Poor Economy, Higher Value of Gold
Many of you have probably noticed how the price and overall value has been increasingly rising as our economy has been floundering. Households throughout the US have taken advantage of this discovery by finding dependable cash for gold NYC locations and selling their unwanted gold. We all know that when our economy is struggling, the value of gold behaves on the contrary. But most of us don’t know exactly why that is.
For centuries upon centuries, gold has been and is considered to be a safe investment. Gold will always have a solid value attached to it, whereas paper money fluctuates based on the economy. Paper currency is simply a reflection of a country’s economy. During hard economic times where a country is in a financial crunch, if there’s a recession, stock market crash, or inflation, the value attached to paper money decreases. However gold is recognized as a valuable asset throughout the world and is able to maintain same value from one country to another. This is why selling or buying gold is a great investment in the long run.
Our Economy and the Perceived Value of Gold
Whenever the American dollar moves down, the value of gold moves up and vice versa. During hard economic times, such as small recession we had in previous years, the value of the dollar goes down. This can be witnessed when we compare the dollar to the euro. If the dollar continues to have less worth compared to the euro, then that is a sign that our economy is getting worse. It used to be that the US currency was attached to value of gold. Over 60 years ago, the US operated under the Gold Standard, where gold had fixed prices so the value of the dollar was always the same. Think of it this way, when our economy is failing, we start looking for something else to place our trust in–that happens to be gold. However if our economy is thriving, we don’t need to depend on looking for a backup plan (such as gold).
However in the early 70s, the US went off the Gold Standard, but the stable value of gold did not change. The only factor that can really influence the value of gold substantially is our own perception of the worth of gold. If everyone suddenly decided that gold was worth 100x more, then every gold owner would be 100x richer. Unlike paper currency can be inflated or deflated based on the actual supply of money, a nation’s debt level, and overall economic status, the value of gold remains strong. Consider gold to be the safe back up plan should all else fail. For all you NY gold buyers or sellers, be smart about when to sell your gold and when to invest in gold!