Why Has Gold Always Been Valuable?
Why Has Gold Always Been Valuable?
By Carla Tardi Updated January 14, 2022 Reviewed By Michael J Boyle Fact Checked By Suzanne Kvilhaug
Part of the allure of gold may be the allure itself There exist a plethora of articles about gold as a financial investment so here we focus on the social and psychological aspects of gold.
KEY TAKEAWAYS
*Since ancient civilization, from the Egyptians to the Inca, gold has held a special place of actual and symbolic value for humanity.
*Gold has moreover been used as money for exchange, as a store of value, and as valuable jewelry and other artifacts.
*Gold's value is ultimately a social construction: it is valuable because we all agree it has been and will be in the future.
*Still, gold's lustrous and metallic qualities, its relative scarcity, and the difficulty of extraction have only added to the perception of gold as a valuable commodity.
Why Has Gold Always Had Value?
Some people argue that gold has no intrinsic value, that it is a barbaric relic which no longer holds the monetary qualities of the past. They contend that in a modern economic environment, paper currency is the money of choice; that gold's only worth is as a material to make jewelry.
At the other end of the spectrum are those that assert that gold is an asset with various intrinsic qualities that make it unique and necessary for investors to hold in their portfolios. They believe that investors have as many reasons for investing in gold as they do vehicles to make those investments.
Gold's Essential Dichotomy
Most would agree that gold has always had value for all of these reasons—a component of decorative jewelry, a sometime currency, and as an investment. But in addition to these concrete values, we would add another characteristic of gold, which, though harder to pinpoint, is as just as real: its mystery. Part of the very appeal of gold is the mystery of its appeal.
In the world of finance and investing, we often like to tiptoe around the word "mystery." Yet, as is true with most disciplines, there is always a place for both science and art, and even mystery.
Gold can stimulate a subjective personal experience, but gold can also be objectified if it's adopted as a system of exchange.
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