Why is Gold So Expensive 2022 - Today Gold Price in Market. Hi, friends today we'll be getting up close and personal with one of the most desired commodities throughout history pirates have plundered for it explorers have searched for lost cities made of it and failed jewellers and fashion houses create beautiful objects from hid investors traded and even tech companies need it yes we are talking about gold.
It's been used as a means of exchange longer than any of the world's existing currencies and because we take it for granted that goal is a measure of wealth you may have never even asked yourself. How it came to be so valuable in the first place if this question has crossed your mind you probably came to the conclusion that it's worth what it is currently over $1,700 an ounce for pure or 24 karats gold simply.
Because it's rare and pretty well we're gonna break it down for you as you'll see yes those are both important factors but there's actually quite a bit more to it so let's uncover some answers to, today's golden question and find out why is gold so expensive first up it's rare no prizes for guessing this one it doesn't make the list of the rarest metals in the world but it's still pretty rare for some perspective more steel is created every hour than the gold that's been extracted from the earth in all of human.
History if you put together all of the world's above surface gold in the pure form you'd only end up with about 190,000 tons that's enough to fill two Olympic sized swimming pools and compared to other precious metals that often gets compared to like silver gold is about 10 times rarer. It's difficult to extract mining gold has never been easy in the old days' gold prospectors used to pan for it and even today old fashioned images of miners and hats digging underground in South Africa or in deep down muddy holes in Brazil.
Still exist but a lot of the time the process isn't so labour-intensive but relies on heavy expensive machinery either way if you wanted to get a gold-mining operation underway you'd need a lot of capital and it isn't just the mining identifying a goldmine can take a decade and requires highly qualified experts including chemists geologists and engineers on top of that. Gold prospectors have to pay governments for licenses to explore it and the end result less than 1% of all areas prospected end up as profitable mines.
So it's no wonder that whenever miners do literally hit gold they demand high prices at the moment China is the world's biggest gold producer accounting for 12% of world production with Australia and Russia taking the second and third spots it's the perfect metal for making jewellery of all the things gold goes into we're gonna start with jewellery not only because it's the oldest use of gold that we know of also because of 50% of the gold that's mine.
Today still goes into this original use making things look blingy in 2022 that was around four thousand four hundred tons that went into jewellery and it just so happens if you ask jewellers to come up with an imaginary metal that would be their dream to work with they wouldn't even have to invent one they probably just named gold that's because it ticks literally every box and it's desirable characteristics go beyond just looking pretty it's easy to shape first let's get a bit technical.
It's very malleable malleability is a measure of how easily you can shape material and gold is the most malleable of all metals, in fact, you can take a single ounce of gold and hammer it out into a sheet that covers 300 square feet which explains how you can make things look shiny and golden without having that much gold in them as well as the ideal material to make necklaces watches ornaments and any objective Beauty you want to dazzle people with it keeps.
Its shine that's right as well as looking shiny it stays shiny unlike silver it doesn't tarnish or require constant polishing unlike copper it doesn't oxidize and turn green take a look at the Statue of Liberty, in fact, it keeps its dazzling appearance pretty much forever ask a scientist and they'll tell you the reason for this is it's extremely unreactive this also gives it a couple more niche benefits it means that unlike lead it isn't poisonous you can even eat it if you want to and also. Because it's unreactive it doesn't taste like anything that means if you're a gourmet chef in a super-exclusive restaurant and you want to bling up a steak a glass of champagne even a coffee or a chocolate Sunday.
You can use gold to do exactly that and there are plenty of Michelin star chefs who do and the gold won't even interfere with the taste its colour is unique, so it's beautiful it's shiny and it's also unique lots of materials have roughly the same colour as silver including ones that are rarer and more expensive like platinum and palladium but gold is the only metal that's well golden for centuries.
It was the perfect form of exchange the oldest gold coins we know of was made by King Croesus of Lydia nowadays that would be Western Turkey in about 540 BC and there are some pretty good reasons why gold was chosen to make the earliest payments. It's rare but not too rare platinum would have been impractical as there's so little of it around totally aside from the fact that.
It's harder to work with and ancient cultures probably didn't even know platinum existed common metals wouldn't have fit the belt because well they're too common to be worth that much copper was used by the ancient Chinese. But it's true that silver also fit the bill and was used as currency alongside gold but as gold is about 10 times rarer than silver gold has always been seen as Silver's prettier classier sister.
It's a highly prized investment more recently governments backed up their paper currencies with gold reserves that they kept in their vaults this practice ended in the second half of the 20th century the USA stopped pegging the dollar to gold in 1971, and Switzerland was the last country to get rid of the gold standard in 1999, but banks still do hold gold reserves and demand from central banks continues to be one big reason. That it's price stays so high in 2018 central bank's bought 651 tons of it that's about twenty-seven billion dollars worth and old prices at the time and of course, investors use it to diversify their portfolios specifically as a form of security against currency devaluation and inflation gold is seen as a sort of safe haven in times of financial uncertainty in 2008.
The financial crisis it shot up in value as investors all over the world were losing faith in the world's major currencies and turning to gold it was at this time it went above the $10,000 an ounce mark and in the coronavirus crisis, you can bet your bottom dollar that yes the price has shot up further from a high of 1542 in 2019 to its current price above $1,700 an ounce in May of 2020 and crises aside historically. It increases in value faster than the rate of inflation from around $300 an ounce 50 years ago to above $1700 now it's increased almost six times.
Why is that well let's think about it what makes any investment whether stocks currencies or commodities more or less valuable is their perceived value and how confident people are it's going to keep that value remember that gold is being used as a store of wealth for over two and a half thousand years with a history like that there's no currency or company on the S&P 500 that can compete with that and with important customers like central banks as well as the world's best-known fashion houses there's no reason to think its price is going anywhere.
But up in the long term tech companies need it so we all know Gold's pretty and people are confident that it will keep its value but totally aside from putting it in a necklace or keeping it in a vault it's got practical uses too as if it weren't enough being prized among the world's most prestigious jewellers and shrewdest investors. There's another group that's also buying up gold tech firms gold is one of the best conductors of electricity.
This means it's used in small quantities in wiring and electronics where it's needed for highly specialized purposes take a look at the device you're using to read this article on you guessed it. It contains gold sure it's only used in small quantities but at the right smart devices are being produced this use accounts for about 14% of gold and it's also used in nuclear technology in satellites and radiation shielding in medicine and dentistry to coat teeth and even in injections to relieve pain for arthritis sufferers and the visors and astronauts helmets are also.
Coated in thin transparent layers of gold which reflects heat and the sun's glare Gold also has a sense of mystery this might seem like a strange one to put on the list but stop a moment to think about the most prestigious luxury brands in the world. They have an allure about them almost a sense of magic whenever you hear their name this keeps customers coming back more and makes investors confident in them.
Gold, although it isn't a brand, has this factor in spades or maybe we should say in carats and it's had it for centuries since ancient times it's been used to make items for royalty and religious rituals, you can even read about it in the Bible when we visit opulent palaces or ornately decorated churches it's all gold that dazzles us more than anything else nowadays the most fashionable brands make their most luxurious pieces out of it prestigious awards from Olympic medals for first place Oscars Grammys Nobel Prizes and obviously, the Golden Globes are made of it.
It's wowed us with its associations of nobility the divine and luxury and it's even embedded itself into our way of thinking look at the number of expressions in English or any other language for that matter that use it to be worth your weight in gold to strike gold to be like gold dust. It's almost as if gold has its own marketing department that's been working overtime the last six thousand years, that since the first known gold artefact was sculpted and all of this means that gold is instilled in our minds as one of the most desirable commodities imaginable, and this can only add to its high price. But will gold hold its value the answer to this one is almost certainly and it could start to rise even faster in the not-too-distant future?
It's estimated that stocks of gold that are still below ground and that we can realistically mine are limited and they could run out in just twenty years from now but there's no sign of demand shrinking even if the world lost interest in beautiful jewellery overnight as if that's about to happen with. Its practical applications for computing and technology gold would still be a prized commodity and that could mean that in the years to come, its value will rise even faster and let's end this with another interesting prediction about the future of gold scientists know that gold can be found on meteorites, and possibly on Mars Mercury and Venus as well.
This means that with space exploration forging ahead the next gold rush could be in space Handel Xers here we are at the end we're curious to know in your mind what's the most beautiful item made from gold you've ever seen tell us in the comments and for sticking with us until the end here's your bonus you want to see the most ridiculously over-the-top bling item we could find that's made of or at least coated in gold we passed on items like gold shirts and gold barbecue sets and a gold set of poker chips to choose the gold-plated Lamborghini Aventador this absolute top of the range Lamborghini is made out of carbon fibre which is then coated in 500 kilograms of solid gold, as well as diamonds in the headlights and 700 precious stones woven into the seats and all of it, can be yours for a price tag of 7.4 million dollars thank you.
It's been used as a means of exchange longer than any of the world's existing currencies and because we take it for granted that goal is a measure of wealth you may have never even asked yourself. How it came to be so valuable in the first place if this question has crossed your mind you probably came to the conclusion that it's worth what it is currently over $1,700 an ounce for pure or 24 karats gold simply.
Because it's rare and pretty well we're gonna break it down for you as you'll see yes those are both important factors but there's actually quite a bit more to it so let's uncover some answers to, today's golden question and find out why is gold so expensive first up it's rare no prizes for guessing this one it doesn't make the list of the rarest metals in the world but it's still pretty rare for some perspective more steel is created every hour than the gold that's been extracted from the earth in all of human.
History if you put together all of the world's above surface gold in the pure form you'd only end up with about 190,000 tons that's enough to fill two Olympic sized swimming pools and compared to other precious metals that often gets compared to like silver gold is about 10 times rarer. It's difficult to extract mining gold has never been easy in the old days' gold prospectors used to pan for it and even today old fashioned images of miners and hats digging underground in South Africa or in deep down muddy holes in Brazil.
Still exist but a lot of the time the process isn't so labour-intensive but relies on heavy expensive machinery either way if you wanted to get a gold-mining operation underway you'd need a lot of capital and it isn't just the mining identifying a goldmine can take a decade and requires highly qualified experts including chemists geologists and engineers on top of that. Gold prospectors have to pay governments for licenses to explore it and the end result less than 1% of all areas prospected end up as profitable mines.
So it's no wonder that whenever miners do literally hit gold they demand high prices at the moment China is the world's biggest gold producer accounting for 12% of world production with Australia and Russia taking the second and third spots it's the perfect metal for making jewellery of all the things gold goes into we're gonna start with jewellery not only because it's the oldest use of gold that we know of also because of 50% of the gold that's mine.
Today still goes into this original use making things look blingy in 2022 that was around four thousand four hundred tons that went into jewellery and it just so happens if you ask jewellers to come up with an imaginary metal that would be their dream to work with they wouldn't even have to invent one they probably just named gold that's because it ticks literally every box and it's desirable characteristics go beyond just looking pretty it's easy to shape first let's get a bit technical.
It's very malleable malleability is a measure of how easily you can shape material and gold is the most malleable of all metals, in fact, you can take a single ounce of gold and hammer it out into a sheet that covers 300 square feet which explains how you can make things look shiny and golden without having that much gold in them as well as the ideal material to make necklaces watches ornaments and any objective Beauty you want to dazzle people with it keeps.
Its shine that's right as well as looking shiny it stays shiny unlike silver it doesn't tarnish or require constant polishing unlike copper it doesn't oxidize and turn green take a look at the Statue of Liberty, in fact, it keeps its dazzling appearance pretty much forever ask a scientist and they'll tell you the reason for this is it's extremely unreactive this also gives it a couple more niche benefits it means that unlike lead it isn't poisonous you can even eat it if you want to and also. Because it's unreactive it doesn't taste like anything that means if you're a gourmet chef in a super-exclusive restaurant and you want to bling up a steak a glass of champagne even a coffee or a chocolate Sunday.
You can use gold to do exactly that and there are plenty of Michelin star chefs who do and the gold won't even interfere with the taste its colour is unique, so it's beautiful it's shiny and it's also unique lots of materials have roughly the same colour as silver including ones that are rarer and more expensive like platinum and palladium but gold is the only metal that's well golden for centuries.
It was the perfect form of exchange the oldest gold coins we know of was made by King Croesus of Lydia nowadays that would be Western Turkey in about 540 BC and there are some pretty good reasons why gold was chosen to make the earliest payments. It's rare but not too rare platinum would have been impractical as there's so little of it around totally aside from the fact that.
It's harder to work with and ancient cultures probably didn't even know platinum existed common metals wouldn't have fit the belt because well they're too common to be worth that much copper was used by the ancient Chinese. But it's true that silver also fit the bill and was used as currency alongside gold but as gold is about 10 times rarer than silver gold has always been seen as Silver's prettier classier sister.
It's a highly prized investment more recently governments backed up their paper currencies with gold reserves that they kept in their vaults this practice ended in the second half of the 20th century the USA stopped pegging the dollar to gold in 1971, and Switzerland was the last country to get rid of the gold standard in 1999, but banks still do hold gold reserves and demand from central banks continues to be one big reason. That it's price stays so high in 2018 central bank's bought 651 tons of it that's about twenty-seven billion dollars worth and old prices at the time and of course, investors use it to diversify their portfolios specifically as a form of security against currency devaluation and inflation gold is seen as a sort of safe haven in times of financial uncertainty in 2008.
The financial crisis it shot up in value as investors all over the world were losing faith in the world's major currencies and turning to gold it was at this time it went above the $10,000 an ounce mark and in the coronavirus crisis, you can bet your bottom dollar that yes the price has shot up further from a high of 1542 in 2019 to its current price above $1,700 an ounce in May of 2020 and crises aside historically. It increases in value faster than the rate of inflation from around $300 an ounce 50 years ago to above $1700 now it's increased almost six times.
Why is that well let's think about it what makes any investment whether stocks currencies or commodities more or less valuable is their perceived value and how confident people are it's going to keep that value remember that gold is being used as a store of wealth for over two and a half thousand years with a history like that there's no currency or company on the S&P 500 that can compete with that and with important customers like central banks as well as the world's best-known fashion houses there's no reason to think its price is going anywhere.
But up in the long term tech companies need it so we all know Gold's pretty and people are confident that it will keep its value but totally aside from putting it in a necklace or keeping it in a vault it's got practical uses too as if it weren't enough being prized among the world's most prestigious jewellers and shrewdest investors. There's another group that's also buying up gold tech firms gold is one of the best conductors of electricity.
This means it's used in small quantities in wiring and electronics where it's needed for highly specialized purposes take a look at the device you're using to read this article on you guessed it. It contains gold sure it's only used in small quantities but at the right smart devices are being produced this use accounts for about 14% of gold and it's also used in nuclear technology in satellites and radiation shielding in medicine and dentistry to coat teeth and even in injections to relieve pain for arthritis sufferers and the visors and astronauts helmets are also.
Coated in thin transparent layers of gold which reflects heat and the sun's glare Gold also has a sense of mystery this might seem like a strange one to put on the list but stop a moment to think about the most prestigious luxury brands in the world. They have an allure about them almost a sense of magic whenever you hear their name this keeps customers coming back more and makes investors confident in them.
Gold, although it isn't a brand, has this factor in spades or maybe we should say in carats and it's had it for centuries since ancient times it's been used to make items for royalty and religious rituals, you can even read about it in the Bible when we visit opulent palaces or ornately decorated churches it's all gold that dazzles us more than anything else nowadays the most fashionable brands make their most luxurious pieces out of it prestigious awards from Olympic medals for first place Oscars Grammys Nobel Prizes and obviously, the Golden Globes are made of it.
It's wowed us with its associations of nobility the divine and luxury and it's even embedded itself into our way of thinking look at the number of expressions in English or any other language for that matter that use it to be worth your weight in gold to strike gold to be like gold dust. It's almost as if gold has its own marketing department that's been working overtime the last six thousand years, that since the first known gold artefact was sculpted and all of this means that gold is instilled in our minds as one of the most desirable commodities imaginable, and this can only add to its high price. But will gold hold its value the answer to this one is almost certainly and it could start to rise even faster in the not-too-distant future?
It's estimated that stocks of gold that are still below ground and that we can realistically mine are limited and they could run out in just twenty years from now but there's no sign of demand shrinking even if the world lost interest in beautiful jewellery overnight as if that's about to happen with. Its practical applications for computing and technology gold would still be a prized commodity and that could mean that in the years to come, its value will rise even faster and let's end this with another interesting prediction about the future of gold scientists know that gold can be found on meteorites, and possibly on Mars Mercury and Venus as well.
This means that with space exploration forging ahead the next gold rush could be in space Handel Xers here we are at the end we're curious to know in your mind what's the most beautiful item made from gold you've ever seen tell us in the comments and for sticking with us until the end here's your bonus you want to see the most ridiculously over-the-top bling item we could find that's made of or at least coated in gold we passed on items like gold shirts and gold barbecue sets and a gold set of poker chips to choose the gold-plated Lamborghini Aventador this absolute top of the range Lamborghini is made out of carbon fibre which is then coated in 500 kilograms of solid gold, as well as diamonds in the headlights and 700 precious stones woven into the seats and all of it, can be yours for a price tag of 7.4 million dollars thank you.
