Gold has been a symbol of wealth for thousands of years and even though the United States is no longer on the gold standard, our fascination continues.
Gold is still viewed as a prized possession, a treasure worth searching the ends of the earth for. Clint Eastwood, John Wayne, and Harrison Ford became household names hunting for gold (or artifacts made from it). But what exactly makes gold so valuable? Why has it been used as currency for millennia when there are far more rare metals and far more productive ones? It turns out that gold is perfect in its simplicity.
The periodic table provides us with a list of elements, including the noble metals. Noble metals are special because they don’t oxidize and become corroded when exposed to damp air or acids. Gold is especially resistant to corrosion and gold coins can last for thousands of years. But compared to other noble metals like silver and palladium, gold is mined and produced most efficiently. Gold has a very low melting point compared to other metals, so production of coins and valuables doesn’t take a gargantuan effort. For example, gold melts at 1948 degrees Fahrenheit while platinum stays solid until 3,215 degrees Fahrenheit. Gold coins are lightweight and easily carried around and exchanged.
It’s Just Rare Enough
Gold may be a scarce metal, but it’s not so rare it can never be found. There’s gold in your smartphone, gold in your computer, even gold in your TV. Because of its ability as a conductor, electronic devices use a small amount of gold to transmit electrical signals. With all this gold being used in everyday devices, finding and producing can’t be that difficult. Indeed, gold is a rare metal, but platinum, palladium, and iridium are all harder to find. But gold hits the Goldilocks zone – it’s rare enough to be scarce and valuable, but not so rare that it’s impossible to find.
Gold has a shine that never fades. Unlike silver or platinum, gold has a color all to its own. The beauty of gold has made it desirable for use in shrines and jewelry. Gold was a symbol of status and wealth in ancient civilizations because of its bright yellow shine and resistance to any kind of tarnishing. If you smelted gold down in 1000 B.C., you could be confident an idol made from it would last for eternity. Gold is still considered beautiful around the world too, which is why we have gold medals for Olympic first place finishers and soccer awards like the Golden Boot, awarded to the highest scoring player in the World Cup tournament.
Gold makes an excellent risk parity tool for your retirement account. Because gold is a tangible asset like real estate, it’s value isn’t beholden to the vast fluctuations of the securities market. If you want to add gold or silver to diversify your portfolio, check out the options Red Rock Secured has to offer.
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