There is still much we do not know about the current Covid-19 situation and the economic impact it will have.
But we do know that worldwide stock, bond, and currency markets are already in significant turmoil, with short-term bonds issued by the U.S. Government trading at negative interest rates this morning for the very first time in history.
We think it’s useful in times like these to focus on what we do know, rather than let the emotions of uncertainty and fear guide our financial decisions.
The Four Faces of Gold
As discussed in our 2020 Gold Outlook, we know that gold plays multiple roles in an investment portfolio and as a financial asset.
First of all gold of course is an investment
And as an investment that competes and compares to other investments like company shares it is faring well.
In a general slowdown company earnings will suffer, but gold has no such cash flow requirements to meet.
Secondly gold is a currency, with a difference.
Gold is the only currency that has no counterparty, that does not rely on the performance of an issuing government or bank in order to have value.
Thirdly, at SendGold we think of gold as a bank account alternative
For the first time, if you invest your money with the U.S. Government you will receive no interest whatsoever, and you will not even receive all of your principal back at maturity. That economic reality will make its way through to banks and bank accounts.
This means that gold is more competitive than ever as a bank account alternative.
Fourthly, gold is an insurance policy
It is widely used as a safe haven in uncertain times.
No government currency, bond, share, bank, or investment vehicle has survived every single calamity in history.
Four Reasons: One Answer
These four aspects of gold mean that practically everyone has a reason to own it, whether you are a saver, investor, or someone wanting simply to protect your wealth in dangerous times.
At SendGold our mission has been to create the safest, most secure, simplest, most accessible, and most liquid way to own gold.
So whether you’re a casual saver, a savvy investor, or just seeking a safe haven in the storm: think hard about whether gold has a place in your portfolio at this time.
You can also take a look at our 2020 gold outlook.