What’s In Store For Gold And Commodities In The Years Ahead?
Gold and other commodities are seen as “the people's money” since a currency like USD or Pound Sterling are man-made, and the currency only moves forward as long as people believe in that currency. The Federal Reserve banking system kept gold as a pegged commodity in a 1:1 ratio with every USD or Pound out there. This way, the supply of money was finite, and the value of that given currency was set in stone.
But in 1933, the Federal Reserve stopped using gold as a 1:1 pegged standard, and this caused fiat currency to crash. By giving up, the gold 1:1 ratio gave the government and the banking system unlimited money over people since they could always print money. And it went all downhill from there. And it still crashes through the form of inflation. In this article, we talk about the commodity gold and what the next few years are looking like for it.
Why gold is a good investment and will stay a good investment
Although the price of gold can be very volatile and have a lot of movement in the short term, in the long term, it remains strong through times of financial crises and recessions since the supply of gold is finite. There is only a set amount of gold on this planet, and when everything is dug up, there is no more; they can’t make it artificially. Everything that can be made artificially is usually cheap and low in value. Medicine, antibiotics and other metals we can make in a lab develop in other ways than actually discovering it is low in value since that supply is infinite, so we peg less value to it.
So through currency crashes, through times of chaos, gold has been standing tall through all of it. So holding gold on hand or saved away is a way to not only make your money worth more in the long term through the value of the actual gold rising, but it is also an amazing hedge fund against inflation and currency fluctuations.
What can cause the value to fluctuate so much in the short term?
People’s buying power. Literary people have more and more money around than 50 years ago. People are finding new ways to make money, and people have started being more intelligent with their money, which makes access to gold easy and thus drops its value.
External sources of gold. However, this is quite rare, but we have seen meteorites crashing into the earth that contained large amounts of gold, massive amounts. So that drops the value of the gold since before there was this set amount of gold on the earth, but now there is external gold that we got our hands on.
Price prediction on gold
It is difficult to predict the price prediction on gold for the next 50 years. People that study the patterns and movements of the market year in and year out develop a feel for what is to be expected. You should keep this in mind when considering an investment or spending money. Do your own research, educate yourself, learn more etc.
I want to leave you with an interesting article on this topic. It is called: gold price predictions for the next 5 years and published by goldalliance.com; it is worth checking out if you want to learn more about this.