Thursday, April 11, 2013

How to Save Your Money: Gold?

Summary of Article: Gold has always been considered one of the safest investments. Paper money can lose its value in inflation but gold is thought to always hold its own. In the last few years, as a result of the recession, people have invested heavily in gold. Now it seems gold is plunging in value.  But it is plunging so quickly, some are saying the "golden age" of gold is over. The last time this happened (in the 1980s), the price of gold took 30 years to recover. Why now? The Great Recession appears to be over and the mass inflation did not occur as expected. Thus, gold's value is decreasing as the economy improves.

Discussion with Kids:
  • What is gold? (A metal) Where do we most often see it (jewelry, watches). What color can it be (white, yellow gold, soft yellow, etc.)
  • What are different ways for spending and saving money? (Paper money, coins, credit cards, checks, bank accounts, bartering, jewelry). Why do some people prefer one method over another? (Bank account money can be frozen in crises; jewelry/gold can go with you in a pinch. Can tell about how in history, when Jews had to flee, they would sew jewelry into the hems of their clothing and use it as money when they got to their new land).
  • Traditionally people have thought gold was the safest way to save their money. Why? (Because it always is valuable). But right now the price of gold is going down for the first time in 30 years. 
  • What does this mean for people who have invested heavily in gold (they are losing a lot of money).

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