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What Is Gold and Why Is It So Valuable?

by Tim

Gold is one of the world’s most precious metals. It is yellow in hue, soft to the touch, malleable in texture and boasts low chemical reactivity compared to most elements – unaffected by oxygen or most acids (including cyanide solutions).

These attributes have made it a symbol of wealth and lasting value for centuries.


Gold has always been seen as a rare and special metal, its natural beauty combined with the fact that it doesn’t corrode or tarnish making it especially desirable.

No wonder then that for millennia it has been associated with gods and royalty from many cultures around the world; one of its advantages being one of the easiest metals to work makes its use in ornamental jewelry an early one as well.

Gold remains one of the most valuable metals today; in some places even used as money!

How did Earth acquire such an exotic element as gold? It is thought that the gold present on our planet originally arrived from outer space as debris from supernova explosions that added it to the interstellar medium.

You can click here to learn more about this theory. While nuclear fusion within stars may produce lighter elements needed for our solar system, heavier ones require extremely high temperatures and pressures before formation can take place.

Heavy metals such as gold can be produced during a supernova through the rapid neutron capture process (r-process). Due to these rare circumstances, it is thought that only limited gold will be produced during one supernova explosion.

Gold can be found in alluvial deposits located alongside rivers or in alluvial deposits deposited from stream banks; these were the main source of gold for ancient Egypt, Mesopotamia, and other civilizations. Gold veins also occur naturally due to fluid action within Earth’s crust.



Gold has long been prized since antiquity for use in coins, jewellery and decorative objects. Due to its malleability it can be drawn into wires, hammered into thin sheets or even melted and cast into ornate shapes that form fine jewellery designs.

Up to 80 percent of mined and recycled gold today is used in this manner – although pure gold can be weak when worn against stones so other metals must often be combined to strengthen it further and give it its distinctive color and sheen. This practice led to various alloys being created which gives each design its individual color and sheen.

Gold’s resistance to corrosion and rust makes it a valuable component in electronic devices.

Solid-state electronics like laptop computers and smartphones require extremely low voltages; even minor corrosion at contact points can disrupt current flow, making gold an excellent way to ensure smooth current transfer between contacts – which explains why so many high-end speaker cables incorporate its connectors as part of their construction.



Gold has long been used as a physical store of value, its rareness, corrosion-resistance and aesthetic allure making it a highly prized commodity over centuries.

Today it is used in coins and jewellery production while private investors hold it in 401k accounts to help diversify their holdings. If you already have a retirement account, a 401k rollover can help you move money into a precious metals account. Be sure to do your research before making any financial commitments.

Gold as an industrial metal is used to craft durable goods that are both highly functional and reliable. Due to its excellent conductivity and resistance to heat, it makes an excellent material for producing circuitry, switches and relays.

Electronic devices accounted for much of gold’s overall demand; today it can be found in cell phones, calculators, personal digital assistants and global positioning system units among many others.

Gold’s many applications go well beyond industrial manufacturing; it is also utilized in medical technology and dentistry. Gold is non-allergenic and doesn’t irritate human tissues.

Additionally, this precious metal can also be found in some medications prescribed to treat rheumatoid arthritis and certain cancer types; colloidal gold has also been explored for its potential to target and deliver chemotherapy agents directly into tumors.

Gold has seen increased demand recently, especially in emerging markets where many investors see an opportunity to diversify their portfolios with an asset that’s free from stock and bond volatility. Digital gold trading provides new investment opportunities for those wishing to participate in the market without owning physical bullion or jewellery.

Gold has become increasingly prevalent as part of Exchange Traded Funds (ETFs) and other products offering low-cost access to the market, and has even begun being used as collateral against loans or debt in China and India, where e-commerce has experienced rapid development resulting in strong gold demand.



Gold’s value is determined by demand from central banks, jewelry manufacturers and investors.

Gold jewelry remains popular as it represents wealth and status to many people; industrial demand is fuelled by its malleability and conductivity; it may also be used in medical treatments for conditions such as rheumatoid arthritis and lagophthalmos (which prevents you from completely closing your eyes).

Gold’s value can also be determined by economic and geopolitical events, with dollar exchange rates having an immediate effect on its price and rising interest rates impacting demand for it. Geopolitical instability or conflict also has the ability to influence gold prices as investors seek an asset with which they feel safe during times of turmoil.

As part of your valuation of gold, it’s essential that you consider both its purity and weight. For an accurate measurement, it is recommended that you utilize a high-quality balance equipped with precise mass measuring technology such as load cells, force restoration mechanisms or tuning fork weighing mechanisms along with display displays and processors.

Other factors affecting gold’s price include inflation rates and market/supply fluctuations, with prices typically increasing during periods of inflation as investors view it as a secure and stable investment. Investors frequently monitor historical highs for price comparison purposes and may make decisions based on distance between current gold prices and historical highs.

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