When looking for investment opportunities, you come across dozens of them, bonds, real estate, currencies, stocks, businesses. So why invest in gold?
It is all over the news and it is a hot topic among economists and reporters that the US is drowning in debt and eventually all personal wealth would be wiped out. Here is our take on the matter:
Central Bank Isn’t Working
Rather than economic indicators like GDP, GNP or productivity, the economy depends solely on people or departments who control the money. To economists, it is commonly known that bad times like recessions and economic depressions only come as a result of manipulation of the money supply.
The Central bank relies on the global players to be nice with the money supply; also certain political factors come into consideration. But when one player manipulates the supply and benefits from it, the rest suffer. This inevitably affects the residents of the country.
It is a well known fact that central banks around the world are investing large chunks of money into gold, keeping in view the ‘economic wars’ going on. Once these wars end, consequently so will the economy of the losing country.
Major Global Investors Are Buying Gold In Bulk
Opposite to what most people think, rich people weren’t really born in drinking milk out of silver or gold bottles. There are a large number of people who earned their wealth through hard work and intelligent investments. Where are they investing now? That’s right, in gold.
Major global investors have started to purchase gold in quantities never seen before and there is a reason. It is what a self-made, rich millionaire would do – make wise investment decisions. They know that gold is one investment that would never go to waste. The recent rise in purchase of gold has also given a steady rise to the price of gold, giving back almost double the returns in the past few years.
Dollar? Euro? Every Currency Fails
History is a witness, every national currency which ever came into being, has seen its fair rise and eventually and inevitably a steep fall. Look at Greece for example, the currency failure in last summer turned out to be so bad that Greek parents admit they are unable to feed and spare money for their children and they are looking for alternatives like orphanages or charities to raise their children.
It is just a matter of time that the debatable U.S economy fails and obviously it will be the local citizens suffering at the cost of their personal savings and wealth.
There has been a noticeable rise in China’s gold purchases because they want to be ready when the US currency will no longer be accepted, this can also be judged by the fact that in the history of China, this is the first time individual investors are allowed to purchase physical gold.
Another reason for failing currencies is that the world-wide excess and the money supply is devaluing money at a controversial rate. The money supply and rising inflation are the culprits behind currencies failing.
Gold Prices Will Keep On Rising
According to a report issued by the World Gold Council, to date almost 153,000 tons of gold has been mined in the human history. It also continues to report that there aren’t much gold reserves left and it is probably a matter of 10 to 15 years until the last mine of gold is processed.
It is well known that if a commodity is in limited supply, the prices skyrocket. That is the case with gold, the prices will keep rising – add the increasing demand, and that equals to high returns.
The world population also increases an estimated 100 million per year, this immense growth compared to the limited commodities available like gold, silver, oil, gas and other metals, will obviously cause more rise in the gold prices.
There is a proven and unarguable correlation between oil and gold prices. Given the trend in never ending rise in oil prices, gold prices will also keep going up the bar.
Gold Is A Form Of Preserving Wealth
When comparing gold to other investment options such as stocks and bonds, we see that gold is the only form of preserving wealth. Stocks, bonds and alternatives have a history of failure during times of market instability. Whereas gold has proven to preserve its value in hard times as well, giving a strong backup base.
Another reason for this is that gold is the form of acceptable currency that is absolutely under no influence of governments or politicians, therefore, its prices and value are not prone to being manipulated. Paper currency is more like a liability with less or absolutely no intrinsic value and that’s not the case with gold.
Diversifying Assets To Minimize Risk
What do most businesses or portfolios do? They try to minimize risk by diversifying their investments. Individuals should do this too, but how? The key to diversifying your assets is trying to find investments that are not closely correlated to each other. Like gold is closely correlated to oil, it’s correlation with stocks and other financial instruments is not really that good.
Intelligent investors and people, who wish to save for their retirement, diversify their investments by combining gold with stocks and bonds. This not only minimizes risk, but there’s substantial backup in case stocks and bonds fail.
The Gold Nutshell
In a nutshell, keeping in mind the high appreciation of gold in emerging countries, it is a highly liquid asset and a currency as well. There are few other investments which are easily convertible in to currencies without the cost of penalties. Investing in gold is a great option, especially for people looking to build up their IRA funds; it is reliable, dependent, no strings attached.
When going for gold investments you can go for gold certificates which entitle you to the ownership of a certain amount of gold that a company has, when you retire you can claim those certificates. Also you can go for physical gold which can be bought in the shape of coins, plates, and blocks.
If you want to go for an IRA gold rollover or you are looking forward to purchasing gold, go for Regal Assets. This company has a good reputation and guarantees you substantial profits over your gold investments.