Gold and Oil Investments Soar as Europe Situation Escalates
With Europe’s ailing economy on the mind of every investor and the possibility of a second recession driving commodities into the ground, certain products have seen a new revival as people flock to protected wealth. And while crude oil and copper have floundered under the pressure, gold is the prime example of a commodity seeing new life amidst the wreckage.
The metal commodity has rebounded from its recent slump and has soared to a record high of $1,921.15 per ounce this month.
Economists and investors alike believe that amidst dizzying market volatility, crumbling European economies and Greece likely defaulting on its debt, gold will likely rise even further in the near future. The metal commodity is already up an incredible 26% this year alone, easily bypassing global stocks and commodities.
With the European economic crisis escalating rather mending, gold’s positions will more than likely continue improving. Greece, Ireland, Portugal, Spain and Cyprus have all had their credit ratings severed.
At the same time, continued civil unrest in the Middle East has many oil investments still performing surprisingly well.
At the epicenter of this escalation of course stand Greece and its ever-crumbling debt situation. After a largely inconclusive E.U. meeting this week, the nation now looks for another conference to plead its case. It is crucial for the country to procure another round of rescue funds as soon as possible in order to stay afloat until more long-term financial aid arrives.
With nations like Italy and Spain expected to follow Greece and its drastic downturn, it is clear that the problems in Europe will not be solved overnight or over the course of a few conferences.
The outlook for the commodities sector appears grim, yet many asset classes including gold and other oil investments are expected to weather these disruptions surprisingly well.
As it stands now, the E.U. meeting seems more like the downtrodden leading the downtrodden, and while China has promised to provide some aid to the tumbling economies of the continent, the emerging nation’s representatives repeatedly stated that they will not remain a fall cushion for Europe for long, and that unless long-term solutions are reached about deficit and unemployment woes, things will likely keep getting worse and worse.
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