It’s been several months since the BREXIT vote, but the world is still shaking from the news. Everyone believed that the European Union would bring lasting peace and stability to the region, but now things are worse than they have been in a generation. The British people are looking for a way to ensure their long-term survival, and many feel that they have found their solution by investing in gold.
Gold has been treated as a store of value and a de facto currency for centuries. It has held its value and actually increased in value, throughout numerous global conflicts, so people put a lot of faith in gold. Because gold is so fundamental to the global economy, gold purchases are tracked by publications throughout the world. Recently, Forbes took note of a new trend among British investors.
The British people are investing in gold at unprecedented levels. Joshua Saul from the Pure Gold Company noted that people are purchasing gold quickly and often. Some people are even converting 50 percent of their net worth into gold, which is much higher than the 10 percent that advisors usually recommend.
Some may feel this trend is made up, but it is backed up by government data. The Royal Mint is owned by the British government, and their data backs up this surge. They sale of 100-gram gold bars has increased by 700% in recent months. This dramatic increase shows that people are demanding gold in record numbers.
The increase in demand for gold seems like it comes out of nowhere, but it makes sense. The Brexit vote could lead to economic turmoil across the globe. The British government will lose the trade benefits of being within the Eurozone, and there is not guarantee that European countries will negotiate their own trade agreement with the country. The decreased benefit to trade with Britain may cause other world powers to avoid the country. The British Pound is reflecting these issues by a decrease in value. The Pound was once worth 150% of the United States dollar, but today it is almost worth the same amount. British people are extremely concerned about the long term value of their currency.
Gold is an amazing store of value, and the British people are rightfully turning to it in this crisis. Nobody knows when the Brexit issue will be settled, but gold should only go up until it does.