Recognizing the Substitution of Gold for Fiat Money

by James on February 20, 2017 · 0 comments


Is 2017 a viable tenure to invest in Gold as safety deposits? Investment bankers often suggest retirees to convert their IRA or 40iK savings to gold bullions or jewelry. Is it a proper investment decision? Many investors are understandably apprehensive in fear of losing the power of cash. After all, conversion of savings to gold limits its applications severely by turning it into ‘fixed’ properties, which must be sold anytime in the future to recover the inherent cash value.

Solid backup

The answer to this essential question may be in the manner of understanding how the fiscal economy works. More specifically, you should have a clear idea on fiat money and why physical commodities such as gold are crucial. In addition, put into the calculations of recent political context, the election of President Donald Trump and the chaos it has ensued on the world. An abrupt financial decision may cost all your savings; so, it must be a good idea to convert it into something so solid as gold, the traditional choice for banking backup. This essentially leads one to the concept of Fiat Money.

The money that is in circulation in the economy works on its imprinted face value, authorized as a legal tender by the Government. However, when this authorized currency circulation does not have an equivalent backing of gold, the economy does not have a backup plan, so to say. The Government may simply order more and more mint printing, but in the event of an inflation or depression, there would be nothing to restore the inflated/deflated valuation of currency. It is a real threat, and its significance has been proven many times over by National bankruptcies and other similar events.

Investment avenues

Nevertheless, the widespread circulation of fiat money, many observers note that it is the best time to resume the conventional creation of gold bullion backups at the banks. By encouraging customers and investors to invest in this valuable metal, the relevance of it can be restored in order to find the balance of economy. It is high time actually because in the event of a collapse, even the wealthiest investor may lose it all like tumbling dominoes blocks. There are several avenues for investing in the precious metal. In the UK, one can directly purchase gold coins from the Royal Mint.

You can also check out professional Gold Funds where an experienced manager overlooks the safe keep of your solidified investments, and decide what to do with it according to market conditions. Besides, owning it also delivers a significant sense of monetary authority to the owner, attributing to the regal value of the yellow bricks. One should proceed systematically. Check out the current gold prices. It is one of those commodities whose prices do not fluctuate very significantly (usually).

The variations are only minimal, but when it is in the crest curve, make it a point to recover the worth of gold from the grave economical condition. Discuss the matter with professional investors, look at the curves and charts, and allow yourself the open-mindedness to take an informed decision. Ultimately, it may save you during an unpredictable collapse!

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