the European Union announced they are going to start inflating their currency immediately the ratio changed about 1 Euro to 1.5 US Dollars overnight!

An example of the effect of other currencies inflating faster than the United States: If you had 1 share of EU stock worth $100 Euros convert to US Dollars at 1.6 = $160 US Dollars, now convert with 1.5 exchange rate = $150 US Dollars. Notice the price of the European stock did not change! The exchange rate changed.) The move to inflate the Euro will have a detrimental effect on your European investment returns after you convert them back into US Dollars. The US Dollar has not gained strength. The Euro has WEAKENED!

If both the US Dollar (63.3% of the global currency reserves) and the Euro (26.5% of the global currency reserves) start having a competition to see who can inflate their currency the fastest where does that leave us? These two currencies account for 89.8% of the world reserve currency. In a word, I would guess HYPERINFLATION. There is a very detailed article that explains hyperinflation why it happens and what it does at: http://www.shadowstats.com/article/292 Please read this article. It will give you insight on what could be coming in your near future.

Gold and silver is an inflation hedge. You may rollover IRA, SEP, and 401K accounts into precious metals as well as take them home with you. Putting your money in a precious metal IRA you DO NOT PAY ANY "MANAGEMENT FEES!" There is a once in a lifetime charge to purchase the coins. Never pay more the 10% for this! Hold them as many years as you like and never pay another commission! You will have to pay a $65 per year storage fee. If you take the coins home with you, you may payyourself anything you wish for a storage fee.

If you are interested in learning about diversifying your portfolio with precious metals call Tamara 303-771-5825 at Golden IRA's & Investments, Inc. in Denver, Colorado. I love to educate others about protecting their accumulated wealth. You may also visit www.goldeniras.com to learn more.