Gold Hits All-Time Record High in Euros and Pounds

While the value of gold is still about five percent below its record high in dollars, it’s reached an all-time high in both euros and British pounds, at €865 and £754 respectively, partly due to the current weakness of those currencies relative to the US dollar.

According to the Telegraph:

“Gold is seen as a safe haven investment but, because it is priced in dollars, investors in countries other than America are exposed to currency risk.

“For example, British gold investors saw the value of their holdings fall by 10pc in the six months to August 2009 as the pound recovered strongly against the dollar – even though gold in dollar terms appreciated by 2.2pc over the period.

“Nicholas Brooks of ETF Securities, which runs a gold exchange-traded fund, said: ‘The strong performance of gold, despite the strength of the US dollar, indicates that investors are increasingly viewing it as an alternative store of value, not just to the US dollar but to fiat [paper] currencies more broadly, as sovereign risks continues to rise.’”

All around the world the inherent flaws found in paper currency systems are becoming more obvious. Governments are taking on massive amounts of debt, printing money furiously, and scrambling to inject some sort of vitality into slowed national economies. On the other hand, gold maintains its value and even strengthens to record highs against each currency in turn. Like a barometer of inevitable government fallibility, gold is the asset to watch.

You can read more about the record-breaking performance in the Telegraph’s coverage of gold hitting a record high for British investors.

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About Rocky Vega 16 Articles

Affiliation: The Daily Reckoning

Rocky Vega is publisher of The Daily Reckoning. Previously, he was founding publisher of UrbanTurf and RFID Update, which he operated from Brazil, Chile, and Puerto Rico, and associate publisher of FierceFinance.

He specialized in direct marketing at MBI, facilitated MIT Sloan School of Management programs, and has been featured on CBS. Vega graduated with honors from Harvard University, where he was on the board of Let’s Go Publications and directed business programs involving McKinsey, Goldman Sachs, and Harvard Business School faculty. He is also enrolled at the Stockholm School of Economics.

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3 Comments on Gold Hits All-Time Record High in Euros and Pounds

  1. It is hard to believe, but Europe is in such a mess that it makes the good old USA look to be a country of sound economics. Europe has been at the socialism game much longer than we have. Our $13 trillion (and climbing) government debt and unfunded government promises will destroy us soon enough, but for now the dollar looks good. As long as Washington can successfully kick the can down the road, it will.

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