Tracing the Origins of The Gold Market
There are several theories about gold’s origins. The most popular one is that it literally fell from the sky as a result of exploding stars.
Inca lore says it’s the sweat or tears of the sun god Inti. Or perhaps it’s just a product of Midas and his golden touch.
Regardless of how it was created, gold became a precious metal at some point in time, and there’s a vast treasure trove of history behind when and how this happened.
What Makes It So Valuable
The earliest records of gold being considered valuable come from ancient Egypt. Egyptians loved gold because it reminded them of the sun god.
In ancient Egypt, gold was referred to as the gods’ flesh and was used for anything that was meant to be eternal and indestructible (that explains the gold tombs of Tutankhamun).
Its preciousness comes from its rarity, among other characteristics. There aren’t infinite amounts of gold deposits in the Earth’s crust; the world will run out of it someday, making it beyond valuable.
But back in the day, people didn’t realize this. So, what then made it so valuable for them?
The answer lies in its attractive color and its ability to be molded into different forms, such as coins, medals, and jewelry.
Its value also has to do with the fact that it didn’t rust like iron. And not to mention it was extremely expensive to mine it, which drove its value up further.
The Gold Standard and Why it Failed
The first civilization to use gold as a form of money was the Kingdom of Lydia in Western Turkey in 700BCE.
This led to gold coins becoming a common form of currency over the next few centuries.
In the 19th century, the Bank of England became the center of world trade, and the global economy practically ran on gold.
Clients would keep gold coins in the bank in exchange for paper receipts or notes based on something known as the gold standard, as these were easier to pay with.
But this arrangement halted in 1931; gold became the villain and a reason for the great depression of the 1930s.
In 1933, President Roosevelt took the US off the gold standard, and that was the supposed end of its reign. Money was no longer a representation of a fixed amount of gold, but it was rather a promise by the government.
It’s Worth Today
After the gold standard failed, gold briefly went out of fashion, and its price declined significantly.
The government started selling off gold. Later, the government started spending huge amounts to prevent a recession.
Federal reserve printed billions of dollars to help the economy, but where would all this money go?
Toward something rare, of course—like gold! Investors then started investing in gold again, considering it a safe haven and driving its prices up again.
Today, this trend continues; gold remains a rare metal, making it precious. And its value rises significantly in times of economic instability, making it a safe haven for investors.
If you’re wondering how to invest in gold to make money, get in touch with us, at Orion Metal Exchange, for the quickest financial market updates and let us help you buy the best gold coins for investment and gold bullions online—from the comfort of your home.