We know that what the Government tells us in regards to economic data is wrong or inaccurate, at best, and purposefully misleading at worst. History suggests that the latter is the case as these false, misleading numbers supports a narrative that the government wants to put forth.
This is where our friend Ben Bernake comes in. The Fed is using and relying on much of the data that is being reported by various government agencies (e.g. unemployment, inflation, spending, etc.). The Fed has told us that they would be very happy to continue to maintain inflation at the 2 to 2.5% range. So, that would be based upon an inaccurate, and artificially low values. If you go to www.shadowstats.com and look at how they compare current numbers or inflation vs. how we used to do it (Pre 1990 and 1980), you will see that inflation is really in the 6-10% range vs. the current, published 2.5%. This is a huge difference and clear case that shows how out of touch the Fed is with the economic realities on the ground.
So, how does this help your precious metals portfolio? To start with we know that inflation is higher than reported. This means that your annual pay increases or your average earnings on your investments is being outstripped by inflation. Secondly, we know that this inflation will have impacts in consumption. This will lead the Fed to another round of money printing. The bottom line is that you are losing purchasing power quickly, and the only way to protect against it is with precious metals.
So, despite what the talking heads on CNBC tell us, we know that we are not out of the woods with a recovery. One of the best things that you can do is hedge your self through your self directed IRA by holding physical, precious metals.