By Brandi Savitt – August 25, 2011
Why Is Everyone Buying Precious Metals?
You can’t turn on the news without hearing about how the price of gold has sky rocketed in the face of the turbulent stock market and floundering world economies. But what does that really mean, and why is it happening? Is investing in precious metals a true safe haven, and should we all rush out today to buy bars of gold? Or is this modern-day gold rush just a sign of the times…?
Are You Worth Your Weight in Gold?
We are all still waiting to find our own pot of gold at the end of the rainbow, but it’s been decades since gold has actually been used to back up the worth of paper currency. So, why is it still so valuable?
Like all precious metals, gold is rare and hard to find – and historically, gold has always been the ultimate symbol of wealth. It doesn’t matter that the “gold standard” (linking gold to our currency) has not been in effect since 1971; gold is still considered a safe commodity and stable investment when other markets are on shaky ground.
Stocks Down, Precious Metals Up
Investors generally buy gold as a hedge against inflation, economic, political, or a social fiat currency crises (money that has value only because of government regulation or law). And while the price of gold fluctuates daily, the risk that its value could go to zero is never a real concern. Many investors don’t consider precious metals a ‘sexy’ investment vehicle, but in uncertain times, there’s nothing like solid gold to make investors feel a bit more stable.
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