BY
George Mathew , MADHUSUDAN SAHOO
Gold has been in the limelight of late with price shooting up to the Rs 20,000 (per 10 grams) level, even stealing the thunder occasionally from other asset classes. “Gold is a safe investment. It will continue to give good returns,” says AJAY MITRA , managing director of World Gold Council (WGC). In a conversation with MADHUSUDAN SAHOO and GEORGE MATHEW , Mitra says, “there’s no asset bubble in the yellow metal as it’s widely spread and beyond the control of speculators.” Excerpts:
Gold prices have been rising sharply in last two years, but still demand is also going up. What are the reasons?
Gold can’t be compared with any other product. In the case of other products, demand drops when prices rise. But not in the case of gold. It always provides safety and security to the investors. As the asset value has gone up by many folds, investors are more attracted to put their money in it. Firstly, if we look at interest rate on the fixed deposits in any bank for 400 days or so, investors get 7-8 per cent whereas investors who bought gold have seen an appreciation of 21 per cent CAGR (compounded annual growth rate). Secondly, investors are not savvy enough in the stock market as it is quite uncertain for them. So where would they go… I think gold is the best option that assures them a good return. The demand for the yellow metal in the country has gone up by 79 per cent to 650.4 tonnes in the period January to September 2010
The site that promotes the advantages of physical gold particularly the gold dinar as stated in Holy Quran. The coming future, it is hoped that people start to realize its significance and crucial roles that can be played by gold dinar as a stabilizer in economics as well as replacing papers' currency.
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