Gold’s reputation as a safe place for your money sent it above $1,600 an ounce for the first time.
Investors are worried about debt problems on both sides of the Atlantic. So they bid gold up $12.30 an ounce Monday to settle at $1,602.40. That’s a record for gold’s market price, but below its 1980 peak after adjusting for inflation. An ounce of gold at that time cost $850, or about $2,400 today.
Gold is looking better by the day because debt problems in the U.S. and Europe are making two other so-called safe havens, the dollar and the euro, seem shaky. Investors believe gold is safe because it doesn’t depend on a government’s ability to repay a bond, like a Treasury or a Greek note. Neither do other commodities such as crude oil, which has the added use of powering automobiles.
Gold rose 21 percent in dollar terms in the 12 months through June 30, according to the World Gold Council.
Associated Press
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