If (as Wikipedia points out) about 10 billion ounces of gold were extracted in history, the total value of the world's gold at $ 1,300 an ounce would be close to $ 13 billion. Gold reserves in the United States are only 8134 tons, only 29,167 ounces per ton = 237.2 million troy ounces of gold. The value of US gold UU. At $ 1,300 an ounce, it stands at $ 308.4 billion.
Compared to our government debt of about $ 22.2 billion (and an increase), the value of gold in US reserves. UU. It represents only approximately 1.3% of our national debt and all the gold in the world is almost paid off by our national debt.
Do you think the fact that there is no link between our debt frenzy and the value of gold is strange? Of course, gold is in a global market, but the fact that its price deviates from the size of our debt means that the current gold price is arbitrary.
The fact that our national debt bursts and that gold has the same price 20 years ago is an excellent television commercial. How wouldn't gold be more valuable if all of these debts weakened the dollar?
If you believe that our public debt, our student debt or our other private debt is low or uncensored, and that we spend a lot, even if there is a "conservative" government, the risk of default on our finances gives gold more value than the price indicates market. Do we double or double our debt in 10 years and the price of gold does not move significantly? You don't have to be an economist to understand that gold prices are controlled and have nothing to do with reality.
Yes, gold was used as a currency in the US, UK and other countries, but its price was also controlled by governments. Today, gold prices track production costs, oil rises and gold production costs go up, leading to an increase in gold prices. What happened to the price based on supply and demand? This came years ago to get gold.
The government intervenes to control the upward movement of the gold price through interest rates and other contract manipulations. If you think of gold as an opportunity cost, you won't get a return on your investment until you sell it. No annual interest of 5% or 10% for gold accumulators. Then they keep the price of gold low and investors get rid of gold in favor of the currency. It works, but now it has the same gold value as it was in 2010.
If you are in the corner for a while and know what happens when gold is allowed to grow significantly, you cannot buy an ounce from anyone. "Turn off the tap" and you can sell what you want, but you can't buy. All operators enter the "we can not get gold" mode. It is not a real market, it may be a “controlled market”, but it is not what you imagine when you enter the gold market.
The fact of gold ownership is that when you invest, you stand with governments and central banks, the largest money trading companies on the planet. Therefore, you should consider gold jewelry or collectible gold coins, where you can enjoy gold while maintaining its price among those who think it is better not to let him float freely in the free market.
The interesting thing about investing in metals is that there is a possibility that all manipulations are not enough to control them when something really important happens. Something like default, reprogramming "Jubilee" or si, if you wish. Control of gold may work today, but if it trembles, control of piggy bank may disappear.