Since hitting an all-time high of $1,923.70 in 2011, the gold spot value had slumped to a disappointing $1213.80 in a little over two years. The bad news for investors in gold during the yellow metals meteoric rise is that gold prices will fall even further in 2014.
With the global economy getting stronger it is inevitable that gold is in for another disappointing year, but the good news for investors this time round is that gold prices will stay low long enough for you to accrue a reasonable amount and the value will go up eventually.
All in all, now is a great time to for long-term investors to buy gold as the charts indicate traders are focused on the commodities market.
Morgan Stanley is the latest investment bank to cut its gold targets for the year. Analysts wrote: “Price performance will continue to suffer as long as risk assets in general and U.S. equities in particular continue to perform strongly, undermining the need for portfolio managers to hold more than a modicum of safe-haven assets.”
The future of gold
There is some uncertainty about the future of gold at the moment. Analysts are predicting prices will continue to fall before the bull re-enters the race. The question is how far will gold fall? If prices drop as low $1000 that will be the end of the precious metals market!
A gold crash however is unlikely to happen and central banks will start to reinvest in gold again – if only to put confidence back in the market. The gold bull will run again, but given gold reserves are expected to expire in 2033, it could be the last time we see a gold rush.
Gold prices will inevitably improve when currencies weaken again and the way the current banking system is being propped up by a false economy, it is only a matter of time before the next market crash.
Peter Schiff, a leading financial advisor in the US, told news channel CNBC: “People have sold off gold based on a false premise of a legitimate economic recovery and the Fed tightening. None of that is going to happen. We don’t have a legitimate recovery. The phony recovery is completely dependent on more QE, which is exactly what we’re going to get. Cheap money is more bullish for gold than it is for stocks.”
All eyes are on the US dollar and the pressure it is being put under by the Chinese yuan as the new benchmark currency. Given that China has the strongest growing economy in the world at the minute and the US are more than $17 trillion in debt there is only one inevitable outcome.
You do not need a degree in economics to know that the false economy created by years of credit loans and bank stimulus is not sustainable. When the ceiling collapses currency will be worth nothing and the global economy will be in a worse state than after the banking crisis of 2008.
The only way to protect your financial future is to invest in physical gold. For the latest prices visit coininvestdirect.co today.