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Gold Spot What a Rush

Updated on December 12, 2011

Rush to Gold Spot...

A rush to find a gold spot has been the motto in emerging countries like Brazil. In fact gold has always represented a material wealth for mankind, only a few years ago he began to serve the technology, but previously it has always been associated with luxury, wealth, and often even the sacred.

But these days the demand has increased, times have changed and we live in times of crisis. So why the incessant search for new locations and why is so much appreciated in these days?

Well Gold preserves its luster! The soaring price of gold should continue, experts say. This trend is explained by the weakness of the dollar and the risk of hyperinflation in the United States. The yellow metal continues to be "the best value getaway". India's central bank recently bought about 200 tons of gold from the International Monetary Fund (IMF) and the Swiss Central Bank (BNS, its acronym in French) announced a profit of almost seven million francs in the first nine months of the year, mainly due to the appreciation of its gold reserves.

Gold to Hedge

The price of gold rose about one-third its value. This increase is explained mainly by the falling dollar and the fact that investors worldwide seek to protect themselves from the crisis. The dollar lost 6.5% against the euro and gold is the best alternative to the dollar and one of the best investments since 2001. Data show that since 2001 gold has performed 16% higher than the U.S. dollar and 10% higher than the euro and the Swiss franc. Investors turned to gold to protect themselves, since governments and central banks increased their spending and reduced interest rates to try to contain the economic crisis.

Hyperinflation

The United States must face a real threat of hyperinflation, because the administration and the U.S. central bank lent record amounts and reduced interest rates to virtually zero. The big question is, therefore, to know when will topple the dollar? The current situation of the United States is similar to the Argentina of 1991, as the peso plunged against the rampant inflation. The cause is the same: the government spends too much! The decision of the U.S. government to save the country's leading financial institutions, means that the losses of the banks have become losses of U.S. government.

A Matter of Trust

Foreign investors such as China, still have the dollar and thus prolong the current economic system. But at some point, they will be interested in gold, which is a natural currency and a powerful symbol of private property. Increasingly, investors have as its main objective, to maintain the capital of their customers and, therefore, their investment funds are active in almost half of the yellow metal. Bet on the gold because there is less confidence in the money.

Reaction in Brazil

Last year, the country occupying the 13th place among the gold producers, with only 62 tons, but the government says that Brazil has the capacity to produce 503 tons per year, surpassing China. In recent months more than a thousand were granted licenses to operate in the Midwest, Northeast and northern Brazil. New technologies, which allow you to extract half a gram of gold a ton stone, make it highly profitable areas deemed to be exhausted. Moreover, it is possible to find gold deposits at 2500 meters deep, while in South Africa, for example, deposits are similar to 4000 meters.

Is it worth Investing in Gold?

Depends on the interest and knowledge about the investor markets. But history demonstrates two facts: The value of gold tends to be quite stable (because their production is slow and expensive) and during periods of instability gold tends to appreciate as it is a product refuge for investors. Thus, in times of crisis gold can actually be a good investment, especially for those who do not master the operation of financial markets. Outside periods of crisis may not be an investment that interesting, since resolved the turmoil investors tend to disinvest in gold to invest in other securities / assets.

I leave you an extreme example of the search for gold:

Urban Gold Miner

In my case

I personally would invest in gold, but not this way. The only investments I do is on gifts for my wife, for example, rings, necklaces, bracelets and so we gradually accumulating gold. This metal seems to hypnotize my wife, she loves the sparkle that is gold, especially she loves white gold. Finally, women.

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