Gold is gaining popularity in being an asset more than the traditional forms of investment. Although once upon a time, the price of gold was correlated to the greenback, its increasing value has caused it to be independent of the greenback value today. Hence, it is no longer true that gold is only valuable in economic crises.
Decoupling of Gold
As the value of gold keeps increasing in tandem with the US dollar, this uptrend further strengthens the position of gold in an investor’s portfolio. Once gold can prove its independence from the greenback, it will open many opportunities for itself.
It is assumed that buying gold coins stand to benefit more when it can be decoupled from the US dollar; a complete decoupling is most likely to raise the gold price. Gold will prove to be a powerful investment tool for any investor who wishes to strengthen his investment portfolio as well as be hedged against any kind of economic crisis or inflation as gold is considered a safe asset.
Gold triumphs in economic crisis although it is otherwise for the greenback; however, certain crisis does favor the US dollar as in the recent European financial crisis. Hence, gold is the better choice where economic concerns only tend to push the value of gold up even when the dollar value is up.
With the generic thinking that most experts hold in that gold prices rise when the dollar value drops tend to increase the demand and popularity of the precious shiny metal.
US Dollar Value
Many are questioning the real impact of the European crisis on the US dollar. There is a growing concern whether the greenback will continue to strengthen itself in the midst of the European economic chaos until such a momentum that even gold cannot keep up with the increase. But this does not take into consideration the poor economic status of the US currently nor the quantitative easing that will come about.
Today, as gold seems to move towards a US dollar decoupling, more investors are considering a keener look on purchasing gold coins. There are many forms of gold offering to investors who are serious in making gold as part of their investment portfolio. There are physical gold, gold bullion and rare coins of gold for one’s taking.
All eyes are watching for a complete or total decoupling of gold from the greenback, which gives more reason to own a piece of the precious yellow metal because the price of gold will certainly rise. Even today’s poor economy pushes the gold prices forward.
Many people today prefer gold over any paper currency out of the fear of Europe’s and US’s increasing debt. They may not be vigilant over the significant resiliency of gold in the past 9 years but it may make it to 10 straight years if gold can hold its fort on its current prices.
Monday, January 10, 2011
Subscribe to:
Posts (Atom)
Posts
