Gold Rush!

Sell your gold for cash now!  And the masses have rushed to do so the past few years.  With gold going up from around $250 to currently around $1860/oz over the past ten years, who could blame them, right?  Ironically, it probably isn’t wise to sell any gold at this point. 

The US dollar is losing ground very quickly, especially since the downgrade of the United States’ credit rating by S&P.  As the value decreases, only true value commodities will keep holding any value, and even possibly grow – like gold. 

Of course for those who lost most or all of their retirement in the 2000 or 2008 crashes, and maybe even subsequently lost their jobs, then selling off items of value to keep a roof overhead and food on the plate is completely understandable.  However, for anyone who feels like they may have a nice windfall to spend during a slow economy should think twice.  Gold is expected to continue to rise in value in the short-term forecast to break $2000 per ounce

What goes up must come down. 

Another bubble looms.  Just like the housing bubble burst with much fallout, this gold bubble too will burst.  Gold will not keep climbing higher and higer indefinitely.  And when it bursts, the price will likely plummet.  When should someone who has gold sell, and should they sell just some or all?  That is tricky to answer.  As the global economy starts to settle and markets calm down, gold will not be such a valued commodity. 

As with any portfolio, it should be diversified.  Gold is always a good investment as part of a portfolio.  Therefore, someone invested in gold, shouldn’t completely sell all of it.  I imagine at best, gold will top out at around $2400-2500/ounce.  It may not even reach that high.  It is probably best to assess what investments you have, and given your age and income, try to decide along with your financial advisor as to how much (if any) you should sell and when.  As the old saying goes, buy low – sell high.  I would imagine once the price breaks $2000, then start figuring out your move.


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