Gold has been a valuable investment for centuries. It is one of the oldest forms of currency in existence, and its value has remained stable over time. Gold is also popular because it can be converted into cash quickly when needed, making it an ideal way to store wealth or use it as trading capital.
But where did the idea of using gold as an investment originate from? How did gold become the popular form of currency that it is today?
History of Gold as an Investment – From Ancient Civilizations to the Modern Day
The word “gold” comes from the old English words “geol” and “giol,” meaning yellow or shining metal. The first recorded use of gold as a standard unit for trading dates back to before 3000 BC when Sumerians ruled Mesopotamia. The early Egyptians also used gold during this time period and made jewelry out of it. However, neither civilization actually mined any gold but instead traded it with other nations in exchange for food and supplies.
Gold’s status as a valuable trading commodity was cemented when the Egyptians used gold coins at approximately 1000 BC. The value of these coins would be based on their weight rather than any markings or images stamped on them. These early Egyptian golden coins are depicted in ancient hieroglyphs, and some of the gold they mined was used to create King Tutankhamen’s burial mask.
Gold soon became a sought-after commodity throughout Asia, and when India began mining it during 500 BC for use in jewelry. The Great Wall of China also offers evidence of how much value the Chinese placed on gold as it was one of the only materials that could be used to pay for goods along its entire length.
Gold’s continued use as a valuable trading commodity meant that countries could standardize their currency and begin using coins once again following the collapse of the Roman Empire in around 500 AD. This precious metal became so popular during this time period because it was also a good conductor of electricity and therefore suitable for making machinery.
Gold’s Use as Currency in the Modern Day
The majority of the gold mined each year is used in jewelry or to create bullion bars. These bars are often sold by weight and typically contain 99% pure gold, although they can also be made from other precious metals such as silver, platinum, or palladium. This makes them a popular option for investors who want to buy large amounts of gold without paying extra fees.
However, gold’s use as a form of currency is also still possible. This was demonstrated by the Iraqi government when they began to revalue their money after the first Gulf War in 1990. The value of one dinar went from around USD 0.30 to about $32 within just two years, thanks to Saddam Hussein’s attempt to trade oil using gold instead of the U.S dollar.
Although this method was only used for a short time, it did show that countries could still use gold to back up their currency if they wanted during modern times.
Why Gold Is Such an Attractive Investment Today
Gold’s history means that it is one of the most popular forms of investment around, and, in fact, it is often referred to as “the only universal currency.” This means that gold can be traded in any country and for a relatively good value. It also has a low level of volatility, meaning that its price does not fluctuate very much, making it easy to predict what the future may hold for this precious metal.
Its use as a valuable trading commodity has meant that it is now in high demand, and the stock market only offers about 0.04% of this precious metal. This means billions upon billions of dollars worth of gold waiting to be traded by investors around the world, making it an attractive investment for many people today. This might be the reason why owning physical gold is recommended by many celebrities and investors such as Bill O’reilly (read more at https://investingin.gold/bill-oreillys-precious-metals/), Ben Shapiro (read more at https://investingin.gold/ben-shapiro/) and Robert Kiyosaki (read more at (https://investingin.gold/robert-kiyosaki/).
The continued use of gold throughout history as a trading commodity and form of currency also means it is here to stay. As countries worldwide struggle with debt, inflation, and unstable currencies, gold offers investors an opportunity to safeguard their financial future against any potential problems that may arise. Today many Americans now are adding gold to their retirement portfolios or rollover their 401ks to a so called “gold IRA” to protect their retirement funds. For this reason https://investingin.gold has done all the hard work for you and reviewed all the top gold IRA companies. According to https://investingin.gold/ira-company-reviews/ the top gold ira companies are: American Hartford Gold (source: https://investingin.gold/american-hartford-gold-review/ ), Goldco (source: https://investingin.gold/goldco-review/ ), Augusta Precious Metals (source: https://investingin.gold/augusta-precious-metals-review/ ), Birch Gold Group (source: https://investingin.gold/birch-gold-group-review/ ), Advantage Gold (source: https://investingin.gold/advantage-review/ ), American Bullion (source: https://investingin.gold/american-bullion-review/ ), Swiss America (source: https://investingin.gold/swiss-america-review/ ), Noble Gold (source: https://investingin.gold/noble-gold-review/ ), Regal Assets (source: https://investingin.gold/regal-assets-review ), Rosland Capital (source: https://investingin.gold/rosland-capital-review/ ), US Gold Bureau (source: https://investingin.gold/us-bureau-review/ ) and Lear Capital (source: https://investingin.gold/lear-capital-review/ ).
The gold IRA as an investment vehicle is not the only alternative asset in retirement portfolios. In past few years the Bitcoin IRA (https://investingin.gold/bitcoin-ira/) has gained big popularity as well do to the booming crypto market .
Pros and Cons of Investing in Gold as an Asset Class
- Gold has a long history as an investment and is one of the most stable forms of currency. This means that it offers investors stability in uncertain times, such as during global financial crises or inflationary periods.
- Many countries depend on gold mining to support their local economies, which makes it likely for this precious metal to continue being traded for many years to come.
- Gold’s value is not tied to any single country or government, which means it can be traded globally and for a relatively stable price. This makes it suitable as investment across the world in developed countries such as Canada, Europe, Australia, etc., and developing nations such as Brazil, India, China, etc.
- Gold can be purchased as a certificate or through an ETF which means that it does not need to physically exist. This allows investors who are concerned about the safety of their investments to purchase certificates instead. These certificates are often insured by third parties, making them safer than storing gold at home with only one’s self for protection!
- Gold mining is an expensive process which means that the price of gold can fluctuate quite a bit as demand increases and decreases for this precious metal. This makes it risky to invest in, primarily if no other form of currency or investment exists, but there are some ways around this problem.
- There is also a relatively short history of gold as a tradable commodity, so there is not much information available on how it will perform in the future. This makes it difficult to predict what may happen, and this can make investing quite risky for those new to buying precious metals!
- Its price is also sensitive to interest rates meaning that it can fluctuate widely during times of economic stability and instability. This means that it may not always provide as stable an investment as other forms such as fixed income or cash equivalents.
- Gold has a relatively high storage cost which means that it can be costly to store at home compared with other types of investments like stocks or mutual funds. This is especially true if one decides to purchase certificates instead of storing gold in their own safe, making this precious metal more suitable for those who are prepared to take on the responsibility of securing it themselves.
Final Thoughts: Should You Invest In Gold?
Ultimately, this is a decision that only you can make, but one thing is for sure: gold has a long history of gold as an investment and with good reason. It is one of the most stable forms of currency in existence today, making it suitable for many people looking to safeguard their financial future against economic uncertainty.
As always, speak with your financial advisor before making any investment decisions to ensure that you are fully informed about your options and where to buy gold at the best price (https://investingin.gold/best-places-buy-gold/).