Why Invest in Silver?

Silver as an investment

We’re very bullish in precious metals in general, but especially with silver. In this article, we aim to show why silver has such strong upside potential. Basically, silver’s supply could not keep up with increasing demand for it, both in industry and as an investment. And whenever supply could not keep up, we can expect prices to explode to the upside.

By the end of this article, you will have understood why it is necessary for you to invest in silver. In brief, we examine the following:

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The 5 Biggest Myths About Investing in Gold and Silver

Myth No. 1: Rising interest rates are bad for precious metals prices.

Must Read: 11 Safe High-Yield Dividend Stocks for Times of Volatility and Uncertainty

It’s surprising how persistent this myth is given that gold and silver experienced one of their greatest runs during a period of rising rates. That was back in the late 1970s, when bond yields surged into the double digits.

Today, some analysts are invoking the threat of the Federal Reserve rate hikes as a reason to avoid precious metals. Of course, it remains to be seen whether the Fed follows through on its rhetoric about higher rates later this year. But nominal interest rates do not determine whether precious metals are more or less attractive than interest-bearing debt instruments.

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The Price of Gold in Troubled Economic Times

Gold has always had a value because it is a real commodity. When it was first used as a way to buy and sell items, and turned into a legal form of currency for both domestic and international use, there was a standard set on the value of that gold, and the face value of it was the same across the board in most cases.

The price of gold has varied throughout the years, hitting many highs and lows as it is invested in, but once the 20th century came along, gold was no longer taken at face value because it had been replaced by the U.S. paper dollar whose value was measured for many years based on the gold standard.

The gold standard was a way to determine the price of gold, as well as the value of other currencies that compared to it. In 1971, the U.S. decided to no longer use that standard to denote the value of a dollar, which caused gold prices to rise increasingly, hitting an all-time high of $850 per ounce in 1980. By 1999, the gold markets had lost much interest in the investing of this precious metal, causing it to drop significantly to less than $253 per ounce, which was a dramatic change. Although investors were greatly affected by this price decrease, people still continue to invest in gold because of its high use in industry, medicine, jewelry and other markets. Fortunately for investors, 2001 saw a new era for gold investing, and created a growth in the market, taking gold back up in price to more than $715 per ounce in 2006 and to an all time high of over $1,000 in March of 2008.

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Invest Your Dollars in Gold

Gold is something that people have been using as a form of currency for over a thousand years. Gold signifies wealth and strength, and the person with the most gold is considered to be the richest. However, in today’s world gold is just more than riches, it is an investment in the future. With the ever dwindling currency market and stocks crashing all around us, gold seems to be the safest of investments. Anybody will accept gold, no matter where you are in the world, because gold always has and always will have value.

The best thing about gold is that it always increases in value; if you compare today’s gold prices with the prices of gold five years ago you will get your answer. Today more than ever people are turning to gold as a safe means of investing their money and solidifying their finances. Gold can be purchased in a number of forms ranging from the ever popular gold bars to gold coins.

From an investment point of view gold bars make the most sense, since the premium that you pay above the market price of gold is the lowest. Which means if you buy a 400 troy ounce .9999 gold bar you are paying far less per ounce if you buy gold in any other form. On the other hand you will need to arrange for transportation and storage of your gold bars. If possible also get your investment insured, so in case of a robbery you are 100 percent covered.

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7 Practical and Emotional Tips For Resisting the Temptation to Invest in Gold

As a licensed psychologist and a Registered Financial Consultant I often see how investors allow emotions to sabotage their efforts at investing long-term to build a secure nest egg. During periods when the stock market is weak or fears of inflation are high, gold often spikes in value, tempting people to invest in bullion-related securities whose value fluctuates with changing gold prices. Some investors are tempted to buy Krugerrands or other coins that change in price based upon their bullion value. This article identifies the emotional issues that make gold a tempting investment at times, explains why gold is a terrible investment, and provides 7 tips for resisting the urge to invest in gold.

Over the decades gold has periodically spiked in price and then crashed. During the inflationary period that occurred in the late 1970s and in 1980, gold reached $850 an ounce before plummeting in value. Recently, we have seen a new spike in gold prices with gold reaching over $1000 an ounce. The latest surge has been fueled by record highs in gasoline prices, fears of inflation, and a weak stock market.

When gold prices surge, numerous investing companies spring up, touting gold as a wonderful investment. The companies describe the dramatic returns that gold has produced over the last two or three years, which dupes investors into believing that gold offers the prospect of a wonderful return. Unfortunately, gold is one of the very worst investments that an individual can make. When we examine long-term returns, we find that gold has failed to outpace inflation over the last 25 years. Gold has dramatically underperformed the S&P 500, corporate bonds, and even completely safe U.S Treasury securities. Simply put, gold is a horrendous investment for the long-term.

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