New gold investment will continue to grow if the world’s major currencies — gold’s main competition as a store of value — plunge into the inflationary spiral that many economists fear.
Until there’s a dramatic change in monetary policy, the over-supply of Dollars, Euros and Yen look set to keep pushing gold prices higher. And it took a dramatic change in central-bank policy to finally kill gold’s last inflation-led surge.
At the start of the 1980s, the Federal Reserve pushed US interest rates up to 18% and above, restoring the world’s confidence in its currency and kick-starting the “long boom” of the next 20 years.
Could America survive such strong medicine now? Would Ben Bernanke even dare risk it?
If you think the world’s central bankers are about to set interest rates far above the real rate of inflation, you should steer well clear of gold.
But if you fear for your savings — and you want to start investing in gold — you can start today, for free, at BullionVault.