With all this talk about the price of gold increasing, and also the price of silver which hit 16.00 an ounce today. People are still left scratching their heads and have been asking each other whether it is a solid investment or not?
Gold got a significant endorsement today from one of the world's largest insurance companies, Northwestern Mutual Life Insurance Co., the third-largest life insurer in the United States, has bought gold for the first time in the company's 152-year history to hedge against continued declines in other asset classes.
The insurance giant has accumulated about $400 million in gold over the past several months. Northwestern Mutual Chief Executive Officer Edward Zore was quoted in Bloomberg saying, "Gold just seems to make sense; it's a store of value... The downside risk is limited, but the upside is large. We have stocks in our portfolio that lost 95 percent." Gold "is not going down to $90."
The move may prompt other insurance companies to follow suit. It makes sense for insurance companies to hold gold since gold is always an asset and can never be considered a liability.
Such a move is a sure bet that other big companies will slowly start moving into gold in the future as well.
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