– Gold is the only one currency that evolved in the marketplace over the last 5,000 years and which is not created by governments. All of today’s other currencies are ‘fiat’ currencies, and don’t represent anything tangible.
– Buy gold as a hedge or harbor against economic, political, or social fiat currency crises.
– With most major Sovereign States as well as the banking system under severe financial pressure, wealth preservation is today absolutely critical. This is why gold should be an important part of any portfolio.
– Gold has maintained its purchasing power whilst government deficits and money printing has consistently destroyed the value of paper money.
– Historically, gold has been a proven method of preserving value against currency devaluation. Allocating a portion to gold assets is similar to a financial insurance policy.
– Investors often rely on gold to counter the effects of inflation and currency fluctuations. Today, a number of factors are conspiring to create inflation. Gold is a hedge against inflation : as inflation goes up, the price of gold goes up along with it. Market cycles come and go, but over the long term, gold retains its purchasing power.
– Central banks in several countries have been increasing their gold holdings as part of their foreign reserves, instead of selling.
– In the pain of the post-bubble period, governments will come under pressure to return to backing their currencies with gold`
– Gold is undervalued : adjusted from the rate of inflation gold should be much high, some say around 7500 dollars an once, taking account of the trillions of dollars that have been printed since 2008. The Dow/Gold ratio is a good indicator of the fact that gold in undervalued.
– The price of gold tracks the shifting balance of supply and demand. Demand for gold is growing while supply is limited. These supply and demand factors have laid foundations for gold’s most positive outlook in over a quarter of a century.
– Demand for gold as an investment is accelerating, but we are still at the beginning of the phenomenon. Very few people have physical gold in their investment portfolios.
It is impossible that gold is in a bubble phenomenon when only 1% of world savings is invested in gold. Historically this is an average of 15% of global savings wich is invested in physical gold.
– Gold is also an effective way to diversify your portfolio. Assets with low volatility liek gold will help to reduce overall risk in your portfolio, adding a beneficial effect on expected returns
