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Gold Vs. Dollar – Why Gold May Be The Best Coming Investment Attraction Of The Decade!

August 13, 2010 by  
Filed under Silver Investment Basics

United Gold Direct

2945 Townsgate Road, Suite 200, CA 91361 ***888.502.3222***


The struggling U.S. Dollar, inflation fears, strong demand for
commodities in general, and interest in “safe haven”
investments have propelled gold and other precious metals
to prices not seen in decades. Where gold will go from here
remains unclear, but one thing is for certain: it remains the
ultimate hedge and world?s reserve currency.

During the last major gold bull market – precipitated by the
Iran hostage crisis in the late 1970?s – serious geopolitical
tensions and the prospect of runaway global inflation played
major roles in gold?s rise from $300 per ounce to $850 per
ounce. As current prices flirt with the $1,000 plateau,
some analysts are beginning to believe that the all-time inflation adjusted peak of $2,450 may not be out of the question.

Why Gold? Why now?

Buying and Selling Gold
Buying precious metals is very simple, but if done
incorrectly, the results can be financially devastating. It is
extremely important to buy precious metals from trusted
and reputable sources in safe and secure transactions.
At all times and in all circumstances gold and silver remains
money. Therefore, both gold and silver belongs in your
portfolio at all times and in all circumstances. We recommend a holdings between 10-20% of your assets to diversify in metals.

“You can transform your life and business in just seven minutes a day.” If that statement makes you want to read on, consider yourself hooked.
There are plenty of theories for the recent surge in gold prices, but
as in many past rallies, a handful of common factors seem to be in
play, including:

Dollar Woes: With the U.S. Dollar in the midst of a months-long
swoon against the major global currencies, many investors are
turning to gold as a commodity that tends to move inversely
with the beleaguered greenback.

Inflation Hedge: High food and energy prices are creating
concerns about the potential for soaring inflation. Gold is widely
viewed as a sensible hedge against inflation – a store of value
even as the purchasing power of traditional currencies erodes.

Geopolitical Concerns: Gold has long been considered a “safe
haven” investment during times turbulent and uncertain times,
and with the constant threat of terrorism, rogue nations, and
energy shocks, many investors have been turning to precious

Diversification: Many investors on the look-out for new ways to
spread their money around a number of economic sectors
flocked to gold of late. The draw is due not to only gold?s
inherent attractiveness as a commodity component, but because
it touches so many disparate areas of the economy – from
interest rates and the equities markets to investor sentiment
and foreign exchange.

Factors Driving the Price of Gold Higher:
Inflation adjusted peak of $2,450 an ounce may soon be a reality.
On May 20, 1999, Alan Greenspan testified before Congress,
“Gold is always accepted and is the ultimate means of
payment and is perceived to be an element of stability in the
currency and in the ultimate value of the currency and that
historically has always been the reason why governments hold

Typically, gold is considered relatively inexpensive when 3 or
fewer ounces need to match the level of the Dow Jones
Industrial Average (DJIA). Today, by this standard, the price of
gold appears to be relatively low with roughly four times this
number of ounces of the yellow metal needed to match the
DJIA. Just to provide some historical context, in 1929, just
before the Wall Street Crash, it took 18 ounces of gold to buy
the DJIA, but within three years, it took just two ounces of gold
to buy the „Dow?. In 1966, the ratio surged to 28 ounces, but
by 1980, one ounce of gold bought the DJIA. Finally, in July of
1999, at the height of the dotcom stock market frenzy, it took
44 ounces of gold to buy the DJIA.

Gold vs. the Dow & vs. Crude Oil:
Ounces of gold to buy DJIA
Additionally, gold also has traded historically at prices between
15 and 20 times the price of a barrel of crude oil. Some analysts
feel that the current gold-to-crude ratio which is far below its
long-term average – signals that gold appears to be relatively
undervalued relative to crude and could be poised to move

Ask yourself:
Do you expect your retirement portfolio to
grow if everything around us is getting

If the economy were to collapse, would
you prefer to have an account full of paper
or an account full of gold?

If you are one of the many who lost
between 20% to 50% of their wealth to the
recession, how do you expect to recover
what you lost? Or get back to even?

Here is the Answer:
Precious Metals – Physical Gold and Silver Coins/Bars
Precious metals have had an average annual
return of 32% since 2001 and Will likely continue its upward trend as the printing press doesn’t seem to be stopping anytime soon.
For more information, please visit us as or contact us at

United Gold Direct | Going for Gold

By Adam Blaser

Macro-Economics – Currency Trading – Precious Metals Investing – Options Trading –

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