should I invest in gold?

gold can benefit you as an investor in a number of ways. Gold has lasting value, can be bought and sold quickly and easily, and is a recognized asset of last resort.

Perhaps gold's most enduring benefit is its ability to diversify and stabilize a portfolio and protect it against stock market fluctuations. Most importantly, when you buy the right gold, it's completely private and non-reportable.

"Is now the right time to buy?" With gold, the answer is always the same: Yes. Gold is an investment for the long run. The right time to buy gold is when you understand what it is and what it can do for your portfolio.

This following report details why you need gold and what gold can do for your portfolio.

Gold - A Long Term Storehouse of Value. Historically, gold acts as a reliable "store of value" and gold fulfills all the functions of money.

Gold is portable and divisible, easy to store in an emergency and far more reliable than paper money in a crisis.

Gold is indestructible, relatively scarce, and cannot be "manufactured." It's value cannot be inflated away like paper currency.

Gold is recognizable and acceptable as a form of payment making it easy to buy, sell or trade worldwide.

Gold is Once Again in Favor

In the 1990's, gold prices traded down while stock prices were high and inflation was low. Historically, gold's best friend has been inflation. Energy shock and oil shortages can create both temporary and permanent economic inflation. Most recently, the combination of extremely low interest rates, the Federal Reserve flooding the market with paper money after 9/11, and energy prices now double or triple what they were two years ago has brought inflation back into the U.S. economy.

Economic cycles are permanent facts of life and one of the best reasons to acquire gold. Even though gold prices fluctuate, over the long term, gold has maintained its long-term value. In contrast, most currencies (including the U.S. dollar) and industrial commodities have generally declined in value due to inflation. Even as little as 3% inflation a year will destroy half of the buying power of your savings in less than 17 years.

In years when energy shock dominated the U.S. economy, the Federal Reserve was not able to stop the inflationary spiral regardless of how high they took interest rates. Is history about to repeat itself? Could we be seeing just a glimpse of the destruction inflation can create.

1979 Was An Historic Year for Gold

To put inflation into perspective, let's look at how inflation hit the average American household in 1979. Rising prices hit commodities, the gas pump, and moved across the economy like wildfire.

First, sugar went from 19 cents a pound to well over $1.00.

Coffee tripled in price.

Gasoline prices soared as it became hard to get; long lines become common.

Middle East tensions exploded when Iran seized the American Embassy.

Interest rates rose quickly and the prime interest rate reached an historic 21%.

In three months time, gold prices went to $850/ounce. Silver traded over $50 an ounce.

Gold Rose from $35 to $850, a 2,400% Increase

Hard to imagine now, but it happened- driven in no small part by a lack of confidence in U.S. leaders and energy shock. Over five years, gold had made a long, hard climb from $35 per ounce to trade between at an amazing level of $100 to $200 by early 1979. As investors worldwide panicked out of the weak U.S. Dollar, gold prices topped $850 an ounce.

That's an 8-fold increase in the price of gold in a year!

Will such an event occur again? We just don't know for sure. But, we are worried, very worried about exactly the same kind of events that we see in place today. Led by a weak President and a new Federal Reserve Chief, the market might panic again.

Exactly the right events were in place in the 1970's- a combination of rapidly rising energy prices creating energy shock, inflation in commodities, a serious Middle East crisis, and the Federal Reserve's constant raising of interest rates.

Yes it is. Especially while you can get it under $1K. A gold ETF is the easiest way to invest.

Forget all these fast money predictions. Unless you really know what you're doing it may be best to buy a proportion of gold as part of a diversified portfolio as a long-term investment then you don't have to worry about short-term price fluctuations between $800-$1000. When you filter out volatility, that's just price consolidation before the commodity move up higher.

On a quarterly chart gold has been on a long-term trend since mid 2001. Some people say gold goes up during a recession, others say it goes up to hedge against inflation. So it can go up either way.

I have no idea what the feds decision will do to gold prices. I assume it will make financial stocks go higher.

Fed's decision to buy the toxic assets of banks and mortgage companies means minting green backs and putting it in circulation without any immediate productive return. This action has the potential to bring down the gold reserve of the fed proportionate to Dollar in circulation. If the gold reserve goes below the standard the fed may decide to buy gold to cover the green back put to circulation in buying the toxic assets. Whether the earlier peak will be surpassed is anybody's guess. Considering all aspects of the market it will not be unwise to invest in gold at this stage.

Never invest in gold. If you have surplus money invest liquid securities like Bank deposits and this deposits are as good as currency. Gold never gets an equivalent amount of cash for its value. If you go for selling you will always get lesser amount. Moreover the increase in price is very meagre for the past 50 years when compared an investment in Bank deposit, mutual fund, stock market and real estate.

. It has not been that price in over a month. Maybe on the overnight but i doubt it. Its reasonable to say it will reach 1000 again but very short term. traders switch to gold just for ticks thats why you see a fluctuation on the price. When gold goes up they are trading gold because they pull their money from stocks and trading s and p day trading. Gold i believe is 25 dollars a tick so there is money to be made. But you need about 20k to trade it unless you trade the options or gold refiner stocks which is worthless to own unless you have about 100k to invest. So to close if you think that you trade gold on stocks, im sorry but you are mistaken. But if you trade it daily on the emini futures then you have a chance at real money.

good luck and yes it will reach your price again but very short term.

I don't think it is a right time to invest in Gold. I would just suggest just wait and watch should be the policy at this juncture. The price of the gold is so high that no one should think of investing in Gold at such a high price. Just wait for a correction and then buy.

1. Yes it is the right time but

2. It may not possible for a few years

3. In present trends to buy gold is the safe investment. Rates have gone to much higher level and it may not climbe up for some times. It may not show a quick return. Later on when market is steady the rates will go up.

In general gold as an asset class is considered to be the best hedge against inflation.Accordingly the inflation in India is nose diving and has almost touched zero level.Therefore your capital is automaticlly being hedged by present falling trend of inflationa.In fact the present finacial crisis wrt an investor point of view is all about liquidity concerns and in such scenerio CASH is the king. Therefore if you have cash in hand,you are king. If you wish to add value to this cash and plan to remain invested with 2-3 years horizon in mind, Mutual Fund and bluechip stocks are the best bet at present valuation of SENSEX.

Yes, you should invest in gold.

The price is about to rise even higher in next 2-3 years

I dont know where the one poster got 850 an oz. It has not been that price in over a month. Maybe on the overnight but i doubt it. Its reasonable to say it will reach 1000 again but very short term. traders switch to gold just for ticks thats why you see a fluctuation on the price. When gold goes up they are trading gold because they pull their money from stocks and trading s and p day trading. Gold i believe is 25 dollars a tick so there is money to be made. But you need about 20k to trade it unless you trade the options or gold refiner stocks which is worthless to own unless you have about 100k to invest. So to close if you think that you trade gold on stocks, im sorry but you are mistaken. But if you trade it daily on the emini futures then you have a chance at real money.

good luck and yes it will reach your price again but very short term.

Another sign by the way is war. Everytime its war time gold stays up. many electronics use gold so do missiles and other weapons.

This is not the best of times to invest in gold. Pl wait for a couple of months when the prices should fall below $820/- Best of luck