Will you max out your credit cards to buy the latest Transformers toys? Will you open new store cards to get that extra one time 15 percent off on all the kids’ new winter coats? While you may not consider yourself materialistic, what values are you displaying?

My sister spoke some truth yesterday, “It’s almost out of my control, you know? How much “stuff” is shoved in my kid’s face. The commercials during Hannah Montana, oh boy. And, this sounds really shallow….and…I know she’s only six years old, but I just don’t want her to be…dorky.”

It’s hard to find the line between showing your love and setting a good example. Examples like frugality, saving, and being responsible with your money. But if you are one of the few lucky people who do have some disposable income for gifts this holiday season, maybe you should think about giving your child a timeless gift that won’t break and end up in the garbage, but actually grow in value as you child gets older. You can give your child a gold coin.

Coins make excellent gifts for kids of all ages. Depending on where they were minted, you can teach little kids about geography and history through a coin collection. And while your sixteen year old is begging for a car, she’ll be a lot happier to forgo the car now if she is given an investment like gold coins that she can turn into a down payment on her first home when she finishes school. Instead of giving your kids cheap, fadlike things, you can make them feel like they are worth their weight in gold by giving them something of long-lasting value. The best thing about coins is that they come in different sizes and denominations, so even if you only have a couple hundred dollars to spend, you can still purchase some coins as stocking stuffers. It’s a way to build your child’s savings every year while giving them lessons about wealth preservation in a concrete way they will never forget. And a six year old will feel like a princess telling her classmates that she has real gold at home in her piggy bank.

Gloom and doom aside, gold is at record highs. As of today we broke $1090 for an ounce. I remember less than 2 months ago, people saying it WOULD NEVER BREAK $1000. But, gold quickly did break $1000, and it’s now nearly 10% over. This time last year, just shortly after the big burst, and the bust of the stock market, gold was hovering around $720. If you would have invested, you would have made over 50% on your money by now. Gold has performed exceptionally well, again despite (or perhaps because of) the overall economy. And the fundamentals haven’t changed – in fact they are getting worse. We are still in debt… we have still yet to see the complete ramifications of the doubling of the money supply, interest rates have not been raised… gold will most likely rise unless someone steps in and changes things. We are at record high unemployment rates, and we have not seen the bottom of real estate prices. We haven’t seen the bottom? That’s crazy! I know, but locally prices continue to drop, and yet there simply isn’t anyone to buy.

Gold was on a meteoric rise early this month, so I don’t know if it will break through uncharted territory again, but it should hover steadily at or around the $1100 mark. As the holidays approach and other countries, including The U.S., China, and India, consume vast amounts of gold, not just for investing purposes, but for jewelry and other reasons, the price may soar to even higher numbers.

Erica Shea and Stephen Valand

We thought we’d digress from our usual gold and talk about something many of us love… booze.

Does this surprise anyone?

What’s the first thing you do when you get laid off or fired from your job? Answer, go grab a beer. What do you do when you have been out all day looking for a job with nothing to show for it? Answer, go grab another beer. What happens when…. well, you get the picture.

America has seen this before, so it shouldn’t be that strange to hear. If you paid attention in history class, or if you actually remember that far back (we won’t point out the seniors), you will remember hearing about Prohibition. Also known as The Noble Experiment, from 1919 – 1933, the selling, manufacturing, and transporting of alcohol were banned in the United States. Did this stop the hard working Americans from having a tasty beverage after work? It sure didn’t. Luckily, mostly for the Mafia, the general public had a desire to have a “cold one” when they pleased.

So if the Constitution of the United States couldn’t even stop people from enjoying a little brew, why would they let a little recession stop them either?

According to the Brewers Association (BA),  which has more than 1,500 members, reports show that the brewing industry has seen a nine percent raise in sales since the first half of this year.  But the large companies are seeing a little entrepreneurial-competition surfacing.

As Jon Cook reports from Reuters Blogs, two New York residents are the latest to make a splash into the brewing world. Erica Shea, Lower-East side resident, and Stephen Valand, Brooklyn resident, both quit their advertising jobs, collected $10,000 in personal savings and created the Brooklyn Brew Shop. They sell home-brewing kits to their customers and also create their own flavors. A kit consist of a 1-gallon jug, tubing, a racking cane, and thermometer, sanitizer, and the yeast, hops and grain. They rent a booth at the Brooklyn Flea Market and clear around $15 per kit sold, depending on the flavor of brew they include in the box.

Shea and Valand obviously were paying attention in their history classes, and figured out that the brewing industry, throughout history thus far, has been recession-proof.

The forex reserves of Western nations have the distinction of holding larger percentages of gold. Gold makes up about 77% of the US’s, 69% of Germany’s, 66% of Italy’s and 70% of France’s. The big Central Banks are only allowed to sell 400 metric tons of their supply at a time, so as not to flood the market and dramatically change the price of bullion. But its unlikely that they will even want to sell, as more and more household investors get into the market and the voracious appetite of Eastern Central Banks make the demand for gold higher than ever.

-Paul Tudor Jones, hedge fund manager and one of Forbes’ wealthiest, famous for predicting Black Monday in 1987, as well as the Nikkei crash, stated that now is the moment to buy gold, as its price is still “cheap.” Tudor told his investors yesterday, I have never been a gold bug. It is just an asset that, like everything else in life, has its time and place. And now is that time… gold’s value should increase as its scarcity relative to printed currencies increases.”

-Peter Schiff, live from the floor of the New York Stock Exchange, reiterated that gold will go higher. “If you don`t own gold you should buy it, don`t think its expensive. Don`t wait till its selling for 2,000 dollars an ounce to buy it.” Check out the video below.

So what is driving the stock market’s bold recovery when about ten percent of us are sitting at home out of work? Well, the S&P 500, the Dow, the NASDQ are indices that are mostly made up of our giant corporations. And along with outsourcing jobs to other countries, these corporations have also gained substantially large customer bases in those other countries. One of Gross’s big points is that “66 percent of Coca-Cola’s beverage business came from outside North America.” Another is Disney’s pending release of a full length animated film made in and for Russians. Should the movie be a success, it will send Disney’s stock up, but it won’t do anything to create more jobs in America and it won’t do much for our GDP.

As the Daily Reckoning sums up, “Gross is showing a decoupling indeed, of course it’s between the US and emerging markets, but it’s also between the US stock market and the functioning domestic economy. So, if you’re waiting for upward trends in the market to lead to a resurgence in the real economy you may be waiting a very long time.” We’ll stick with gold over here.

Graph of long-term unemployment.

The long-term unemployed. It’s a scary position to find yourself in. You fall into this category exactly 27 weeks after the day you are laid off. And what’s worst, right now, the long-term unemployed make up the biggest chunk of the current unemployed population.

Long-term unemployment could foreshadow the number of permanent jobs lost. Since the majority of those unemployed have been without work for over 27 weeks, it could mean that the majority of the 8,000,000 jobs lost since the recession began are gone for good.

Bloomberg has reported that a number of economists are anticipating that our “natural rate of unemployment” will simply be much higher. In essence, “A higher rate [of natural unemployment] would also require the Fed to make a choice: Accept an economy with more Americans permanently out of work, or try to boost employment at the risk of heating up inflation.”

Yesterday’s election has painted a clear picture to the elected officials, at least. The number one concern for Americans is unemployment. And all House officials and one third of the Senate are up for reelection next year. So the administration will have a choice – to gain popular favor, find a way to create jobs, which will come hand and hand with inflation. Did you buy gold yet? The dollar’s bumpy ride to inflation will most likely continue.

It could mean that the IMF didn’t want billions of US dollars. The IMF sold their gold for humanitarian reasons, to increase their lending capacities to developing nations. Maybe they didn’t want to be on the wrong end of the weak dollar and requested that the trade occur in this way.

Or it could mean that India was being kind to the US and didn’t want to appear like it was dumping billions of dollars (when, essentially, that is exactly what India was doing). This is what analysts at BNP Paribas believe, “By using SDRs, the Reserve Bank of India left the impression that it does not like paper currencies in general, suggesting that other major Western currencies were not seen as any better than the USD.”

Either way, the greenback is losing friends.

Yet every single day, dozens of screeching talking heads are either yammering back and forth about opportunities you shouldn’t miss or spewing forth theories apocalyptic doom and gloom that would make anyone reach for the prozac. And then the paralysis slowly creeps in until you are completely overwhelmed and just sit there and do nothing, possibly missing the greatest investment opportunities of your lifetime.

Right now, the experts are arguing. And it might be confusing for you to figure out whose opinion you can trust. Jim Rogers, known for his legendary portfolio management skills, and Nouriel Roubini, NYU professor and Dr. Doom economist, have been sparring on your cable news shows about whether gold’s current bull run will continue to astronomical profits, or whether gold will just keep its value as we whether out the crisis. Either way, the outlook for gold is good. But the two are pretty riled up and hopefully it doesn’t resort to name-calling.

Rogers is predicting gold with rise to $2000/oz or “much, much higher.” As of the writing of this blog post, gold is less than ten dollars away from $1100/oz. Roubini is saying that Rogers is wrong and that there is the threat of a bubble in the gold market. To which, Rogers responds with a smile, “It’s clear Mr. Roubini hasn’t done his homework, yet again.”

Now, while I don’t doubt Mr. Roubini’s credentials, Jim Rogers is a very skilled investor. Rogers predicted this precious metals bull run. The way that Jim Rogers made his name though is more involved than making broad predictions. At the age of 28, Rogers started the Quantum Fund in 1970. Over the next ten years, the portfolio gained 4200%, while the S&P only gained 47%. For a portfolio to outperform the market by such astronomical levels, well all I can say is that is very, very rare. It takes a devoted manager to know the markets cold, to have a dramatic understanding of cause and effect, and maybe even a gut he can trust.

Both men have respectable opinions, and neither has a crystal ball feeding them the magic number in which gold will hit its price ceiling. And when you feel exposed, part of that is because you don’t know who to trust and you don’t want to make the wrong decision when a lot is at stake. One trick to handle this is modeling. What asset is Jim Rogers, an astronomically profitable investor, predicting to double in value? The answer is gold. What it is his main reason for this belief? He is looking back to history, “The old high, back in 1980 adjusted for inflation, would be over $2000 now, just to get back to the old high. So we’ll certainly get there some time in the next decade.”

Truly miserable news. So many Americans are unemployed; with about 7,000 people losing their benefits every day. The long duration has forced many people to max out all savings, tapping into their dwindling 401Ks to make ends meet. They tried to prepare, just like you are probably trying to prepare for the worst possible circumstances. But then they got hit with something unexpected, like a necessary medical procedure, or a higher mortgage readjustment. And then, suddenly, bankruptcy court.

I had a childhood friend back in third grade whose father had just gone out on his own to start his dream of a restaurant. He had taken a gamble and figured that the family would be able to avoid a health insurance payment for the first month he was in business. Then, my friend’s appendix burst. The poor father had an eight year old crying in pain and the only option was to seek immediate medical treatment. Which resulted in very high medical bills. And the father was forced to close up his month old dream business and declare bankruptcy. Are you prepared for the unexpected? How easily will your investments liquidate in times of emergency? Would you feel more prepared if you decided to buy gold today?