What are 2 reasons why gold is so valuable?

Even so, the shiny and metallic qualities of gold, its relative scarcity and the difficulty of its extraction have only contributed to the perception of gold as a valuable commodity. Fundamentally, gold is generally regarded as a favorable hedge against inflation.

What are 2 reasons why gold is so valuable?

Even so, the shiny and metallic qualities of gold, its relative scarcity and the difficulty of its extraction have only contributed to the perception of gold as a valuable commodity. Fundamentally, gold is generally regarded as a favorable hedge against inflation. Gold works as a good store of value against a declining currency. It turns out then that the reason why gold is precious is precisely because it lacks chemical interest.

Gold has a distinctive quality that few precious metals can boast. It resists rust and tarnishing and can only be corroded under particular conditions. The durability of gold is one of the reasons why it continues to have value throughout history. Gold is the proverbial source of youth among precious metals, retaining its attractiveness and vitality over the centuries.

Even if you consider only durability and scarcity, gold would not enjoy its valuable metal status if it did not have superior malleability characteristics. Malleability refers to the ability of gold to be molded. You can beat it with a hammer or use large rollers to extend it to the desired thickness. Pure gold, which is quite soft for metals of this type, can be handled and shaped without any difficulty.

This property makes this type of gold particularly desirable for many applications, from jewelry making to manufacturing. While pure gold is too soft to withstand the demands of daily use, it can be combined with various alloys to give it durability and strength. One reason why gold is so valuable is because it is linked to physical properties, which makes it perfect for use as money. What's more, it can't be destroyed by time, fire or water.

Man also prefers gold as currency, because he does not need fertilizer, food or regular maintenance. In fact, as a metal, gold is exceptionally beautiful, malleable, ductile and rare. When engineers began to perfect metallurgical techniques, gold became a permanent presence in the world currency. The goldsmiths of ancient Egypt formed the shekel, which was an alloy of one-third silver and two-thirds gold.

It became the main unit of monetary measure in the Middle East. When something is safe, it is also usually stable. The price of gold does not depend on external factors or currencies and is generally protected from inflation. In the long term, gold is a stable investment because it is not as volatile as other currencies or investments.

In short, history has given gold a power that surpasses that of any other product on the planet, and that power has never really disappeared. Neighboring countries took note and sold most of their gold to the United States for a cash injection, causing the dollar to plummet. Although gold mining did not have the safety standards and labor technologies that modern companies have, they were present in most countries before the arrival of navigation or flight. Due to the global pandemic, many gold mines have been forced to close, reducing the supply of gold.

The main problem with gold is that, unlike other commodities such as oil or wheat, it is not consumed or consumed. In the old golden days, this was not a big problem; economies were quite small, local things were moving rather slowly, they had low production and limited technological capacity. In addition, doctors and dentists use gold for dental fillings, radioactive treatments for cancer and diagnostic procedures. Gold generally performs well during economic recessions, largely because the value of gold remains constant while everything goes up.

Gold was present in many corners of the world, and many different tribes began to use and trade it, even before the first governments and economies flourished. Gold can offer much greater returns than other types of investments, as it is an excellent addition to any investment portfolio. Proponents of this rule argue that such a monetary system effectively controls credit expansion and applies discipline in lending rules, since the amount of credit created is linked to a physical supply of gold. .

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