Have you noticed that it is more and more difficult to balance your budget? Your family income has probably remained the same, but prices have risen. Besides local inflation, there are numerous rising world dangers that can also negatively affect your portfolio. When the British voted for Brexit, severing ties with the European Union, the final nail in 2016’s financial coffin was driven home. However, there are still ways to hedge against uncertainty and inflation, and the smartest investors are looking to gold.
Gold Has Intrinsic Value
Real wealth comes from collateral. The reality of economics is that all paper financial bills are backed by something solid, firm and tangible. In the case of a mortgage, if you should default, your home would be repossessed by the lending institution. Central bankers understand this basic maxim, and will charge you higher interest rates, when you do not have any collateral, behind your loan. Your property is “security” for your mortgage. But, what do central bankers use as their primary forms of tangible assets? The answer of course is gold and silver.
Central Banks Adding Gold
Since the 2008 Credit Crunch, central bankers have been adding gold to their vaults. The “Official Monetary Financial Institutions Forum” think tank reports that since 2008, central banks have purchased 2,800 tons of gold because it stands as the most trusted collateral during uncertain times. Generally, each paper currency is meant to be used in one particular nation, while the “gold standard” is recognized globally, and gold can be used in all nations, making it the trusted international currency for trade. As China’s power has arisen, it has even opened its own Shanghai Gold Exchange (SGE), and the Shanghai Gold Benchmark Price will allow the nation to facilitate the purchase of physical gold.
Gold Conquers Inflation
Central banks purchase gold to protect their wealth during times of financial upheaval, which is why bullion and coins act as an “inflation hedge” — it is a physical commodity and is traded on global exchanges. This precious metal is not destroyed by water, oxygen or time and can always be resold.
Physical Tangible Wealth
There are only a limited number of gold mines in the world. This creates the “scarcity,” which lends gold its value, but also makes it a challenge to acquire and house bullion and coins. With a professional wealth management firm such as Guildhall Wealth Management, you can purchase a physical gold inflation hedge, and add real, hard currency to your investment fund. Visit Guildhallwealth.com to learn more about adding the power of gold to your RRSP, further fortifying your portfolio and adding strength and versatility to your portfolio.
Just like the central banker, you will feel the power of the precious metal inflation hedge. You’ll have the most valuable collateral: gold, and Guildhall Wealth Management can help you to acquire, store, and manage this important financial certainty in uncertain times.