Currency Crisis and Gold

With the disappearance of the gold standard, currencies are no longer supported by the precious metal, but the only paper money, ie a medium of exchange, without any objective value of their own. How is the public's confidence in them is simply their "value" can go up and down with the political or economic events, in which it is difficult to determine the standard value of international activities through their centers, a fact that gold could ensure a; like. In addition tocontinuing financial crisis, most of the world, the relative value of currencies that can be manipulated by governments or what they are guilty, has once again been exposed.

After the collapse of the housing bubble in the U.S. and the related credit crisis, banks have lost so much that most of them in the event of bankruptcy, and governments have had to save by increasing their debt, and so their deficits budget. With their central banks print more money, but also leads to an increaseinflation and thus weaken their currencies.

USA, for example, the legal debt ceiling is raised in only two years of almost $ 2 billion, and the Federal Reserve has printed 1,000 billion dollars (almost the entire debt of the Wall Street bailout, which cost so much need!). But this is not limited to the United States. This year, national governments issued approximately $ 4500000000000 in debt, which is three times the average of developed economies means in the last five years. For example,State debt in the UK if the five largest banks, is more than 500% of GDP (in the U.S. is only 200%). This shows the dimensions of the crisis, when some of the best economies in the world has collapsed (including Switzerland have noticed is that the debt of private banks is seven times its GDP).

Also deteriorated with their financial system to an extent, foreign investors sell their shares (the debt they bought from them), morePressure on interest rates, which increase the lead to a further devaluation of its currency. The U.S. dollar, for example, a record low in the last 6 months: 20% against the Canadian dollar, 15% and 7% of the Australian dollar against the euro.

Unlike gold hit 28-year high, the action of central banks to buy solid gold is understandable. Ingots of gold is a better investment for the preservation of their wealth as some unstablealways fluctuating currencies, hit by inflation. For example, since 1913 at the Federal Reserve was born, the purchasing power of dollars, decreased by 95%! Gold, on the other century has virtually maintained its purchasing power in the past. So why not invest in gold, the demand on the rise as its price, not only because of lack of currencies, but the basic rule of trading, ie the ratio between supply and demand? This is a win-winSituation: You can not lose!