Gold price steepens

The current exceptionally high growth of the gold price is due to three important factors: the financial crisis, fear about future developments and high sovereign debts. These factors bring down the profit earning capacity of common investment products and cause a redistribution of investment money. This new allocation of money has a positive effect on the gold industry, because investors have always considered gold as a safe investment in times of financial mayhem, despite the fact that it’s a non-yielding product of which the profit is only determined by the uplift of the value. This increase of value is influenced by the global financial stability and could therefore tumble down again if the economy succeeds in recovering, but luckily for the investors there is still a lot of work left to be done. (The Quardian)

Cedric Meyers