As troubles overseas continue to create an uncertain market for American investors, a gold IRA makes more sense now than ever. Continued disruption out of the Eurozone has been plaguing American market and threatening American institutions for nearly a year. The threat of toxic debt on European balance sheets was particularly realized in the US on October 31, 2011 when MF Global, a centuries old American banking institution, declared its insolvency as a direct result of exposure to bad European sovereign debt.
Investors were shocked. Particularly those investors who received a Monday morning phone call from a trustee explaining they could not locate what eventually turned out to be $1.2 billion in customer money. On February 1, 2012, a Federal judge ruled in favor of MF Global concerning bankruptcy case law that makes it less likely customers will see their money soon.
To make matters worse, MF Global was allowed by a ruling from the Commodities Futures Trading Commission, the government body responsible for regulating the trade of futures contracts, to use the customer money in the $6.3 billion bad debt bet that is considered the catalyst for the downfall of the megalithic institution. In mid-December, it emerged that MF Global used $700 million of the missing customer money in just the days prior to its collapse in order to make that bet.
The lesson for the American investor, however, is clear. American banks are exposed to European debt and American banks are no longer behaving responsibly in their use of American customer’s funds. For our working generations looking to retire, this is a particularly conflicting concern. Why would you give a bank your money if you know they will misuse it and are not accountable to you?
A gold IRA offers a cure to many of the problems in today’s banks and in today’s markets. With all the tax shelters of a traditional IRA, a gold IRA offers the value of gold as the best-performing commodity available as well as the value of gold as a safe- haven currency. Gold has been in a ten-year bull run and shows no signs of slowing down as investors, put off by the market, continue to buy gold as a store of wealth that is not exposed to market trouble.
Additionally, gold in an IRA is a tradable holding. So you as the owner have the option to buy and sell gold with your particular insight into the market. This provides the maximum amount of protection against market disruption, shelter from taxation, and market participation. A gold IRA is a sophisticated and efficient method for working Americans to safely save for and invest in their future now.