The Historical Roller Coaster of Precious Metals

The Golden Age: When Gold Was King

Gold was the only commodity that mattered back then. For centuries, the value of gold had a direct bearing on the global currency and economic stability.

Investors would swarm to gold during uncertain economic periods, driving up the price. Its price would decline during times of expansion and prosperity as investors transferred capital into riskier investments that had the potential for greater returns. Due to the stable price of gold during much of modern history, its worth remained constant.

Everything was altered in 1971 when the gold standard was dropped, and gold prices were permitted to fluctuate freely. Since that time, the price of gold has fluctuated wildly. Gold prices rose along with inflation throughout the 1970s, reaching a peak of $850 per ounce.

Gold prices reached record highs in 2008 as investors sought safe havens during the global financial crisis. During a time of market turmoil and economic uncertainty in 2011, the price of gold rose to a record $1,900 per ounce. In 2023 it is reaching a peak of CAD $ 2600 due to an increase in interest rates and world economic impact.

Even if gold isn’t as popular as it once was, it is still a crucial indicator of investor sentiment and a safeguard against market hazards.

The Fall and Rise Again of Silver

Over the years, the price of silver has fluctuated. It has occasionally been worth more than gold. Sometimes it was as inexpensive as dirt. At the height of the late 19th-century silver rush, investors stood to gain greatly. However, the market later crashed and huge sums of money were lost.

For years, the price of silver was lowered by the discovery of vast silver reserves in Nevada. The silver mining industry was very speculative, and investors frequently lost money. Numerous smaller mines failed. But there were bargains to be gotten if you were wise and persistent. Early in the 20th century, when demand increased once more and supplies became constrained, silver prices skyrocketed.

The prospects for silver have improved again in the twenty-first century due to rising industrial demand. In addition to many other things, it’s utilised in electronics, medicine, and solar panels. But if history is any indication, silver’s price will never remain steady for very long. Any investor in silver should be prepared for a rollercoaster since the white metal’s value fluctuates with the vagaries of the market.

What's your reaction?