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Why buy gold?
Gold as the best store of wealth
As we enter a period of monetary instability with Banks and even Governments struggling to meet their financial responsibilities, people are actively looking for safe havens for their savings. Gold bullion has been seen as the safest store of wealth for 1000's of years. People are buying gold as a safe haven against any economic, political, social or currency-based crises. When you buy gold you are investing in a tangible product unlike stocks & shares and paper money, which only have a notional value.
“Paper money eventually returns to its intrinsic value ---- zero.”
Voltaire (1694-1778)
The Price of Gold Bullion
Looking at the price of gold bullion today, you might think that because it is ten times as expensive as it was in the 1970's, it has reached a peak and is now expensive. However there is a problem with this view. The £Pound or $Dollar can not buy what they did 30 years ago. Other methods of measurement show that gold bullion is in fact far cheaper than it has been for decades and that it is so undervalued relative to paper money, such as the $ and £, that the gold price is ready to soar higher than ever. Adjusted for inflation, the gold price is still a long way from its all-time high above $2300 an ounce in 1980.
Two sides to gold: both Investment and Crisis insurance
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Gold as a safe haven insurance
Gold has always been considered a 'crisis insurance' against unexpected economic disaster. No one likes to think about potential disasters but we still take out insurance which normally comes at a cost. Gold may drop in value but that is the price one pays for the safe haven insurance that this tangible metal provides. |
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Gold as an investment
The price of gold, when adjusted for inflation, is still a long way from it 1980 high. It would need to be over $2400 an ounce to beat that price.... Had you invested $10,000 in gold bullion in 1999, your initial investment would have grown to over $40,000 by 2010 - a staggering 300% increase. The same $10,000 investment in stocks of the S&P index would have lost over $1,400. A 14% loss. |
Click here to read the full article on 'Two sides to gold: both Investment and Credit Insurance
Gold Made Simple ® makes the process of investing in gold bullion simple in a secure and convenient way. Our aim is to make investment in gold simple and accessible to all investors. We want to demystify the process and make the markets simple and easy to understand. Our customers are buying gold in a number of varieties including investing in gold sovereigns, investing in gold bars and gold grams.