Gold is the Obvious Choice in Precious Metals Investing

Gold is the Obvious Choice in Precious Metals Investing 5.00/5 (100.00%) 5 votes

Because of uncertainties in the financial world, precious metals investing has become more popular.  High debt levels are causing banks to print money in the hopes of raising stock levels, but this rise is misleading.  It may work for a short time, but the long-term risk to the financial system is greatly increased.  Precious metals investing, especially in gold, is an option for some people to maintain their wealth with little risk.

The lack of risk here is perhaps the paramount reason that investors choose to go this route. Low risk with good growth is always preferred to high risk, especially in the face of an unstable stock market.

A Safe Investment
For 5,000 years, the durability and rarity of gold have made it a recognizable form of money.  The supply of gold cannot be manipulated by banks or governments and therefore, cannot be inflated and used to cover debts that are incurred.  Paper currency can lose value, depending on the government and banking industries choices.  Gold can be used as a form of payment all over the world.  During times of economic trouble, gold maintains its value and is another reason precious metals investing has become more common.

Why Gold Performs Well
The price of gold continues to rise as more money is printed.  There is a limited amount of gold so it keeps its value as paper currency loses value with continuous printing.  If financial markets collapse, gold will maintain its purchasing power.  Investors will be able to keep their wealth in gold.  Precious metals investing is a safer option than putting cash in the bank.  Gold has always been recognizable as a form of payment and investors are realizing that the value of gold will continue to rise despite the current unsteady financial situation many countries are facing.

The United States dollar is currently the world reserve currency.  However, if the dollar loses this status, the Federal Reserve will no longer be able to print more money to pay off its debts.  Some countries are choosing other forms of payment besides the dollar because of the constant lowering of its value by making more money.

Gold Will Retain Value in a Currency War
Currency wars occur when a currency is depreciated so that exports become more competitive.  This also stimulates a country’s economy.  The problem is that each country must depreciate its currency to stay competitive with other nations.  This may bring short-term positive results, but the long-term damage is devastating to all involved.  When currency is depreciated too quickly, hyperinflation may occur.  Hyperinflation is when the devaluation of currency gets out of control and cannot be stopped easily.  The currency could be worthless.  Through all of these ups and downs, gold will retain its value and investors will maintain their wealth.  Precious metals investing can help ensure a private financial loss does not occur during these troubling economic times.

German Repatriation
Germany recently requested tons of its gold be returned from the United States.  Several others countries may follow suit and if this occurs, there may be an insufficient supply of gold to return it all to them.  Gold prices will skyrocket if a supply crisis occurs and anyone who owns gold could sell it for many times over its purchase price.

Precious metals investing could prevent a personal financial crisis.  As financial systems fail, placing money in gold investments is a sound decision.  Any number of possible events could cause gold prices to increase.  Potential investors should always check with a reputable dealer when making investments decisions.