Gold!

Wars have been fought over it, people have killed for it. What is the allure of gold?

Originally (it is guessed) man was attracted to gold because of its sheer beauty and the fact that it never tarnishes or rots in any way. Some ancient cultures associated it with the sun, gods, or royalty (often the three were intertwined in their beliefs). It was used to adorn valued things from jewelry to idols. It soon began to be used for currency. Why trade shells when you have gold?

These ancient cultures quickly learned how to add other metals to gold to ‘toughen it up’ because gold in it’s natural form is too soft to be practical. For gold, karat grade is used to express the proportion of gold in an alloy or the quality of a gold alloy. Fine gold (pure) is 24 karat. The proportions in other karat are listed below.

All jewelry is required by law to be stamped so consumers will know the quality of gold used. Jewelry made in North America is typically marked with the karat grade (10K, 14K, etc.), and jewelry made in Italy is typically marked with the "fineness" such as (417, 583, etc.). So if your jewelry does not have a karat grade stamped on it, check for a 3-digit fineness number.

10k gold has 10/24 parts gold to alloy, it's 41.67% gold, and the fineness grade is 417.

14k gold has 14/24 parts gold to alloy, it's 58.33% gold, and the fineness grade is 583.

18k gold has 18/24 parts gold to alloy, it's 75% gold, and the fineness grade is 750.

22k gold has 22/24 parts gold to alloy, it's 91.66% gold, and the fineness grade is 917.

White gold is a mixture of gold in its natural state (yellow) and white metals such as platinum, rhodium or nickel. 18K white gold will be much yellower than 10K. Additionally, it is always plated in rhodium which will wear off in 1-5 years and leave the gold less bright and shiny.

I wish they wouldn’t do that! I'd rather go without the plating, personally. I will only wear white gold because I believe it sets the gems off better (it doesn’t interfere with their tones) so I’m OK with that. I’m not so obsessed with shine that I’ll buy platinum instead, which is vastly expensive.

Many people are surprised to find out that we don’t have a gold standard for our currency any more. During WWI, the government began running out of money, so they started printing more. Why not? If you need it, make it. Right?

The problem was that the government didn’t have enough gold to back up what they were printing, and they still don’t. If every person in America walked up to the Federal Reserve tomorrow and asked to exchange their dollars for gold, they’d be severely surprised. In fact, the Feds would probably just tell everyone to go home. There simply isn’t enough gold to back up what is printed.

What does this mean?

It means that we will continue to have inflation because the American Dollar doesn’t have a set value. It fluctuates because the more volume that is printed, the more it is cheapened.

I’m not an economist by any means (though I loved macroeconomics in college) so I can’t speak authoritatively about this. But for more information, read The Case For a Genuine Gold Dollar.

Here’s another site that tells you what an ounce of gold is going for on any particular day: Live Gold Prices.

So yes! When you hear the commercials on TV about investing in gold, I would agree that it’s a wise investment. But invest carefully, and consult an expert.

Oh, and it wouldn’t hurt to tell your Other Half that buying you that gold ring this year is an investment, too.