Market Trends and Gold Prices

Tariffs, Trade Wars, Shrinking Tech . . .What’s the best way to invest in scrap gold today?

We have to admit, we have never seen a period when it has been so difficult to pinpoint the biggest trends that will affect the prices of gold. In the past, there were periods of uncertainty when it was possible to consider just one trend, see how it was probably going to affect domestic gold prices, and formulate an investment strategy. You could say, for example, “Looks like trade relations with China are going to be rough for a while, there could be fewer gold crossing borders, so the price of gold that is already in the U.S. is probably going to rise.”

But today an awful lot of things are happening at once. Let’s take a quick overview . . .

  • Trade agreements are being challenged by our administration. You know, because you’ve been following the news. Our president has decided to protect or simulate American employment by charging high tariffs for goods that are imported into the U.S. You might be thinking, “How much gold is imported anyway  . . . how much difference is that going to make?” But don’t forget that electronics, cars, and lots of other products that have been imported into the U.S. contain small amounts of gold. So if less gold is entering the U.S. in those items, what will that mean for the prices of gold - both in the U.S. and in Asia? We’re talking long term, but it is a destabilizing situation.
  • Our favorite electronic devices people use are shrinking in size. We’ve already seen this trend at work over the last few decades, as desktop computers have become less popular and fallen in usage compared to laptops and tablets. Now another migration to smaller devices is taking place, as more and more apps are migrating to smartphones. Not too long ago, you needed a laptop to check stock prices, monitor your health, check your email, or play a game. (Remember those days?) Now the smartphone is king, as tens of thousands of new apps are being developed and marketed. What will this mean for gold prices? That’s another good question. Because while the size of devices is shrinking and people are scrapping the devices they used to enjoy, they are also trading in and upgrading their phones at a blistering pace. (According to many estimates, as many as 150 million cell phones are being scrapped every year in the U.S. alone.) So scrapped gold-containing electronic devices are everywhere. The question is, can you get ahold of them?

What Do those Trends Suggest about Gold Recycling?

They tell us that no matter what happens, it is still a good time to find scrap gold, collect it, and have it recycled. Why? For several reasons. The first is that if the imports of products that contain gold are about to drop, the gold that is already present in the U.S. (a lot of it in devices that will be scrapped) will be worth more. The second is that as phones are scrapped in large numbers (as well as tablets and laptops), this is a good time for smart recyclers to acquire those devices and the gold they contain.

The good thing about electronic scrap is that you can collect those old cell phones, store them, and then recycle them later at a time when prices stabilize and hit an attractive level. If you want to know more about collecting gold scrap and recycling it profitably, call us at 800-426-2344 to speak with one of our precious metals consultants. The world of gold investing might seem unstable at the moment, but the strategies we can discuss with you are proven to work.

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