Gold has been on the defensive in recent trade, and prices are approaching the $1200 per ounce level. Recent hawkish commentary from the Federal Reserve, as well as from the central banks of Canada, Europe and even Japan have kept animal spirits going as investors anticipate the end of the easy money era.
Although some investors may consider this to be cause for celebration, it is also important to consider just how long it has taken to get to this point. After all, the U.S. only started raising rates this past year after holding rates at zero for many years. The Bank of Japan has not sounded as hawkish about the economy in a decade, and Japan has been stuck in a deflationary spiral for the better part of 20 years.
The bottom line is this: Even if the recent era of cheap money is in fact over (which remains debatable), there is nothing to say that such monetary policies would not come roaring right back if the economy finds itself on loose footing.
In fact, global central banks would very likely look to fight such a slowdown by lowering rates, and a return to massive QE cannot be ruled out, either.
We believe that the current economic situation demonstrates the importance of dollar-cost averaging. Yes-gold has been trending lower, and YES that is exactly why you should be looking to buy even more right now.
The current pullback in gold prices is nothing more than another temporary blip on the screen in our opinion. As we have said before and we will say again, gold should not be viewed as a short-term “play” or trade but rather a long-term investment made to add diversification while acting as a hedge against inflation, declining currency values, geopolitical risks and more.
The potential for price appreciation is certainly a nice bonus, but should be viewed as the icing on the cake rather than the cake itself. Within this context, the idea of buying gold consistently regardless of price makes even further sense.
A lower gold price should not be feared, but should be taken advantage of. And current prices may potentially provide an opportunity to add gold at a great long-term value.
If you do not already own physical gold, now may be the time to consider an allocation. If you do already own gold, now may be an ideal time to add to your holdings. Buying and holding physical gold has never been easier than it is today.
Speak with an Advantage Gold account executive today about the potential benefits of physical gold ownership. Our associates are here to answer any questions you may have, and can even show you how to harness the power of an IRA account to build a significant holding of physical gold or other precious metals.
Don’t wait for the next round of zero interest rates, QE and higher gold prices. Act now. Explore your options for gold ownership today. Call Advantage Gold at 1-800-341-8584 to get started now.Tags: advantage gold, end of easy money, federal reserve, gold, monetary policy