Castlestone Management Details Why Gold is Such a Safe Investment

As far as investments go, gold bullionhas often been seen as one of the safest products to invest in. It has held this reputation over the past five millennia, acting as a safe haven asset in times of financial instability, especially so when the devaluation of international currencies leaves few investments safe from the devastation they cause. Recently, with the looming threat of the US reaching its debt ceiling (at the time of writing, Wednesday 16^th October), which has the potential to have far reaching effects on the world economy, many in the financial sector are once again questioning whether now is the right time to invest in gold.

To understand how gold has acquired its reputation as one of the safest investment opportunities on the global economic stage, you have to understand the history behind it. The history begins far before the first stock markets came into being. gold has always been seen as a commodity to be coveted and a store of value. Ancient civilisations of every race colour and creed valued gold for its unique blend of rarity, beauty and near indestructability.

Gold grew to be the one universal constant in the emerging financial sector. Everybody valued it, which meant that it held a real significance on the world stage. Nations stored gold for wealth and it became the medium of international exchange. The first monetary role for gold was ascribed to it in 1792 by the United States, when Congress put the nation’s currency on a bimetallic standard, backing it with gold and silver, many countries followed and by the end of the 19^th Century, the ideal was for a nations’ currency to be measured against the gold standard.

The great Depression of the 1930’s saw most nations forced to sever their currencies away from the gold standard in an attempt to stabilise their economies, however gold formally re-entered the world’s monetary system in 1944 when the Bretton Woods Agreement fixed all the world’s paper currencies in relation to the US Dollar, which was tied to gold. This lasted until 1971.

Today precious metals including gold have an intrinsic investment value because of their versatility and their necessity for use in heavy industry. This all highlights the versatility of gold. Time and time again the global economy has faced crisis, time and time again gold has recovered its role in said economy. History quite frankly speaks for itself; gold is the most versatile investment you can make and in times like these, where there’s so much instability, Castlestone Management knows gold is the investment that will make sure you can weather the storm.