Many financial advisors will try to tell you about the mighty power of certain stocks and bonds. The true force to be reckoned with in the investment world is gold. Gold existed as a treasured form of currency long before any of the stocks or bonds currently available, and will almost certainly be around long after they are gone.
While gold shot up in value during the first part of 2016, reversing a multi-year downtrend and creating a very exciting situation for gold investors, in the fourth quarter of 2016, gold prices dropped noticeably, making some investors believe it is time to panic. In fact, a situation like this may be the best possible time to invest in gold.
Gold and Price Corrections
For gold to drop somewhat after a steep and sudden rise is quite normal. It is normal for just about any investment product to respond this way, and these situations tend to be merely price-wise corrections, part of a normal and healthy financial trend. People panic in response to global uncertainty and buy gold heavily, then settle down as things get a little calmer and more outcomes are known. Once those outlying “panic” investors have sold off some of their gold, the real gold trend can begin again. There is no reason to expect gold prices to continue to fall under the current climate and no need for consumers to reconsider purchasing gold anytime soon.
Gold and Rising Interest Rates
Some may point to rising federal interest rates as a reason to pull out of gold, especially when connected to falling gold prices. While rising interest rates can have a bearish effect on gold prices due to the higher opportunity cost of holding onto gold, this is only one variable affecting gold prices. In fact, gold’s rise in the 1970′s to its all-time high for the 20th century occurred when interest rates were not only high, but rising quickly.
Gold and the Future
Global uncertainty is at the highest it’s been in some time. Between Brexit and the surprise election of Donald Trump as President of the United States, we can already see that markets and people don’t know how to react. This is the perfect time to invest in gold. We don’t know what the future will bring, but given how divisive the Presidential election and its aftermath have been, it’s easy to see there are any number of occurrences that could heighten panic and have investors running for the stability and security of gold.
Many prominent investors agree that being bullish on gold can be an excellent strategy under the right circumstances. Gold, with its intrinsic value and history of being strong when traditional investments are weak, is an ideal product with which to back your IRA and protect your retirement assets.
If you’d like to learn more about the power of gold, why it remains as good an investment as ever, or how you can get started with a gold IRA, CLICK HERE for a FREE Guide or call Fortress Gold Group today at 1-800-777-6177.