April 12, 2016 /PRNewswire/ — Gold Specialists at precious metals brokerage firm American Bullion, Inc, are urging investors to take advantage of the negative interest rate policies (NIRPs) adopted by central banks in Europe and Japan to buy gold now to diversify portfolios and individual retirement accounts (IRAs). This latest buy recommendation has been issued because of the unique financial environment created from newly implemented NIRPs, a situation that risk assessment specialists agree bodes well for gold owners.
Negative interest rate policies are usually introduced in an attempt to combat deflationary pressure and help prop up a nation’s currency. Under NIRPs, commercial banks must pay for keeping deposits at central banks, which penalizes idle money and, in theory, helps the economy by encouraging lending and spending. The resulting financial environment is one that makes gold a very attractive investment for central banks, portfolio managers, and individual investors alike.
“With NIRPs in place, the opportunity cost for buying gold is significantly reduced,” says Orkan Ozkan, American Bullion CEO. “Investors no longer have to choose between holding gold in an IRA until retirement or putting their money into more traditional assets that yield 5% annually. Those yields simply aren’t there anymore. Meanwhile, the price of gold continues to rise despite general market turmoil.”
Lower opportunity cost isn’t the only reason it makes sense to buy gold now. The very fact that governments are implementing NIRPs—long seen as a move of last resort—should alarm investors. “When governments turn to negative interest rates, you can bet they’re out of ideas about how to stop deflation and stagnancy,” says Ozkan. “NIRPs lead to more market unrest and uncertainty, and undermine confidence in fiat currencies because of the potential for further monetary interventions. All of these factors combine to make gold even more of a safe haven than usual, so we are recommending to buy gold now and hold.”
To learn more about negative interest rates, and the effects they have on precious metals, read more at: https://www.americanbullion.com/what-negative-interest-rates-mean-for-gold-investors/
First time gold investors; for more information about starting a precious metals IRA, adding gold to an existing IRA, or rolling over an employer-based retirement fund into a gold IRA, please visit www.AmericanBullion.com to set up a consultation.