Gold – A Truly Precious Metal
Whenever someone sees an object made of gold, particularly a gold bar or coin, the first thought that comes to mind is that of wealth. This is no accident either, because for thousands of years gold has been the most appropriate symbol for wealth that exists.
If you know the live price of gold and the direction which gold has been moving, you will be able to make the best decisions in regards to when you should buy gold. The historic price of gold is fine to be aware of, but when it comes to making an investment today, or maybe even tomorrow, you need to know how gold is acting in real time as well as the factors that affect it. If you pay attention to live updates of gold’s price, made easier by the feature on this page, you will be one or two steps ahead of investors who aren’t quite as proactive as you.
Much like stock markets all around the world, the price of gold is changing all the time; on a day to day, hour by hour, and minute to minute basis. The trick to investing in gold is knowing when to buy and when to sell and the only way to do that is to understand a bit more about what exactly effects the live price of gold and how you can use this information to your benefit. The following few sections will help you understand how the price of gold reached the spot it is at today, what makes the value improve and slip, and many other useful bits of information.
Gold Price History
While gold has been around for hundreds and thousands of years, the purpose which the metal served has changed over time. In Ancient times gold was said to be used as a form of currency, but with government being as disorganized and unreliable as it was it was hard for rulers to set a standard for gold as currency and thus the earliest prices of gold are very hard to make sense of.
It wasn’t until the days before WWI that gold had started to become widespread and popularized by governments and large banks. In fact, gold was one of the financial driving force behind many of the nations, mainly European, that were involved in the First World War. While the first half of the 20th century saw a large part of the world witness and be a part of complete devastation and destruction, the price of gold remained fairly constant and reliable. In the midst of incredibly rocky economic times for economies all over the world, gold managed to be a safe place for people to store their assets.
Prior to 1910 gold was valued at a little under $20 and by 1940, in the midst of WWII, the price of the precious metal had steadily risen to the tune of almost $40. After WWII gold began to quickly fall out of the hands of governments around the world and into the private hands of people everywhere. The timespan between the late 1960s up until 1980 proved to be incredibly profitable for gold investors as the price rose by hundreds of dollars during that timespan. After 1980 the price receded a bit but in the grand scheme of things the average price of gold was still within the $300s and was a lot more valuable than it was even after WWII. The 1990s were yet another incredibly profitable time period for gold which saw the metal rise hundreds and hundreds of dollars in barely over ten years.
Factors Affecting Gold’s Price
When you invest in gold, your main goal is to buy the precious metal at a time when the price has dropped in hopes of it gaining more money in the future, which it usually does. In order to know when to purchase gold, you have to know a little bit about the factors around the world that affect the price of gold.
The first major concern on the mind of every precious metal investor is the current values of major currencies around the world. When people begin to lose their faith in paper money, they tend to put their faith in other investment outlets and in most cases that is either company stocks or precious metals. Some of the main currencies that affect the overall live price of gold are the United States Dollar (USD), the euro, the British Pound, and the Canadian Dollar. Most often when the value of a particular currency drops, the price of gold rises against it.
Another factor affecting the live price of gold are the monetary decisions that are made by government agencies around the world. For instance, when a government decides to spend more or less money on things like the military and social programs, this action will affect the value of the currency used in that country and thus affect the price of gold. Each and every decision about monetary policy made by a government entity may have an impact on the value of gold and it is your job as an investor to keep up with major government decisions from around the world.
The developing of poorer countries will also mean a lot in regards to the live price of gold because if a once poor country becomes efficient and a productive member of the world society their currency will rise and as their currency becomes more valuable it will mean for a change in price of gold and even other currencies. In addition to the rise of poorer countries, the collapse of prominent economies could also mean for a deviation in the value of gold.
At the end of the day, paying attention to key happenings around the world is what the real investor needs to do in order to make smart investment decisions regarding gold. If you pay attention to the movements of major currencies, the monetary decisions of world governments, and how economies around the world are faring, you will have a better idea how you can allocate your resources effectively.