Does Gold Have a Future?

The following is a guest post by James Brighton. Thanks for the great article, James. 

Everyone is talking about gold today, it has become one of the most popular commodities in the world and there is no doubt that its price reflects that. Gold prices have reached a high never seen before in history, and this is all due to the fact that investors have seen it as a great opportunity to secure their money whilst the banks are failing.

Gold prices have risen to a record high of around $1900 per troy ounce recently, it is important to remember that prior to the crash in 2008 gold was only trading at around $600 per troy ounce. That is significantly cheaper, so does gold have a future, or is it time that we start to look for alternatives?

A Bright Future

Gold certainly has a bright future if economic conditions continue to remain stale or falter. The reason that gold became so popular was because investors saw it as a safe haven. Until they are sure that their investments are better served elsewhere gold will continue to rise in value. This means that the bubble will continue to grow and gold will be as popular as it has ever been. If you decide to invest in gold then you need to make sure that you follow the economy around the globe.

Any movements within the global economy towards improvement or failure will see the gold price fall or jump, so you need to be there to react. If you do not react soon enough, you could have missed the chance to buy at a fair price, or even seen your investments fail. As with any investment your monitoring of the situation will ensure the best chance of success.

Other Investments?

There is the chance that a shift in the economy in a positive way would see gold prices fall and it fail to be a sensible investment. The markets show that gold is currently still on an upward trend, even if it has fallen from its peak price. If the economy improves then there is no doubt that investors will come away from gold, but where does that leave you? There are many options of course, in fact, you could consider spreads and bet on the fact that gold price will fall, taking advantage of the failure of the commodity you just sold. There can’t be anything much better than making money twice out of an investment!

If you are using gold as a tool for saving, when the banks improve you could move back to the standard savings accounts offered by banks. Eventually these accounts will offer a good percentage of interest, and will be a good choice, but until the economy changes its important to remember that the banks will not reward us. Despite the fact that it was their failure that got us into this situation!

Photo By: DigitalMoneyWorld