What is it about Precious Metals (gold, platinum, silver, etc.) that makes them "Precious"

SanctionII

Is it simply because they "look pretty"?

For that matter, what is it about gold that for centuries has made it a "store of value" which can give comfort to gold owners during troubled times? Where does its "value" come from? It looks pretty, but it does not do anything [gold by itself just sits there and does not produce or consume anything since it is an inanimate object] without human intervention.

Is it simply a store of value because people, going back to antiquity, have considered it valuable? Is it possible that some other substance [i.e. petrified wood] could have been chosen long ago as an object of desire instead of gold, leaving us today with people talking about the spot price of petrified wood and selling/buying same in the same manner that gold is?

Your thoughts please.

rgCoinGuy

The PM forum is a Longacre Free zone, please ask one question at a time.

Gold is precious because of some of the things you mention. It also never degrades, and can be made into jewelry, etc.

I don't see many petrified wood engagement rings out there.

secondrepublic

It's a complicated question, as some precious metals have not really been "precious" all that long -- such as palladium, which wasn't even discovered until the early 1800s.

gecko109

I think some of the biggest reasons gold has appealed to man as a valuable asset are its relative scarcity (yet can still be found in a free state), its widespread distribution (its found almost everywhere on earth), its non reactive composition, its workability, and its dazzling looks (there is no other buttery yellow metal). All of these factors combine IMO to make gold the percieved store of wealth it is today, has been for the last 5,000 years, and most likely will continue to be for centuries to come.

sinin1

they are like land, only so much available and more is not easily made

SanctionII

Justacoinaddict and Gecko109 have hit the nail on the head. "Perception" is the key. For some reason that is lost in the mists of history and time, someone at sometime got it into his/her mind that gold is "special" and "desirable". This perception caught on and has spread around the world and down through the ages to today.

Diamonds are similarly perceived; and DeBeers has created a system whereby this perception is nutured, protected and promoted in the extreme. The reality is that diamonds are fairly common and plentiful.

konsole

Gold is rare, hard to get, pretty, non-corrosive, heavy(feels valuable), has a unique color etc.

Now the real question people around here want the answer to is, is it 62 times more valuable then silver?

PerryHall

<< <i>Gold is rare, hard to get, pretty, non-corrosive, heavy(feels valuable), has a unique color etc. >>



..................and the government can't create it out of thin air like they do with money.

Weiss

I think it's important to understand that most early humans were obsessed with the sun. And rightfully so. They literally lived and died by it. That connection to gold shouldn't be overlooked.

Ultimate, humans, like any other species, are on this earth to reproduce. Gold helps them do that--by affording them power, prestige, desirability, leisure time, etc., etc. Gold gets the chicks. The man who gets the chicks has offspring. It's a meme.

Cladiator

<< <i>

<< <i>Gold is rare, hard to get, pretty, non-corrosive, heavy(feels valuable), has a unique color etc. >>



..................and the government can't create it out of thin air like they do with money. >>

Amen to that.

fc

salt used to be worth more then gold.
obviously salt is no longer considered precious.
who knows what a 1000 years will do to the current precious metals
and how we perceive them.

Cladiator

<< <i>salt used to be worth more then gold. >>

So did aluminum.

PerryHall

<< <i>salt used to be worth more then gold. >>



Salt used to be much more valuable than it is today but it was never more valuable than gold.

OnlyGoldIsMoney

<< <i>I think some of the biggest reasons gold has appealed to man as a valuable asset are its relative scarcity (yet can still be found in a free state), its widespread distribution (its found almost everywhere on earth), its non reactive composition, its workability, and its dazzling looks (there is no other buttery yellow metal). All of these factors combine IMO to make gold the percieved store of wealth it is today, has been for the last 5,000 years, and most likely will continue to be for centuries to come. >>





Well said. Gold has been on a 5,000 year winning streak.

roadrunner

As far as gold goes: conductivity, malleability, ductility, divisibility, portability, biocompatibility due to bacterial resistance, non-corrosivity.

And research is continuing to find new uses for gold in nanotechnology. Brian Bloom has written about the potential for gold to unlock or be involved in the secrets of DNA decoding. Those things are still years away but potentially promising. Gold may be looked at entirely different decades from now and something other than just a barbarous precious metal sitting in bank vaults. Well, that's assuming banks are still around.

roadrunner

1jester

<< <i>salt used to be worth more then gold.
obviously salt is no longer considered precious.
who knows what a 1000 years will do to the current precious metals
and how we perceive them. >>



Salt has never been a metal.

jmski52

Now the real question people around here want the answer to is, is it 62 times more valuable then silver?

Uh, let me answer that question. No, it's not. But a 1 ouncer is worth about 10,000 times more than a paper dollar.

Whoops, I'm getting a little ahead of myself.

gecko109

<< <i>Now the real question people around here want the answer to is, is it 62 times more valuable then silver?

Uh, let me answer that question. No, it's not. But a 1 ouncer is worth about 10,000 times more than a paper dollar.

Whoops, I'm getting a little ahead of myself. >>





DEAL!....Ship me 10,000 paper dollars, and i'll ship you a 1 ouncer.

mhammerman

"What is it about Precious Metals (gold, platinum, silver, etc.) that makes them "Precious"?"

Is it because they keep getting more valuable? Just a guess.

KentuckyJ

Diamonds are created on Earth. Gold is a heavy metal created off Earth in the blast furnace of a star. Whatever amount of gold made it into the formation of Earth is all we have available to us. Obviously, in the case of planet Earth, the amount of gold present is of a small enough quantity to have made gold into a thousands year old viable store of value.

PerryHall

<< <i>

<< <i>Now the real question people around here want the answer to is, is it 62 times more valuable then silver?

Uh, let me answer that question. No, it's not. But a 1 ouncer is worth about 10,000 times more than a paper dollar.

Whoops, I'm getting a little ahead of myself. >>




DEAL!....Ship me 10,000 paper dollars, and i'll ship you a 1 ouncer. >>



Watch out---he never said a U.S. paper dollar. He may send you some of that Zimbabwe funny money.

illini420

This is gold, Mr Bond. All my life, I've been in love with its color, its brilliance and divine heaviness. I welcome any enterprise that will increase my stock.

roadrunner

My first introduction to precious gold was during Barry Goldwater's presidential campaign in the fall of 1964. Us kids took great glee during the Halloween period before the election scrawling "AU H20" all over the paved roads in 99-44/100% pure ivory soap. Little did I know that someday I'd be playing with 999 pure.

roadrunner

jmski52

But a 1 ouncer is worth about 10,000 times more than a paper dollar.

I should start putting disclaimers on my opinions. Was not an offer to buy or sell.

However, the opinion was still free.

cladking

Salt is a vital part of the diet in many places and there have been
times that such places have been isolated because of trade and war.
It's unusual for salt to have been extremely valuable in history though
it did happen many times in many places.

Gold has been valued probably for 40,000 years but I've never actually
heard of any finds so old. The oldest that comes to mind is a 12,000
year old grave find in Mongolia. The Egyptians were mining gold exten-
sively 5000 years ago and at that time silver was nearly as valuable.

People were probably much more attracted by drinking water in very
early times and then water for irrigation as agriculture started taking
off 12,000 years ago. But gold nuggets would certainly attract peoples'
attention. Smelting of copper was going on as early as about 4000 BC.

Like everything it is perception which drives value. It is perception
which drives both buyers and sellers as well as those who would buy
at the proper price. Everything is cyclical and everything has a sort of
mass perception which is always changing. Gold, however, has always
enjoyed a fairly lofty status. There does seem to be a general erosion
in this perception over the last 225 years but it still has a more steady
perception than most currencies. It still provides excellent stability in
times of rising prices. This could change of course but I'ds look for changes
to continue to be gradual with gold. Perception of silver could change ra-
pidly.

gecko109

"Perception of silver could change rapidly."


Favorable or unfavorable?

cladking

<< <i>"Perception of silver could change rapidly."


Favorable or unfavorable? >>



The Hunts caused silver prices to increase some 20 fold in '78/ '79 by
purchasing a mere 180 million ounces. There is far less silver in the
world today than there was in those days because it has been consumed
by industry. Indeed, a large percentage of the silver today is really just
paper IOU's promising that they will pay in silver but such silver doesn't
exist; it's been used to make consumer products and keep the factories
running. Our silver markets exist habd to mouth. Silver comes out of the
ground in copious quantities but it soon fills the dumps and washes down
rivers unrecoverably.

We've gotten to the point that there is probably less silver in the world
than there is gold. This certainly is true if you look only at "available" sil-
ver compared to "available" gold. There is significant quantities of silver
in museums and various collections but much of this won't be melted just
because silver prices increased ten or a hundred fold. Where billions of
ounces of gold sits as bullion in enormous vaults and could be sold or
turned into products were there the will to do so, silver simply doesn't
exist in this form. There are hundreds of millions of ounces spread far and
wide not billions stashed in large inventories.

Government entities have used the commodities markets to suppress both
gold and silver prices for a very long time. For many years $300 gold was
simply the bench mark used by the FED to determine interest rates and gold
sales.

But the damage to silver has been incredible. In order to hold the price
down it became necessary to to sell vast amounts of paper IOU's which
everyone considered "good as silver". But this game seems to be coming
to a head because it appears it was the Chinese who would be the brunt
of the losses if silver goes up and the Chinese have repudiated these losses
in advance. The goivernment has said that they won't hold Chinese institu-
tions liable if they default on such contracts. This has the effect of making
most of the silver in the world no better than the paper it's printed on.

An economy and a culture can not survive forever on inertia alone. Ships
head for rocks and railroad tracks wash away. Among the many rocks we're
bearing down on is the fact that silver is required to maintain 6 billion people
on this planet and bankers have suppressed its price for decades for selfish
ends.

Eventually people will wake up to the facts. There will be a buying panic or
a population decline. I'm betting on a buying panic. There are many forces
at play and it could still be decades before there's a buying panic. Silver is
a long term investment in the ingenuity of man. It has been a huge gamble
in the short term for a very long time.

fastrudy

Gold is an easy metal to work with malleable, ductile, heat (and electrically) conductive. A pleasure to work with (ask any jeweller).
It is rare. All the gold ever mined would cover a football field 6 feet deep. As a comparison, Pt would be only 2 inches deep and Radium...only enough for a golf ball!
It has a desireable luster and anti-corrosive tendency. Gold brought up from 250 years under the sea is as lusterous as the day it was minted!

Precious is fleeting. Salt has traded at a price equivalent to gold, but not now.
Aluminum was a precious metal, until Kayser found an easy way to extract it from its ore. Now it is very inexpensive.

Scientific American had an article about a near-Earth asteroid that had a lot of gold in it (gold differentiates, ie., since it is dense, there is more of it in the center of a planet than near the planet's surface). It was an asteroid that was a piece of an object that had differentiated, and it was a high assay asteroid (I think it had a better assay than Earth's most profitable gold mine). If we landed a robotic 'miner' on the asteroid and had the capability of sending the ore to Earth (basically mining the asteroid into a rubble pile), the price of gold would plummet. The gist of the article was that there should be some sort of controls in place such that this would not happen!!

We can make artificial gold with particle accelerators, realizing the dream of producing it, from proton, electrons and neutrons....but the price is exorbinant.

So, as the other posted said....the gov't can't create it. And they can't mine very deep either (5 miles is the world's deepest hole in the Earth {diameter 8000 miles}).

That is why gold is precious.