Gold prices are primarily affected by global supply and demand. Since 2011 began, supply has been declining while demand has been on the rise. The result has been a steady upward trend in the market price for gold with only a few short-term price dips. Today, the price of gold has been hovering around $1,542.40/ounce. Just one year back, it was around $1,161.60/ounce. Five years ago, it was only $561.50/ounce. It’s obvious to see that investors who purchased gold in 2006 have realized substantial profit on their investments.
Gold Price Predictions of $1,800/Ounce Make Now a Wise Time to Invest
Many financial experts and commodities traders believe that gold may top $1,800/ounce in the near future and even higher during late 2012. Their reasons are twofold. First, new mines can’t contribute adequate gold to the available supply due to the fact that these mines usually take 5-7 years to reach a substantial production rate. Second, the world’s financial turmoil we are facing doesn’t seem to be heading toward a reslove anytime soon.
If this is the case, gold, platinum and silver are likely to be the preferred investments during the next decade, thanks to both their stability and prices continually trending upwards.
Gold is not likely to drop in price due to accounting scandals or any major market failures like stocks and bonds are. Gold has proven to be a highly effective wealth preserver as well as a safe haven during periods of political and financial instability. Perhaps most important, the gold investors purchase today is more likely to go up in value than any other asset they have.
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American Bullion specializes in adding gold and silver to retirement accounts. If you have a question or would like to know more about your investment options, please call American Bullion at 1-800-326-9598 to speak with a precious metals specialist.