Savvy Investment Options: Making the Leap to Gold

There are many panicked investors out there who have no idea where to safely stash their money in these troubled times. Expert investors and traders know several key facts about investing, which I’m going to share with you now. First, according to Larry Edelson of Money and Markets magazine, “Many of the lowest risk, most profitable investments are made when things look the scariest…or, as better said, when it’s darkest before dawn.”

Second, you’d be better off going with your own instincts and forging your own path. Followers never make it big in the markets.

With that being said, let’s take a look at some of the pressing conce
s raised by investors these days.

You may have heard of the Dow Jones breaking its own low points of late, causing you to wonder what that means to the stock market. First and foremost, you need to understand that the values you see quoted on a day-to-day basis for everything but gold are not true values. The reason is, quite simply, because the value of money often undergoes significant changes every single day. It’s next to impossible for the average investor to keep track of these changes.

To give you an idea of what I’m talking about, let’s break dow
General Electric’s stock over the past decade. In September of 2000, GE stock was sitting at a record high of $60.75. Last month, it had plunged 79.3% to a low of $12.58.

But that’s not the end of it. The dollar bill has also lost value in the past eight years, so we have to take that into account as well. Back in the height of its value, when GE’s stock was $60.75, you could have traded in each stock for about 1/5 of an ounce of gold. Its recent low point of $12.58 per share would gain you only 1/50 of an ounce of gold, which is a 93% loss in the purchasing power of GE stock.

All of this means that General Electric is now worth less than 1/12 of the value it enjoyed at its peak nine years ago.

The one constant over the years is gold. In fact, gold has served as the benchmark to gauge the value of money for over 5,000 years, and it’s not about the change now.

One thing’s for sure: the value of money is on the downhill slide, a trend that shows no sign of relief in the coming years. To compensate, asset values will be forced higher. We’ve seen it happen in Brazil, Argentina, and other third-world countries that have muddled through currency devaluations. If we don’t change course, we’ll find ourselves the first and only first-world country to meet the same fate.

Investors are also wondering what’s going on with gold, and I’m here to tell you, gold is doing amazingly well. Larry Edelson exclaims that, “Gold is still well above its long-term uptrend line, and even above support derived from the 2006 and 2007 highs.”

He believes that gold has not only held up well but that it’s on its way up, and I couldn’t agree more.

We could also look at the history of gold to see that gold bull markets tend to last eleven years or more, which would mean that gold would top out around 2011 or 2012. Which would also mean that long-term gold cycles are still safe bets for savvy investors.

Many investors are picking up on this, sending the demand for gold soaring in recent months. As of September 30, 2008, total gold demand was up 18% from September of the prior year. Investor demand made up the greatest percentage (56%) of those seeking to purchase gold.

While demand was surging, supply was rapidly decreasing. In fact, the available gold supply dropped 10% from September of 2007 to September of 2008. The biggest reason for the decline in supply? Central banks stopped selling their gold, which is a huge indication that they are becoming increasingly aware of gold’s real value.

Knowledgeable investors and powerful central banks are quickly realizing that gold’s an optimal place to store their capital for long-term safekeeping. If you’re questioning the safety of your money in your current investments, now would be a great time to make the leap to gold.