Gold as a way to preserve savings during economic turbulence
In what form shall we keep savings? This question gives no rest to many, from individuals to large corporations. And it’s not about that people don’t have options to invest money. The thing is much more complicated: it is important not just to invest it somewhere, but also to preserve its value in the future, because present-day banknotes do not have gold backing and lose in value, completely depreciate, or have fluctuations in the exchange rate, which can bring their owners only pressure surges, and even heart attacks.
It has long been a common practice to keep money in the form of gold. From this, we have all these kinds of tales and legends about the wealth of the heroes, kings, and emperors of the past. Moreover, to keep money in gold could have several forms: some people kept their savings in the form of gold coins, some liked to equip palaces with gold utensils, which were utilitarian and at the same time served as an investment of money. There were also those who transformed gold into different kinds of jewelry.
Such people aim to use their gold reserves rationally and increase its value through a jeweler’s work, adding precious stones, even though the weight of jewelry is usually small. One of the most conventional methods of gold storing is gold bars - cast bars made of gold of a certain weight. Banks keep them in their reserves. And to this day, you can invest money in them, for example, by purchasing ready-made bars from manufacturing companies such as Golden Way.
Why is it profitable to keep savings in gold?
Gold was and remains the main measure of wealth. And no matter what new types of investments are invented, all wealthy people and companies, and even countries strive to possess gold when they need to wait out a storm in the global economy. A simple example: in 2019, in anticipation of a potential economic war between the United States and China, two superpowers, many decided to invest their funds in gold. As a result, the precious metal rose in price by 20%.
In what form is gold in demand?
- In the form of jewelry. There is always a demand for it, and as the market grows, the demand constantly increases.
- In the form of metal for industrial needs: this is also a very significant factor because let’s say for the production of the computer equipment, gold is also required. Then multiply the smallest amount of gold needed in circuit boards by the number of computers produced per year, and you will be amazed by the volume.
- Gold remains a stable anchor for the economy of any country. It is not for nothing that each state has its own gold reserve in the form of ingots stored in central banks. One of the most rational types of investments is an investment in gold bars. You can physically sense what your money is invested in. You can store bullion both at home and in a personal safe deposit box - its value remains the same. There are even special impersonal metal accounts to which a bank will pay you money for every purchased gram of gold. Tracking the gold market is a profitable process, although it is less exciting than playing on oil or cryptocurrencies’ stock markets. And with the right strategy, you can make a considerable fortune.
Even though the role of gold has slightly faded over the past 50 years, it remains one of the most stable investments in the global economy. And when you are planning your investments, take this into account: gold is one of the most profitable investments because of its stability and slight fluctuations in price.