Schiff says there will be hyper-inflation. So is borrowing money and buying gold now a good idea?


gold buying
OMaha999 asked:


http://www.youtube.com/watch?v=NGxC5v220HE&feature=related

Because if there is hyper-inflation, we will be paying the depreciated value anyway. But when there is inflation, Gold price will not go down.
Same goes for Credit Card Balances also. I can carry the balance on my card, and pay off sometime in future the depreciated value when future inflation is taken into account.
What are your thoughts?

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5 Responses to “Schiff says there will be hyper-inflation. So is borrowing money and buying gold now a good idea?”

  1. D.C. Says:
    February 1st, 2009 at 8:22 am

    YOU FORGET 1 THING —-IN HYPER-INFLATION EVERYTHING WILL COST FAR MORE AND YOU WON’T BE MAKING MORE —-SIMPLE THINGS LIKE FOOD , GAS , UTILITIES , EVERYDAY STUFF WILL BE SO HIGH YOU WON’T HAVE ANY LEFT OVER .—–BUT INVEST WHAT YOU CAN WITHOUT GOING TO FAR IN DEBT .

  2. EndlessMountain Says:
    February 3rd, 2009 at 1:25 am

    Gold is a risk, but is safer than the dollar which is phony like the economy is phony

    I would rather buy food, apparel, oil or any other asset commodity that has value. There is going to be a great depression like symptoms soon if not already. Gold may go to 3 or 5 thousand an ounce and considering my family has gold stock I hope it does, but I would go real commodities for this upcoming economic collapse.

    namaste.

  3. I Buy And Sell Houses Says:
    February 6th, 2009 at 11:08 am

    Well, if Schiff is correct in his forecast, it would make sense to borrow money and buy gold.

    But what if Schiff is wrong and there’s actually a recession with deflation coming?

    Problem with borrowing money and buying gold is that you have to pay that money back. You need additional reveue (income) to pay back the principal and interest. And if you buy gold, you get metal. It doesn’t produce any income. So you’re faced with some other way of repaying the borrowed money. If the value of gold goes up, you can sell it, of course. If it doesn’t go up, you can still sell, albeit at a loss. And that doesn’t help repay that borrowed money.

    As for credit card balances, yes but….

    In hyperinflation, of course you’re paying off the debt with cheaper money. But consider: Credit cards typically charge 10%-24% or more on balances. We’ve got a ways to go to get to 10% annual inflation…not to mention 24% inflation. And then you’d only be breaking even. And if we get to hyperinflation–say 100% annual inflation or more–then your credit card debt is going to be a relatively minor problem.

    Hope that helps.

  4. dnldslk Says:
    February 8th, 2009 at 5:04 pm

    Timing is everything. The claim is made that he also predicted the current monetary crisis.

    If the economy sours, commodities will go down. They are generally not a good investment during a recession.

    But with all the money the govs are using to try to bailout every org and solve every problem, there should be inflation at some point in the future. When inflation picks up, gold and other commodities will be a buy.If the economies of the world every pick up steam, gold etc. will be solid investments.

  5. JohnGalt Says:
    February 11th, 2009 at 4:30 am

    Credit card rates float, so will always stay ahead of inflation. Whether borrowing other money to buy gold makes sense depends a lot on your financial resources and what rate you can borrow at and your conviction to see it thru and your risk of loss if you are wrong. Traditionally, gold works better as a STORE of value than as a speculation. Put some of your assets into gold? Sure. Borrow money to speculate? Probably unwise.

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