The Real Price Of Gold

The Real Price Of Gold

Still, as impressive as the gold bull has been, its price remains stuck in the days of disco and Jimmy Carter

Gold Getting Even Rarer

That startling observation is from Larry Edelson of Weiss Research, and what he means here is that gold isn't just undervalued at today's $700+ price, it's a steal .Which, by any investor's standard, would still be a steal. Edelson's premise is that gold would "have to more than triple just to regain the same purchasing power it had 26 years ago!"The funny thing is, gold is supposed to be the ultimate inflation barometer. Its price is supposed to honestly tell us, from generation to generation, just how ridiculously inflated the dollar has become. So what happened? What's been keeping the precious metal from telling us the cold, hard truth? That's a good question. Whatever the answer is, whatever mischief the central banks have been up to in manipulating the precious metal, it will all soon give way to the irrepressible pressure that's been building.

Has something happened to change gold's dynamics these past 27 years? Has there been some gigantic gold find? Production has not only stalled, it's been rolling backwards . The South African gold industry, for just one precious metal producer, looks like it's running out of bullets. Back in 1970, 70 percent of the world's gold came from that country. By the 21st Century, though, SA production had shrunk to a mere 14.5 percent of global output.

South Africa isn't alone in this. "After peaking in 2001, world gold production has been steadily slipping. One reason for the lack in new supply is there haven't been any big discoveries of gold deposits in a while, certainly not on the scale seen in the 80s and 90s. For the few discoveries that were made, the length of time needed to develop and extract their deposits has lengthened from four to seven years," wrote Bernard Baumohl, Time magazine's senior economics reporter.Gold At An "Inflation-Adjusted" $2,176"In terms of today's dollars, gold reached $2,176 in 1980."The Real Price Of Gold

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Buying Gold Coins - FAQs

Why Should I Go For Gold Coins?

The most important reason is the relative stability of the gold market and the high returns you get. When compared to other investments, gold is an asset which you can dissolve easily in case of an emergency. Another benefit of buying this precious metal is the ease of storage and transport.

When Should I Buy Gold Coins?

Some people prefer buying this precious metal on auspicious occasions like the Akshaya Tritiya day, while others purchase for birthdays, anniversaries, and on special occasions. 

What are the purity levels of gold coins?

The purity of gold is measured in karats. Some of the popular purity levels are 24 karats, 22 karats, and 18 karats. Coins generally come in 24 karats (99 percent pure) and 22 karats (91.67 percent pure). 

How Can I Identify The Purity Level?

Check for BIS Hallmark symbol, which indicates the purity level. This symbol has five components - the Assaying and Hallmarking Centre's mark, fitness number (karat), Jeweller's identification mark, code letter (year of making), and finally the BIS mark. 

Where Can I buy Quality Gold Coins? Article Source: http://EzineArticles.com/7079199

Gold Price Influence

 Gold Price Influence 

Gold is a safe heaven investment against inflation and economic uncertainty, this is the reason we have been seeing gold rising steadily in recent times. Since gold is traded in US currency, it is also directly influenced by changes in the exchange rate and a weaker US dollar usually means an increase in gold price. This is true because investors choose to sell US currency and buy gold with it in order to protect their assets as the US dollar continues to decline.

Supply and demand of physical gold also has a great influence on gold price. India and China are by far the biggest consumers of gold in the world, and the demand for jewelry and bullion at any given time will drive gold in either direction. The people of India have a longstanding tradition to accumulate gold jewelry as a sign of wealth and as these countries become more powerful and prosper, the physical demand for gold would be higher. 

The political and economic situation in the world also has an effect on the price of gold. During the recent recession when the interest rate dropped to near record low levels, the price of gold has been steadily on the rise.

Tensions in the Middle East also have a direct effect on gold prices since gold is highly influenced by other commodities such as oil., the sad truth is wars drive economies and while most governments would never admit to it, wars are very profitable and necessary to sustain economic activity and increase global wealth.Article Source: http://EzineArticles.com/4897955

 Gold Price Influence 

What Causes the Price of Gold to Fluctuate?

Currency Inflation

This perspective is inaccurate. Inflation is technically an increase in the money supply. This has a direct effect on how gold prices move in relation to a country's currency.

To explain, suppose you used every U.S. dollar to purchase every product in the world.

Gold is used as an exchange unit of value because it cannot be arbitrarily produced. It is a near-perfect store of value against supply and demand.

Central Banks

The above discussion leads directly into the role of central banks in the context of how they influence gold prices. They can do so in two distinct ways. First, central banks can decide to sell a portion of their reserves or buy more on the market. The amount sold each year is limited to 400 tonnes to help avoid a glut in the market that drives gold prices downward.

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Factors That Drive The Price Of Silver

This is actually a very good question and the answers might just turn you into a silver investor yourself. Let us look at the important factors that drive that will answer this very important and interesting question.

Currency Devaluation 
 Fortunately, the precious metal industry has remained independent of this because it is in them that currencies are actually pegged, particularly gold.

Great Demand 
That is why people are now lining up to buy every ounce of silver their money will allow. Silver is actually a bit cheaper than gold but an equally wise investment. This is the reason why people who have lesser money to invest turn to silver. The greater the demand, the higher the value of the commodity as the law of demand and supply dictates.

Wide Industrial Use 
It is also used in the electronics industry because it is actually one of the more reliable conductors of electricity aside from gold. Silver is also widely used in making silver coins and silver coin bullion which are great investments as well. The list may go on and on proving silver is recognized in almost all industries.

Probable Shortage? 
 That is why the probable shortage of silver supply is what makes it even more valuable. Now that people have been heavily affected by the financial downturn, they are starting to realize the value of silver.  There are even reports that even minting industries all over the world have had troubles securing pure silver to mint their silver coins. Moreover, there is no way to detect if the supply of silver is indeed dwindling.

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Price Of Silver

Gold Market Price

 Since 1919, the most well- known way of pricing gold has been to use London gold fixing. London gold fixing is done via a telephone meeting between many different representatives from gold trading firms that are involved in the London gold and silver bullion market. The gold fix is always assigned in United States dollars, Euros or British pound starlings. The current firms that make the decisions on gold market pricing include Deutsche Bank, HSBC, Société Générale Scotia-Mocatta and Barclays.The London gold market is comprised of a variety of international trading firms and is owned by the Bank of England. London, England is by far the most unrestrained gold trading market operating in cities such as Tokyo and New York City. Market examination is obligatory to distinguish the various types of trends that gold may undergo in the gold market. This inevitably affects the gold market price. Many investors will study historical trends to see if there is any fluctuating market average that can be taken into consideration when pricing the gold. Market average is determined using a series of data and analyzing them in a certain type of arithmetical system. Many websites have chronological data in the form of graphs and analytical documentation that can aid investors in making decisions as to whether they should acquire gold in their portfolios. There are many factors that contribute to the gold market price as well and they include stability of US dollar, government policies, international financial rates, manufacturing demands, mining costs, which despite it being one of the more capricious investments one can make, this can certainly affect gold prices; the liquidity factor, which determines how liquid the gold is that is operating in the market and inflation and deflation, which are economic terms that predict the ebb and flow of equity pricing.Article Source: http://EzineArticles.com/6739889

Possible Risks In Gold Investment

Gold Investment

Risky Investment Strategy

Several collectors and investors venture on physical asset like gold because these commodities can be seen and touched. However, it can be risky to have your investment at home. If an investor is not cautious enough, he can come home and find his safe empty and his investments gone.

Buying gold stocks is a risky business. Again, the price of this yellow metal is not constant. It goes up and down almost every day. The truth is, it really doesn't matter how high the rate of gold goes, if you invest in a fundamentally unsteady gold company, there's a great probability that you will lose your money. T

Risk In Gold stocks

It is important to know that gold stocks are not gold. Think of it as a share. You get the share from gold mining companies. Basically, if gold price in the market rises, profits of the gold mining company should also rise.Article Source: http://EzineArticles.com/6640435 Gold Investment