2007-01-23 14:54:59 · 3 answers · asked by Mocha_latta_ice 4 in Business & Finance ➔ Investing
They have an inverse relationship because they are substitutes for one another when it comes to investing. If the USD is strong and stable, people have a tendency to invest in savings bonds, etc. When the value of the USD starts to fall, people will panic and move their money to something stable like gold, which usually only does really well while the dollar is doing poorly. They form a system of checks and balances for one another.
2007-01-23 15:13:23 · answer #1 · answered by bigbill 3 · 0⤊ 0⤋
Yes, gold and the dollar are inverse, silver follows the gold pattern too. The american dollar is a NOTE, not a (precious) metal.. It takes more dollars to buy an ounce than it did many years ago, because the value of the dollar is DECREASING. That makes metals INCREASE. Why?... How many dollar bills can you make in one day?? (many),ask the federal reserve... compared to how many gold coins?? ( not as many) .. I have purchased both gold and silver, for my children as an investment, not 5 years from now but over 20 years from now. Gold as money does follow the world economy, war, famine, crisis, unstablity,.. silver does follow behind this pattern too. I am not a broker. Put go to one online and check the history and thier pattern. below is one place to see.. I dont work for them but I follow the prices here.
2016-05-24 02:56:08 · answer #2 · answered by Anonymous · 0⤊ 0⤋
Gold prices move up for two reasons. One when economy is predicted to be on a slump route. Two when inflation is high or it can be that when gold prices move up there is a tendency for inflation to pick up. Inflation naturally distroys purchasing power of the currency which is nothing other than currency here dollar loosing value.
2007-01-24 02:38:13 · answer #3 · answered by Mathew C 5 · 0⤊ 0⤋