The rarity of gold has made it a precious metal for people. It has been bought and sold all along the path of history. However, with the appearance of strong American and European currencies, the dollar and the euro, gold devaluated. It has become the third most popular holding in the world. Then the latest economic recession hit America. Nevertheless, the American dollar has managed to maintain its place on top of the list of most stable currencies. Still, there is a constant danger for all paper currencies, including the dollar. It is inflation. This loss of value of currencies however has no power over gold. The economic evolution does not influence its tangible value. Moreover the precious metal is sometimes used to combat inflation.
The economic crisis strike threatened the paper currencies reserves. This has determined central banks of many countries around the globe to buy gold. The most important three gold investors have been Russia, China and India. In the last years Russia bought the precious metal constantly. The Russian Government supported the country's own mine extraction by purchasing Russian gold. Why this sudden attraction to gold? Because of the prestige this metal confers and because this purchase represents a measure of protection against inflation.
China followed the same path as Russia. It is the largest gold producer in the world. The Asian country also invested in its own gold. Its representatives did not always admit the existence of these massive investments. Nevertheless, in 2009, China acknowledged that its reserves of gold have augmented since 2003. The augmentation was not at all insignificant: 76 per cent. You may wonder why China preferred to keep a low profile regarding its investments in the valuable metal. First of all we should take a look at the quantity of American treasuries possessed by the Asian state. Although China invested massively in gold, these investments are estimated to reflect only around 1.5 per cent of all its reserves.
US Government bonds had been bought in large quantities by the Chinese, but the economic recession put their value in danger. A long lasting crisis in the USA could not be beneficial for China. Therefore the latter decided to help America come out of the recession as soon as possible by acquiring more of its Government's bonds. The devaluation of the American dollar was not something China had hoped for. This could have affected the value of its own reserves as well as America's power to support China's fundamental exports.
If we trust the instincts of China, India and Russia, we may be tempted to invest in gold ourselves. Indeed, it seems to be the right time for this type of acquisitions. The unfolding of the global economy comes to support this idea. As a result, gold will become more appealing to a larger number of people. The interest of coin collectors and investors towards Gold Sovereigns may increase. Numismatists will surely continue their search for these valuable coins, which also have a high premium to the price of gold.
The economic crisis strike threatened the paper currencies reserves. This has determined central banks of many countries around the globe to buy gold. The most important three gold investors have been Russia, China and India. In the last years Russia bought the precious metal constantly. The Russian Government supported the country's own mine extraction by purchasing Russian gold. Why this sudden attraction to gold? Because of the prestige this metal confers and because this purchase represents a measure of protection against inflation.
China followed the same path as Russia. It is the largest gold producer in the world. The Asian country also invested in its own gold. Its representatives did not always admit the existence of these massive investments. Nevertheless, in 2009, China acknowledged that its reserves of gold have augmented since 2003. The augmentation was not at all insignificant: 76 per cent. You may wonder why China preferred to keep a low profile regarding its investments in the valuable metal. First of all we should take a look at the quantity of American treasuries possessed by the Asian state. Although China invested massively in gold, these investments are estimated to reflect only around 1.5 per cent of all its reserves.
US Government bonds had been bought in large quantities by the Chinese, but the economic recession put their value in danger. A long lasting crisis in the USA could not be beneficial for China. Therefore the latter decided to help America come out of the recession as soon as possible by acquiring more of its Government's bonds. The devaluation of the American dollar was not something China had hoped for. This could have affected the value of its own reserves as well as America's power to support China's fundamental exports.
If we trust the instincts of China, India and Russia, we may be tempted to invest in gold ourselves. Indeed, it seems to be the right time for this type of acquisitions. The unfolding of the global economy comes to support this idea. As a result, gold will become more appealing to a larger number of people. The interest of coin collectors and investors towards Gold Sovereigns may increase. Numismatists will surely continue their search for these valuable coins, which also have a high premium to the price of gold.
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Investors and coin collectors should consider the 22 carat gold coin, the Gold Sovereign, which also has a traditional engraving.
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