Is physical gold a protection against inflation

I am not sure about using gold as money. As far as physical gold is concerned, I believe it has something to do with Gold always increasing in values. It does not inflate in the most part, and even if it does, it always bounces back up. With paper money, if the currency lost its value, then it became useless or worth very little. With Gold, you are assured that the value will always be more than when you purchased it.

Gold has always been one of the precious metals that backed currencies in the past. Then many countries began to stop that policy, and came off the gold standard, which allowed them to just print money as they wanted. Now many countries around the world are battling huge debts, the chance of inflation, deflation, and super inflation...all of these make precious metals great hedges against the currency used in those nations. If the countries currency collapses, then by holding physical gold (or silver) you still have the power to purchase goods for yourself. Another great hedge against inflation is to buy extra goods now, while the price is cheaper to use later when the price has doubled, or tripled. Right now, in my country, gold is not very well accepted as a form of payment for goods or services...however, there are plenty of places where you can easily sell your gold for money to purchase goods and services. But in the US, gold is a sought after hedge against a weakened economy. Throughout history, gold has always been considered a form of currency. We might be headed in that direction again, considering the state of the economy in many countries around the world.

Unless a standard was set, it wouldn't really be worth anything. If the currency failed, the gold would still be worth something, but only what another person would value it at. And 2 different people might value the same piece of gold at different levels.

I think things will have to get pretty bad before stores accept gold directly as payment. At least in the US few businesses are currently equipped to accept gold (that said, I have heard of a couple of small businesses that will take cash, gold, or silver!). However, even if gold can't be used directly to pay for goods and services, it is still a great protection against inflation -- it will hold its value better than most other physical assets. And if the worst case currency scenario does unfold, then I think gold could very possibly become something people turn to to use as currency eventually. By the way, I notice you are from Germany. Do you know if people started using gold to pay for things in Weimar Germany after hyperinflation took root? I've heard the stories of people driving wheelbarrows full of basically worthless money around, but don't really know how the common person tried to cope with the inflation back then. Maybe they bartered?

I think that is a good option to save money in the form of gold. Gold is pricing high every day and that will definitely not going to down in near future based on current demand and supply. In India we have ornaments of gold that helps in crunch time to sell them and get the required amount. A very good investment for sure.

The value of paper money is based on the value of gold so it is logical that gold is a good investment. I`m sure that using gold instead of paper money is the best way for people. Anyway investing at gold is a good investment.

Gold is sure a good protection against inflation and that's it. gold should not be bought as investment. Gold has been and will continue to be the default currency for the world. With shrinking confidence in dollar and Greek crises, the attraction of gold has risen manifold. Gold production has been falling and demand has been rising. These two push and pull factors are taking the price of Gold higher and higher. You can visit my blog for a detailed analysis on Gold. For now, this information should be suffice. Buy gold as an hedge against inflation and Not as an investment.

In my place trading physical gold is booming today since everybody want to invest their moneys as golds. My region's currency with dollars is unstable today. Even trading gold online is common here. I guess saving golds is better than saving moneys because of its zero inflation characteristic, i mean an inflation never affects to gold's currency anytime. Have a nice day

Gold always preservable, and they are valuable over time. The printing of money always back by gold, so physical gold is one way of protection if you think of it. But now it is not the good time to buy gold, because its price is high.

In my opinion buying pure goldbars and coins is the best form of investment, if one has money, one can sell his gold in any country and get right price always, not legal formality required.. Thanks for sharing. Welcome always. Cheers. Professor