And the dollar will probably go lower

Dollar’s record low levels contributed to the record rise in gold prices to $450 an ounce. This is the highest price in 16 years as gold began to be increasingly viewed as an alternative investment.

Much of the fall of the dollar is due to the ballooning deficit caused by the immense amounts of money being spent on the Iraq war.

Those with money sitting around getting 1.5% in a savings account might want to look at the PIMCO Real Return funds, which invest in inflation-indexed bonds, with a current YTD return of almost 7%.