Market Specialists? More Like Market Amateurs

When gold broke through the $1,000 barrier in March of 2008, many so-called market specialists predicted that the “gold bubble” would immediately burst, resulting in a sharp plunge in the value of gold. The same thing happened when gold broke $1,100, $1,200, and, more recently $1,300 in September of 2010.

Regrettably, these market “specialists” are no different than the same experts advising people with “hot stock picks” and various other high risk investments. All the while, as their investment advice tanks, gold and the precious metals market as a whole continues to climb in a steady, positive direction, indicating sustainable appreciation. Moreover, with continued concern over currencies, credit, and other negative economic indicators, the precious metals market has reclaimed its position as an investment safe haven.

Gold continues to climb. As it begins its journey towards flirting with $1,400, there will be rumblings of a massive dip in value. Admittedly, the market may correct itself—but we speak of pennies on the dollar compared to the growth it will continue to experience. This correction will occur at every broken threshold, as long-term investors aim to take profit spurred on by fear and uncertain territory. However, a correction is very different from a bursting bubble. The gold market will continue to move forward positively as long as federal, national, and global debt accumulates, as long as currencies remain unsubstantiated, and as long as unemployment remains atrocious.

Every “market specialist” has offered an opinion on what immediate actions need to be taken to turn the country a complete one hundred and eighty degrees. Unfortunately, these recommendations are coming from people who were created within the collapsed system of credit, debt, and production (or lack thereof). There is no quick fix. To truly address all of these negative economic conditions will take a very, very long time. It took decades to cause these crises—to think that one can reverse decades worth of poor decisions overnight is to live in a fantasy world.

The time is now to buy gold. As the world becomes more educated on the crisis at hand and as gold continues its massive climb, the window of opportunity will close. Protect your future today.

Call United Gold Group today at 1-800-488-3903, and ask to speak to one of our Senior Account Executives, who will be more than willing to help you with your precious metals investment needs.

Call Today: 1-800-488-3903

value of gold : Gold – The Sound Investment

The value of gold continues to grow. This isn’t speculation—this is an empirical fact. While your shorting stock trader may look at a day-to-day slide as an indicator of decline, this simply isn’t the case. Many people have been brought up with the notion that sound investment means investing in low-risk stocks. Unfortunately, a “low-risk” stock doesn’t exist—only “lesser risk” stocks exist; and usually, these stocks are ones that are so inflated in price that the barriers of entry for your average investor are just too great.

Even if one were to get their hands on one of these stocks, a single painful reality still exists: a stock can default, plummeting to something of literally no value. Sound investment, then, is investing in something that has been shown to produce a return and has never hit rock bottom.
One such asset is gold, and other precious metals. Investors shouldn’t be discouraged when gold prices take a slight dip. More often than not, the “economic experts” who urge people to remain upbeat and positive about the failing stock market are the same people who try to strike fear into people when gold so much as falls by a few dollars.

Take, for instance, one example. From an all-time high in June 2010 to a slight decline in July of 2010, gold dipped only 5%. On the other hand, during the same period of time, the stock market has dropped between 7% and 8% across each of the three major United States markets—with no all-time highs, and week-long slides. Yet you hear these same fear-driving experts telling unsuspecting investors to liquidate their gold and precious metal assets in favor of stocks that are likely to “rebound.”

Unfortunately, those who get caught up in this usually end up losing substantial portions of their portfolios and watch from afar as the gold they once physically held in their hands increases in value yet again. This is the simple truth: liquidating a long-term asset, such as gold, in order to invest in a short-term asset that is being advertised as long-term just doesn’t tend to work.

If you are actively investing in gold or are looking to enter the market, the best advice one can give you is this: do not be deterred by miniscule dips. These dips often provide a great potential entry point for new investors, but do not necessarily negatively impact investors who are looking to hold onto their assets for multiple months at a time, if not years.

If history is any indicator for the stock market, it should continue to be a volatile investment path. If history is any indicator for gold, it should continue to appreciate and act as a safe-haven for long-term, responsible investment.

Which would you rather bet your hard-earned money on?

For more information on gold stock investing, including how to get on the right path to diversifying your investment portfolio with gold and other precious metals, call United Gold Group at (800) 615-1513, and ask for a Senior Account Representative who will be more than willing to get you started.

price of gold : What really controls the price of gold?

If you were to ask your average person the question: “what drives the price of gold up or down?” they would probably give you an answer that has been told to them for years: the value of the U.S. dollar entirely dictates the value of gold. This is often one of the biggest misconceptions in the modern, globalized economy. While it may have been true twenty years ago that the value of the U.S. dollar (primarily due to inflationary cycles) was the sole indicator of the value of gold, it is no longer the case.

Today, everyone has their own theories as to what controls the price of gold. If the economy worsens, then the price of gold should increase. If the economy improves, then the opposite should occur. If interest rates are low, then gold will rise. If interest rates are high, gold will fall.

You get the idea, right?

Clearly, these all cannot be true—at least not simultaneously. History has shown us many instances where our commonly-accepted economic rationales for the value of gold simply do not hold true. For instance, there have been many periods where the strength of the dollar has improved, yet the value of gold has increased as well. Likewise, such as in 1989, interest rates were high yet gold was as well. Moreover, certain concepts of supply and demand—the very backbone of economic theory—don’t apply either. At the end of 2009, when the IMF released nearly 400 metric tons of gold for sale, the price of gold continued to rise. Despite an increase in readily available supply for consumption, prices did not fall.

What gives, then? What is the correct answer?

If we use the old macroeconomic adage of “if everything else is held constant, then this theory is always true,” each theory could be correct at any particular moment in time. Unfortunately for theories, the real world is a different animal entirely. There are, quite literally, hundreds of factors which can dictate gold prices. In this globalized economic world, almost every commodity has its value based to some degree on the value of every other commodity, with particular emphasis given to complimentary commodities (i.e., gold and precious minerals such as diamonds). World crises, domestic economic crashes, foreign economic crashes, foreign credit market collapses, domestic credit market collapses—these all would lend one to believe that the value of gold would increase.

There are, however, daily indicators of the value of gold. In addition to the value of the U.S. Dollar, it’s important to look at the price of other commodities which are essentially large enough to be their own individual markets, such as petroleum. On the grand scheme of things, the largest factor driving the price of gold may be civil and foreign conflict, but to judge this on a day-to-day scale becomes impractical.

Ultimately, it comes down to one reality. Every nuance of the world economy affects the price of gold. The difference, of course, is that gold sometimes does not act like other commodities with respect to economic principles. But this is because it isn’t just another commodity.

Gold is money.