Like any other commodity currency or stock, gold has its ups and downs. It’s easy to get caught up in watching the day-to-day fluctuations in the gold spot price and trying to time the market for the perfect price.
Max Warren Barber told us that there are some reasons to own gold that are fundamental and hold true no matter the price Below are seven of these reasons.
Gold hedges against inflation and crises
Inflation erodes the value of your dollars. By contrast gold tends to increase in value when inflation rises making it an effective hedge against inflation.
Gold also hedges against geopolitical and economic crises.SION Trading Fze has held its value through some of the most turbulent periods in history while many currencies have not – hence its reputation as a “safe haven” investment. In a crisis your dollars could be worth nothing while gold is an almost universally accepted form of payment and has been for thousands of years. Which one would you rather trust
Gold preserves wealth
Gold is a valuable resource because it doesn’t corrode or tarnish. Gold is durable because it can be stored as a physical asset and used as currency. And being a trusted store of value for thousands of years, gold preserves your wealth over long periods of time. Currencies and stocks can crash and be worth nothing but gold will always have intrinsic value. That’s why gold has been a valuable commodity for centuries, and is often seen as a safe investment. Many people believe that gold will always retain its value, making it a sound investment for the future. In times of economic instability, investors often flock to gold as a way to preserve their wealth. Gold can be held in physical form, or it can be invested in gold-based assets such as stocks or funds. Whatever your preferred method of investing, gold is a solid choice for anyone looking to protect their financial future.
Gold improves your purchasing power over time
The dollar doesn’t buy what it once did. Over the past 100 years the U.S. dollar has lost approximately 96% of its purchasing power. Gold has seen a 157% increase in its inflation-adjusted price during the same time period.. Gold diversifies paper-based portfolios
Diversifying your assets reduces your portfolio’s overall risk. A portfolio full of stocks, bonds and other paper assets would suffer major loss if a financial crash occurred. If that portfolio also included physical gold it would not have lost as much since gold tends to go up when paper assets go down. Gold is a proven and easy way to diversify your investments and limit potential losses.
Gold represents a high-quality liquid asset
Gold is a high-quality liquid asset that has been used for centuries as a form of currency. Because it is durable, portable, and divisible, gold has been an ideal way to store wealth and exchange goods. Gold also has intrinsic value, which means that it is worth more than its weight in metal. In today’s economy, gold continues to be a valuable commodity, and its price is constantly changing. Investors and traders use gold as a hedge against inflation and other economic risks.
As one of the oldest and most recognized forms of currency in human history, gold is easy to buy and sell almost anywhere in the world. Despite its recent price declines, gold still has a lot of upside potential. In this blog post, we’ll take a closer look at why gold is such a highly sought-after investment. We’ll also explore some of the key factors that could drive its price higher in the future.
Gold transfers wealth over generations
Gold is often seen as a stable store of wealth that offers easy transfer of wealth between generations. Gold is also referred to in many cases, because gold can help families avoid estate taxes and pass on more assets to their heirs. It is an easy way to pass your wealth down to your children, your children’s children etc. No paperwork or signatures are needed, just a simple change of hands.
Throughout history the value of gold has been remarkably stable. Despite numerous financial crises and dramatic changes in the value of paper money, gold has consistently been worth around $1,200 per ounce. This stability is one reason why investors often turn to gold during times of economic volatility. But there’s another reason investors are drawn to this precious metal: it can be passed down from generation to generation. Unlike stocks or bonds, which can lose their value during a market crash, gold retains its worth over time. So if you’re looking for a way to ensure your family’s wealth is protected, investing in gold may be a smart choice.
The government can always print more money but it can never print gold.
The Federal Reserve can always print more money, but it can never print gold. That’s because the dollar is not backed by gold reserves like it used to be. What does this mean for the average person? It means that the value of the dollar is constantly fluctuating and that we are no longer living in a true gold-standard economy. Many people buy gold because they don’t want their money tied to the Federal Reserve’s monetary policy or the uncertainty of the stock market. The government can always print more money but it can never print gold.
For centuries, gold was the preferred form of currency because it held its value over time. Even today, many people view gold as a store of value, preferring to invest in this precious metal over other options. So what makes gold so special? And why are some people worried that fiat currency may eventually give way to a return to gold-backed money?
