The Gold Bubble
Among the list of topics one is bound to see on any given nightly news cast, there are certain issues that can be counted on:
1. Healthcare Reform
2. The War
3. Celebrity Gossip
And
4. The Economy
With the ever-present recession and unemployment rates reaching frightening figures, it can be difficult to find a silver lining in our cloudy economy. In what has proven itself to be an ever-changing market, we should not be surprised to find that our silver lining is in fact, gold.
Over the past few years, the world market has seen an unexpected and almost unbelievable explosion in the price of gold. That little Au on the periodic table has rarely been more valuable. Consumers are berated with TV and radio ads urging people to turn in their gold and and unwanted jewelry for cashe, which has proven a slick move for those in the business of gold. In today’s world, the need for the money that the average individual stands to make far outstrips the desire to hang on to an old watch or an outdated pair of gold earrings. These businesses are gaining the upper hand by running their own refineries and selling the precious metal at previously unheard –of prices.
For those that might wonder exactly what makes gold so valuable, there is a great deal more to gold than fashion and fancy eating utensils. Keep in mind the fact that the entire American economy is backed up by gold. Real, shiny, honest-to-goodness gold rests in the vaults of the national treasury, as a surety for all of the paper money currently in circulation- i.e., the more gold the government has in the treasury, the more currency they can print. The current scarcity of that money is exactly what makes the metal so valuable to Americans and our government. The current bull market, along with the inflation that has ballooned since the start of the recession lend themselves to the well being of the precious metal in a big way. As the backup for our currency, we rely heavily upon its continued value in our treasury. Some market experts strongly recommend investment in other commodities, like lead or cotton, but gold endures as the traditional failsafe.
While market nay-sayers would stress the idea that what goes up, must come down, gold seems to be riding safely high above most other markets. In the fall of 2009, gold had risen to the record high of $1,024 per ounce, having quadrupled over the course of the past decade. Experts predict that prices could rise astronomically, some even venturing a value in excess of $5,000 an ounce. Measures are being taken to reignite our current economy, but gold continues to play a vital part in promoting our national markt. The mining undustry has invested over 12 bilion dollars in recent years attempting to bring to the surface more of the metal we rely so heavily on, and despite the much predicted and hypothesized drop in value, signs indicate that the movement isn’t ready to turn in just yet.