The Case For Gold

Finance

 

After centuries of having gold and using it, humanity cannot live without this yellow precious metal. It is such an engrained part of our being, we use it in virtually everything. It is part not our religion, our culture the electronic devices were cannot live without and so much more. 

Ancient civilisations considered this precious metal to be a symbol of power, wealth and good fortune. This has not changed over the centuries since the discovery of this precious metal was made. It seems that people will always have an affinity for gold. Centuries have passed, several civilisations died out and the world has evolved, but gold is still as valuable as it was in the beginning. 

Gold over centuries

The oldest gold artefacts found dates back to the ancient Sumerian civilisation of Mesopotamia. During that period, gold was mined in opencast mines, primarily to make jewellery. There are some well preserved ancient gold artefacts that can be seen at the British Museum, the Louvre and the University of Pennsylvania Museum of Archaeology.

Ancient Egyptian’s gold dates back some 3,500 years ago. Back then, gold was discovered in Kish, Nubia and Sudan. Egyptian Pharaohs accumulated a lot of gold which made them the rich and powerful. In ancient times, he who held more gold held more power. For Egyptians, gold was so important, kings and queens were buried with it so that they could take it with them to the afterlife. 

In North and South America, gold was also part of the ancient Mayan people. There was so much gold that legends of entire cities built with gold were carried across the globe, drawing conquistadors who sought to colonize this new world and get as much gold for the Spanish empire. 

By the time the 20th century rolled in, everyone sought gold and the gold mining industry was firmly entrenched. Gold might not be the stuff for rich people only, anyone can own gold. What is true of gold however is that it is still a store of wealth. Countries that have emerged as the biggest producers of gold in the world in the 20th and 21st century are:

  1. Australia

The Australian continent is believed to have 9,800 tons of gold to be mined. Half of this gold is concentrated in  four major mines: Cadia-Ridgeway, Olympic Dam Mine, Boddington and Telfer. People are still stumbling across gold nuggets in the Australian outback, suggesting that one can still find and sell gold nuggets Melbourne.

  1. South Africa

South Africa has a both 6,000 tons of gold deposits. Most of the gold is found in the area known as the Witwatersrand. South Africa has over35 gold mines located within a 75,000 sq.km. only four of these mines contain 40% of the country’s gold resources.

More than 48,000 tons of gold have been mined from the earth in the Witwatersrand area since 1886. Unfortunately, production of gold has since fallen by 60%. It is believed that South African Gold Reserves could last for more than 40 years. 

  1. Russia

Russia has 10% of the world’s gold reserve. That works out to 5,500 tons. The most deposits are in the Far Eastern District of the country as well as in Western Siberia. The current gold reserves in Russia are expected to last 20 years. 

Mining companies produce about 3,000 tons of gold a year, that is 1.5% of the 190,000 tons of the total gold reserves in the world. There has been a slowdown in the production of gold. In the 20th century, prospectors used to stumble across large goldfields and several medium and small sized gold deposits every decade, however, modern day discoveries are far less than they were 15 years ago. There are less gold nuggets being found or leading to possible goldfields, even if they are prospectors are secretive about where they are finding nuggets. The fact that there are dealers and special places where people can sell gold nuggets Melbourne means that those in the industry know there is plenty of gold still to be found.

The point is, the amount of gold that could be extracted on the earth’s upper crust easily has diminished. Experts predict that it will be harder to mine for gold in the near future. 

This means that most of the gold that is in the world is already in the hands of individuals who have turned it to jewellery, bullion bars as well as coins. People buy these gold products as investments or some sort of financial cushion for hard times.

Whilst the amount of gold on Earth is dwindling, people still regard gold as a shield against increased volatility of financial markets. The weakening U.S dollar and the currency crisis in countries like Turkey and Venezuela will continue to drive the price of gold up. Gold comes in handy when you find yourself in need of cash and you cannot access it by any conventional means. 

 

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