Why You Should Buy Gold Now!

Why You Should Buy Gold Now! by Naeem Aslam for Forbes

Gold is known as the safe-haven asset, and whenever we see a meltdown in the equity markets or prospects of loose monetary policy, its price begins to explode to the upside. Currently, the gold price has a strong negative correlation with the equity markets meaning when the equity markets fall; investors pour money into gold and vice versa.

The fact is that the current sell-off in the global equity markets is only a start because there is a lot more to come. After all, the economic weakness isn’t fully baked into economic data, let alone in earnings. Thus, there is no better time to buy gold.

Why?

First, the equity markets are in major turmoil as a 1000 point move for the Dow Jones index has become the norm. Secondly, the Coronavirus has pushed the Federal Reserve into a corner, and it’s being forced to keep its monetary policy on the dovish side. The Fed cut the interest rate by 50 basis points only a couple of weeks ago, and yet the market expects further cuts.

Gold which is up nearly 10% year-to-date is likely to score serious gain in the coming weeks. The reason is that we have a situation where monetary policy itself isn’t enough to calm the markets; however, governments are trying to provide support on the fiscal front as well. For instance, Donald Trump has pitched the idea of no payroll tax for this year to soften the blow of Coronavirus. So far, we have not seen a green flag which is why investors are still nervous. Donald Trump may achieve some of his goals, but it won’t be enough, the economic damage is too considerable, and the Coronavirus is still nowhere close to coming under control.

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Rory Hall, The Daily Coin and Gospel News Network. Beginning in 1987 Rory has written over 1,400 articles and produced more than 500 videos on topics ranging from the precious metals market, economic and monetary policies, preparedness as well as geopolitical events. His articles have been published by Zerohedge, SHTFPlan, Sprott Money, GoldSilver, Gold Seek, SGTReport, and a great many more. Rory was a producer and daily contributor at SGTReport between 2012 and 2014. He has interviewed experts such as Dr. Paul Craig Roberts, Dr. Marc Faber, Eric Sprott, Dr. Warren Coates and Peter Schiff, to name but a few. Don't forget to visit The Daily Coin and Gospel News Network to enjoy some of the best economic, precious metals, geopolitical and preparedness news from around the world.