October 31, 2013 – The Gold Constant: Since the 14th Century, gold’s purchasing power has maintained a broadly constant level. To put this in practical terms, an ounce of gold has repeatedly bought a mid-range outfit of clothing. This was true in the fourteenth century, when an ounce of gold was worth £1.25 to £1.33; it was true in the late 18th century and it remained true at the beginning of this century (2000 to 2008), when an ounce of gold averaged £269 or $472. Even the exchange rate between gold and commodities has been relatively constant over the centuries.
On the other hand, the US dollar that bought 14.5 loaves of bread in 1900 buys only 3/4 of a loaf today. While inflation and other forces have ravaged the value of the world’s currencies, gold has emerged with its capacity for wealth preservation firmly intact. Being no-one’s liability, gold exhibits the same wealth preserving qualities in the face of financial turmoil, earning a reputation as a crisis hedge in addition to its credentials as an inflation hedge.
Published on Oct 8, 2013 – The Video (2:38) is from Marcus Grubb, MD of Investment, discussing the relevance of the research findings to the investment market and the World Gold Council‘s research program.
Pictured above, the California gold rush – 1848.
The story of gold is as rich and complex as the metal itself.
Wars have been fought for it; love has been declared with it. Ancient Egyptian hieroglyphs portray gold as the brilliance of the sun; modern astronomers use mirrors coated with gold to capture images of the heavens.
By 325 BC the Greeks had mined for gold from Gibraltar to Asia Minor. In 1848 AD James Marshall found flakes of gold whilst building a sawmill near Sacramento and so triggered the gold rush in California.
Held securely in national vaults as a reserve asset, gold has an irrefutable logic; released from the tombs of pharaohs and emperors alike, gold has an undeniable magic. (Credits – The World Gold Council and Photobucket).
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