Gold Futures and Dollar Drop

I’ve been keeping an eye on gold futures lately. A lot of US investors are heading into gold right now to protect themselves against the weaker dollar. In fact, some analysts are interpreting the strength of gold futures as an indication that the dollar will get weaker soon.

Of course it is impossible to predict the weaker dollar. Our fiscal and monetary policies would indicate that it is imminent, but even Warren Buffett was burned by trying to time the decline.

I have done really well in the overseas ETFs that I have invested in. By putting more money overseas, I think I have diversified out of the dollar a little bit. I know I have also been helped by the strong stock markets in Europe. Perhaps now would be a good time to add a small position in gold to diversify and hedge against further dollar decline.