Why Invest in Gold?


A big part of winning the game of life is to preserve and build your assets to allow you future freedom and financial security. To let time pass and not put your hard earned money to work for you is foolish.

Most people choose to save their money in a bank, but banks are not the most profitable option these days with interest rates being so low and the cost of living increasing much faster than the interest rates can keep up with. By investing in gold and other precious metals you can grow your wealth much faster than with fiat currencies and this wealth can then be passed on to your children and grandchildren.

More and more people are purchasing gold, silver and other precious metals and have no regrets doing so. In fact, investing in gold brings peace of mind as well as financial security, as the price rises over time. You can expect to receive great returns on your precious metals investments over the long term. Gold investing is one of the wisest things you can do today to preserve your wealth and develop future abundance for your senior years.

Some Reasons for Investing in Gold


Below are just some of the great reasons why investing in gold is a wise decision:

The Cycle of Paper Currency Failures

All throughout history governments have used paper currencies only to see them eventually fail. What happens is that a government turns away from a gold or silver backed money in favour of paper currencies also known as `fiat currencies’ the reason for this turn to paper is that paper currencies can be printed in more or less unlimited quantities.

This allows governments to spend more than they can really afford, and begins a self-doom fulfilling prophecy. Every fiat currency throughout history has always gone to zero, as more printing means inflation of prices. It is for this reason that China is not only the largest gold producer in the world but also the world’s largest gold importer, they are preparing themselves for the collapse of the US dollar and the following economic turmoil this would create.

The continuous enlargement of the money supply by the Federal Reserve and European Central Bank is something that is only going to lead to paper currency failure.

 

"Gold has intrinsic value. The problem with the dollar is it has no intrinsic value. And if the Federal Reserve is going to spend trillions of them to buy up all these bad mortgages and all other kinds of bad debt, the dollar is going to lose all of its value. Gold will store its value, and you'll always be able to buy more food with your gold."

Peter Schiff

Central Banks are Buying Gold

Central banks around the world are buying gold. Not only China, but Russia, India and many, many other central banks no longer trust Gross National Product or Gross Domestic Product indicators to accurately foretell the health of a nation’s economy.

Following the 2008 crisis and the bailout of Wall Street, the world has been in an economic recession that governments are trying hard to manipulate the figures of so that it doesn’t appear that bad. However, governments around the world are investing in gold as a counter measure to future economic shocks and problems that endless printing and manipulation of money supply is creating.

Gold’s Value Increases

According to the World Gold Council’s report, throughout history a little over 150,000 tons of physical gold have been mined. That is not a lot of gold, and it is certainly not enough to meet present day demand. Gold is used in almost all electronics and there is a shortage in worldwide gold reserves. Some experts believe within 10-15 years the very last gold mine will be processed.

Considering this limited supply of gold, coupled with its use in industry, the price of the precious metal is most certainly due to increase. As the world suffers further economic problems, investor demand will make gold prices skyrocket as there is simply not enough gold to go around. This means massive financial returns for your investments in precious metals.

The Rich are Buying Gold

The rich become and remain rich by making smart investments that look to preserve their future wealth. Most rich people, millionaires and billionaires are now choosing gold as their investment vehicle to improve their portfolios and act as insurance against worsening economic times or if their other investments fail.

What are the Benefits of Owning Gold?


After reviewing the reasons why people are buying gold, understanding the benefit of investing in gold is also useful.

Preserve Wealth

The US dollar just like every other currency is not immune to falling in value due to various economic conditions. This has been seen recently in 2008 before that in 1998 and many times before then too.

Regardless of the US dollar’s position as the world currency, it can still lose its value.

Gold on the other hand, tends to do very well in economic hard times, with gold going from around $1,000 an ounce in early 2008 to over $1,900 an ounce in 2012.

That is a fantastic return on the investment and ensures great wealth creation for you.

Ultimate Liquidity

While it is not easy to pay for things in gold, gold is better than cash because it will always have a value, where paper currencies may not. For centuries gold and silver were used as money because they were always able to be used for purchasing goods. Regardless of economic conditions, you can rely on gold to be exchangeable for goods and services and this is a passport to financial freedom.

Diversification

Gold helps you diversify your portfolio and also eliminate some risk. Nothing will ever stay the same price, and there will always be fluctuations in various assets, but gold can help you to even out the risk and balance your portfolio.

Protection

Gold is a store of value and regardless of what happens in the economy, gold will always purchase goods and services. This has been proved time and time again through wars, conflicts, economic downturns and depressions and recessions.

During the Great Depression of 1929, the stock market and bond market failed, but gold ruled as the ultimate investment. Likewise in the modern world, should the stock market or bond market take a significant hit, then gold will rise as nervous investors look to the precious metal to protect their wealth.

Conclusion


It is essential that you consider investing in gold and including it in your portfolio. In the short term the gold price rises and falls just like any other asset, but in the long term it makes notable returns and outdoes most any other asset vehicle. Gold and other precious metals are the only true protection against inflation, economic turmoil and fiat currency failure.

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