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Revealing the Truth About Buying, Selling, and Investing in Gold

Understanding Gold

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GOLD is hot right now. The bad economy and falling dollar are driving GOLD prices way up. Concerned investors are buying up GOLD while others are rushing to sell their old gold items for a hefty profit.

Unfortunately, increased opportunity in GOLD brings with it increased chances of getting ripped off. FREEgoldTIPS.com is here to help.

We do NOT sell anything and do NOT endorse any GOLD product or service. Sure, there are ads on the website to pay the bills, but you can ignore them if you want. We provide comprehensive and impartial articles detailing everything you want to know about GOLD in an easy to understand format.

This FREE website contains articles on:

Why GOLD is valuable
What makes GOLD prices rise and fall
How to make money in GOLD
How to sell SCRAP GOLD
How to buy and sell GOLD BULLION
How to buy and sell GOLD COINS

If you have any questions, suggestions, or comments feel free to contact us through our CONTACT PAGE. We will do our best to help.

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How to Make Money Buying Gold

Gold is the oldest and more enduring form of legal tender. It is universally recognized for its value and rarity. While financial markets make wild swings over short periods of time, gold prices tend to creep up and down. The patient investor can do quite well if they know what to look for.

It is important to understand what makes gold prices move. When the economy is doing well, gold prices tend to fall. When the economy is bad, gold prices rise. Investors tend to cling to the enduring value of gold when their financial future is uncertain.

Back in 1999, gold was selling for about $250 per ounce. By 2008 it topped $1,000 per ounce. Similar dips and spikes are recorded throughout history. Understand that gold prices don't fluctuate much on a daily basis but often make a steady march upward or downward over the course of several months and years.

The key to making money in gold is to buy low and sell high. This may sound obvious, but if it was easy then everyone would do it. If you are buying gold, do it when no one wants gold. Do not buy when everyone has gold fever.

Another way is to gather gold that nobody wants. Most gold transactions focus on high-quality gold coins. With gold coins, the condition and rarity of the coin increases the price dramatically over the value of the gold content. Meanwhile you can find lower quality gold coins, gold bullion, and gold scrap selling at prices at or below the spot value. You can often buy this gold in cheap lots or as unwanted scrap. When the price of gold is high, your less-than-perfect gold will sell just fine.

When accumulating gold, look for every opportunity to buy in bulk and cut expenses. Many gold dealers waive sales tax and shipping when you buy a certain amount. When you are selling, pedal your gold to the general public. A gold dealer will want a wholesale price from you but regular people will pay market retail. Sell your gold on Internet auction sites, at coin shows or to another investor who isn't as smart as you.

Hold onto that gold if the spot price is on the rise. Gold investing is an exercise in patience. Accumulate your gold when the economy is good and gold is cheap. Wait until the economy crashes. It always does eventually. When gold prices rise, dust off your gold, sell it, and reap in the profits.

Why Gold Is So Valuable

Gold is valuable primarily because a lot of people believe it is. Gold's value is a cultural phenomenon. Its price is determined by a complex combination of factors but not necessarily need. Cultures that do not use gold or do not seek it, do not value it. Gold is mainly an investment commodity. It is seen as a refuge from shaky currencies during tough economic times.

Gold has been prized throughout history. Cultures ranging from the ancient Egyptians to the Chinese to the Native Americans valued it for its beauty and unique characteristics. Gold was so treasured that the pursuit of it led to human atrocities ranging from war to colonialism to slavery. The Americas were colonized largely as a result of gold exploration. Spanish conquistador Hernan Cortez wiped out the Aztec Empire, and fellow Spaniard Francisco Pizarro destroyed the Inca Empire while plundering gold. Many human migrations, like the 1849 "gold rush" to California, were a direct result of gold discoveries. So many people moved to the California Territory that it gained statehood decades earlier than surrounding territories. Most paper money around the world was based on the gold standard until the 20th century. The Great Depression prompted most countries to leave the gold standard by 1932.

Gold is valuable because it has unique properties. It is a soft metal so it is easy to forge but incredibly strong. It does not tarnish, rust or corrode. Gold maintains an aesthetically pleasing luster over time. All these factors enticed cultures all over the world to treasure gold for artwork, jewelry and coinage. Gold is an element. On the periodic table it has atomic number 79 and its symbol is "Au". It conducts heat and electricity well. That makes gold useful for electronics and chemical applications. Virtually every computer in the world has some gold in it.

Gold is actively traded on world markets. It is treated as a commodity with the actual metal never changing hands. It is seen as a refuge for investments during tough economic times. Investors believe that gold will always hold its value while currencies and stocks might not. Gold is valued in jewelry and artwork. It does not cause allergic reactions and requires no maintenance to sparkle and look great. Gold is also treasured in coinage and bullion. Gold coins made by ancient civilizations still survive today and are prized by collectors.

There are misconceptions about how the price of gold is determined. It is not only about supply and demand. In fact, in 1999 and 2000 there was a high demand for gold jewelry but the price of gold remained low. Gold's value is influenced more by world currency markets. The price of gold is closely linked to the confidence in the U.S. dollar. The value of gold rises as confidence in the dollar falls. There is also a misconception about the definition of "pure gold." Nearly all gold in private ownership is an alloy, meaning it is partially gold. It is commonly combined with silver or copper to make it hard enough to handle. Eighteen-karat gold is only 75 percent gold. Fourteen-karat gold is less than 60 percent gold.

Gold is also valuable because of its rarity. It is estimated that all the gold in the world would form a cube measuring just 19 meters on each side. That is a remarkably small amount considering the size of the Earth. More gold is mined all the time but demand also increases as there are more people to desire it.