Bulls And Bears


On doing your research you will undoubtedly come across the terms bulls and bears.  Well, I know when I first came across these terms I thought, can somebody just tell me what have these mammals got to do with anything.
Well, here you will find out.  These terms relate to the direction in which the price of precious metals is going over time, up or
down.  Bull is Up, Bear is Down.


Prices RisingDuring the 1970′s there was a ten year long period where gold and silver prices steadily continued to rise making for very happy investors as they watched their profits grow continuously year by year.  This is referred to as a bull market.  The 70′s was a time of great economic turmoil with record inflation and hardships among the population.  This is the situation we are in today and if history repeats itself, as it normally does we could be looking at another Bull Market.

If you look through the 20 year chart below you can see from 2000 onwards you will notice a steady rise during this period of inflation.  One of the reasons for inflation is governments printing more and more paper money which has no real intrinsic value.  The more that is being pumped out, the less it is worth so the price of consumer goods goes up and the general population suffers in the process.  Not unless of course you are protecting yourself with precious metals.

Here’s how you could have profited in this Bull Market:

2003 gold at £180 per ounce or (troy oz), 2012 gold at £1,050 per ounce
So if you had bought £5,000 worth of gold in 2003, your investment would have been worth £29,158 in 2012


By the law of physics, what goes up must come down, so after a bull there will be a bear and vise versa.    There will be periods of swings and volatility which means that prices could “zigzag” and “sway” during it’s course not making a straight “B” line in one direction as you could see in the chart below.

Between 1980-1999 we saw a bear market where the trend was downward. During this time inflation was down and consumer spending increased due to lower prices. The early 80′s in particular showed a rough time for investors as prices of gold nosedived.

This continued till 2001, and this was a time when investors saw an opportunity, stocked up high on these precious metals and are reaping the rewards today.