This has been a good year for both gold and silver. At the end of 2018 we were seeing a dip in numbers for both precious metals, but come January they began to steadily rise due to increasing geopolitical tensions mixed with monetary inflation.
The main culprit seems to be the ongoing U.S. Trade War with China. Looking at gold and silver charts you can easily see that the worth of gold and silver steadily began to rise in July, which is when tensions were at their highest.
Month by Month: Gold and Silver 2019
Global Bullion wants to keep you informed on all the latest gold and silver news. Let’s take a look at some highlights for each month for both gold and silver.
Silver USD/oz: $15.71
Gold USD/oz: $1,302.60
Silver USD/oz: $15.90
Gold USD/oz: $1,327.90
Mar 22 (DOWN)
Silver USD/oz: $15.41
Gold USD/oz: $1,313.40
Silver USD/oz: $15.10
Gold USD/oz: $1,285.90
Silver USD/oz: $14.53
Gold USD/oz: $1,284.60
Jun 21 (UP)
Silver USD/oz: $15.32
Gold USD/oz: $1,399.00
Silver USD/oz: $16.35
Gold USD/oz: $1,418.30
Silver USD/oz: $17.64
Gold USD/oz: $1,526.60
Sept 04 (HIGHEST OF 2019)
Silver USD/oz: $19.57
Gold USD/oz: $1,552.60
Silver USD/oz: $18.58
Gold USD/oz: $1,531.50
Silver USD/oz: $18.00
Gold USD/oz: $1,504.00
Nov 28 (DOWN)
Silver USD/oz: $16.91
Gold USD/oz: $1,455.60
As of December 4, gold was at $1,483.50 and silver was at $17.27, but overnight silver experienced a sharp dip down to $16.80. Since then, both have been steadily on the rise again.
Gold and Silver Predictions 2020
According to financial writer Aaran Fronda of ig.com/uk gold and silver prices are remaining relatively stable, but could see volatility on Friday, Dec. 6 due to the release of economic data reports from the U.S. (at the time of writing this article, the reports were not released yet.)
That being said, according to a survey done by BullionVault in July 2019, many people are anticipating a recession in the U.S. before the end of 2020 which could set gold prices to rise 20% by the New Year.
Despite predictions, no one can really know until the reports are released and everyone has a better sense of the current economic state of the U.S. and other geopolitical factors. We saw this throughout the year as relations between the U.S. and China saw improvement – as uncertainty settled the prices of gold and silver began to drop.
Is Gold a Good Investment?
Back in August Kitco News published an article where they quoted some interesting insights made by Mad Money’s Jim Cramer. He talked about why more people should buy and sell gold, noting that this precious metal is a safe haven for your money. He advised that everyone should have 10% of their wealth invested in gold. Investing in this metal is even safer than government bonds because it never yields negative and always holds its own value no matter how much time passes.
As Cramer notes, "People will keep buying precious metals as insurance against economic chaos,” which in turn makes the value of gold rise as confidence in the dollar falls. With this in mind, it’s easy to understand the ups and downs that gold and silver experienced over 2019, and what is yet to come for these precious metals.
There are a few more factors that go into the worth of gold, and which make it hard to predict in regards to future worth. Let’s take a look at why this precious metal is considered a valuable commodity, as well as a safe haven for your wealth.
A Crisis Commodity
As we’ve already mentioned, gold retains its value in both financial and geopolitical uncertainty – even when other investments fail. Historically, during periods of deflation when the economy slows down and is burdened with debt, the purchasing power of precious metals typically rises in response.
This reasoning behind this is because people seek to hoard wealth in a physical, more reliable form (like bullion). The same is true when world tensions rise and confidence in governing bodies is low, which is what is currently happening in today’s geopolitical atmosphere.
Used as a Hedge Investment
Gold is commonly used as an effective hedge investment against inflation and is designed to reduce investment risk. Throughout history, it can be seen that gold typically appreciates during periods of high inflation despite stock markets plunging. When fiat currency loses its purchasing power, this precious metal tends to be priced in those currency units and investors flock to it as opposed to the weakening dollar.
An Important Part of Portfolio Diversification
Many investors believe that a diverse investment portfolio is important for all levels of investors. The purpose of a diverse investment portfolio is to make investing safer by putting money into different assets that don’t correlate with each other. By doing this, when the economy causes one asset to lower in worth the other one will in turn rise and offset the loss.
Gold behaves exactly in this way in contrast to other assets like currency, which is why it’s a great option for portfolio diversification.
As the economic and geopolitical climate worsens, more parties become interested in buying up gold. For example, emerging market economies like China and India have shown an increased interest in purchasing gold in order to diversify their reserves and focus instead on safer liquid assets.
The more people want to buy gold, supplies will lower, and invariably demand will rise. As demand rises, so too does the price.
A History of Value
So now that you’ve seen things from an investor’s perspective, let’s consider why gold is so valuable to people around the world. Historically, gold has been treasured because it doesn’t corrode and can be easily melted and manipulated when heated. Its durability and versatility means that people view this precious metal as an easy and effective way to pass on wealth from one generation to the next. So as long as people continue to view this precious metal as something of value, it will always maintain its worth for years to come.
It’s an exciting time to be investing in gold and silver – are you interested in joining in? If so, visit our store and make your first investment with a purchase of gold or silver bullion. Global Bullion is Canadian owned and operated and can be relied on to offer the best prices around.