reasons gold price to increase

The Gold Prices Continue To Rise - Is The Price Of Gold Inflated?

You can look at the prices of gold as a reaction to monetary policies. It is not the other way around. No doubt, there are some investors running purely on speculation, however for the most part, investing into gold, and the price of gold, simply reflects the lack of trust investors (and people in general) have in government's ability to bring the economy around.

Clearly, people do not have much confidence in Congress or Obama's administration and do not expect the economy to make any dramatic turn for better any time soon. Even though the stock market made huge jump in the past 2 years, other parts of the economy remain gloomy.

Probably the most pressing issue is the unemployment. At close to 10% (although the Democrats like to stress that it is LESS than 10% - nice feel-a-little-better speech tactic), unemployment drives the fear to all-time high levels.

As the U.S. economy is service based, such high unemployment numbers inevitably reflect in consumer's confidence, reducing spending, and causing more lay offs. It's a vicious circle that no one seems to be able to get us out of. At least no one in the government.

Still, I see one positive coming from all this turmoil and misfortune. Self-reliance. People can now see, that no government will be able to solve their financial problems and unless you are happy with the amount of your wealth-fare check, you simply must prepare for bad times, during the good times.Article Source: http://EzineArticles.com/5402954

Wall Street Wants Gold Prices to Rise Above $2,000 in 2012

The effect of higher gold prices on the jewelry industry has been disastrous. Jewelry made with gold and platinum have seen significant price increases over the past 3 - 5 years. These increases have been passed on to the consumer and in effect have made gold and platinum jewelry more expensive and harder to find. Many jewelers have substituted gold jewelry with silver and are offering pieces of a lesser quality. None of this effects Wall Street investors, unless they happen to own jewelry stocks that have never fully recovered from the market collapse in 2008. In fact, Wall Street has created a new bubble that will eventually burst, just like the housing market and dot com bubbles before this one. With world currencies like the Euro and Yen in flux, gold is the precious metal by which all currencies are valued. But to use this as a way to create investment instruments that have absolutely no real value is very suspect. These instruments only serve to artificially inflate the value of these precious metals and give Wall Street a new carrot to dangle in front of hungry investors looking to profit on the next big bubble.

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Understanding Gold Pricing and Gold Price Charts

Gold trading started out using basic trading - a buyer negotiated with a seller, and the trade took place immediately. This immediate exchange of goods and money is referred to as a Spot trade today. There are two other types of trades you need to understand.

You already understand the Spot trade - it is a transaction where delivery of the commodity, gold in this case, occurs immediately at the time of the trade. The problem with this type of trade is that it is not useful when trading on gold because it takes time to discover, extract, and refine gold. The producer needs to spend money to acquire the gold, and a consumer has no idea how much the gold might cost. So the idea of a Forward Contract started - in this case the seller and buyer agree to a price based on a fixed future date and fixed quantity. The price of a Forward Contract is determined now, yet the transaction is completed in the future. A more complex type of Forward Contract is a Futures Contract. A Futures Contract is so complex that it requires its own exchange - which operates much like a stock exchange.

The gold rate can be the rate at which gold is currently trading, its spot price, forward contract price, or futures contract price. A gold chart is a basic bar graph with time on the horizontal axis (at the bottom) and the price on the vertical axis (the right side of the graph). The price at the point in time is plotted on the graph and this gets repeated for each time or day. A line joining the points completes the graph. The gold chart can represent a day of trading, an hour, week, month, or any other time frame. Using a gold chart, traders may be able to spot patterns that may help determine factors that influence gold pricing and may help predict future gold prices.

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reasons gold price to increase

Gold Prices - The Only Thing That's Certain Is Uncertaint

Everyone knows that if Greece leave the Euro Zone a domino effect is inevitable and no one can predict how it will end. A study at Barclays last week suggested that the immediate costs of a Greek exit would be $371.5 billion for Euro Zone members, of which Germany would be liable for around $108 billion, France 80.8 billion, Italy $71.5 billion and Spain for $47 billion. Its obvious why the rest of the Euro Zone do not want Greece to leave, but, unfortunately it seems that is what is going to happen.

Greek banks are insolvent and are being kept alive by the bailout sums they keep receiving from the ECB (European Central Banks), even though reforms have been put on hold till after the elections. However recently Greece's central bank president reported that Greeks have withdrawn another 800 million from their accounts and as such he had to ask for more money. The wealthiest people in Greece have already moved their money and people who still have hope that Greece will stay in the Euro Zone, are likely to get burnt when the drachma is reintroduced and their money is worth even less.Article Source: http://EzineArticles.com/7083990

How a Weak Dollar Affects Gold Prices

The Bretton Woods Agreement

Following World War II, a system much like the Gold Standard was established under the Bretton Woods Agreement. The system allowed for many countries to fix their exchange rates relative to the dollar. Under the agreement, the U.S. promised to establish the price of gold at thirty-five dollars an ounce. All currencies that were pegged to the U.S. dollar had a fixed value that was determined by gold. Because of this agreement, the U.S. dollar was accepted in nearly every corner of the globe. The dollar held value everywhere. After all, you could exchange it for its value in gold. (That is, if you were a foreigner. Citizens of the U.S. weren't allowed to own gold between the years of 1933 and 1974).

For a time, the Bretton Wood Agreement fulfilled its goal of maintaining stability among the currencies around the world following a devastating war. Eventually, however, imbalances in the system led to its demise. In 1971, President Nixon eliminated the fixed price for gold, which made gold a commodity like any other. Gold was now subject to the law of supply-and-demand. But it no longer backs the American dollar. But unlike other commodities, gold is still perceived as being a reliable and tangible investment.Article Source: http://EzineArticles.com/6928667

Why Gold Prices Are Racing Ahead?

Investing in any precious metal is based on the underlying fact that it is of some value. There is a lot of sentimental value attached to gold and therefore it has been viewed as a solid investment that can be liquidated at any time. However, in terms of its usage elsewhere, there are other precious that are much more in use, such as that of platinum. Platinum is rarer than gold, yet it has receded in price. Silver, while cheaper than gold is used much more for commercial and industrial purposes, yet it is nowhere near the price of gold. The worry is whether the bubble of gold's price will be able to hold its own.

The reason for this increase in price of gold is simply public fear. Gold is viewed as a safe instrument of investment and has been used by countries as a means of trading for centuries. There is a sort of rapport that has been built over gold. The basic ideology is that if it is shiny and rare, then it is worth something. The price of gold tends to go up when there is instability prevalent among economies. When the value of the US dollar goes down, the price of gold tends to go up and such is the case right now.Article Source: http://EzineArticles.com/7001604

Gold Price Trends - When Is The Best Time To Sell Gold

The current market value for the gold

This is also a huge determining factor, as to what it is trading at, in the various markets, and the different world wide stock exchange systems. If selling in the US, it will vary with those who are making the sale with foreign buyers in the UK, or other regions in the world, as to what they will be willing to pay.

Cost it was purchased at by the seller.

Depending on what they originally paid for it, or what the market value was when the pieces were purchased, may have an impact on the sales price it will go for. Not always, but as many factors do affect the pricing, and what one can expect to earn on a sale, this might also be something which is taken in to account.

What buyers are willing to pay for it.

In certain cases, if it is a rare piece, a special collector item, or something that is extremely unique, certain buyers will be willing to pay more than the actual value. Therefore, considering this, and seeking out several buyers, rather than just one, will ensure that sellers receive top dollar for what they are selling.

The amount being sold

This will also vary, depending on how many karats it is, what the quality and condition are, and the actual weight which is being sold, when it is up for sale. These factors will help in determining the price, and having it valued prior to deciding to place the pieces for sale, will help sellers realise what they might be able to get for it.

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Federal Reserve Announcements and the Gold Price

At first, the released Fed employment stats seem to contradict the Goldman Sachs predictions. But many analysts say things have to evolve. The positive data published do show a somewhat surprising recovery rate of the American economy, but this process is still slow. The global circumstances to which the Feds already answered with two rounds of quantitative easing are still in action in 2012. Analysts still expect the Federal Reserve to work at improving its balance sheet and at increasing liquidity and money supply, so a third round of quantitative easing (or a similar set of measures) is a reasonable expectation.

When making this positive announcement, the Fed also reiterated their intention of keeping interest rates extremely low until 2014. But the third round of easing was not mentioned for now, and gold sold off in result. After the $40/ oz. fall on March 14 (somewhat reminding of the $110/ oz. fall occurring abruptly in February in one day), gold price started recovering this week. It gained 1% on Monday and 4% on Tuesday, as compared to the week before. Monday saw gold at $1679/ oz. and Tuesday saw it at almost $1700/ oz.Article Source: http://EzineArticles.com/6969909

Gold Bullion Investment and the Gold Price

he success of gold bullion investment relies heavily on the world's major central banks and the International Monetary Fund, as they play a important role in the price of gold. In 2004central banks and other official organisations held 19% of all above-ground gold as official reserves, and they are restricted to how much gold they can sell by the Washington Agreement on Gold (WAG). The member states of WAG include the US, Europe, Japan, Australia, the Bank for International Settlements and the International Monetary Fund. They are forbidden to sell more than 400 tonnes of gold each year, which limits the amount of gold available to independent investors.

China and Russia, which are not members of WAG have shown an interest in growing their gold reserves, which has added another competitor onto the gold bullion investment market.

What actually influences the price of gold on the market can be separated into three major factors; failure of the banks, low or negative real interest rates and social/political crisis.

o When banks fail in the public's eyes there can be nation-wide bank runs, in which citizens are quick to remove all of their savings from the bank. When citizens take gold from the banks, this can lead to the price of gold increasing as people are worried that the value of paper money is worthless.Article Source: http://EzineArticles.com/3074630

Consider Four Factors Before Investing in Gold

here are many types of gold bullion you can consider purchasing:

Krugerrand South Africa
Canadian Maple Leaf
Austrian Philharmonic
American Eagle
American Buffalo
Chinese Panda
Mexican Gold 50 Peso
Pamp Suisse Gold Bar
Johnson Matthey Gold Bar

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Why Gold Prices Are So Stable

e of the reasons for inflation is the rising oil prices. This puts the pressure on governments to print more money. As this happens, the currency goes down in value, which is when people start putting money in stable assets like gold.Currency is very unstableThe only real value currency that is not backed by gold has is whatever the government says. he first time it was fixed was over 90 years ago. In other words, gold is not impacted by changes in the local currency.Why invest in goldThe main reason is security. Gold does not go up in value the way some stocks do, and you probably will not see a 20% yearly return on investment from it. However, it does consistently go up year after year, while other investments do not. It is one of the most stable investments you can possibly put money in. Again, this is because it is not affected by inflation and other market factors that stocks and other investments get impacted by.

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Factors That Determine Gold Coin Prices

The price of gold is dependent on its fineness and its grading. The purer the gold's concentration is in a given coin, the finer it will be. The standard concentration of a normal coin is at.9167 and a $50 coin with this type of fineness can have a starting price of $1200. Canada releases some series in recent years which had.9999 gold concentration. These are the usual 22 karat gold coins. There is no such thing as a 100% gold coin. The plausibility of which is very low. No technology is known to produce pure-gold-coins because of the high likelihood that the material turning into liquid once melted and shaped into a coin.Article Source: http://EzineArticles.com/5893764

Price of Gold - The Glenn Beck Factor

Most industry experts would tell you that Beck has absolutely no effect on the price of gold, but I will have to disagree. Glenn Beck is the proverbial butterfly flapping his wings. Day after day, Beck tells his viewers that the sky is falling. Right or wrong, he certainly has an impact on the balance of supply and demand, and in turn affects the price of gold.

Beck's prophecies about mutually assured economic destruction, riots in the streets, and food shortages certainly provoke an emotional response among his millions of television viewers and radio listeners. Viewers continue to spread the gospel of Beck by reciting his doomsday prophecy within their own communities. Next thing you know, the demand for gold is driven artificially high by fear based buying.Article Source: http://EzineArticles.com/6083371

Gold Price Prediction

First and foremost if you wish to reasonably accurately go in for gold price prediction then you should have a close look at the movement of gold prices over the past three to five years. Going by this record it is quite normal for us to understand that of all the precious metals and commodities that are aggressively traded, the price of gold is something that has grown up on an average of 20% each year. These is amazing and even the best of stocks and shares cannot match this performance. Further it is also fact that the price of gold is also dependent on the global and local economic scenario around the world. Here it would not be wrong to point out that the current problems that are being faced by the Euro Zone countries could push up the demand for this yellow metal as countries scurry for cover for hedging against economic and financial uncertainties.

Further when you talk about the gold price prediction retail and small investor consumption pattern is also very important. Here it would be pertinent to point out that the demand for gold in the emerging economies like China, India, Brazil and other such countries is quite robust to say the least and this could play a big role in pushing up the prices of gold over the next few months. It would not be wrong to point out that the price may even scale $2,250 per ounce within the next five to six months.Article Source: http://EzineArticles.com/6832721

What Factors Are Affecting Gold Bullion Prices?

1. Market Sentiment 

2. Economics 

3. Deflation 

4. Liquidity 

5. Inflation 

6. Currencies

7. Fear 

8. Mining costs 

9. Media

10. Government policies 

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Factors Affecting Gold Price

Seasonality: Prices of gold coins depend on the season. 

Bad Economic Climate: Economic crisis will increase the price of gold, while a stabilized situation could steady the price of gold as well. The cost of gold is greatly influenced by other market factors also.

Demand and Supply: With its huge tradition and culture of buying and saving gold, India is responsible for 27% of the demand for gold in the world. 

Inflation: In India price of gold coins are greatly swayed by inflation. 

Collector's Coin: If you are into buying mint or bullion coins, then other factors like demand and supply influence its price. Article Source: http://EzineArticles.com/7096515

Factors Influencing Gold Price Rise

Gold, just like any other commodity is driven by the forces of supply and demand. But what gives gold an added advantage is that it is something that people hoard in the time of crisis and because of its high liquidation, its effect on prices is constant. Another factor influencing prices is the way banks manage the gold that they have. The political and economical situation of country also determines the price of gold. The failure of bank in a country, political instability as well as very low or interest rates touching the negative mark can have an impact on the prices of gold almost overnight. The failure of bank can result in instability and therefore the prices of gold will go up, since people will begin to buy and horde for a rainy day. Article Source: http://EzineArticles.com/6947833

Factors Affecting The Price of Gold

The first factor is rather basic and depends on the simple economics of supply and demand. This is true of any commodity.The second factor is the gold and other policies of central banks.  A higher interest rate will lead to people investing in currency, whereas a low interest will increase gold purchase. The third factor is the social conditions prevalent. In times of war, emergencies, the price of gold shoots up as the value of the prevalent currency is in doubt. Since one can be sure of the value of gold, people try to acquire as much gold as they can, pushing up the price of gold. The fourth factor is the state of the economy. If the economy is in the doldrums with the markets performing in a shabby manner like now, prices of gold will increase due to more people choosing to invest in gold.The fifth factor is the value of the US Dollar. Since the dollar is the currency that most people incest in any fall in its value will lead to the prices of gold shooting up. The gold rate has always had this relationship with the Dollar ever since the dollar became the global trading currency.Article Source: http://EzineArticles.com/6782488

Factors Affecting Gold Price