What Does the Price of Gold Tell Us Historically?

                                
      What Does the Price of Gold, Silver &           Platinum tell us Historically?

Was gold struck down by lightning? After hitting a new high of $1921 per troy oz. the price of gold retreated in the face of some heavy selling which very briefly brought it down below $1800. Spot gold is now trading $1,581 per troy ounce as you can see on http://www.kitco.com/ daily. Following that, the silver price hit a low at $26.3 – though both metals have staged a decent rally since then.

                      Although the gold price is still up by 10.22% this year, the silver price is currently down 8.21% for the year. Platinum have failed worse, goign down by 20.35%. Simply put: gold is a safe-haven metal in a way that the other precious metals are not. All are safe havens to the extent that they represent tangible assets with unique properties and industrial utility – in contrast to currency or bonds – but as economic fears have grown over the course of the second half of the year, industrial utility has been the last thing on investors’ minds. Below, I've included the closing gold prices as we approach this new year.
                   

                More importantly, anyone who understands that gold is money can see why demand for it, by definition, rises during deflations.Whether we see ‘70s style inflation, ‘30s style deflation or a more extreme cases in our future, gold is STILL the best insurance. The price of gold rose in all those scenarios. As long as real interest rates remain negative, the opportunity cost of saving in gold is zero. Sell your gold while you can, get the highest rates while they are still fluctuating. Holding on to your gold, silver, or platinum ensures nothing. It is a seller's market.