In its entire history, the price of gold has fluctuated but the precious metal has never lost all value. This proves that, as in investment, gold has and will continue to be worth its weight, and then some. Paper currency, bonds, and stocks can lose all intrinsic value but this will never happen to gold. This tangible asset is not only liquid, it will always be demanded due to its rarity and inflation-proof nature.

Even during the roughest economic and political times, gold has retained its value. Once serving as a currency in many countries of the world, gold is still considered international. At any time, it can be sold or traded for a needed good or service. Everyone recognizes the value of the precious metal and rare are the situations when someone would not enjoy owning it.

Not only are gold coins a portable form of gold, their value corresponds to their gold content. As a currency, the use of gold could not continue because there was not enough of it. This limited supply eventually resulted in it ceasing to be used to back token currencies. Currencies became undervalued because their quantity exceeded that of gold reserves.

Paper currency has a symbolic value, with worth based on the items for which it can be exchanged. High inflation can cause paper money to lose nearly all of its value, as prices skyrocket. However, gold will never be in this situation because its intrinsic value cannot be lost. When token economies collapse, gold’s value will increase.

The Bank of England and the U.S. Treasury have shown us that selling massive amounts of gold does not result in the precious metal losing all its value. Investors find gold attractive because they worry that currencies will become further devalued. They are also concerned that bonds and stocks will someday become worthless.

Keep learning more:

1. Gold Is The Only Global Currency


2. The Different Ways To Invest In Gold


3. What is FOREX?


4. What Is Value Investing


5. Corporate Bonds 101: An Introduction to Corporate Bonds


6. Inflation is the Biggest Risk of Bond Investing


7. How Much of Your Portfolio Should Be in Bonds?

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