August 1, 2013
James O'Dell
August 1, 2013, Los Angeles ? Gold was modestly lower on Wednesday, as the price to invest in the precious metal eased 0.15 percent or $2.00 to close at $1,323.60 an ounce, following a very choppy trading day that saw the Gold price see-saw dramatically after the close of the Federal Open Market Committee (FOMC) meeting, but still finished July with Gold's biggest monthly gain since January 2012. The price to invest in Silver rose 0.36 percent or $0.07 to close at $19.77 an ounce, while the Gold/Silver ratio slipped to 66.95 after hitting a new three year high on Tuesday, as Silver outperformed Gold.
The World Gold Council (WGC) used the Fed's July policy meeting as an opportunity to caution investors against hanging on every word from Fed Chairman Bernanke's mouth. In its latest research paper titled "Gold and the US interest rates: a reality check" the WGC warns against giving too much credence to the Fed's announcements that it may or may not taper its quantitative easing (QE) program.
"While negative interest rates support Gold investment demand and rising rates increase the cost of investing in it," says the report. "A normal rate environment ? with real interest rates ranging between 0 percent and 4 percent or approximately 2.5 percent to 6.5 percent in nominal terms ? is not automatically adverse to Gold. In such a rate environment, Gold's inclusion in a portfolio has historically been beneficial to investors."
Gold investments have been very positive, historically, with long term average annual returns of between six and seven percent, claims the WGC, and when investors put too much emphasis on U.S. interest rates, it "oversimplifies the issues currently at play," said the WGC's Juan Carlos Artigas. "In the event of a return to a more normalized real rate environment in the U.S. it is worth remembering that investment demand is not the only arbiter of Gold prices, nor does it originate solely in the US," said Artigas, as he points to the Asian market where Gold consumption jumped 132 percent between 2007 and 2012 in China.
"Even with the highest rate of interest, the core value of Gold is to balance out a portfolio," says Artigas. "Most investors are under allocated; optimal levels are identified as between 2 percent and 10 percent." Don't leave your assets unprotected during these times of economic and geopolitical uncertainty, invest in Gold and invest in Silver and protect your wealth in 2013.??
You can browse and buy a Gold coin or a Silver bar, quite easily at Gold-backed IRA provider Morgan Gold and they can be stored in a safe-deposit box if needed. Join our 38th Director of the U.S. Mint, and Morgan Gold?s Chief Strategist, Edmund C. Moy, and?? add physical Gold to your IRA Today.?? Hear Mr. Moy speak on Gold and your retirement. Let our team at Morgan Gold help you diversify your portfolio today by calling us Toll Free at 1.800.585.1773.
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