Millionaire with one kilogram of gold? In these countries, it's possible.

Goldprice and inflation

Two years ago, the gold price was around €50,000 per kilogram. Today, one kilogram of gold costs nearly €60,000. Looking at the period between June 2021 and April this year, the gold price has increased by approximately 16%. Comparing this to Dutch inflation during the same period (15%), we see that gold has outperformed savings. However, this does not mean that gold always performs better than a savings account. For example, between 2015 and 2018, the gold price remained around €35,000.
The gold price does not directly react to rising inflation. Instead, the expectation that more people will buy gold during periods of high inflation creates the link between inflation and an increase in the gold price. Gold tends to thrive during times of high inflation, currency devaluation, and political uncertainty.
 

Purchasing power

Additionally, gold always retains its intrinsic value. Because of this, it is seen as an excellent store of value, providing a safeguard for preserving purchasing power. Gold itself does not increase in value; rather, it reflects the decline in the value of the currency in which the gold price is denominated.
Other financial products, such as currencies, stocks, (government) bonds, and savings accounts, all carry the risk of their value dropping to zero or even going negative, as we see today. However, if you own physical gold, you are not dependent on complex financial systems or the performance of companies, countries, and banks. Additionally, gold cannot be printed or artificially created, unlike fiat money.
 

The price of gold in local currency

Inflation in the Netherlands is currently high. However, it is relatively mild compared to countries experiencing hyperinflation. In the countries listed below, currency devaluation is so extreme that one kilogram of gold can make you a millionaire in the local currency.
Gold price in local currency as of 26-05-2023

 

Country	Currency	1 kilogram gold	Country	Currency	1 kilogram gold
Venezuela	Bolivar	163.328.876.753	Djibouti	Franc	11.176.457
Indonesia	Rupiah	940.224.291	Haiti	Gourde	8.884.682
Uzbekistan	Som	714.983.062	Algeria	Dinar	8.583.546
Guinea	Franc	539.528.897	Bangladesh	Taka	6.740.088
Paraguay	Guarani	451.455.784	Albania	Lek	6.487.902
Colombia	Peso	282.011.187	Cape Verde	Escudo	6.453.527
Burundi	Franc	177.377.723	Afghanistan	Afghani	5.504.265
Congo	Franc	145.989.184	Bhutan	Ngultrum	5.194.253
South-Korea	Won	83.088.853	Russia	Ruble	5.021.977
Iraq	Dinar	82.266.806	Gambia	Dalasi	3.740.456
North-Korea	Won	56.337.091	Dominican Republic	Peso	3.424.421
Chile	Peso	50.761.667	Ethiopia	Birr	3.409.647
Sudan	Pound	37.653.460	Suriname	Hrivna	2.335.870
Angola	Kwanza	34.748.510	Ukraine	Hryvnia	2.318.789
Costa Rica	Colon	33.697.207	Egypt	Pound	1.939.483
Nigeria	Naira	28.952.005	Cuba	Peso	1.663.516
Kazakhstan	Tenge	28.004.223	Czech Republic	Koruna	1.383.043
Armenia	Dram	24.219.138	Moldova	Leu	1.117.641
Hungary	Forint	21.724.412	Mexico	Peso	1.108.118
Zimbabwe	Dollar	20.186.640	USA	Dollar	62.909
Argentina	Peso	14.826.720	Eurozone	Euro	58.512
Guyana	Dollar	13.276.099

 
Disclaimer: The Silver Mountain does not provide investment advice, and this article should not be considered as such. Past performance is no guarantee of future results.