So What"s Going on With Gold?
The yellow stuff is the oldest currency in the world.
Long before Governments dreamt up paper as a store of wealth and means of exchange traders and workers would only accept a true barter.
That is, they would exchange one commodity or service for another.
When one party to the transaction didn't need the others commodity or service something of value that could be exchanged elsewhere was needed and Gold fitted the need perfectly.
There is a finite supply, so it had that all important rarity value to maintain it's intrinsic value and so for thousands of years Gold has been the ultimate store of wealth and accepted barter token.
Regrettably, as there is only so much available, Governments have the problem of wanting to increase economic activity way beyond the amount of Gold available to pay for it and so early Gold coins would be mixed with other cheap metals and, ultimately paper.
Paper is just a promise to pay, it only has value if others believe in the promise to pay the amount stated.
Paper used to be backed by Gold, it could be exchanged at a bank for it's equivalent in the actual metal.
Those days are long gone and the need to create massive economic activity, particularly after the second world war meant that credit had to be created and that took the world into a new dimension.
Throughout the centuries and recent decades Gold has just not gone away.
Whenever anyone is sceptical that the value of a paper currency will survive, the paper has been exchanged for Gold as so it continues.
So, that's the reason why Gold has dramatically increased in it's US Dollar value as western Governments print and create more paper money using the crazy words, Quantitative Easing - it's printing money that is not related to actual physical economic output and consequently devalues each paper dollar.
The actual intrinsic barter value of a lump of Gold hasn't actually changed.
It's just that as more US Dollars have been created from nothing, the value of all the Dollars in circulation falls.
That's why the US Dollar price of Gold has risen so far, the US Government has flooded us with paper that is based on credit not actual economic activity.
We all know that eventually credit is either paid back or the Government defaults and doesn't pay back what it owes! Is seems that the only way for US Dollar value to be maintained is for future generations to pay back the credit that has created the Quantitative Easing trillions.
If not it just defaults and the value of the US Dollar will collapse.
The Dollar price of Gold will soar but the actual barter value of a bar of Gold will still buy the same amount of land, ships or oil that it did before all this new money was created.
So just how can traders and investors gain from what is going on with Gold? Just watch the trends and the best way to profit from trends is with trend following strategy.
Contact me or click the link for a free video explaining how it works.
Long before Governments dreamt up paper as a store of wealth and means of exchange traders and workers would only accept a true barter.
That is, they would exchange one commodity or service for another.
When one party to the transaction didn't need the others commodity or service something of value that could be exchanged elsewhere was needed and Gold fitted the need perfectly.
There is a finite supply, so it had that all important rarity value to maintain it's intrinsic value and so for thousands of years Gold has been the ultimate store of wealth and accepted barter token.
Regrettably, as there is only so much available, Governments have the problem of wanting to increase economic activity way beyond the amount of Gold available to pay for it and so early Gold coins would be mixed with other cheap metals and, ultimately paper.
Paper is just a promise to pay, it only has value if others believe in the promise to pay the amount stated.
Paper used to be backed by Gold, it could be exchanged at a bank for it's equivalent in the actual metal.
Those days are long gone and the need to create massive economic activity, particularly after the second world war meant that credit had to be created and that took the world into a new dimension.
Throughout the centuries and recent decades Gold has just not gone away.
Whenever anyone is sceptical that the value of a paper currency will survive, the paper has been exchanged for Gold as so it continues.
So, that's the reason why Gold has dramatically increased in it's US Dollar value as western Governments print and create more paper money using the crazy words, Quantitative Easing - it's printing money that is not related to actual physical economic output and consequently devalues each paper dollar.
The actual intrinsic barter value of a lump of Gold hasn't actually changed.
It's just that as more US Dollars have been created from nothing, the value of all the Dollars in circulation falls.
That's why the US Dollar price of Gold has risen so far, the US Government has flooded us with paper that is based on credit not actual economic activity.
We all know that eventually credit is either paid back or the Government defaults and doesn't pay back what it owes! Is seems that the only way for US Dollar value to be maintained is for future generations to pay back the credit that has created the Quantitative Easing trillions.
If not it just defaults and the value of the US Dollar will collapse.
The Dollar price of Gold will soar but the actual barter value of a bar of Gold will still buy the same amount of land, ships or oil that it did before all this new money was created.
So just how can traders and investors gain from what is going on with Gold? Just watch the trends and the best way to profit from trends is with trend following strategy.
Contact me or click the link for a free video explaining how it works.
