Gold may be losing its luster
Updated: 2013-04-19 20:14
The recent plunge in the price of gold may provide certain opportunities but a long-term outlook is best, says an article in Beijing News (excerpts below):
Before any investment, two issues must be addressed. What is the real value of gold in a modern society and why did the great bull market in gold happened in the past 12 years?
The worship of gold has a long history. It is not just an asset but a badge, indicating wealth and prestige.
But why did the gold price increase for 12 years until the decline in April. In 2001, gold was priced at $200 an ounce. It hit more than $1,900 in 2012. The emergence of Asia and investors using it as a super hedge against the financial crisis certainly boosted the metal's price.
But the state of the global economy and dampened demand has hit sentiment for purchasing gold. Some will say now is a good time to buy but it wild be good to remember that, for all its history, it is, in the end, a commodity.