The Resilience of Gold
Last night, gold futures came within touching distance of $2,000, reaching $1,998.60 before closing at $1,994.40. This impressive move towards the key psychological level occurred despite the strength of the US dollar throughout the day. The short-term strength of both gold and the US dollar can be attributed to safe haven demand in the Middle East.
Gold's momentum may have eased slightly due to better-than-expected US housing data and some progress in diplomatic efforts in the Middle East. However, there are two key reports from the US to watch out for today and tomorrow, which could put further pressure on gold. The release of third quarter GDP data today at 8:30 AM EDT and the most recent inflation statistics from the Bureau of Economic Analysis (BEA) as well as the September Personal Consumption Expenditure (PCE) Price Index tomorrow are likely to impact the Federal Open Market Committee's (FOMC) decision on interest rates next week.
Although the current consensus is that the FOMC will keep rates unchanged, today and tomorrow's releases could determine whether another rate hike is on the horizon.
China's Actions
China's recent actions have raised questions about its intentions. Is it trying to support its currency or deal with geopolitical tensions? Perhaps both. The latest US Treasury data shows that China has been selling off significant amounts of US assets. It is interesting to note that during the same period, both the People's Bank of China (PBOC) and private investors in China have been increasing their demand for gold. The destinations of the proceeds from the asset sales remain uncertain.
In addition to selling off US assets, China has also taken other measures to stabilize its economy. The government recently announced plans to issue an additional 1 trillion yuan in sovereign debt, which will push the deficit to a three-year high. This move reflects the concerns of the PBOC and the government about the state of the economy.
Expect China to take more aggressive actions as it strives to achieve a soft landing for its economy.
The Real Drivers of Gold
Mainstream articles often attribute gold's recent strength to the ongoing atrocities in the Middle East. While geopolitical risk certainly plays a role, this perspective is short-sighted. Gold was already showing strength before the attacks by Hamas on Israel and the subsequent retaliation. The underlying sentiment towards monetary decisions and the global economy remains weak. Few people believe that the FOMC and governments have a viable plan for economic recovery. Their actions are focused on managing the current situation rather than addressing the issues of debt and currency value.
Although the events in the Middle East and the actions of the US Federal Reserve are interconnected, gold's performance is not solely reliant on interest rate data. Despite the traditional inverse relationship between gold and interest rates, gold has remained strong even as interest rates have surged.
It will be interesting to see how these dynamics play out in the coming weeks.
Gold Prices
Here are the recent AM/PM LBMA FIX prices for gold in USD, GBP, and EUR:
25-10-2023: USD 1970.15, GBP 1983.30, EUR 1625.18
24-10-2023: USD 1967.40, GBP 1963.65, EUR 1605.99
23-10-2023: USD 1980.95, GBP 1973.00, EUR 1627.94
20-10-2023: USD 1984.20, GBP 1988.50, EUR 1637.76
19-10-2023: USD 1948.65, GBP 1953.55, EUR 1610.95
18-10-2023: USD 1943.85, GBP 1955.70, EUR 1592.60
17-10-2023: USD 1923.45, GBP 1928.20, EUR 1581.27
16-10-2023: USD 1914.65, GBP 1918.05, EUR 1575.18
13-10-2023: USD 1887.00, GBP 1909.20, EUR 1546.21
12-10-2023: USD 1881.15, GBP 1874.00, EUR 1529.56
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The post Gold's Not Going Anywhere, No Matter What Happens Next appeared first on GoldCore News.
Frequently Asked Questions
How is gold taxed by Roth IRA?
A tax assessment for an investment account will be based on the current market value, and not what you paid initially. All gains, even if you have invested $1,000 in a mutual funds stock, are subject to tax.
You don't pay tax if you have the money in a traditional IRA/401k. Capital gains and dividends earn you no tax. This applies only to investments made for longer than one-year.
Each state has its own rules regarding these accounts. Maryland requires that you withdraw funds within 60 business days after reaching the age of 59 1/2. You can delay until April 1st in Massachusetts. New York allows you to wait until age 70 1/2. To avoid penalties, plan ahead so you can take distributions at the right time.
Is buying gold a good retirement plan?
Buying gold as an investment may not seem very appealing at first glance, but when you consider how much people spend on average on gold per year worldwide, it becomes worth considering.
The best form of investing is physical bullion, which is the most widely used. But there are many other options for investing in gold. You should research all options thoroughly before making a decision on which option you prefer.
For example, purchasing shares of companies that extract gold or mining equipment might be a better option if you aren't looking for a safe place to store your wealth. If you need cash flow from an investment, purchasing gold stocks is a good choice.
You can also put your money in exchange traded funds (ETFs). These funds allow you to be exposed to the price and value of gold by holding gold related securities. These ETFs may include stocks that are owned by gold miners or precious metals refining companies as well as commodity trading firms.
Should You Buy Gold?
In the past, gold was considered a haven for investors during economic turmoil. Many people are now turning their backs on traditional investments like stocks and bonds, and instead look to precious metals like Gold.
While gold prices have been rising in recent years they are still low relative to other commodities, such as silver and oil.
Some experts believe that this could change very soon. Experts believe that gold prices could skyrocket in the face of another global financial crisis.
They also note that gold is increasingly popular because of its perceived intrinsic value and potential return.
If you are considering investing in gold, here are some things that you need to keep in mind.
- Before you start saving money for retirement, think about whether you really need it. It's possible to save for retirement without putting your savings into gold. The added protection that gold provides when you retire is a good option.
- Second, you need to be clear about what you are buying before you decide to buy gold. Each offers varying levels of flexibility and security.
- Don't forget that gold does not offer the same safety level as a bank accounts. It is possible to lose your gold coins.
Don't buy gold unless you have done your research. You should also ensure that you do everything you can to protect your gold.
How is gold taxed in an IRA?
The fair market value at the time of sale is what determines how much tax you pay on gold sales. You don't have tax to pay when you buy or sell gold. It isn't considered income. If you sell it later, you'll have a taxable gain if the price goes up.
You can use gold as collateral to secure loans. Lenders try to maximize the return on loans that you take against your assets. For gold, this means selling it. The lender might not do this. They may just keep it. They might decide that they want to resell it. The bottom line is that you could lose potential profit in any case.
You should not lend against your gold if it is intended to be used as collateral. It is better to leave it alone.
How do you withdraw from an IRA that holds precious metals?
First, decide if it is possible to withdraw funds from an IRA. After that, you need to decide if you want to withdraw funds from an IRA account. Next, make sure you have enough money in order for you pay any fees or penalties.
A taxable brokerage account is a better option than an IRA if you are prepared to pay a penalty for early withdrawals. This option is also available if you are willing to pay taxes on the amount you withdraw.
Next, you need to determine how much money is going to be taken out from your IRA. The calculation is influenced by several factors such as your age at withdrawal, the length of time you have owned the account and whether or not you plan to continue contributing to retirement plans.
Once you know how much of your total savings to convert to cash, it's time to choose the type of IRA that you want. While traditional IRAs are tax-free, Roth IRAs can be withdrawn at any time after you reach 59 1/2. However, Roth IRAs will charge income taxes upfront and allow you to access your earnings later without additional taxes.
Once the calculations have been completed, it's time to open a brokerage accounts. Most brokers offer free signup bonuses and other promotions to entice people to open accounts. To avoid unnecessary fees, however, try opening an account using a debit card rather than a credit card.
When you finally get around to making withdrawals from your precious metal IRA, you'll need a safe place where you can store your coins. Some storage areas will accept bullion, while others require you to purchase individual coins. You will need to weigh each one before making a decision.
Bullion bars require less space, as they don't contain individual coins. However, each coin will need to be counted individually. On the flip side, storing individual coins allows you to easily track their value.
Some people prefer to keep their coins in a vault. Some prefer to keep them in a vault. Whichever method you choose, make sure you store your bullion safely so you can enjoy its benefits for years to come.
What are the benefits of a gold IRA
There are many advantages to a gold IRA. It's an investment vehicle that allows you to diversify your portfolio. You decide how much money you want to put into each account, and when you want it to be withdrawn.
You also have the option to transfer funds from other retirement plans into a IRA. This makes for an easy transition if you decide to retire early.
The best part is that you don't need special skills to invest in gold IRAs. They are readily available at most banks and brokerages. Withdrawals are made automatically without having to worry about fees or penalties.
There are, however, some drawbacks. Gold has always been volatile. It is important to understand why you are investing in gold. Is it for growth or safety? Do you want to use it as an insurance strategy or for long-term growth? Only once you know, that will you be able to make an informed decision.
If you plan to keep your gold IRA indefinitely, you'll probably want to consider buying more than one ounce of gold. A single ounce isn't enough to cover all of your needs. You may need several ounces, depending on what you intend to do with your precious gold.
You don’t necessarily need a lot if you’re looking to sell your gold. Even a single ounce can suffice. But you won't be able to buy anything else with those funds.
What are the fees for an IRA that holds gold?
$6 per month is the Individual Retirement Account Fee (IRA). This includes account maintenance fees and investment costs for your chosen investments.
If you want to diversify, you may be required to pay extra fees. These fees vary depending on what type of IRA you choose. For example, some companies offer free checking accounts but charge monthly fees for IRA accounts.
Most providers also charge annual management costs. These fees are usually between 0% and 1%. The average rate for a year is.25%. These rates are often waived if a broker like TD Ameritrade is used.
Statistics
- Indeed, several financial advisers interviewed for this article suggest you invest 5 to 15 percent of your portfolio in gold, just in case. (aarp.org)
- Contribution limits$6,000 (49 and under) $7,000 (50 and up)$6,000 (49 and under) $7,000 (50 and up)$58,000 or 25% of your annual compensation (whichever is smaller) (lendedu.com)
- Instead, the economy improved, stocks rebounded, and gold plunged, losing 28 percent of its value in 2013. (aarp.org)
- You can only purchase gold bars at least 99.5% purity. (forbes.com)
- (Basically, if your GDP grows by 2%, you need miners to dig 2% more gold out of the ground every year to keep prices steady.) (smartasset.com)
External Links
investopedia.com
law.cornell.edu
- 7 U.S. Code SS 7 – Designation of boards of trade as contract markets
- 26 U.S. Code SS 408 – Individual retirement plans
forbes.com
- Gold IRA, Add Sparkle to Your Retirement Nest egg
- Understanding China's Evergrande Crisis – Forbes Advisor
cftc.gov
How To
Gold Roth IRA guidelines
Starting early is the best way to save for retirement. Start saving as soon and as often as you're eligible (usually around 50 years old) and keep going until retirement. It's vital to contribute enough money each year to ensure adequate growth on an ongoing basis.
Additionally, tax-free opportunities like a traditional 401k or SEP IRA are available. These savings vehicles let you make contributions and not pay taxes until the earnings are withdrawn. This makes them great options for people who don't have access to employer matching funds.
Savings should be done consistently and regularly over time. If you aren't contributing the maximum amount permitted, you could miss out on tax benefits.
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By: Dave Russell
Title: Gold's Not Going Anywhere, No Matter What Happens Next
Sourced From: news.goldcore.com/golds-not-going-anywhere-no-matter-what-happens-next/
Published Date: Thu, 26 Oct 2023 12:05:38 +0000
