During troubled or volatile economic times, much like those facing investors today, many savvy investors will look to protect their wealth, capital, and other assets by placing this money into areas considered safe or less risky.
From the dawn of civilization, gold’s beauty and luster have produced a rare mythical quality unmatched by any other metal. One of the earliest and most valued metals known to man. For centuries men everywhere have dreamed of finding gold. Men have mined it, bartered with it, and even died for it since the beginnings, of civilization. These facts are not so surprising when you consider its rarity, durability and unusual properties. Today gold has thousands of uses. It can be found in everything from calculators to space craft, jewelry and much more. It is virtually indestructible, resists corrosion, blocks 98% of radioactivity and conducts electricity. Its uses are almost endless and have just begun to be tapped.
LIMITED SUPPLY - Today some 90% of the world’s gold is found in only four countries: South Africa, the former Soviet Union, the United States and Canada. South Africa has dominated world gold production and accounts for about 50% of the total world supply. The former Soviet Union accounts for 32%, the United States for 6%, and Canada for 3%. The rest of the world combined produces about 9%. The total yield, however, has been incredibly small. Unlike other such commodities, because of hoarding and stockpiling, each year’s production is a very small part of the available supply. An estimated 2/3 of all the gold on earth has already been mined. Only about 88,000 tons have been extracted from the earth in all of recorded history. All of this could be formed into one cube 18 yards high. It is this scarcity, along with gold’s beauty, durability, and compactness, that has made gold the ideal standard and store of value.
WORLD WIDE LIQUIDITY – Perhaps the most amazing feature of gold is its stability as a standard of real value. Although its value may fluctuate, history proves its buying power tends to remain the same. Gold has been the most coveted metal in the world and the single most trusted international medium of exchange for thousands of years. Trade between countries frequently is based on gold value as the most reliable currency. While paper currencies have been devalued, eroded by inflation, and become virtually worthless, gold has maintained its purchasing power. Gold has been the established monetary standard for centuries. During times of inflation, people have turned to gold for profit and protection. Gold, unlike paper currencies or other commodities, has retained its value during both crisis and calm periods throughout the history of civilization.
PROVEN HEDGE AGAINST INFLATION - The primary factors influencing gold prices are anticipated inflation caused by huge U.S. deficits and the diminishing power of world currencies. As people lose confidence in a government’s ability to control inflationary pressures, they turn to gold. While gold prices may fluctuate from day to day in world markets, the long-term demand for this timeless treasure can be expected to continue. The current gold market conditions offer profitable opportunities; take advantage of these opportunities and own gold today.
SUPPLY AND DEMAND OF GOLD GLOBALLY
Like all other commodities, gold price fluctuates most basically on a level of supply and demand. The production of new gold supply is today relatively inelastic in spite of rising gold prices and demand for gold. The sustained growth of gold, in turn, will only continue due to the consistent level of increasing demand and the inelastic production of new supply. The foundations for a positive outlook regarding gold investing is better than ever.
GOLD PRICE VERSUS STOCKS
Though stocks and gold bullion are completely different asset classifications, the performance of both items are often compared. Gold retains a store value, while stocks return profits to investors through a return on value. Typically speaking, stocks and bonds will only perform well in stable economic and political times, while gold maintains even higher levels of performance amidst these tumultuous times. Given the political uncertainty, economic downtrend, and financial crisis facing the United States and other nations, the hedging of losses, and in turn, returns on investments, from gold have continually out performed stocks and bonds of all kinds