Gold Market Prices
Historical gold market prices are important for you to understand gold prices today. Gold market prices have experienced bull markets like today before and have experienced bear market prices. In fact, over the last 30 years gold market prices have been in bear markets longer than bully markets.
However, in 2009, the price of gold clearly indicates that we are in a bull market. The demand for gold bullion is at an all time high. The United States Mint and mints around the world are having a difficult time keeping up with this demand. As an example, the United States Mint decided to stop selling fractional gold bullion coins this year due to problems with supply of the gold bullion planchets that the coins are made from.
But, if you want to invest in gold, you need to understand historical gold market prices. Chances are that gold will not sell above $1,000 an ounce forever. And, if the last 40 years are to provide any indication on the future price of gold, I think that it is important to understand where the price of gold has been over this period of time.
Gold Value Chart 1971 - 2008
Gold Market Prices 1971 – 1980
In 1971, the average price of gold was $40.81 per ounce. Can you believe that forty years ago you could buy an ounce of gold for this little of money? It is hard to believe that gold market prices would be so low considering that the gold prices today are around $1,000 and ounce of gold.
From 1971 to 1980 the average price of gold increased from $40 an ounce to $614 an ounce. In ten years that price of gold skyrocketed and the first gold bull market of recent memory began. But, the price of gold tends to be a contrarian play. During times of economic uncertainty, demand for gold increases.
Gold Market Prices 1980 – 2000
Beginning in the 1980s with the policies implemented by the Reagan Administration, the United States experiences a 20 year economic bull market. During this 20 year economic bull market, the price of gold fell off its record highs of $614 an ounce. It fell fast and hard. The average price of gold in 1981 was only $459 an ounce. In 1982, the average price of gold fell further to $375 an ounce. Then the gold bear market was in full force with gold averaging in the mid $300s during most of the 1980s and 1990s. In 2000, the price of gold averaged $270 an ounce.
Gold Market Prices 2000 – 2008
During this decade, gold market prices experienced another bull market beginning in 2003. On July 20, 1999 gold market prices hit a 20 year low of $252 an ounce. By 2003, the average price of gold was up to $363. In 2004, gold prices rose to an average of $409 per ounce. In 2005 average price of gold reached $444 per ounce. This steady increase in the average price of gold has continued ever since with gold prices today hitting $1000 per ounce.
Future Gold Market Prices
Where future gold market prices will be nobody knows for sure. However, understanding the historical gold market prices is important for you to understand the risk of investing in gold. Too many gold investors today believe that the price of gold is stable and can’t fall. That is not correct. As you read above, investors in gold in the late 1970s saw huge declines in the price of gold in the early 1980s. Am I predicting a similar gold market crash now? No, I am not. But, I think that it is prudent to understand the risks when investing in gold.
Hopefully this review of the gold market prices has been helpful. I think that it is important to understand the gold market before investing.
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