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Gold Bullion Investments

Talk about gold bullion retirement accounts, a fifty-year-old woman was recently arrested for stealing a whopping five hundred pounds of gold from her employers while working for a New York jeweller. You may be wondering how a fifty-year-old woman made off with that much of the precious metal; She didn't do it all at once. She had a secret compartment in her purse and over the course of several years stole a bar here and an engagement ring there until she wound up with the equivalent of thirty-one bricks. For those keeping score, that's more than just a few million dollars.

This may seem unrelated to gold bullion investments, but we bring it up to point out one of the vital truths you should keep in mind when you buy gold: A little here and a little there adds up.

While amassing several million dollars in six years is a bit unrealistic for most of us holding gold bullion investments, the point remains that when you buy gold a little at a time, it usually turns into a lot more money than what you put into it.

For example, if you invested just one thousand dollars into gold bars five years ago, that investment would be about twice what it was worth in 2004. If you invested the same thousand dollars into gold bullion investments back in 2001, that investment would currently be worth between three and four thousand dollars based on the gold price average in 2001 and the current 900+ average.

You might be quick to point out that the gold price has had bad decades, as well, and that is a fair criticism, but let's look at historical averages...

Throughout the nineties, the spot price of gold lost nearly one hundred dollars from a $362 average at the end of 1991 to a $279 average at the end of 2000, after having suffered a similar decade in the eighties, having started at $460 in 1981 and ending at $362 in 1990. Remember that the 1980’s and 1990’s were very strong economic periods. The middle class was booming and those who did have gold bullion investments were under no pressure to dip into those savings.

The reason to hold gold bullion investments is simply to protect yourself against economic crisis, right? Well consider the late seventies, a period that was rougher than the current economic crisis: Gold went from a $40 average at the beginning of the decade to six hundred twelve at the end of the decade.

If nothing else, these numbers prove two things: First, that the metal has proven to be reliable for protection in times of recession, and second, that it's a good idea to invest in bullion even in times of ease, as you never know what the next year holds for the economy.

Article Archive

Kenneth Hansen

July 1, 2009

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