I still see people in Vancouver wearing their outdated 2010 Winter Olympics jackets. The Olympics were held here in 2010, they were wonderful, we won the hockey, but now 2015 is about to dawn. Move on. Do you know what happened in Holland regarding tulip bulbs?

“By 1636 the tulip bulb became the fourth leading export product of the Netherlands, after gin, herring and cheese. The price of tulips skyrocketed because of speculation in tulip futures among people who never saw the bulbs. Many men made and lost fortunes overnight.” – Wikipedia. It was a bubble – just like the .com bubble and the housing bubble and all the other bubbles over the centuries.

Let’s be clear about bubbles. Some things are not bubbles, and some are. Like the price of real estate in Vancouver BC where I live, or in New York City. When there are limitations to the amount of something, in this case available land – Vancouver locked in by sea and mountains, NY being an island – and there is an ongoing, ever-increasing demand for it (they’re not making any more real estate), the bubble doesn’t burst, in spite of the fact that the collectivists are concerned that some people can’t afford houses in these places. They can’t afford to buy a Rolex Presidential either, so they just buy cheaper watches.

Smart people are ahead of the curve – the preempt change and they are proactive. They leave Germany before Hitler wipes out 6 million of their people, they sell their bulbs before the bubble bursts, and they hold on to their New York City real estate while the value skyrockets and continues to do so. (Only problem with real estate is that when hyperinflation hits, broke governments will push property taxes through the roof like they did in Greece, where people who had lived in their mortgage free family homes for generations lost them to government thievery.)

Paper money, which is simply a substitute for gold – real money – has a 150 year history, which is all bad. Every fiat currency (paper money) in history has failed, and so will the US$. The American Dollar Bubble will soon pop. And this is not idle speculation. Those who ignore history are indeed doomed to repeat it. Not to understand or believe that is simply ignorance spurred on by arrogance. Gold, the real money, has a 5,000 year history which is all good.

So here’s my point. You probably won’t be selling your house to buy tulip bulbs or 2010 Vancouver Winter Olympics Jackets. So why are you hoarding paper money instead of simply converting it into real money and enjoying the inevitable increase and profits you will derive when others lose their shirts? I’m not talking about gold stocks or ETF’s; I’m talking about owning real gold bullion. Read this to see how dangerous it is to own gold stocks instead of real gold.

Robin Elliott LeverageAdvantage.com