Why Buy Gold and When to Sell Gold
Gold is Beautiful
Gold, both as a precious metal and as a commodity, has been around a long time. It even warranted a mention in the first book of the Bible. To quote from Genesis 2:11-12, "it is the one that flows around the whole land of Havilah. Where there is gold; and the gold of that land is good...". In many ways our perception hasn't changed; gold is still primarily seen as good.
If there is an argument that other metals, for example, have an industrial use, then can gold be measured for its aesthetic value? If we define aesthetics as an appreciation of beauty, we need look no further than uses of gold in works of art, in religious artefacts or as ornamental value in jewellery. But this beauty is also linked to a monetary value, above and beyond the beauty itself.
Barter
As civilisation developed, so did the transactional nature of how we traded. Bartering, which is the mutual exchange of goods and services, formed the basis of early commerce. This system, of course, had its limitations, no more so than the freedom of choice and a sense that the most industrious would not necessarily get true reward for their efforts. Money was introduced, initially in the form of gold coins and nuggets, before the modern tradition of coinage and paper money replaced it. Yet, we still adhere to gold as the acceptable standard.
Why Buy Gold?
Inflation, economic turmoil and its resultant fluctuations and political unrest have all contributed to the destabilisation of modern society. Factor in a shift in balance of economic power with the might of China and India as now accepted 'players' and there is global economic disturbance. Also, with the US debt showing no real signs of diminishing and peripheral states undermining the value of the Euro, does monetary investment really look that good at present?
This theory tests itself both at central bank or government level and with the 'man in the street'. If there is fear in the marketplace, people want something tangible. That's why people are turning to precious metals and gold in particular. In November 2011, the Royal Canadian Mint announced plans to sell gold in $20 amounts, with each tiny speck held at a central facility in the nation's capital, Ottawa.
The perception of gold as an investment has changed over the years, particularly since 2000. If gold had previously been perceived as a 'safe bet', that is, a way of not losing on assets as opposed to making a killing, this is no longer the case. With rocketing gold prices (the value of gold has increased fivefold in the last ten years), it is now being viewed as a more serious investment.
Time to Sell?
It works both ways. That eager Canadians are willing to snap up specks of gold at $20 a time is actually also testimony to the endearing quality that is gold. It is unlikely, given the economic climate, that they would rush in their hordes to claim $20 bonds in such a way. Governments change and policies differ but the perception of gold 'as a good thing' remains.
There's hardly a high street in a major town or city today that does not have some kind of facility for selling gold. These are, of course, aimed at recession hit households in need of spare cash but this doesn't alter the fact that gold is attractive. It could be said that many of these outlets and similar ventures run off the back of shiny advertising are a "rip-off". The gold fever springing up now is along the lines of traditional Tupperware parties. Women are invited to bring along and sell old broken bits of jewellery and things they'll never wear again or unwanted gifts. There's also a big market for selling gold by post and, of course, via the traditional pawnbrokers. Given that most jewellery is generally 9 carat as opposed to 24, it will sell for 37.5% of the price of pure gold. That said, if you do visit the dentist and you have a gold crown removed, it might be worth as much as £30. If the dentist asks if you wish to keep the tooth, the answer has to be yes!
Making it Pay
If the household is the microcosm of society in how it operates, then gold is being sold on all levels from central government bullion down to auntie's old bracelet. For individuals, an online auction site can work providing the seller has a good track record and an understanding of what the product is truly worth. So can selling privately, but again having knowledge of the market is important. Internet sites can be found that offer both good information and sound deals when it comes to selling scrap gold.
These are difficult times. Funds can be needed for an emergency; be that at governmental level or to pay the electricity bill. Also, with the increasing price of gold, opportunities are arising to make 'quick' money. We have established that gold will always retain its value and in today's climate, do much more than that, so it offers buyers and sellers security in trade. But like any potential transaction, an informed choice needs to be made.
