The current economic expansion in the U.S. is the third longest recorded. And while the idea of a never-ending expansion is certainly appealing, it is also straight out of fantasyland. The economy will see another recession, and the next one could be closer than many have been anticipating.
And it could be brutal…
Whether its next year, two years from now or even early in the next decade, the next recession could have a significant impact on the economy. Only this time, the Fed may not have as many tools at its disposal to fight it. Back in 2008/2009, rates were considerably higher, and the central bank had the luxury of being able to lower them sharply enough to produce a stimulating effect on economic activity.
This time around, however, the central bank will not have nearly as much room to operate with, as rates are not likely to get anywhere near previous cyclical levels. With a hampered ability to fight the next recession, the Fed could be forced to turn to other measures, such as more QE. Either way, the next one could be significant and painful. Lower rates and higher deficits may only add fuel to the fire, and the next downturn could be very prolonged.
The time to start thinking about the next big recession is now. Rising wage pressures, higher oil prices and other signs of inflation could be indicative of not only further rate hikes from the Fed, but also a faster pace of hikes. As the central bank is forced to put the brakes on the economy through rate increases, economic activity will slow down-dramatically.
The wheels have already been set in motion, and now it is simply a matter of time before the next major downturn. Billions in shareholder value will be wiped away, while real estate and other markets may also see sharp declines in activity. Investors will be forced to search for alternatives as the equity-market-exit-stampede gets going, and hard assets like physical gold will likely be at the top of their shopping lists.
The time to get into gold is before such a shift happens, not after…
Gold has been considered a reliable store of wealth and value for centuries. It could very well be the perfect asset class to hold during such a scenario. Gold may not only see a significant increase in value as more and more investors jump on the bandwagon, but it may also potentially provide an important hedge against rising inflation and a weaker dollar. Indeed, the next big recession could very well be the catalyst for new all-time highs in the yellow metal.
If you would prefer to buy low and sell high, now is the time to consider a significant allocation in gold. Adding this key asset class has never been easier than it is today.
Speak with an Advantage Gold account executive today about the potential benefits of gold. An Advantage Gold associate can answer any questions you may have, and can even show you how simple it is to diversify with this asset class using your IRA account.
Don’t wait for the next big recession to hit before taking action. Explore your options for gold ownership today. Call Advantage Gold at 1-800-341-8584 to get started nowTags: 2008, advantage gold, business cycle, Fed, gold, interest rate increase, qe, recession