Here are a few reasons why gold should be accumulated at these levels:
1. Rising Interest Rates
Although gold rose significantly from 2001 to 2011, it was not really the ideal conditions. There were many reasons for conditions not being ideal, such as: rising stock markets and major commodities like oil (more markets rising means more competition for investment).
However, now I would like to focus on only interest rates. The direction of interest rates is normally indicative of a type of economic condition that exist. During the period from 2001 to 2011 interest rates were falling, and this was indicative of economic conditions that are less than ideal for gold prices.
In fact, these falling interest rates were in some way facilitating significant rises in the stock market and oil for example, which are investment classes competing with gold.
Continue reading“Guest Post: Why Gold Should Be Accumulated At These Levels”