Physical gold and silver is the safest currency investment available, according to a veteran finance market commentator.

Richard Russell, writer of the newsletter Dow Theory Letters since 1958, claimed the world is beginning to realise that the US dollar is merely a unit of account backed by faith in a “bankrupt nation”.

Mr Russell told King World News that many global currencies are similarly prone to market fluctuations, regardless of how strong a nation’s economy may be at a given time.

According to the expert, he recently read a pamphlet claiming the Australian dollar is the safest currency in the world, largely due to the country’s lack of debt and robust economy.

“But it’s absolute nonsense; the safest currency in the world is gold,” he explained.

“This is true because gold is not backed or guaranteed by any single nation, gold is pure wealth, and needs no nation to guarantee its value.” Meaning gold is money.

Reasons to invest in gold and silver

Precious metals are well regarded as a safe haven investment, providing protection against the pitfalls of financial markets.

As a result, Mr Russell advised investors to continue ramping up their gold and silver holdings.

“The thesis that only gold and silver represent true wealth is spreading. My advice is to own physical silver or gold.” he stated.

One of the primary reasons Mr Russell gave for investing in gold and silver is that the precious metals are among the only monetary items that do not require interest payments.

He argued that the less safe currencies are, the higher interest payments to buyers will be. This encourages people to invest in the fiat system, but underlines its fragile nature.

Invest in gold and silver for the future

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Given economic troubles across North America and Europe, it would not be surprising if more investors flock to save havens such as gold and silver over the coming months.

The World Gold Council noted that consumer demand for the yellow metal reached record levels in 2013, with significant interest in bullion bars, coins and jewellery. This trend could be the result of many people losing faith in currencies – a factor Mr Russell explained as showing good sense based on available evidence.

He said: “One advantage that gold and silver possess is that they can’t degenerate into nothingness, they can’t become worthless.

“Every fiat currency in history has ultimately become worthless, valueless. No fiat currency in history has ever survived.”