The gold will remain bullish on the next two years Bank proposes return to gold standard for the exchange rates
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November 9, 2010, 2:21 a.m. | The world's major economies should consider the possibility of returning to gold as a reference for the parities of their currencies, according to World Bank President Robert Zoellick.

In an article published yesterday in the Financial Times, Zoellick said the need for a successor to the floating currency system, in force since the regime of fixed exchange rates collapsed in 1971.

Zoellick proposes a system that should surely be the dollar, euro, yen, pound and Chinese yuan, "to advance toward its" internationalization "and lead to an" open capital account. "

This system should also "consider the possibility of using gold as an international reference point" in terms of market expectations of "inflation, deflation and future changes in currencies."

Although there have been occasional calls for the return to gold, most policy makers and experts do not consider it advisable because it would lead to an overly rigid monetary policy could adversely affect growth and employment.

The original Bretton Woods system, established in 1945 and managed by the International Monetary Fund, was based on fixed exchange rates but adjustable linked to the value of gold.

According to Zoellick, "but the manuals might consider the old gold coin, the market is used as an alternative monetary asset." Erika Hidalgo López efe

ehidalgo@cadena-capriles.com

The crisis is not over the lease and the dollar remains weak. The prospects for improved economic outlook is not very clear and low confidence of investors do the analysts predict that the commodities will continue to gain ground in the next two years, particularly gold and silver.

Excess liquidity and few assets to help reverse that attention is diverted into gold, says the president of the Chamber of Mines of Venezuela (Camiven), Luis Alejandro Rojas.

The union leader estimated that the picture will not change in the medium term, but this trend will continue.

He explains that gold's best friend is the negative real interest rates, as it is showing the U.S. economy.

International analysts argue that "if gold is to take a break, it would be a buying opportunity when you come down to 1150-1200 per ounce, with a goal at $ 1,500 for the coming months. Considering that yesterday topped $ 1,400 an ounce."

During the past two years, specifically ones that lasted the crisis, gold has become fashionable asset. The fear of the inflationary effect of non-standard measures of monetary policy being made by the Federal Reserve, makes the precious metal is formed in a key instrument for portfolio managers to hedge risks.

Similarly, the central banks of emerging countries are turning to gold as a hedge against the falling value of the standard reserve currencies trustee or non-convertible currency. From the lows of October 2008, $ 681.85, has gone to a new record in nominal terms to reach $ 1,407.59 yesterday.

How to invest

However, many will wonder how an ordinary Venezuelan can invest in gold.

The answer, according to financial analyst, economist and professor at IESA, Carlos Molina, is that investing in gold is not an option for ordinary Venezuelans, it is an area addressed to large investors.

Explain to invest in gold for the Venezuelans have a significant effect, moreover it is difficult for a citizen who does not have the resources or drive this type of investment can buy gold directly.

But the jewels of gold, says Molina, could be an option if you want to protect the value of money in hard currency, would be an alternative for Venezuelans who can not save in dollars.

However, this alternative is very tricky, "the problem is that saving in gold is very insecure. I do not recommend to anyone who has his home gold storage," says the expert.

Camiven president, meanwhile, said that the custodians of gold ore are extremely expensive, in some cases may come to represent 1% of the value of the product in a year.

But if you want to opt for a mutual fund tied to gold Bs can not do it. Molina argues that besides being a significant investment in Venezuela are no alternatives to it.

Investment funds tied to commodities are the instruments which currently has in the country, brokerage firms have become extinct, that was the way to do it.

However, not entirely rule out the alternative that can be done through a bank. Clarifies that it is not so simple and has not seen that banks are offering this instrument, since it requires an account in dollars, because nobody has a background in gold to pay in Bolivars.

Financially, investing in gold is something like buying oil, it is subject to fluctuations in the price but it is a form of savings in hard currency. In international markets can be purchased attached to gold metal background, but require large investments.

"A recommendation for someone middle-class copper profits at year's end or performance, that before thinking about investing in gold decides to improve your home, your car or buy home appliances, in general, they invest in improving things maintain some value in the country, "says financial analyst.