Why People Turn to Gold in Troubled Times?

hard times gold investing 300x262 Why People Turn to Gold in Troubled Times? Throughout man’s history, people have relied on gold as a means of protecting their wealth and investment especially in troubled times.

Gold in many ways has earned the respect of people because of its historical significance and the intrinsic value it seems the command.

Here are some reasons:

Gold has more intrinsic value than paper in many peoples eyes, it has an intrinsic touch and feel of something of value.

Gold as a commodity has more uses than paper and people are always willing to barter with gold than they do paper.

Gold more than any other metal retains its value over much longer periods.

It does not erode or deteriorate as easily. Gold can maintain its shine and luster for hundreds of years.

The amount of gold on earth is limited as compared to other metals or paper.

These are just some brief reasons why gold maintains the status it does in the world.
The world extracts about 2500 tons of gold per year. Of that amount two thirds is used as a store of value while the other one third is used in manufacturing and industrial applications.
What causes the erratic jump in prices of gold? For the most part the price of gold is mainly determined by peoples and governments perception of the economy, and not because of supply and demand.
People and governments seek to acquire and hold larger reserves of gold when their confidence in the economy is slipping, which gives gold the title as “the currency of last resort”.
During wars, inflation, economic anxiety, troubled financial markets people hold on to gold and as things get better the price rebounds back to normal.