The Undying Value of Gold
We’re all entranced by gold. Yes, all of us – even mistaken investor-mavens who claim stocks and bonds make for better investments. Remember that famous quote from Warren Buffett to the effect gold does nothing but look at you? I don’t think the Oracle of Omaha was being entirely honest when he made that comment. Personally, I think he should have come clean, and admitted his gold doesn’t look at him, but he looks at it.
If you doubt our special universal attraction to the yellow metal, I dare you to throw your wedding ring in the trash. You think it’s just a symbol? Then why don’t grooms simply buy a silver or copper wedding ring for brides? (Perhaps copper and silver are not symbolic enough)
Who among film buffs can deny they were captivated by the 1948 John Huston film, The Treasure of the Sierra Madre that told the tale of prospectors lusting to the point of murder over gold in Mexico? And who among us isn’t fascinated by a recent, real-life discovery story? Certainly it’s easy to believe all the gold ever mined is still with us. But we can just as easily believe every single ounce of it isn’t necessarily present and accounted for.
Here’s a recent discovery story the folks at Guinness World Records might appreciate. A prospector in Victoria, Australia, who understandably chooses to remain anonymous, managed to find a one-hundred-forty-five-ounce gold nugget during a routine dig.
When that gold piece goes on the auction block, it will go for a minimum of two hundred fifty thousand Australian dollars (almost $191,000). I know – it seems like one of those wild Publishers Clearing House strokes of fortune that only graces people who match their checks with their plaids when they dress for a special occasion.
The lucky prospector is reportedly so overjoyed about his shiny-metal find; he and his significant other will be buying a van and traveling around Australia, once he receives his check from the auctioneer.
In a tale with a more historic twist, Israeli Laurie Rimon was recently hiking in eastern Galilee near the site where Jesus was reputed to have walked on water. Apparently, it pays to look down when you take a walk. Rimon happened on a gold coin that clearly shows the face of Emperor Augustus, the founder of the Roman Empire, who ruled from 27 BC to AD 14.
According to Donald Ariel at the Israel Antiquities Authority, the coin was created around AD 107 by the Roman Emperor Trajan as a tribute to the reign of Augustus.
Our virtually metabolic fixation with the yellow metal leads us to embrace spectacular images that underscore its rarity. For instance, all the gold ever mined would fit easily underneath the Eiffel Tower in Paris. Or, if you prefer, in three Olympic-sized swimming pools.
According to the same source, in 2013, the market value of all the gold ever mined amounted to almost eight and a half quadrillion dollars. At the current price of gold, the market value approaches almost double that number.
Gold has been used as money throughout history. In fact, it’s frequently referred to as “real money” by those who compare it to the fragile and arbitrary nature of paper currency. And when the financial going gets tough, as it certainly has in recent months, can you guess what hard asset investors run to? Maybe a nice vacation in Australia or Israel is in order.