It’s a gold rush: In times of economic uncertainty, citizens, hedge funds and public entities stock up on gold to protect capital from market shocks or to do business. the gold price In the last few hours it has reached a high $2,043.47 per ounceAn increase of +0.12%.
Why is the price of gold rising?
The psychological threshold of $2,000 per ounce was breached last October 27 in London, and then in the following days there was a volatile trend. Today comes a new strong upward bounce.
2023 has been a perfect storm, a series of economic shocks, some with catastrophic effects.
There are two ongoing wars: Ukraine and Russia, and Israel and Hamas. The first, in particular, disrupted the economic balances of the food market and led to long-standing imbalances in the oil and gas market, which had major repercussions on prices and production.
All of this happened while the world’s economies were still feeling the effects of the long wave of the pandemic that took companies that seemed very strong out of the market, and then collapsed instead. The role model everyone should follow is WeWork, the smart working giant that promised to change the world.
But 2023 is also the year of cutbacks in major technology companies (LinkedIn, Amazon, Nokia, etc.), listed directly or indirectly on the stock exchange, resulting in tens of thousands of layoffs over the course of the year. But the Chinese economy has also suffered severe blows, such as the deflation bubble and the Evergrande bankruptcy.
Who invests in gold today?
All this prompted thousands of small investors and dozens of hedge funds to buy gold. But not only that: governments also resumed the gold rush in style, and it was bought in order Tens of tonsTo amplify their gold reserves and protect their economies as much as possible from market shocks. And this is exactly the main reason for the rise in gold prices: the countries that bought the largest number of gold are China, Poland, Turkey, Singapore, India and a series of countries in the Middle East.
The basic law of supply and demand states that the more a good is desired, the higher its price.
Is it worth buying gold now?
Answering with 100% accuracy the question of whether buying gold now is worth it is an exercise that falls more into the realm of divination than market prediction. When the price of gold reached $2,000 per ounce, experts were divided between those who expected the limit to be reached already, and those who advised them to sell, and those who instead suggested waiting because the international situation might get worse. Buying gold now depends on your appetite for risk and betting on the further deterioration of the economic and geopolitical crisis.
Those who intend to buy gold, physically or via trading, are reminded that among the expenses to consider there are also commissions and capital gains taxes of 26%.
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