The Good, the Bad and the Bullion
Despite the fact that gold has always been considered a safe haven by investors, the common man as well as the governments and international monetary institutions such as the IMF, it still largely depends on which side of the bullion market entities get caught in during price surges, if you happen to buy silver bullion or gold bullion when prices are ‘just about to go upwards then it is all good, but if the opposite transpires just as you dipped your wallet into the pot of gold, then you are already at the losing end at the point of entry.
Again the good side about owning gold based investments (especially physical gold or silver) is the fact that it will always retain its intrinsic value – in other words you don’t have to worry about losing too much when you buy silver bullion or gold bullion as in one way or another you will get most of your money back, if not all. The best part about having gold related investments during economic downturns is that, they will be worth more, much more than they would during normal economic conditions when investors are more attracted to common stocks, bonds and other financial instruments that yield higher ROI in the short term. The current economic scenario reveals a rather ugly picture as governments continue to print money indiscriminately causing major currencies to be devalued, Economists are at present predicting that if the current trends continue, money or rather paper currency would lose value and the need for a single trading currency that is back by gold and silver will arise to prevent market manipulation.
This actually means that in the long run, the bullion market looks bright. While Europe is squandering their mined gold to ‘patch up’ their economies that will eventually crumble, emerging economies such as China, India and Russia (BRIC Countries) are beginning to store up on gold. It is an inevitable fact that the world will eventually return to the gold standard, and those in possession of gold during that time, would be actually in a ‘safe position’ financially. The idea behind the concept is quite simple actually, as these countries purchase and augment their gold and silver bullion reserves, their dependency on trading currencies is reduced (mainly the Dollar and the Euro), currently the reason behind these currencies being strong is due to the immense demand for these currencies for the purpose of trade, but if at all, these emerging economies offer to pay in gold and accept payment for exports in gold, the demand for the Dollar and Euro will diminish, which will in turn diminish the demand for the currency which would in turn diminish the value of the currency. These concept will also apply to those who have gold bullion in possession, as having gold or silver bullions would actually decrease the individuals dependency on paper currency and if at all the currency loses value, it will not affect those who have precious metals such as silver5 and gold in their possession as their net worth will be based on the gold that they have. In retrospect, the depressing economic and investment outlook has caused gold and silver purchases to soar by 1600% over the last 12 months worldwide and this trend is most likely to continue until currencies of the world start becoming absolutely valueless.
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