Demand for gold rises by 176% in the first quarter of 2023, according to the World Gold Council. Against a backdrop of widespread economic fears, the rise in physical gold indicates that it is one of the most sought-after safe-haven assets. Will you be the last one to protect your savings?

As 11Onze anticipated almost a year and a half ago, physical gold is becoming an indispensable tool for protecting long-term savings. That is why Preciosos 11Onze offers several tools to enable the community to use gold to better withstand the period of economic turbulence we are experiencing. On the one hand, there is Gold Seed, which allows short-term gains to be made by taking advantage of the constant revaluation of gold. On the other hand, there is Gold Patrimony, where the idea is to buy physical gold with the long term in mind.

Gold Patrimony

This is what we have called the gold that we have been selling from day one at Preciosos 11Onze, to differentiate it from Gold Seed. They are gold bars of various sizes, with a minimum purchase of 3,000 euros. And the gold is delivered to your home or can be kept in safe custody in a vault.

Why can gold be considered an asset like a house? Because it is an asset that tends to appreciate in value and is highly liquid. In recent years, gold has appreciated by 40% and, during 2022 alone, its price increased by 9.5%. It should be remembered that in 2022 average inflation in Spain was 8.4%. Therefore, people who had their savings in gold gained a little purchasing power, while those who had them in euros lost it.

But Gold Patrimony has to be seen in perspective. So we should remember that in January 2008 an ounce cost $883, while today it is around $1,960 – $2,000, an increase of more than 100% in 15 years. The outlook, however, remains bullish. Why? Because central banks are making record purchases of gold, probably looking for a safe and tangible asset on which to support huge public debts. The World Gold Council noted that central banks had bought 4,741 tonnes of gold during 2022, a figure not seen for 55 years.

Turbulence and indicators

The banking crises of the last few months have generated doubts among depositors. From Silicon Valley Bank to Credit Suisse, via First Republic Bank, history is repeating itself. Add to this the FDIC’s view last November that the volume of debt is not sustainable, and it is only natural that many people are looking for safe options for their money. Withdrawals from bank accounts are very high in Spain, the UK and the US. The trend indicates, as also noted by the FDIC, that people with more money and information are somehow protecting their savings by taking them out of banks, a behaviour that may accelerate further collapses.

What now?

One of the questions to be answered is what to do with the money once it is out of the bank. In complicated scenarios, you have to look for safe options. These can be bonds, property or products with insurance (such as Guaranteed Funds or Litigation Funding). But if there is one product that stands out for its historical security, it is always Gold Patrimony.