Gold is prized worldwide for its high value and long history of being woven into cultures for centuries. Coins containing gold initially emerged in approximately 650 B.C., and the first gold coins were minted around 100 years later during the reign of King Croesus of Lydia.
People have kept gold for a variety of reasons over the years. Gold is valued by societies and economies, preserving its value. It is the metal we turn to when other kinds of currency fail, and always has value as a hedge against bad times. Here are eight compelling reasons to consider purchasing gold now.
Unlike paper money or coins, or any other assets, gold has always retained its worth over time. Gold is seen as a method for people to carry on and protect their riches from generation to next. People have admired the precious metal’s remarkable characteristics since ancient times. Because gold does not rust and can be melted over a standard flame, it is simple to deal with and imprint as a coin. Unlike other metals, gold has a gleaming hue. Because gold atoms are heavier and electrons move quicker, some light is absorbed, a process that required Einstein’s theory of relativity to understand.
- Weakness of the Indian INR
The key that gold has perfectly stored wealth for all past generations is also one of the reasons for its current relevance in the economy. The same is however not true for currencies on paper. Consider this e.g., to put things into perspective:
One ounce of gold was worth INR 2,712 in the early 1970s. Assume you had the option of holding an ounce of gold or merely retaining the INR 2,712 at the moment. They would both purchase identical items for you, such as a brand new business suit or a high-end bicycle. However, if you had an ounce of gold today and translated it to today’s pricing, it would still be enough to purchase a brand new suit, however, Inr 2,712 of that time would not.
- Hedge Against Inflation
Because gold’s price rises when the cost of living rises, it has historically been a good inflation hedge. In high-inflation years during the last 50 years, gold prices have soared while the stock market has plummeted. Because gold is valued in those currency units when fiat money loses its purchasing power due to inflation, it tends to climb in tandem with everything else. Furthermore, because gold is seen as an excellent store of value, individuals may be enticed to purchase it if they perceive their country’s currency is losing value.
- Demand Is Growing
Increased affluence in market nations has also drove gold demand in prior years. Gold runs deeply in the DNA of many of the countries. India is world’s second-largest gold consumer, and uses it for a variety of purposes, including jewelry pieces. As a result, the Indian wedding season in October is generally the time of year when worldwide demand for 22 karat gold coins or gold in any form is strongest.
- Protection Against Inflation
Deflation is a time in which prices fall, corporate activity slows, and the economy is burdened by excessive debt, something that hasn’t happened since the Great Depression of the 1930s (although a small degree of deflation occurred following the 2008 financial crisis in some parts of the world and in covid time). During the Depressions, gold’s relative buying power has increased, while other prices have always plummeted. This is because people like to hoard cash, and the safest location to keep the currency at the time was gold and gold coins.
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