The world is undergoing a major financial shift as countries move away from paper currency into tangible assets. The news might want to distract you with babblings of a potential UFO invasion, but savvy investors are keeping their eyes peeled.
Watch this week’s The Gold Spot to hear Scottsdale Bullion & Coin Sr. Advisor Steve Rand & Advisor Todd Graf discuss why everyone’s focused on gold, why countries are pulling away from the US dollar, and how investors can best position themselves for the future.
Gold Price Dip Sparks Buying Frenzy
Gold prices are experiencing a slight pullback which has led to more stockpiling by institutional and retail investors alike. Instead of being scared off by a temporary dip in value, investors recognize the opportunity to dollar cost average down for a better position by scooping up gold and silver coins, gold bullion bars, and silver bullion bars at lower price points.
This move should come as no surprise as governments around the world have made it clear that increasing their gold reserves is a priority. In fact, central bank gold buying reached record highs last year with countries like China and Russia leading the charge.
The Dollar Ditching Continues
The record-setting rush to gold is only half the story. As countries strategically jump into tangible assets, they’re simultaneously moving away from the US dollar. Record-setting inflation, potential debt defaults, and other financial fiascos show the weakness of the dollar, and governments are preferring the stability offered by gold, silver, and other precious metals.
Saudi Arabia’s potential decision to accept non-USD currencies, like the Petroyuan, for oil trade would further loosen the dollar’s already weakening grip on the world. While China, Russia, and other adversarial governments actively seek to hurt US dominance, many nations are simply doing what’s in the best interest of their constituents, but the end result is the same.
Low USD Demand Increases Pain
The strength of the dollar is owed, in part, to the prestigious position it has held as a global reserve currency. This prominence has bolstered the US economy and fiat-backed stocks. As the hegemony of the greenback is threatened, everything that relied on the USD as a foundation is in danger of losing significant value. This is of paramount importance for investors who have significant funds in savings or in paper assets.
A Perfect Storm for Investors
A tried-and-true strategy for investing is following the moves of institutional investors. Central banks represent some of the most educated and knowledgeable financial minds in the world, and they’re pouring into gold like there’s no (financially sound) tomorrow. The current pullback in gold and silver prices is creating a perfect storm allowing investors to increase their physical gold and silver holdings at lower costs.
Don’t Wait to Buy Gold, Buy Gold and Wait
Gold prices might be experiencing a slight pullback, but it’s only a matter of time before the value of this highly-sought after precious metal jumps ahead. The gold price forecast for 2023 is looking solid with many experts projecting new highs. As always, it’s better to increase your gold exposure now so you can lock in higher gains when prices inevitably turn upward again.
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