Gold has been the best investment for some of the world's wealthiest families throughout history. The DuPonts, who now own a huge chemical company, the Rothschilds (who were once the richest people in the world), the (JP) Morgans, and Egypt's royal Farouk family are just a few of the very wealthy people who built their fortunes on gold. We could go on and on about more family businesses that owe most of their wealth to gold, but there's no need. The bottom line is that investing in gold has always been a great way to make money over the centuries, and stocks, real estate, and bonds have never been able to compete with it in terms of returns.
Want proof that gold has made people a lot of money in recent years? Think about these shocking facts:
Investing in this "secret gold" in the 1960s brought an average annual return of 100%.
- Between 1972 and 1974, the price of secret gold went up by 350% (while the stock market was heading desperately south).
Then, between 1976 and 1980, investors made an average of 300% per year on this secret gold.
Between 1987 and 1989, the price of gold went up by 340 percent every year.
The average investor keeps putting money into stocks, real estate, and bonds, not knowing that certain types of gold have done better every year since 2000 than their risky investments (and the last couple of years have seen double returns over stocks). And as you'll soon find out, we're just at the beginning of something very big...
It's interesting to know that gold was first used as a form of money or investment as early as 700 BC. Since then, people of all cultures and races around the world have wanted to own gold, and its value has only gone up over the centuries.
Gold is a good investment right now because its price is generally going up (and many experts agree that this is set to continue for many years to come). Gold can be bought for a small amount of money, so most people can afford to put money into it. Gold is also beautiful and a status symbol in a way that most other investments can't match.
Why investing in gold now could make for spectacular returns - The facts don't lie, and this is why the rise in gold prices could mean big things for those who invest early.
Right now, the U.S. government is doing everything it can to stop deflation (lower prices), and it has made it clear that it will do everything it can to stop this from happening. In short, this means that there will be more "paper money" while the amount of gold will stay the same. What do you think it means?
More paper dollars are needed to buy the same amount of gold.
So, the price of gold goes up when the amount of money being printed goes up. Over the next few years, it's likely that a lot of money will be printed, and you don't need me to tell you what that means for the price of gold.
Even worse, there are more reasons why the current rise in gold prices could be the start of a huge bull run. In the past, gold has always done well when there was a lot of uncertainty. I say "sadly" because the long war on terrorism doesn't seem to be coming to an end, so the amount of paper money needed to pay for things like wars and other things keeps going up. This huge rise in paper money will keep pushing up the price of gold.
The Gold Shortage: One of the biggest investment banks in the world is predicting a gold boom due to a fundamental shortage, a glut of government-printed paper money, and other factors.
Credit Agricole, a major French investment bank, just put out a report called the Cheuvreux report, which is named after the bank's equity research department and shows that a gold boom is a very real possibility in the near future.
"We're raising our estimate for the mid-cycle gold price from USD750/oz to USD900/oz, and we think it could go up to USD2,000 or more. For ten years, the price has been kept artificially low by secret sales and loans from the central bank."
At the time this was written, the price of an ounce of gold was around $500, and many experts think it could go up to over $2,000 per ounce. Why? The report shows that there is a basic lack of gold stock. Governments around the world are in desperate need of gold bullion (possibly by levels higher than 50 percent ). Gold is still in high demand around the world, but there isn't much of it to go around (only 2,500 tonnes produced worldwide). Also, the oversupply of paper money and the artificial suppression of gold prices over the last ten years mean that gold could very well explode to as high as $2,000/oz, which would be an increase of almost 400%.
