Just about everyday this past week I see gold and silver making new highs. Just today silver hit a 30 year high! This is wonderful news for those of us who bought or own gold and silver a lower levels, but why is gold and silver on a tear?

The answer is clear if you follow the actions of the Fed and Teasury: Inflation.

The Fed has more than doubled the money supply in its efforts to reflate property prices across the US. Simply put… that means that every dollar you own will eventually have its purchasing power cut in half! Inflation enters the monetary system slowly, and those that have first use of the new money benefit the most. If you haven’t already guessed who gets first use, you can just think of your favorite bank.

Currently, banks are borrowing from the Fed at near 0% interest and then loaning that borrowed money to you and I at around 5% for homes and cars. With the banks having access to almost free capital, they are able to pad their profits lending even at historically low interest rates.

The markets are becoming increasingly aware that the new money flowing into the system will eventually permeate the entire economy causing higher prices for real things like gold and silver. This is because you have more paper dollars chasing the same number of goods and services.

Think about cash flow property… homes are made of real things: wood, stone, copper, and steel. As the prices of these commodities rise, so will the cost of new builds and ultimately the housing market in general. Cash flow property will behave just like other commodities in terms of price; however, it has the added benefit of cash flow!

Not only do you stand to benefit from appreciation like you would with gold or silver, but you can also benefit by renting and producing an income stream through cash flow property ownership.

With real property prices still relatively depressed compared to other items and asset classes, it may be time for you to take a hard look at cash flow property. Its like gold, but it pays you!