Gold Market Price
"What is the current gold market price?" is not a simple query to answer, because the information is always changing from day to day and hour to hour. At the time of writing, the price of gold $957.50 per troy ounce. But the previous 30 days has gone through a wide range of gold prices, from a minimum of $897 to a maximum of $993 per ounce. That's a 10% fluctuation within the span of a single month.
Why is the price of gold so volatile? Well the price of gold depends on supply and demand. When people like you and me buy jewelry or other gold items, or invest in gold bullion and coins, demand rises and the prices rise along with it. Then when prices rise quite high and everybody decides to cash in on the high prices by selling, demand decreases and the price goes down. The supply-demand pendulum is affected by personal investments and purchases, but also by industrial demand for the precious metal.
Something that is fueling demand for gold right now is the recent economic turmoil in the US and throughout the world. Often you'll see that seemingly good economic news brings a drop in the gold price, while bad news bring an increase in the gold price. Why is that, you ask? Because gold is viewed as a safe-haven investment. Regular paper currencies can lose their value and your buying power can decrease. In extreme cases, fiat currencies (as these paper currencies are called) can lose virutally all of their value.
One well-known example of this is Weimar Germany of the 1920s, when the currency inflated so drastically that there was a daily doubling of consumer prices. One of the most well-known memories of that time is that people were using wheelbarrels full of banknotes in place of firewood, because the paper money was worth even less than the wood. There is evidence that our economic situation will be nearly that bad, but in periods of uncertainty serious investors normally move part of their money into gold to be covered in case of a worst case scenario.
If the current problems end soon, then we will most likely see gold prices drop. If the problems persist for years to come as I think they will, then the gold price will continue to go up (with dips in price as well).The principle reason I'm convinced that the gold price will proceed to keep rising is because government deficit spending around the world continues, devaluing their currencies over time. If you have paper money, the value of your savings will drop. If you hold gold, your wealth will be preserved. The
gold market price is a reflection of the factors affecting the value of our currency.
