Debt Crisis in Europe Pushes Gold to Record Highs

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Debt Crisis in Europe Pushes Gold to Record Highs

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Platinum used to trade at higher prices than gold's. In fact, jewelry made of platinum normally cost double the price of their gold counterparts. That used to be the traditional order of things. However, conditions today are far from being normal, with the price of gold at par or even exceeding the price of platinum. A few days ago, gold traded at $1,877 an ounce. In contrast, platinum costs $1,850.

This is a far cry from the situation two years ago, when the price of gold was about $1,200 an ounce. I can only imagine that those smarter commodity traders have already cashed in seeing that the price of gold is somehow in a bubble--a terrifying prospect given that gold has always been seen as a safe haven during times of crisis.

The debt crisis occurring in Europe, coupled with the sluggish economy and uncertain conditions in the US, has led to this frantic shift in investments towards the supposedly safe arms of gold. Even young people without so much experience in investing in precious metals have already turned towards gold in their bid to avoid the fallouts of the crises in Europe and elsewhere.

When will the escalated rise ever stop or go back to normal levels? Nobody really knows. The sovereign debt crisis in Europe has been going on for two years, with no end in sight. Greece is just part of the story. There's still Spain, Ireland, Italy, and Portugal requiring some form of assistance. Iceland resisted any kind of assistance and would rather rebuild their economy after their default. This is commendable in a layperson's view, but terrifying in the view of the investors.

So much money has already been printed and flooded to the markets, but the results are nowhere near encouraging. In this escalation in the price of gold and the uncertainties in Western markets, it may be advisable to just focus on the markets in the East and stay there for a long while.

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Tags: • uncertainties • investors • iceland • portugal • investments • commodity • platinum • europe • crisis • sovereign debt • precious metals • record highs • safe haven • debt crisis • price of gold •

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