Gold has successfully preserved wealth for thousands of generations. The same cannot be said for paper coins. This has made gold one of the great hedges against inflation.
In 1970, an ounce of gold was worth $35.8 – enough to buy a suit. If you had an ounce of gold today and converted it to today’s price, you could still buy a suit. But if you’d kept your $35 in paper money, you wouldn’t be able to afford a tie.
Gold’s potential to protect wealth is even more important in an economic environment where investors are bearish in the US. Dollar and rising inflation.
Historically, gold has acted as a hedge against both scenarios. As inflation increases, gold generally appreciates.
When investors see that their money is losing value, they start moving capital into a tangible asset that traditionally holds its value. The 1970s provide a good example of rising gold prices amid rising inflation.
Despite such advantages, investing in gold suffers from drawbacks, which have limited its appeal to retail investors. Settlement spreads can be wide, making inbound and outbound trades expensive; Storage and insurance costs are high, at 0.4% per year; It is expensive and difficult to transport.
The rise of gold-backed blockchain tokens like Universal Gold [UPXAU] will bring digital portability, low fees and zero storage costs.
The price of gold changes 24/7/365 as it is traded on various exchanges around the world.
We have more gold bars than we need, so price changes are more related to market sentiment and events than availability.
Here are the three main factors that affect gold prices:
- Uncertainty: When times are bad and there is economic instability, demand for precious metals is usually strong as investors seek a safe haven.
- Economic Issues: Changes in economic policy, or the strength of a country’s currency, or interest rates can affect the price of gold.
- Demand: Precious metals are not for governments or the rich to hoard. Gold is used in industrial processes. Another important factor is the jewelery trade. People are more likely to buy jewelry during times of prosperity. In some Eastern countries, precious metals are gifted to family members in the form of coins or bars.
- Gold is a timeless investment: Indeed, people rich and poor have used gold for centuries to hold or exchange wealth.
- There is so much gold; We don’t need to mine anymore: For all the practical uses of gold, it’s true, we have many government and private bank vaults around the world.
- Gold is hard to use for anything (it’s so heavy): It’s true, gold is heavy, heavy, and hard to trade, even if it’s across the street (let alone around the world).
- We are in uncertain times when gold prices traditionally hold up well: Gold generally performs better during times of economic or political uncertainty.
- Gold can be converted into digital forms: Tokens like Universal Gold [UPXAU] will make them more accessible and tradable to mainstream investors than ever before, increasing demand for the base metal that underlies each token.
- Gold is in demand: From digital circuitry and medical devices to jewelery and wealth creation, gold is in demand for practical uses and coupled with economic uncertainty, it can be a good investment option.
Gold is a timeless investment to protect your wealth. A time capsule from any century is sure to include gold coins or bullion. Discover the security and pride in ownership for yourself. Pool your resources and make an important decision about your financial future. Talk to a knowledgeable professional at Nexusearn via the Livechat widget below. Learn how to buy gold bullion for greater financial growth and experience. We take pride in offering outstanding service, great pricing, and fast delivery times to everyone – from novice buyers to sophisticated investors…
