PRO_SMART_Trader

Gold prediction & Economic Crisis

Long
FX_IDC:XAUUSD   Gold Spot / U.S. Dollar
ECONOMIC CRISIS

Usually, everything is going fine. But from time to time something bad happens and the crisis breaks out. It may either apply to our business (or personal life), or the whole economy. Then, we talk about “economic crisis”.
There are many types of economic crises: currency crisis, debt crisis, bank crisis, broad financial crisis, GDP crisis, etc. We analyze “financial crisis” in a separate entry, focusing in this case on the latter meaning. We do this for two reasons. First, this is usually what people have in mind when they talk about “economic crisis”. Second, it is the most serious crisis as it entails the most severe effects on human welfare and the whole economy (in terms of increased unemployment and reduced income) often spurring other crises.
So, in the simplest terms, economic crisis is a sharp transition from expansion to a recession, or from boom to bust. Economic crises are, thus, related to the business cycle. They are characterized by a sharp fall in GDP and the rise in the unemployment rate. Investors are shocked and they panic. Nobody knows what will happen next, so there is a lot of uncertainty.

Economic Crisis and Gold

The widespread belief is that gold shines during economic crises. There is something in it, as the safe havens often thrive when economies are struggling, while markets are in turmoil. Indeed, as one can see in the chart below, gold gained during most of the several last US recessions (the timing of recessions is reflected by the rectangles).

Comments

LOL Target 😂
Reply
PRO_SMART_Trader pierreradjudin
@pierreradjudin,Just sit and watch and enjoy 😂
Reply
Home Stock Screener Forex Screener Crypto Screener Economic Calendar How It Works Chart Features Pricing Refer a friend House Rules Help Center Website & Broker Solutions Widgets Charting Solutions Lightweight Charting Library Blog & News Twitter
Profile Profile Settings Account and Billing Referred friends Coins My Support Tickets Help Center Private Messages Chat Sign Out