Gold has great role to play in the economies of many nations. However it is no longer a primary form of currency, gold is still a solid, long-term investment and may be a valuable part of portfolio, particularly in a bear market.
Gold was considered a universal currency for hundreds of years. Gold standard was used as far back as the Byzantine Empire over 1,500 years ago because of its recognized value worldwide. Until recently, in fact, gold was used as the world reserve currency.
In 1944, upon the signing of the Bretton Woods Agreement, the dollar replaced gold as the world reserve currency. But even after this agreement, gold continued to be used to back up various countries’ domestic currencies. However, in 1971, Richard Nixon removed the gold standard in the U.S. and other countries soon followed.
Why we should buy gold
1. Gold is highly liquid
Investment. It can be converted in cash anywhere in the world.
2. Gold preserves its value
over the period of time. Intrinsic value of gold does not change during great economic recession.
3. Gold has shown positive
results even during the economic downturn and market volatility. It serves as
the best hedge against inflation. Gold has seen strong asset appreciation in
long-term and emerged as best investment option in economic recession.
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