There are many Best Performing Asset Classes which have outperform during the time of recession. But The Asset Class of the year 2009 is, Gold.
Yes, This is True. Gold has out performed any other asset class in 2009. Gold has even beaten the Businesses as an asset class. Since January 2009, Gold has given excellent returns. Many Gold ETFs (Exchange Traded Funds) in India have notices more than double growth in their Asset size.
Just few months back, Benchmark ETF has 0.3 tonnes of gold under management but now it has more than 1.8 tonne of gold under management.
Why Gold is the Best Performing Asset Class right now?
Well, Because the Real Money was Gold only. Modern Money (After 1971) is not backed by anything but it is a derivative of Gold only and that’s why our modern money is known as Currency. Previously (Before), The US Dollar and other currencies in the world were backed by Gold. Which was preventing the inflation going now. But after 1971, President Nixon had removed the Gold Standard in USA and thus US Dollar and other currencies in the world are not backed by any Gold now.
Modern Money (Currency) is a piece of paper only without having any intrinsic value. So whenever, the US Government prints new dollars in the economy, The Gold price rises because investors shift their wealth to Gold.
Recently US Government has doubled its monetary base from $ 800 Billion to $ 2 Trillion. And that’s why Gold (10 gram) price has rise from Rs.7,000 to Rs.15,000. So whenever, the price of Gold doubles, it means that central banks and governments all around the world have doubled their monetary base. It means that, Central Banks & Governments all around the world have printed money…!!!!
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