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Gold drops price by 5%, threatens status as a safe havenAll listings are the responsiblity of the posters; keep in mind, anyone can post anything! |
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Gold drops price by 5%, threatens status as a safe havenAll listings are the responsiblity of the posters; keep in mind, anyone can post anything! |
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Gold Investing StrategiesGold drops price by 5%, threatens status as a safe haven
Like what we have already mentioned here article upon article, speculation about the price of gold will only make you go crazy because of its unpredictable behavior. It has both the qualities of currency and commodity, while the fluctuating demand for gold during times of prosperity and crisis account for all the crazy behavior in price. For instance, the price of gold recently dropped by about 5% just right after months and months of setting new record prices.
Gold price dropped by about $104 last August 24 to a price of $1,757 per ounce. This is the biggest drop in the price of gold in the last 3.5 years and comes as a shock to many investors who have held unto gold because of its reputation as a safe haven for storing wealth during a time when economic certainties continue to hound the markets. Gold was considered to be a haven in the previous years because it is relatively unpopular to investors, who would rather put their money in high-yielding investment vehicles. As the crisis in the US and in Europe unfolded, however, the same investors made gold as a popular investment option, increasing errors in pricing due to unruly speculation in the market. Swings in the stock market only pushed tensed investors on the brink of sanity and put their wealth in gold. Now that investors are already trying to sell their holdings for profit, we see the price of gold drop by this much. This recent development will becoe a big test of people's perception of gold in these uncertain times. Gold is like a commodity because it is still used in items like jewelry after all. However, recent developmens have shown us that gold does act like a currency as well. For most part, it does not have any intrinsic value and its value relies mainly on how valuable people think it is. Therefore, it is subject to fluctuations in price brought about merely by emotion--and that is never good for something that is thought to be a safe haven. You can talk about... Gold drops price by 5%, threatens status as a safe haven Tags: • crisis • prosperity • commodity • currency • speculation • intrinsic value • stock market • investment vehicles • gold price • safe haven • demand for gold • record prices • price of gold • Related articles:
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