The Banking Crisis – Why Gold?
The History of banking in Germany is quite long and distinguished, with arguably its most important historical moment being the birth of Johann Fugger in 1367 in Augsburg. This man was the founder of a family destined to shake up the banking industry in Europe at the time, and to depose the de Medici family from their undisputed rule of all things fiscal.
In that time, Germany has dealt with its share of banking and financial crises, and in each case of these it was the savvy merchants and cunning investors that came out on top. Germany’s current banking crisis is no different, it’s making waves in everything from interest rates to gold prices, and once again it will be the prepared and canny trader that will spin wealth out of potential disaster.
The recent conversations taking place between the Deutsche Bank and Commerzbank are showing that the environment there is decidedly in flux, and that the existing banking troubles are anticipated to get only worse. Take this in context of a global market and Italy’s flagging economic struggles, and it’s a time of great financial troubles on the horizon. As always, the smart investors are turning their eyes to Gold.
Why Gold Is the Harbor in the Storm
Gold was the first currency to utterly shake the world and shape the way that economies that stretched across continents and ultimately oceans formed, flexed, and changed. It built up nobility and brought down Kingdoms, all on the power of its lustrous yellow shine. With world economies going into crisis, the value of gold isn’t just staying the same, it’s rising in value. Like real estate, it’s the one of the few real forms of wealth.
The value of holding gold is a well-known, and the stability of those governments that use it as the basis of their economies have always remained stable until they stretched beyond their means and into the realm of ‘paper money’ and ‘promissory notes’. But even as their economies collapse through overspending, the value of gold remains strong and immutable, even as the exchange rate fluxes.