Gold isnt the only commodity that is looking like a good investment..

Gold isn’t the only commodity that is looking like a good investment. The U.S. dollar is sliding lower, its once-solid support giving way like rotting timbers.

The time has come for big gains in gold, silver, sugar, grains, energy and more as the big commodity bull market moves into its next phase.

What’s driving this next wave higher in commodity prices? Fundamentals forces are lining up that should push the dollar lower and commodities — especially precious metals — much higher.

Washington Is Debasing the U.S. Dollar. The U.S. Treasury is printing at warp speed. It’s adding debt to the burden of every American man, woman and child at a frightening pace. According to the Peter G. Peterson Foundation, “Our $56 trillion in unfunded obligations amount to $483,000 per household. That’s 10 times the median household income — so it’s as if everyone had a second or third mortgage on a house equal to 10 times their income but no house they can lay claim to.”

The U.S. deficit for this year alone is $1.8 trillion. The Peterson Foundation points out that a deficit that large is adding debt at a clip of $3.4 million a minute, $200 million an hour or $5 billion a day.

All that debt has to be paid back eventually, and paid back with dollars. When you create more of something, you cheapen its value. In a nutshell, that’s one reason why the U.S. dollar is breaking support and heading lower.

The Dollar Is Losing Its Status as Global Reserve Currency. With Uncle Sam spending money like his wallet is on fire, our trading partners in China, Russia, the Middle East, and around the world are getting steamed. They’re ready to dump the dollar. The move away from the dollar won’t be quick. There are trillions and trillions of dollars worth of investments that have to be reallocated. But once started, this juggernaut is hard to stop. It’s already started in China! Recently, Cheng Siwei, a leading Chinese policy maker, said that his country’s leaders were “dismayed” by America flooding the banking system with money.

“If they keep printing money to buy bonds, it will lead to inflation,” Cheng said. “So we’ll diversify incremental reserves into euros, yen and other currencies.”

Russia jumped on the anti-dollar bandwagon. At a meeting in Yekaterinburg, Russia, the BRIC nations — Brazil, Russia, India and China — suggested shifting their currency holdings from the dollar into International Monetary Fund “Special Drawing Rights,” or SDRs. The IMF recently announced that around $2 billion in SDRs recently transferred to Russia. But Russia is still behind China, which announced its intention to purchase up to $50 billion in SDRs from the IMF. India is going to purchase SDRs, too! SDRs on their own can’t function as a global reserve currency. But combined with a basket of hard assets — gold, silver, copper and oil, for example — they could be a BIG step in that direction.

The U.N. is the latest to get in on the act. The United Nations Conference on Trade and Development laid the blame for the financial crisis at the dollar’s feet, and proposed replacing the dollar with an artificial currency.
This is the first time a major multinational institution has suggested dumping the U.S. dollar as the world’s reserve currency.

Meanwhile, China, Russia and others are buying gold on every dip. This is probably part of their plan for a long-term shift away from the dollar. But it also puts a floor under the price of gold ... and means the easiest path for the yellow metal should be higher.

The amount of gold in ETFs globally has surged to more than 66.7 million ounces. The World Gold Council reports that only about a half of 1 percent of total worldwide funds under management are currently invested in gold and, if that were to double to 1 percent, there would be insufficient gold in the vaults of central banks to accommodate the increase in demand. Also, recent news reports reveal that China is exhorting its citizens to buy gold and silver bullion.