With the Dollar Weakening, Is Now the Time to Invest in Precious Metals?

“Dollar in Danger of Weakening for Six Years,” an article that appeared on Bloomberg.com on November 16, sounds these alarms that all investors should heed . . .

• According to Hans Redeker, a chief global strategist at Morgan Stanley, the U.S. dollar should continue to grow weaker over the next six years. 
• Even though the Bloomberg Dollar Spot Index has climbed 3.8% since hitting a two-year low in September, it was still down more than 7% during the calendar year 2017.

And those aren’t the only predictions of a weakening dollar. If you spend a little time conducting research online, you will find lots of other prophecies.

What About Converting Your U.S. Dollars into Chinese Currency?

You have probably heard that it is a good idea today to convert your U.S. Dollars into the Chinese Yuan, which is backed by gold. Unfortunately, the situation is more complex than that. Even though the Chinese government has been increasing its gold holdings in the last years, Chinese currency is not backed up directly by gold. Not yet, in any case. If that changes and you have a lot of Chinese currency, you could be positioned to profit. But as we publish this blog, there are only rumors that China will change to a gold-backed currency. So this approach should be classified as more of a gamble than a dependable strategy.

There is also talk that the Japanese Yen is about to become a “world standard currency,” much like the U.S. Dollar has been in the past. That could happen, and increasing your holdings in the Yen is probably a safe hedge against a weakening dollar. But is doing so a dependable strategy to safeguard your holdings? As year 2018 dawns, no one knows for certain.

What’s a Smart Investor to Do?

One very basic strategy for individual investors will be to shift their holdings into investment vehicles - stocks and even cash - that are in foreign currencies. Okay, that might help investors weather the six-year slump that is probably dawning.

But here are some strategies that experts say could help you weather the storm . . .

• Invest in gold and silver bullion bars and coins. There is no guarantee that they will increase dramatically in value. But as in previous times when the dollar weakened, many investors are looking at solid-metal investments as hedges against a weakening dollar. To learn more about investing in bullion, call Specialty Metals Smelters and Refiners at (800) 426-2344 to discuss investment options.
• Increase your holdings in scrap precious metals that have not yet been recycled. Unrecycled catalytic converters, thermocouples and other forms of scrap metals can be an effective hedge against a weakening dollar. A Specialty Metals Pool Account lets you store quantities of scrap metals with us and then recycle them later when their value hits a price point you specify. Call us at (800) 426-2344 to learn more.

Specialty Metals Is Your Source for Sound Advice in Turbulent Times

We are here to help you determine the best strategies for investing in precious metals - strategies that have the potential to preserve your net worth in coming uncertain times. We invite you to call us at (800) 426-2344 to learn more.

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