The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.
NEW YORK (
) -- Gold and silver have again been temporarily imprisoned in a trading range, and there are plenty of articles out there sowing doubt about investing in precious metals.
Such articles can lead newer investors astray, so I want to give those investor a simple message: You have no choice other than to protect yourselves with precious metals.
To understand why, we need to examine three concepts. Small inside:
Turn Back the Clock
Go back even 15 years in time, and the world of investing bears absolutely no resemblance to the Carnival of Fools that we see today. Back then, the vast majority of financial advisers preached a single mantra: buy and hold.
The premise is simple: Those people who place short-term bets in the market are not investors -- they are gamblers.
Investing means putting one's capital into particular sector/company, and then allowing the time for that investment opportunity to mature/ripen. The principal difference between investing and gambling is time.
Put another way, investors (as opposed to gamblers) provide themselves with the luxury of waiting for the optimal time to harvest their profits.
They wait long enough for the fundamentals that support their investments to assert themselves.
Conversely, the gamblers who do nothing but make serial, short-term bets are merely momentum players. If they time their bets right, they will make a profit.
How did the world of investing devolve from the sober, careful allocation of funds into frantically flitting from one (short-term) bet to another like a swarm of rabid butterflies?
Simple. The vast majority of financial advisers finally became aware of their own gross incompetence. Not having the slightest clue about where our economies have been headed, these "experts" eventually acknowledged (after being surprised by one market crash after another) that when it comes to investing they are much better at destroying fortunes than creating them.
At the same time, these highly paid professionals were not prepared to publicly acknowledge their own, massive deficiencies (and forgo the commissions that they parasitically rake-in).
Thus, instead of admitting that they were no longer capable of providing competent advice for investing, they absurdly announced that investing itself no longer existed. "Buy and hold is dead," they (nearly) unanimously proclaimed.