The future is always hard to foretell. Yet changes in the current market and future economic projects still prompt many individuals and investors to try to speculate what may happen and to seek out ways to benefit or minimize risk in volatile times.
We now operate as part of a complex and dynamic global economy where changes on the other side of the other side of the planet can have a massive impact on multiple markets. Looking at economic trends in the fourth quarter of 2018, as well as understanding potential changes in other major markets around the world can certainly help improve projections.
Many investors and financial advisors are constantly looking for ways to make the most out of capital, which of course includes insulating your portfolio against loss.
The World Gold Council notes that historically, gold has always served as an effective refuge for investors and individuals in times of economic crisis. Looking at some potential future trends there is still some uncertainty in store on the global marketplace.
The World Gold Council further notes that several factors could lead to some very promising opportunities for people who possess physical gold and invest in gold as part of a strong, and diverse portfolio. Projections and speculations for the next 30 years show that there are several trends which can influence gold’s value by the year 2048.
Technology will most likely have a significant impact on the future of gold. This includes things like consumer electronics, mining, investment trends, and gold recycling as well as other developing sectors. Gold is likely to be in high demand in commercial applications such electrification technologies, the transformation of the currently inefficient power grid, developments in the medical industry, and much more.
On an international level, emerging economies are sure to have a major impact in gold usage and value. This is especially relevant as China and India continue to emerge onto the world stage as major economic powers. Their growing middle-class populations continue to show interest in gold for personal reasons as well as financial interests.
China’s economy now manages roughly 2 trillion US Dollars in assets. At the same time China’s Gold Association encourages more robust regulations in gold-related industries. This hints that they suspect the gold mining industry and gold recycling technology will start to become a more significant player the international stage.
India also enjoys robust investments in gold on an economic level and in their investment interests as well as in the personal habits of their people. Indeed, many people living in modern-day India keep physical gold in multiple forms. This might include coins, fractional bars, or bars, as well as woven into fabrics and used in jewelry or other personal adornments.
Both China and India are strongly invested in the consumer electronics and commercial electronics industries, where gold holds major demand. This is largely related to the fact that gold does not tarnish or rust and is a superior conductor of electricity, which makes it very appealing for use in solid state electronic circuits and devices.
It’s also worth noting that there is a developing relationship between the gold mining industry and gold recycling technology, which could be a factor in the long-term value of gold. No one is sure just how much gold is still available on the surface of the Earth. Plaster miners, hard rock miners, and other aspects of the mining sector continue to endeavor to open up new resources, while the value of gold remains relatively high.
However, global gold demand remains high and is likely to increase with the emergence of China, and India, and our ever-evolving technological landscape. At the same time, many electronic devices with solid state circuits have a small amount of gold in their components. This has started to drive increased interest in gold recycling, and related industries, which can further help meet global gold demand.
Gold can also have a profound influence on international market trends. It’s worth keeping in mind that fiat currencies throughout the world show increasing dilution rates, which of course leads to inevitable inflation issues. Left unchecked these trends can potentially lead to the collapse of various fiat currencies, including the US Dollar, or a reorganization to include backing some or all currencies with some form of a gold standard.
Drawing out the blade of speculation toward the year 2048 gold shows the potential for significant growth over the course of the next three decades. This trend can have significant implications for investors to consider.
Over the course of the next three decades we see an increased risk of experiencing one or more times of increased economic distress. This could be related to several factors, including dilution of fiat currencies, geopolitical changes and stock market trends. Any of these could affect your portfolio’s volatility and leave you at increased risk of suffering an investment loss. Reallocating something as simple as 5 to 10% of your investment assets to gold can provide you with added peace of mind.
Keeping a small amount of physical gold on hand in a safe or otherwise secure location can also help hedge concerns about having means to purchase goods and services during a prolonged span of economic distress.
While the changes between now and 2048 is uncertain, the current factors at play in the gold market, means that you should strongly consider increasing your gold investments the next time you rebalance your portfolio.