bing
 Gold $2,393.20   $8.70  Silver $28.73   $0.37  Platinum $938.30   $-11.20  Palladium $1,038.00   $-3.50

We can look back throughout history and see the financial struggles that have shaped our country. From the Great Depression to the 2008 Recession, the stock market has been a constant source of both wealth and worry. Stocks and bonds may not always be safe investments, but what’s the alternative? Precious metals have always been a strong source of investment, but is gold any more secure than stocks and bonds? What happens to gold when the stock market crashes? Precious metals investors should be careful to do their research and work with a reputable firm, such as First National Bullion. San Diego residents rely on First National’s professionalism and expertise when they’re ready to invest in gold and other precious metals to stave off the effects of a falling stock market.

Fortunately, there is data we can use to compare the history of gold with the performance of stocks and bonds. Since the early 1900s, gold and silver have both had their ups and downs, but a closer look will show that no matter how far they may have fallen, precious metals have always soared back up again. Gold in particular has a way of rising quickly. During the early 2000s, despite the dramatic decline of the stock market, the value of gold actually climbed. In the 1970s, gold hit rock bottom but by the end of three years showed a 440.6 percent increase. Even when President Roosevelt fixed the gold price during the 1930s, shares in Homestake Mining—the largest gold producer in the U.S.—more than doubled.

This consistent climb is why you shouldn’t worry if gold takes an initial drop. In 2008, it did dip but ended up rebounding at 5.5 percent. In fact, history shows it might be most profitable to take advantage of the times gold does fall, given it’s almost a certainty that it will rise up by the year’s end and offer you maximum selling opportunities.

Why does a stock market crash cause a spike in gold? The truth is there’s a negative correlation between stock prices and gold’s value. When stocks drop, gold increases, just as when stocks rise, gold decreases. Stocks profit from economic growth. The safer investors feel their stocks are, the less likely they are to invest in gold.

The reality is that when stocks crash, investors will run back to the safety of gold. Gold has proven itself to be a reliable investment because it offers stability in the midst of economic distress. Precious metals are a safe haven for worried investors, as they have a history of lasting through stock market crash after stock market crash. The more the economy thrives, the safer it is to choose stocks. However, if you face a market that’s rapidly declining, gold provides you with security. Metal is tangible, comforting, and accessible, which is why stock market crashes will send investors running to gold.

If you’re building an investment portfolio and you’re looking for the best place to purchase San Diego gold and bullion, reach out to the trustworthy professionals at First National Bullion. We can answer all your questions and help you understand how gold can figure into your investment decisions. Give one of our experienced dealers a call today at 858-666-6570.\

The statements made in this blog are opinions, and past performance is not indicative of future returns. Precious metals, like all investments, carry risk. Precious metals and coins may appreciate, depreciate, or stay the same in cash value depending on a variety of factors. First National Bullion does not guarantee, and its website and employees make no representation, that any metals for sale will appreciate sufficiently to earn the customers a profit. The decision to buy, sell, or borrow precious metals and which precious metals to purchase, borrow, or sell are made at the customer’s sole discretion.

By |2020-08-09T23:49:43-07:00August 10th, 2020|Miscellaneous|0 Comments