The stock market has been bouncing up and down with prices fluctuating like crazy, but have we seen the peak price for gold? If you told someone ten years ago that the current gold price was going to skyrocket and more than quadruple, they’d have looked at you like you were nuts. And they would have missed out. But is the worst over?
Gold prices in 2002 were at about $272.20 per ounce. The current gold price is sitting at a whopping $1744.80 (as of December 7, 2011). That’s a jump of roughly 536%. But why are people clamoring for gold purchases now when the gold was a relative bargain just a decade ago? One word:
Let’s look at some of the problems that the world is facing. Greece has been in the news lately, running into severe debt problems with their national debt of roughly €390 billion. Italy’s problem is even worse with a national debt closing in on €2 TRILLION. Governments that have been around for thousands of years are running into severe debt problems and people in these countries are starting to realize that the government is not a reliable source of funds.
With all of these countries having problems, their companies are also suffering, and lest we forget about a particular country whose national debt has just crossed $15.1 Trillion known as the U.S., and people who want to make money in this recession are looking to something with a stable value. That’s why the current gold price is so high.
• Have we hit our peak?
While no future is certain, there are beliefs that the price of gold will continue to rise if we fall into another recession. The economy has become reliant on the global picture, and if they’re looking to expand and thrive in this economy, they’ll continue to look for ways to enhance their portfolio and earn money during this downturn, and that may raise the current gold price to $2000 or more per ounce.
In this economy, gold is a safe investment, now and in the future.