Pros and Cons of Investing in Precious Metals

“We buy gold.” “Sell your unwanted and broken jewelry.” “Gold and silver are at all time highs.” Today more than ever Americans are inundated with these slogans.  Why? The answer is because of an unstable global economy and the weakening dollar. What does that mean? What are the pros and cons of investing in precious metals? And what does history reveal about these investments?

When listening to or reading about the economy to often the phrase “weakening dollar” is used; but what does that term mean? That phrase refers to the fact that a dollar is now worth less in gold than what it was in the past. Or put another way, one measure of gold buys more dollars than what it did in the past. In today’s economy, an investment in precious metals is usually based on the prediction of a weakening currency rather than a shortage of the metal as has been the case in past history.

The pros of investing in precious metals are numerous. First, precious metals are the only true global currency, meaning that if all other forms of money failed those with gold, silver or platinum would still be able to function as a civilization that buys and sells goods and services. Second ,they are stable, typically making no great jumps in value but rather increasing slowly and securely over time.

The cons of this type of investment are really few. Precious metals are a safe haven for what a person already has and are not typically considered a growth investment so for someone looking for a quick return this is probably not a good idea. Unfortunately gold is heavy, it takes up space, and it must be secured after all history is full of stories about stolen silver and gold. And dependent on where you purchase from, you can be over charged which puts your initial investment that much further away from realizing a profit.

History speaks for itself, precious metals are a good investment; there has never been a gold crash, or a recession or depression that left gold on the losing end. No, precious metals will never be the next stock rush or hot commodity, but with patience and preservation of assets as the goal, they do offer a safe way to earn a modest return. In conclusion this article is meant as a guide it’s up to each investor to realize there own predictions on investments.