Precious Metals
Precious metals like gold bullion and silver bullion are becoming the new rage for big-time investors lately but it’s now totally affordable for the new investor as well!
2011 has seen a wild turn around in the worldwide economic situation. Whereas the last two years have seen the economy recover slowly, we have seen the almost the whole market take a downturn in the latter half of the year. Any optimism over the growth of nations had dwindled, and economists the world over, are agreeing the next few years seem bleak. Stocks and shares seem out as the latest figures of most companies show a shrinking line. The contraction of China and India have also led to a reduction in commodity price such as iron, copper and coal. Europe seems like it is on the brink of collapse, USA is struggling with its housing market and unemployment rate, the Middle East is consumed in unrest. Nowhere looks untouched. It is looking increasingly likely that the world will be sinking into a second recession, and that this one will be worse than in 2008. The only place that is a bright light is that of gold bullion, precious metals, and silver bullion itself, which are some of the few investments that have seen a healthy return over the last year.
Even opportunities in investing into companies that deal in mining gold, silver and other precious metals are not at safe as investing directly into those metals because mining companies need financing, and everyone is short on financing in a recession. Even big name companies such as Rio Tinto who diversify into gold mining have fallen, because no-one wants to finance companies in a recession – the only sure way that you can tap into precious metals boom is to buy them yourself.
So why gold bullion, precious metals, or silver over any other investment – why have they increased in value when everything else has dropped? The reason is that precious metals are considered safe havens from economic disaster. Even hundreds of years ago, gold, silver, platinum were considered enormously valuable, and that has not changed. They are still considered valuable, and there is very little that you can say that has retained its value over hundred of years.
Just by looking at the economic charts you can see that in 2008, just 3 years ago, gold was valued at $650 per ounce – and this year, it has hit over $1900 – which is almost 3 times its value in 3 years – 100% gain each year. Similarly, silver was $8 per ounce 3 years ago, and this year, hit $49, which is a growth of 6 times its value in just 3 years – a 200% gain. If you had invested in these precious metals when there was the last big recession scare, your investment portfolio would be 2-6 times as large.
Since the last big recession scare, smart investors have been moving their money into gold bullion, precious metals as they know that when the economy starts to fail again, as it is now, then they will see another huge rise in the value of gold and silver. When the recession really hits, then those investors in stocks and shares and other commodities will sell out, and switch their attentions to gold and silver as safe havens, and there will be huge demand in gold and silver, sending the value sky high.
The value in precious metals is not only attributed to their value as a safe haven against recession, but they also have a use in one of the only growing industries – that is electronics. If you check your mobile phone, your computer, your monitor, your DVD cable, the cables connecting them all, you will notice that there is a considerable amount of gold and silver in them. They are used because they do not corrode like other metals. It is one of the reasons why old mobile phones still have their value. Even when the economy is crashing you can guarantee society will not give up their mobile phones, and there will still be a lot of industrial demand for gold and silver. Many economists forecast that there will be a growth in gold to over $2000 in 2012, and close to $3000 during. Similarly with silver, they expect it to close on $100 per ounce in 2012.
So how do you get hold of gold and silver? If you have access to the commodities market through a broker, you can buy contracts that promise a certain amount of gold, but you will not be able to take physical delivery – you will just deal with the contract, or you can buy gold bullion, precious metals and silver through a precious metals dealer.
When researching how to buy gold, there are a few online resources available that make it very secure and easy to monitor as well. Regal Assets is one of the top sites to have a look at, and they are offering a free Gold Investing Kit which any investor should read before jumping into the gold commodity.
Check out the Gold Investing Kit here.






