How High Could The Price Of Gold Go
Gold has served as a safe haven for literally thousands of years. So if fear is high or a crisis develops in the markets or economy, investors instinctively rush to gold, and the demand pushes its price higher. Believe it or not, gold soared over 2,300% in the 1970s, because there was a series of crises underway two recessions, an energy embargo, runaway inflation, and sky-high interest rates. Combined, they served to push golds price to its inflation-adjusted all-time high.
We think there are a multitude of outsized current risk factors again, and that a series of crises is headed our way if so, gold and silver prices are likely to hit new all-time highs. A five-figure gold price is possible if the crises are severe enough. Heres what a dozen of the largest investment banks predict for gold prices in 2018.
Why Do Gold And Silver Prices Fluctuate
Like other investment assets, gold and silver are prone to price swings based on investor sentiment. They can also fluctuate due to trends in underlying supply and demand fundamentals.
Traders determine gold spot prices on futures exchanges. Metals contracts change hands in London and Shanghai when U.S. markets are closed. But the largest and most influential market for metals prices is the U.S. COMEX exchange. The quote for immediate settlement at any given time is effectively the spot price.
A hundred years ago, gold sold for just $20 per ounce. In recent years gold has traded between $1,200 and $1,900 per ounce. Thats a huge move up in nominal terms over the past century. Yet in real terms gold prices today arent much different from what they were when they were last quoted at $20 an ounce.
Its not that gold has become so much more expensive. Its that the currency in which gold prices are quoted has depreciated so much.
Silver Prices Have Barely Budged In Months Even As Global Silver Demand Looks To Reach A Record This Year
Silver futures trade at less than $24 an ounce.
Global demand for silver is on the rise and expected to reach a record this year, offering an opportunity for investors to buy the metal at prices that have seen little change in the past six months.
A compelling argument can be made that 2022 will be a good year for silver, says Edmund Moy, former director of the United States Mint and senior IRA strategist for gold and silver dealer U.S. Money Reserve. As the global economy recovers from the pandemic, expect to see silver demand rise from the industrial sector.
A compelling argument can be made that 2022 will be a good year for silver.
Edmund Moy, U.S. Money Reserve
Total global silver demand is forecast to climb by 8% to a record high of 1.112 billion ounces this year, according to the Silver Institute.
Based in part on analysis from precious-metals research consultancy Metals Focus, the Silver Institute said that the exceptionally promising outlook for silver demand is driven by record silver industrial fabrication, which includes electrical and electronic applications, as well as green technologies.
The Silver Institute forecasts growth of 5% this year for global industrial silver demand to a new high of 552 million ounces.
For silver just to catch up to half of coppers performance, that would imply a silver price near $25.50 an ounce, says Minter. On Feb. 16, silver futures SIH22SI00,
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A Cautionary Tale For Gold And Silver Buyers
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In these troubled economic times, its not hard to understand why people might want to protect their life savings by purchasing a hard asset like gold or silver.
At least, thats the pitch of Monex, the big Newport Beach investment firm, which bills itself as Americas trusted name in precious metals investments and assures clients that its committed to customer service.
So lets take a look at the experiences of some customers who say their trust in Monex was misplaced.
Patricia Mike, 66, of Camarillo says she had no prior investing experience when she and two adult daughters discovered Monex via the Internet in 2008, according to their lawsuit in Orange County Superior Court. Mike owned an annuity and an inheritance worth $240,000 that she wanted to protect. Her daughters, Susanne Drumheller and Johnna Mike-Price, had the proceeds of a lawsuit.
Banks were failing, the stock market had cratered. Their Monex salesman assured them that their idea of buying gold bars was the right one calling it a very safe, no-risk investment, the lawsuit says. They say they invested a total of $689,500.
Then the pressure started, their lawsuit alleges. Within days, the salesman was urging them not to sit on their gold bars but to trade actively in the metals market, according to their suit, so they could double their money, even quad their investments.
A hearing on Monexs motion to force Shaffters lawsuit to arbitration is scheduled for Jan. 26.
What Was The Highest Price For Silver
What was the highest silver price ever and when was it reached? Learn about the white metals historic and current price movement.
Like its sister metal gold, silver has been attracting renewed attention as a safe-haven asset.
Although it continues to exhibit its hallmark volatility, many silver investors believe that a bull market is on the way for the precious metal. Experts are optimistic about the future, and as a result, some market watchers are putting forth price forecasts and asking themselves, What was the highest price for silver?
The answer reveals how much potential there is for the silver price to rise. Read on for a look at silver’s historical moves, and what they could mean for both the price of silver today and the white metals price in the future.
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How Is The Spot Price Of Precious Metals Determined
The spot price is based on trading activity in the futures markets. Precious metals trade just like stocks and other securities do. Spot price reflects the current trading price.
In the US, the COMEX is the primary exchange that sets the price, which fluctuates throughout the trading day. This is the price that filters down to the retail level and is quoted to you when you go to buy from a dealer, depending on what buyers and sellers are doing.
COMEX transactions involve the buying and selling of futures contracts. In the case of gold, each of them represents 100 ounces of the metal. For silver, contracts are for 5,000 ounces . It is possible for individuals to buy physical gold or silver on the Comex, but the size of the contracts puts them out of the reach of all but the most affluent buyers. In addition, taking delivery of metal from the Comex is a complicated procedure. Thus nearly all of the trading on the exchange results from major financial institutions making speculative moves or hedges, using large contracts as the vehicle.
So, oddly, the price you will pay for physical gold at any given time is driven by a market where nearly 100% of the participants are simply trading paper and have no interest in purchasing physical gold. The spot price is quoted in US dollars.
What Were Gold And Silver Prices In 1986
After peaking in January 1980, gold and silver prices moved sharply lower over the following two years before basing out in the mid 1980s. By 1986, gold had found a floor around $300/oz.
A rally ensued through 1987, but it proved to be fleeting. Gold prices fell back into a long, protracted trading range. The market finally bottomed out from 1999-2001 before embarking on a multi-year secular upleg.
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Historical Prices Of Gold And Silver
The price of gold today is determined by supply and demand as it is traded through large global markets of physical metals , and even contracts for future delivery at a specific price.
In the US, a market-determined price is a relatively recent phenomenon. For most of US history, government set the price at which gold could be converted to paper currency. In the early years of the republic, the exchange rate was $19.39/ounce. In 1834, it rose to $20.67 and stayed at or near that mark until 1933, when Franklin Roosevelt increased it to $35. Roosevelt also banned the private ownership of gold bullion by US citizens, and canceled the convertibility of paper dollars to metal, so the price only reflected what foreign buyers paid. Finally, in 1972, President Nixon closed the “gold window” citizens could own gold again but foreigners could not redeem paper dollars for gold through the government . The gold price was allowed to freely float.
Silver, by contrast, has always had a market-determined price, and its price history is marked by the sharp fluctuations youd expect absent any constant-price peg determined by the federal government.
Gold As An Investment
Gold is available for investment in the form of bullion and paper certificates. Physical gold bullion is produced by many private and government mints both in the USA and worldwide. This option is most commonly found in bar, coin, and round form, with a vast amount of sizes available for each.
Gold bars can range anywhere in size from one gram up to 400 ounces, while most coins are found in one ounce and fractional sizes. Like other precious metals, physical gold is regarded by some as a good way to protect themselves against the ongoing devaluation of fiat currencies and from volatile stock markets.
Buying gold certificates is another way to invest in the metal. A gold certificate is basically a piece of paper stating that you own a specified amount of gold stored at an off-site location. This is different from owning bullion unencumbered and outright because you are never actually taking physical ownership of the gold. While some investors enjoy the ease of buying paper gold, some prefer to see and hold their precious metals first-hand.
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How Was Silver Priced Historically
Silver hit US$48.70 per ounce, the highest silver price to date, towards the end of the 1970s.
However, the purchase price didnt exactly reach that level by honest means. As Investopedia explains, the metals bid price was driven by the Hunt brothers, two wealthy traders who attempted to corner the market by buying not only physical silver, but also silver futures they took delivery of those silver futures contracts instead of taking legal tender in the form cash settlements. Their exploits ultimately ended in disaster: On March 27, 1980, they missed a and the silver market price plunged to US$11.
Silver wouldnt test that high again until 2011. At that time, its price uptick came on the back of very strong silver investment demand, and was more than double the 2009 average silver price of US$14.67. The chart below from Kitco spans from the start of January 2010 to February 2022. It shows that the silver price reached US$47.94 in April 2011 before plummeting in the years that followed.
Silver price chart, January 2010 to September 2022.
What Is The London Fix Price
Gold trades around the world and around the clock. Some of the larger exchanges include New York, London, and Shanghai. Gold trades from 6AM to 5:15PM Eastern Time, Sunday through Friday . The spot price constantly fluctuates during trading days, depending on what buyers and sellers are doing.
The London market provides a fix price twice per day for gold at 10:30 a.m. and 3:00 p.m. and once per day for silver . It is designed to establish a price for settling contracts between members of the London bullion market, but it informally provides a recognized rate that is used as a benchmark for pricing the majority of gold products and derivatives throughout the world’s markets.
The London fix on any given day is determined through a conference call among 12 of the worlds largest private banks. It is then used by institutions, producers, and other large market participants to price contracts.
Retail customers like you and I cannot buy and sell based on the fix price, only the spot price .
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What Is Gold Spot Price
The spot price of gold is the most common standard used to gauge the going rate for a troy ounce of gold. The price is driven by speculation in the markets, currency values, current events, and many other factors. Gold spot price is used as the basis for most bullion dealers to determine the exact price to charge for a specific coin or bar. These prices are calculated in troy ounces and change every couple of seconds during market hours.
How Is The Live Price Of Silver Determined
The live price of silver changes by the second. The reason the live price of silver changes is based on several factors that can be fairly unpredictable. The Federal Reserve raising or lowering interest rates, job and wage reports, current events, or a failing U.S. dollar are all aspects that will send the price of silver up or down within minutes. With markets around the world trading silver 24 hours a day, the price is constantly in flux.
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Are Gold And Silver Prices Correlated To Platinum And Palladium Prices
All precious metals share some positive correlation with each other, especially during times of inflation. However, platinum and palladium are more sensitive to the economic cycle and to automotive demand in particular.
While gold and silver are money, platinum and palladium historically are not. They therefore dont see much investment demand.
Palladium tends to be the least correlated to the other precious metals and often seems to march to the beat of a different drummer. That makes it useful potentially as a portfolio diversifier.
Get Started Buying Today
Now that you understand gold and silver prices, you are ready to invest. Right now is agreat time to diversify out of paper money and assets and buy tangible gold and silver.You do not need a lot of money to get started.
Give us a call or order right here at MoneyMetals.com today. Our friendly staff cananswer any additional questions. Were happy to provide honest advice with no pressure to buy just great prices on the best gold, silver, platinum andpalladium products for investment.
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What Is The Spot Price
The spot price is typically the base price of one troy ounce of a metal in any form. Any transaction you make in the gold market will be based upon the spot price.
Any quote of the spot price of gold in grams or kilos is typically just a conversion of the value in ounces, and not a separate trading market. Its the same for other currencies, like the euro or yuan, which are usually calculated using current foreign currency exchange rates.
Any buying and selling you want to do will be based upon the spot price at the moment of purchase or sale. Purchases are based on the ask price, and sales are based on the bid price.
Gold Bullion Price Charts
Gold bullion bars are tangible assets, and throughout history, have been an ideal store of value with good trading potential. They are easily stored and transported, and can be a uniquely private way to preserve ones wealth. Research historical pricing data and track the latest prices with our interactive gold price charts.
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Why Should I Pay Attention To The Live Price Of Silver
Paying attention to the live price of silver allows an investor to snatch up opportunity. The price of silver is historically much lower than gold and the silver market is smaller than the gold market. When money moves in and out of the silver industry it causes shifts in price to be more dramatic. Higher highs and lower lows that equal opportunity. Silver is unique in comparison to gold because it has many industrial and scientific uses that go beyond just investing in bullion. Since silvers largest use is for things like batteries, automobiles, solar panels, and electronics, there are many options for price shifts. Watching the live price of silver will expose those shifts and open up opportunities to buy and sell.
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Investing In Precious Metals With Monex
Monex believes the products above are the best offerings of precious metals for investors to add real, physical metal to their portfolio. We are proud that our product offerings include beautiful gold, silver, platinum, and palladium coins and bars created by mints from around the world, including the United States Mint, the Royal Canadian Mint, and more. In addition to our wide selection of coins and bars, we are also proud of the transparency we offer when it comes to pricing. Every product we offer, whether it is a coin or a bar, corresponds to a live price. This live price updates as the market changes and provides you with the products value at any given time.
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What Is The Price Of Gold
Gold is bought and sold in a wide range of forms, quality, delivery locations, forward time conditions and types of transactional exchanges, producing very different prices at any one time. Most common gold price reporting is for commercially standard, pure .999 fine bullion bars in kilogram or larger bar sizes. Commodity exchanges like the COMEX report previous transaction prices to the public on a 5-15 minute delayed basis. Actually, Current Gold Prices are the two price levels where traders are most actively making a market, which represent where those are willing to buy versus sell. The best value for a Current Price of Gold is the nominal price between those prices on an active high volume marketplace for immediate delivery, which is most commonly referred to as the spot price of gold. Gold prices are recorded over time as comparison, and charted to suggest trends and overextended price moves. Besides the current gold price, how it compares to a previous days final price and average of previous spot prices are frequently monitored.
