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Jan 29

Investing in Precious Metals – Is It Still Worth It?

Posted by at 17:57 | Default | Comments(0) | Reads(837)

The world economic system is, to put it bluntly, in a rut. Many people are referring to the current economic climate as “the Great Recession” and comparing it to the Great Depression that ushered in two decades of misery, culminating in the Second World War. While it seems unlikely that a third global war will engulf the planet in the wake of the invention of the atomic bomb and its technological descendants, there's no denying the money is tighter, jobs are scarcer and any sort of investment plan is riskier than ever. Still, some investments are more reliable than others. The stock market is, of course, a casino of sorts, while government bonds are a long yet ultimately reliable investment, particularly with the United States government so desperate for funding. Somewhere between the short term lottery of the stock market and the long term stability of bonds, there are many investments in between. One such investment is the old stand by of investing in precious metals. But is it still worth it?

Gold is one particular investment that seems to be doing quite well as a long term investment. The price of gold has more than quadrupled in the past ten years. You can buy and sell gold in many reputable stores nowadays and start investing in coins and bars. This has been due to a number of factors spanning across the entire planet. The first, of course, is that a great many people are investing in gold hoping to beat the Great Recession, driving prices up to high levels. Because trust in banks and stock markets is pretty low throughout the Western world and gold has long been pretty valuable, making it seem more solid than most stocks and bonds, many people are eager to invest in gold rather than risk their limited supply of funds in less reliable investments. However, it should be noted that the inflation of the past ten years has also done quite a number to the price of gold, another major factor in the metal's skyrocketing worth. Finally, with the march of technology going ever forward, new industrial and technological applications for gold have emerged, making the metal more useful than ever. While this is not the biggest factor in gold's current value, it is notable that some people in the third world have transformed removing gold from discarded electronics into a profitable side business.

The price of silver and platinum alike have likewise increased due to the same set of factors; lack of confidence in banks and stock exchanges, all around inflation and increasing industrial uses for the metal. Still, these investments are not without risks. Should the world financial markets stabilize, fewer people will want to invest in gold as a back up plan against poverty. Thus, while gold and other precious metals on the whole are a very solid investment, there are quite a few risks involved, as with any investment, large or small. Still, precious metals are always worth money in the modern economy, whether it's boom or bust, and investing in this near universal constant, while somewhat risky, is usually a smart move.


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