By Manny Supnic

Gold Yesterday, Cash for Gold Today

For time immemorial, gold has played an important role in lifestyle and economy. As a finite natural resource, its value has never decreased; if anything, it is increasing with time. There is no substitute, and there is no artificial alternative. It is, in the purest sense of the word, one of the most valuable elements on planet earth. It is pure gold.

It was already back in Egypt that gold made a marked appearance. The pharaohs requested tons of gold for cosmetic purposes, to adorn their thrones, clothes, shoes, wives, and the like. Slaves were sent to mine the precious metal under strict supervision. Particularly noteworthy are the gold items discovered by Howard Carter and Lord Carnarvon in 1922 in the tomb of Tutankhamun. This young pharaoh ruled Egypt in the 14th century B.C. Gold was, and remains, one of the most precious commodities.

The trend continued into the time of the Greeks, where towering works of architecture were adorned with gold carvings. The wealthy sported gold figurines, masks, cups, diadems, and jewelry, plus hundreds of decorated beads and buttons. The Romans, who took many aspects of their culture from the Greeks, also placed a heavy emphasis on all forms of gold, both refined and scrap gold.

And so the gold fever continued through the California Gold Rush, where people grabbed gold for themselves, into our modern day economy. The discovery of gold at Sutter’s Mill in California sparked the gold rush of 1849-50, and hundreds of mining camps sprang to life as new deposits were discovered. Gold production increased rapidly, as people rapidly looked to sell their newly mined gold. Deposits in the Mother Lode and Grass Valley districts in California and the Comstock Lode in Nevada were discovered during the 1860’s, and the Cripple Creek deposits in Colorado began to produce gold in 1892. By 1905 the Tonopah and Goldfield deposits in Nevada and the Alaskan placer deposits had been discovered, and United States gold production for the first time exceeded 4 million troy ounces a year–a level maintained until 1917.

During World War I and for some years thereafter, the annual production declined to about 2 million ounces. When the price of gold was raised from $20.67 to $35 an ounce in 1934, production increased rapidly and again exceeded the 4-million-ounce level in 1937. Shortly after the start of World War II, gold mines were closed by the War Production Board and not permitted to reopen until 1945.

From the end of World War II through 1983, domestic mine production of gold did not exceed 2 million ounces annually. Since 1985, annual production has risen by 1 million to 1.5 million ounces every year. By the end of 1989, the cumulative output from deposits in the United States since 1792 reached 363 million ounces.

Nations of the world today use gold as a medium of exchange in monetary transactions. A large part of the gold stocks of the United States is stored in the vault of the Fort Knox Bullion Depository. The Depository, located about 30 miles southwest of Louisville, Kentucky, is under the supervision of the Director of the Mint.

Gold in the Depository consists of bars about the size of ordinary building bricks (7 x 3 5/8 x 1 3/4 inches) that weigh about 27.5 pounds each (about 400 troy ounces; 1 troy ounce equals about 1.1 avoirdupois ounces.) They are stored without wrappings in the vault compartments.

Aside from monetary uses, gold is used in jewelry and allied wares, electronic applications, dentistry, the aircraft-aerospace industry, the arts, and medical and chemical fields.

The changes in demand for gold and supply from domestic mines in the past two decades reflect price changes. After the United States deregulated gold in 1971, the price increased markedly, briefly reaching more than $800 per troy ounce in 1980. Since 1980, the price has remained in the range of $320 to $460 per troy ounce. The rapidly rising prices of the 1970’s encouraged both experienced entrepreneurs and amateur prospectors to renew their search for gold. As a result of their efforts, many new mines opened in the 1980’s, accounting for much of the expansion of gold output. The sharp declines in consumption in 1974 and 1980 resulted from reduced demands for gold jewelry (the major use of fabricated gold) and investment products, which in turn reflected rapid price increases in those years.

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Source:

isnare.com

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