New York company Gold Standard, which buys jewellery, had so many customers despite the usually sleepy month that it felt like Christmas in August.
A new record is seemingly made every other day as the stock market’s volatility led to more demand from investors, some of whom want to investment in a safe bet during the turbulent times. Some investors are however worried because others are buying gold just to make money fast.
“Is gold the next bubble?” said Bill DiRocco, a golf company manager in Overland Park, Kan. He stopped buying gold because of the constant increase in price and instead shifted 10 percent of his portfolio into an investment fund this year that tracks the price of gold.
Gold was sold at $740 an ounce in October 2007 but increased to over $1,000 for the first time a little over a year later. The price of gold started to rise up this March, traded at $1,801 last week and settled Wednesday at the price of $1,795 an ounce.
The price of stocks may have increased sharply in the last two and a half years but the price is only slightly higher compared to a decade ago. The Standard & Poor’s 500 index is down 23 percent after it hit a record high in October 2007.
Gold is a highly preferred investment among the elements because it does not lose its properties even when divided into small amounts, it is chemically stable and while it is rare, it is not too rare. It has been used for thousands of years as a currency and backed up the value of paper currency for hundreds of years more.
Dazzling is once again dazzling investors amid the growing European financial crisis, the U.S. credit downgrade and the slow growth worldwide. Gold has been used as a hedge against foreign currency holdings by the world’s central banks and for the first time in over 10 year, South Korea bought gold.
Gold is “an effective hedge in a world where there is too much debt and uncertainty,” said Northern Trust chief investment strategist Jim McDonald who owns $2.8 billion of gold in a gold fund.
“Gold is the reciprocal of the world’s faith in the world’s central banks,” Grant’s Interest rate Observer Jim Grant says, and right now, “the world is in a pickle.”
A big bounce, ounce by ounce, as gold takes off
New York company Gold Standard, which buys jewellery, had so many customers despite the usually sleepy month that it felt like Christmas in August.
A new record is seemingly made every other day as the stock market’s volatility led to more demand from investors, some of whom want to investment in a safe bet during the turbulent times. Some investors are however worried because others are buying gold just to make money fast.
“Is gold the next bubble?” said Bill DiRocco, a golf company manager in Overland Park, Kan. He stopped buying gold because of the constant increase in price and instead shifted 10 percent of his portfolio into an investment fund this year that tracks the price of gold.
Gold was sold at $740 an ounce in October 2007 but increased to over $1,000 for the first time a little over a year later. The price of gold started to rise up this March, traded at $1,801 last week and settled Wednesday at the price of $1,795 an ounce.
The price of stocks may have increased sharply in the last two and a half years but the price is only slightly higher compared to a decade ago. The Standard & Poor’s 500 index is down 23 percent after it hit a record high in October 2007.
Gold is a highly preferred investment among the elements because it does not lose its properties even when divided into small amounts, it is chemically stable and while it is rare, it is not too rare. It has been used for thousands of years as a currency and backed up the value of paper currency for hundreds of years more.
Dazzling is once again dazzling investors amid the growing European financial crisis, the U.S. credit downgrade and the slow growth worldwide. Gold has been used as a hedge against foreign currency holdings by the world’s central banks and for the first time in over 10 year, South Korea bought gold.
Gold is “an effective hedge in a world where there is too much debt and uncertainty,” said Northern Trust chief investment strategist Jim McDonald who owns $2.8 billion of gold in a gold fund.
“Gold is the reciprocal of the world’s faith in the world’s central banks,” Grant’s Interest rate Observer Jim Grant says, and right now, “the world is in a pickle.”
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