Invest In Gold
If
you want to invest in gold, then I highly recommend you start learning
about investing in gold specifically, and all about this incredible
precious metal right now because this is the time to invest as it will
allow you to make a lot of money while the trend is still positive.
One
of the main reasons why people invest in gold during a down economy is
because it helps them hedge their bets against inflation.
This is what happens when the power of the US dollar becomes weakened
because it is so inflated that it’s just not worth nearly as much as it
used to be at one time. There are those predicting the continuation of
inflation, and potential hyperinflation.
But gold, on the other hand, is a precious metal with real world value
so there is never going to be any reason for the price of gold to
become too inflated. One big factor to keep in mind is the buying power
that gold carries continuously. Gold 100 years ago would buy the same
amount of goods it will today. For instance the value of one
ounce of gold was worth $20 way back then, and is around $1600 now.
Back then, $20 would have gotten the same amount of merchandise as
$1600 will today. So over the long haul, forgetting these short term
spikes and dips, gold remains unchanged, and the dollar is losing it’s
value.
You can see this evidence by some national decisions made by large nations in their acquisitions of gold.
It will certainly fluctuate as investors want to sell some of their
gold to reap the profits of their investments, but as a long-term trend
you should definitely begin to invest in gold because it really is the
smart move to make while there is so much economic turmoil taking place
throughout the world.Another excellent reason to invest in
gold right now is the fact that this commodity is seriously on the rise
and it doesn’t appear that it’s going to be stopping anytime soon.
It may take a small dip and it may even level off at certain points,
but the long-term outlook on gold is extremely positive since the
economy is struggling and it’s going to take a really long time for the
damage of the mortgage industry to finally start getting repaired.
Right now foreclosures are still at an all-time high, and people are
struggling more and more each day to pay their bills. I know this sounds
like a recipe for disaster, and if you are investing in regular
businesses than it really is a bad move to make. But not with gold, and
not investing in other precious metals as well.
The final reason you definitely want to invest in gold is the fact
that this precious metal is a commodity that is becoming more and more
scarce as time goes by.For one reason or another, our gold
supply is steadily dwindling and the mining companies just aren’t
finding as much gold as they used to.
So owning a commodity that
is in high demand and relatively scarce is certainly a good move to
make. So do yourself a favor and invest in gold as soon as you have the
opportunity to do so.
For further reading on investing in gold: Some Of The Best Gold Investments Gold IRA Investment Options Gold IRA vs GOLD 401k vs Gold ETFs
I
highly suggest you watch this video, as it is very enlightening with
how the value of gold has been sustained throughout the course of
history, with illustrations of what you could do with one ounce of gold
in 1900, and how it’s nearly identical today as aforementioned, whereas
the fluctuations of the US currency have been nothing less then
massively erratic, and continually downwards.
Interestingly,
notice how they move in opposite directions in direct proportion with
each other. That isn’t the value of gold increasing, that is the value
of the dollar decreasing.
You can tangibly get a feel for how the
evacuation of the Bretton Woods Exchange in 1971 and having a Fiat
currency sent waves through the economy that are felt still to this
day, exponentially.
Had you invested $100,000 in gold in 1971, you’d be resting on around half a million dollars worth of gold today.
Here are some of situation that often affect the price of gold:
1. Changes in exchange rate. A weaker U.S. dollar exchange rate is
usually encouraging the increase in world gold prices. This is because
investors choose to sell their dollar and then buy the gold with the
hope that gold can protect the value of their assets. For example, while
the value of dollar exchange rate against other currencies continue to
decline, the price of gold continue to rise.
2. World political
situation. Increase of gold price in the end of 2002 and early 2003
occurred as a result of the attack to Iraq by the U.S. command allies.
Market participants shifted from money market investment and the stock
market to gold investment, causing the demand for gold jumped so
sharply.
3. Supply and demand. An example of this 'supply and
demand of gold' is like the event occured in mid-1980. At that time,
forward sales by mining companies are always blamed for the rise of gold
price. Although in business term, the mining company's actual behavior
is reasonable. By making forward sales when gold rose, they could secure
the mine output price at a fairly attractive price. Another example,
the case in mid-1998 in which the gold price continued to decline. At
that time, Central Banks in Europe Union said that they would reduce
their gold reserves regarding the implementation plan of the Euro
currency. Because of it, the price of gold has been plunged immediately
around 290 dollars per troy ounce.
4. The global economic
situation. Approximately 80 percent of the total supply of gold has been
used by jewelry industry. Jewelry consumption is a major influence on
the demand side. As economic conditions improved, the need for gold tend
to rise. However, the most sensitive industry to be influenced deeply
is jewelry industry.
Recession had influenced the jewelry demand in
the year 1982-1983, because at the same time, the gold price also rose.
In the recession of the early 90, The level of jewelry demand was
falling too, but at this time the price of gold also fall down
simultaneously.
As described above, economic situation may lead to
high inflation. So, the benefit of using the gold as a hedging tool
against inflation has been felt by investors for a long time. With gold,
investors got a perfect protection against the decline in purchasing
power. On the years 1978-1980 the price was booming. While inflation in
the U.S. rose from 4 percent to 14 percent, the gold rose three-fold.
5. Interest rate. When interest rate rise, peoples tend to keep money
on deposit better than gold which does not earn interest (non
interest-bearing). This will cause pressure on the price of gold.
Conversely, when interest rate fall down, the price of gold will likely
rise. In theory, if the short-term interest rate rise, your gold fell.
In Indonesia, this theory does not always work. In 1998, as Rupiah fell
sharply against the U.S. dollar currency, the government raised interest
rate significantly for the hope to put a halt to rising U.S. dollar
exchange rate. As a result, despite from rising interest rate, gold
price also rose.
Article taken from: http://wiki.answers.com/Q/What_factors_influence_the_price_of_Gold
The world’s major economic powers are all suffering from the economic downturn but even the most cynical doomsayer is sure we’ll get ourselves out of this mess—eventually. Rare are those instances in which entire economies are disrupted to the point – typically as a result of rampant inflation, or hyper inflation – that an entire form of currency is discarded, reformed or replaced. But it does happen. There are invariably external issues (military, political, etc) at play, which result in what can generally be referred to the ‘failure of a currency’, and each situation is unique. The following is a list of nine notable examples in which currencies became so devalued that they were eventually replaced:
By the end of 1922 Germany found it was no longer able to pay the war reparations set forth by the Treaty of Versailles. French and Belgian armies responded by occupying Germany’s most productive, and industrial regions. German industrialists then ordered workers strikes, which put further pressure on an already frail economy. The German government countered this situation by printing unbacked currency with which it meant to pay both workers benefits, as well as its delinquent international debt. Supply and demand followed: too much money was circulated, and the money was soon considered worthless. In 1922, the largest denomination of the Papiermark was 50,000. A year later it was 100 Trillion. This means that by December 1923, the exchange rate with the US Dollar was 4.2 Trillion to 1. It is estimated that by November 1923, the yearly inflation rate was considered 325,000,000%. This means that the cost of goods were increasing about every two days. As a result, the Rentenmark was introduced at a rate of 1 to 1 Trillion of the Papiermark. Reparation payments eventually continued, and France and Belgium agreed to leave the country.
The Great Depression put an initial strain on the Austrian Pengo, originally introduced with great strength as a replacement to the Austrian-Hungarian Korona in 1926, per the Treaty of Versailles. Next, the associated effects of World War II would run their course. In 1944, the Hungarian Pengo’s highest denomination was the 1,000 note. A year later it was 10,000,000. And by mid-1946, it was 100,000,000,000,000,000,000. Realizing that this type of hyperinflation and denomination increase was not sustainable – and after 20 short years – the Pengo was replaced by the Forint. There are famous pictures of this event, which include street sweepers cleaning the sea of Pengo notes that Hungarians so eagerly discarded. At the time of this replacement, the Pengo to Forint exchange, was Four Hundred Octillion (That’s 29 Zeros) to one. That same Forint would exchange for 11.74 to $1USD. Inflation has since continued at a much more subdued rate, and the current exchange is valued at approximately 195.2 Forint to 1 $USD. It is estimated that at the time of replacement, the value of all Hungarian currency in circulation equaled less than one-thousandth of one US dollar.
Shortly after the ascension to the office of president, Socialist President Salvador Allende, decreed that many of Chile’s leading industries would be nationalized. Owing predominately to management problems (with bureaucrats overseeing the market) this government soon began hemorrhaging money, and in order to subsidize the loss, the Chilean Central Bank began printing unbacked currency at an alarming rate. This resulted in an inflation rate of 600% by the end of 1972; inflation eventually skyrocketed to 1200% by the end of 1973. This was the same year General Augusto Pinochet’s US-backed coup d’état seized control and installed his populist military regime. Shortly thereafter, in 1985, the Escudo (1960-1975) was replaced by the New Peso at a rate of 1,000 to 1. Except for a slight depression in 1981, the Chilean economy recovered, largely due to the government’s decision to sell off newly acquired State-owned enterprises. The rest of Pinochet’ s tenure in Chile, however, is entirely another story.
After unprecedented annual growth rates and record trade surpluses, panic and political unrest broke out between Argentine Trotskyists and the Perón loyalists, in the wake of the 1973 oil crisis. Conflict came to a head in 1975, when a sharp recession looked inevitable. The Argentine government then exacerbated the situation by refusing to borrow in order to cover its budget and trade deficits. In 1975, the largest Argentine Peso denomination was 1,000. A year later the 5,000 note was introduced. In March 1976, a violent coup was staged by the country’s military leaders, who promised to bring stability to the region. By ’79, there was a 10,000 Peso banknote and by 1981, the Argentine Central Bank had introduced a 1,000,000 Peso note. The country’s economy declined, further worsening the situation – in between 1981 and 1982, Argentina’s GDP fell 12%, the worst single year decline since The Great Depression. When the currency was reformed in 1983, 1 Peso Argentino was exchanged for 10,000 of the “old” Peso. Then in 1985, the ‘Austral’ was introduced, which replaced the Peso Argentino at a rate of 1-to-1,0000 Then yet again, in 1992, the New Peso replaced the Austral this time at 1-to-10,000. This end result of this experience – in many circles referred to as, “The March of Zeros” – equated to a 1 New Peso equal to 100,000,000,000 Pre-’83 Pesos.
During the 1980s, Peru, like many Latin American countries introduced a number of trade liberalization polices. At the same time, government increased public spending, privatized enterprise, and neglected to service the nation’s external debt. As a result, by the end of the 1990s, Peru’s already small economy – which once had been enticing avenue for foreign direct investment – was experiencing not only negative economic growth, but also deficits of all types, as well as hyperinflation. While hyperinflation became apparent, the Peruvian government replaced the Peru “Old” Sol with the Inti, in 1985, at a rate of 1,000 to 1. The largest denomination of this new currency, was a 1,000 note. In two years, monthly inflation would increase by a rate of 132% in September 1988, and later 400% by September 1990. In order to facilitate the new higher prices of goods and services, new notes were introduced such as the 10,000,000 Inti note by 1991. Again, Peruvian government decided again to replace the currency, this time with the Neuvo Sol, at a rate of 1,000,000,000 to 1. The result was a currency that was worth one billion times that of only six years before.
Angola’s story is an unfortunate one, and while it is today one of the fastest growing economies in the world, the country was plagued by civil war from 1975 to 2002. This conflict placed a large strain on the nation’s economy, as well as its currency, the Kwanza. In 1991, the largest note was the 50,000 kwanza denomination. By ’94, there was the 500,000 banknote. In 1995, the Readjusted Kwanza (Kwanza reajustado) was introduced for 1,000 Kwanzas. The new currency also had a 500,000 denomination. When the country changed currencies in again in 1999, the New Kwanza was introduced, exchanging for 1,000,000 of the reajustados; by this time, the new currency was equal to one billion of the pre-’91 Kwanzas.
Between 1988 and 1989, the Yugoslavian Dinar’s largest denomination switched from 50,000 to 2,000,000 notes. The New Dinar replaced the Dinar in 1992, at a rate of 1 to 10, with the highest denomination being 50,000. By 1993, this was 10,000,000,000. In answer to this sharp increase inflation, the government simply removed six zeros, meaning that the “Newer” Dinar replaced the “Old Dinar” at a rate of 1 to 1,000,000. In the next year the currency was replaced yet again, this time at the rate of 1 to 1,000,000,000! By January 1995, prices had increased a quadrillion percent in two years, and as a result the German Mark became the country’s Fiat currency. It is estimated that during the height of hyperinflation (December 1994), inflation was increasing by a rate of 100% per day. In fact many Yugoslavians during this time sought to forgo paying their bills for as long as possible, because it several weeks the amount owed would seem relatively cheap!
Shortly after the Cold War, many of the newly independent Eastern Bloc states began to experience the pains of a currency fluctuation, and moving towards a market-based economy. At the time of independence, Belarus was had a relatively highly developed economy, and it’s citizens experienced a standard of living among the highest of eastern Europe. In 1993, the largest Belorussian note denomination in circulation was the 5,000 Rubles. By the end of the decade, this had increased to 5,000,000 notes. In an effort to displace this, the government replaced the new Ruble at an exchange rate of 1 to 1,000 “old” Ruble. Presently, the highest denomination is the 100,000 note, which is equal to 100,000,000 1993 Ruble. Many people credit the high rates of inflation to the leadership of Lukashenko who has been in office since 1994. Today 80% of the country’s industries are still nationalized.
When Zimbabwe became an independent African state in 1980, the Zimbabwe dollar was actually valued higher than the US dollar, at a rate of 1 to 1.25. Through a series of questionable race-based land seizures and rampant money-printing, the Zimbabwe dollar began to experience rampant inflation by the early 21st century. By 2004, inflation reached a then-all time high of 624%, before going below triple digits in 2005, and then surged up to to 1,730% in 2006. In August 2006, the currency was replaced with a New Zimbabwe dollar at a rate of 1 to 1,000. By mid-2007, inflation reached a yearly increase of 11,000%. By May 2008, 100 Million and 250 Million New Zimbabwe Dollars (ZWD) denominated notes were released, and less than two weeks later, a 500 Million ZWD note was introduced (valued at about $2.50). Then less than a week later, 5 B, 25 B and 50 B ZWD notes were introduced, and later, in July, a 100 B denomination was introduced. In August 2008, the government removed ten zeros from the currency, and 10 Billion ZWD became equal to 1 New ZWD, with an estimated annual inflation rate of about 500 quintillion (18 zeros) percent, with a monthly rate of 13 billion percent.
Gold is considered as a safe-haven asset as throughout history it has been viewed as a store of value. Gold, like all precious metals, may be used as a hedge against inflation, deflation or currency devaluation.
Gold as your retirement plan is a smart move, as the value of gold increases eventually in the long run. Money ;the more money a country prints the less valuable the currencies become.
Simple example of Gold Saving :
If you Buy 100g of PublicGold in 2011 the price is (6.7.2011) RM16,590 Now (24.2.2012) your 100g is worth RM19,343.
So why wait, Buy from Us & Make your saving a safe & profitable saving.
Bebaloikah menyimpan emas fizikal & dinar?
Disini saya akan memberikan sedikit penerangan yang mudah difahami bagi yang ingin tahu serba sedikit tentang emas.
Emas boleh dijadikan pelindung aset simpanan anda.
Emas simpanan anda boleh menambah simpanan anda kerana nilai emas akan naik tahun demi tahun dalam masa panjang. Bukankah ini menguntungkan pemilik simpanan emas?
Simpanan berbentuk Emas adalah pilihan yang bijak.
Contoh:
Sekiranya anda mengambil sedikit wang simpanan anda untuk membeli Emas PG Gold Bar 100g pada tahun 2011 (6.7.2011) dengan harga RM16,590. Sekarang (24.2.2012) harga 100g adalah RM19,343. Dalam masa 7 bulan , nilai emas anda membuat berbezaan RM2753.
