Gold prices are on the wobble once again.
Last week, they finished up. The reason for this was a weak dollar. But as they began the week, prices on the world’s favorite precious metal slumped just slightly. The denting came from inclines in prices for oil and wheat.
This week begins with more slumping in stocks as the market reacts to news that swine flu has hit American shores and that federal government health officials are declaring a health emergency in some areas and closing several schools. (The outbreaks have been in California, Texas, and New York City. All victims had recently traveled to Mexico, with the exception of one woman whose husband had just come back from that country.) President Barack Obama says the flu outbreaks are cause for concern but “not a cause of alarm” at this point.
Apparently, the markets were “concerned” enough to cause an adjustment, but nothing major at this point.
But what about gold? Is this the time to buy? Would investment gold be an appropriate Mother’s Day gift?
Gold is always a good gift for two reasons: its intrinsic value and its ability to suggest long-term, deep emotional attachment to the recipient. The price of gold usually shifts little over the life of a recipient with the only change likely to be slow and steady incline. We have certainly seen a bit of movement in recent months, with the economic downturn as investors sought refuge. That rush seems to be over for now, but it was completely in keeping with what the market and even the general public believes to be true about gold: it keeps its value and over time, will even show growth when other commodities won’t.
I did mention inclines in oil and wheat, didn’t I? The price of oil will continue to fluctuate up and down while Americans look for alternatives in fuel and means of transportation. The price of wheat, meantime, is riding just a little below $4 per bushel. I want to offer a touch of perspective on that one, my friends.
I grew up on a farm. My father is a college professor who owned a portion of a family farm that he bought from his own father. He then rented out plots of land to his kids and paid himself to farm it for us. (Don’t worry; he offered great hourly rates on tilling fields. We were all on the “family plan.”) And at the end of every growing season, he sold the crop for us and put the money in our college funds. He usually planted wheat, but occasionally corn. And during my high school years, the price of a bushel of wheat ran right around $4 per bushel. Which also means I have no explanation for the price of a loaf of bread or a filet mignon.
Wheat hasn’t gone up in decades. Gold has risen steadily in those same years. Gold is an excellent investment right now, and at the same time, it’s also a good moment to divest of that investment if you need the cash. The choice is up to you, but think of it this way: on Mother’s Day, which one would your mother rather have: a bushel of wheat or a little bit of gold?
Category: Gold Prices