Why Is Gold Expensive Anyway?

Why Is Gold Expensive Anyway?


There must have been a day when a person belonging
to an ancient civilization got hold of a piece of gold and thought, hmm, I kinda like this. Since then it’s become a metal that denotes
wealth, a powerful symbol that wraps around our fingers and for some people covers their
teeth. How did that happen? There is evidence that gold impressed humans
as far back as 40,000 BC. The ancient Egyptians loved the stuff, and
it’s said pharaohs couldn’t get enough of it. They even used it as currency, with the deal
being that one piece of gold was worth as much as two pieces of equal-weight silver. How come silver got the raw deal? Why did the ancient Greeks hold this kind
of bling in high esteem, making it the status symbol it still is today? Let’s investigate. So, we already know that some of the ancients
prized this stuff. We also know that in the bible there is mention
of heavenly lands covered with gold. We know other civilizations from the Aztecs
to the Persians cherished it. It wasn’t that hard to find, either, and
all over the world someone could acquire gold. Why is it expensive though? You might be thinking, well, it’s gold man,
it’s just expensive because it is. But not all things mankind cherishes are very
expensive. Maybe you have a thing for marble, and that’s
relatively cheap. Ok, so the first reason is a matter of geology. While gold can be found all over the place
it is still rare, rarer than say oak wood. So, to get gold you have to mine, and mining
is labour intensive. You then have to clean up the gold and make
it look nice, that also takes hard work. That’s one of the reasons gold is expensive,
but it doesn’t explain everything. You see, some metals that are very abundant
are obviously cheap. But there are other metals that are just as
rare as gold that are also cheap. One example is the metal called Ruthenium. We just looked online to see the price and
were told it’s now going for $9,000 per kilogram. We are also told that if we buy a kilo of
gold today we’ll have to pay $41,149. That just doesn’t seem right. In the list of the rarest metals in the world
one metallurgy website tells us that gold is 7th and ruthenium is 6th. The second rarest of them all, though, Rhodium,
is very expensive. You can get a kilo of that stuff today for
$91,308. The eighth rarest metal, platinum, has been
expensive in the past, but now you can get your hands on a kilo for just $26,106. What you can see here is that rarity does
make something expensive, but it doesn’t define the price overall, otherwise platinum
would cost more than gold and poor ruthenium wouldn’t be a bargain basement metal. Now for a bit of science. There is a reason gold is rare. That’s because it is a heavy atom consisting
of 79 protons and 118 neutrons. Now, back before we had science the ancients
had no idea where gold came from. The Egyptians called it the “breath of God”
and the Aztecs called it the “the sweat of the sun.” While this sounds kind of pretty, the sun
didn’t sweat gold out and God didn’t cough it onto planet Earth. What actually happened was a great big supernova
in space forged gold atoms and hurled them across the universe. As the story goes, billions of years ago meteorites
packed with gold hit the Earth. Little did they know that one day they’d
end up covering Flavor Flav’s teeth. As for that first gold, it sank when molten
iron was busy making the core of the Earth. Now, we said it is rare, but it’s not super-rare,
say, not as rare as a five-legged horse. Yes, they exist. We don’t know exactly how much gold there
is because we haven’t dug it all up, but the world Gold Council said that as of 2019
the entire amount of gold that has been mined is 190,040 metric tons. That equals about 418,878,298 pounds of gold,
or 190,000,000 kilos of it. Let’s just make a quick calculation in our
head…hmm…190,000,000 x 41 and a bit equals about… seven trillion dollars. No doubt if you had all the world’s gold
you would get an invite to Jeff Bezos’ country club. Ok, so it’s rare, but not that rare. There is enough of it to build a skyscraper. It is expensive because it takes a lot of
work to mine it. But that’s not all. It’s also a really handy metal to work with,
it’s corrosion-resistant and it can be made into nice shapes that people can admire. Some metals are very hard to smelt, but gold
isn’t. So, you have a very pretty metal that doesn’t
corrode and you can easily make things out of it. Silver is also kinda rare and it also has
a relatively low melting point, but there is a problem with silver and that is the fact
it tarnishes. Gold hits all the spots, it really is the
perfect kind of metal. It remains perfect, too, for a long time. As the BBC put it, “Gold’s relative inertness
means you can create an elaborate golden jaguar and be confident that 1,000 years later it
can be found in a museum display case in central London, still in pristine condition.” If you have gold, you are holding good currency. Its value remains quite stable, which makes
it something people want to have. The value has dropped before of course, but
nothing as major as the drop in the 16th century when vast amounts of the stuff was discovered
in South America. Back then people used to talk about Cities
of Gold, but they were never found. Still, if you look at gold prices from the
low in 2001 to the high in 2011 there is a massive difference. What we are trying to say it that it has always
been expensive, but it has been cheaper. So, to recap again. Gold is rare, rare means expensive. Gold also has a history of being admired,
which does add to the cost. Today it’s still seen as something that
denotes high status, and like Gucci bags, that keeps the price high. Not only that, it keeps its shape and doesn’t
corrode. It’s nice on the eye and you can easily
make cool stuff out of it. That’s about it really. Can you think of something else? Tell us in the comments. Also, be sure to check out our other video
What If United States Paid Of Its Debt. Thanks for watching, and, as always don’t
forget to like, share and subscribe. See you next time.

100 Comments

  1. technically it's better for a civilisation to get their hands on iron —> with iron you can produce steel, with steel you make weapons, with weapons you equip your army and get the military edge. with military edge, you bully the others, and take their gold.

  2. Can you make a video stating who would win between the governor and Charles Bronson. P.s my money is on Bronson

  3. Gold is expensive because of greed. How would you like to self appraise your property to make your solid assets look better? That’s what people who own gold have done. It’s not that rare a metal.

  4. Artificial supply control and fear mongering with threat of war and political instability to artificially pump up supply.

  5. I remember reading that scientist said there's a enough gold to cover the earth one time and it can go up to our knees. It's just a suggestion but thats a lot

  6. Gold is also a very ductile metal which means a little can go a long, long way. You can spread out an ounce of it over 40 miles long.

  7. That's why Indian people are the Biggest hoarders of Gold…..and it's bigger than worlds top 5 countries Gold reserve…..

  8. Slender man is named after ender man they just add sl so slender man got inspired by Minecraft and Mine craft was released in 2009 like slender man

  9. Hey Infographics Show, do you guys ever intend on putting out the revamped version of the Killdozer video you promised to do 2 months ago due to poor research, incorrect and poor information and bias?? Or are you guys too busy doing the push up challenge to correct your lazy mistakes? Seems like you guys have really fallen off recently. Many of your videos are lazy, repetitive and incorrect and it seems to be happening much more frequently. Maybe your success has gotten to your head to address the most important aspects of your channel. This channel has become a huge disappointment and you clowns don’t seem to care. As long as you guys are getting that ad revenue right? Total garbage.

  10. “Gold hits all the right spots”
    But what about conductivity? Both thermal and electrical?
    And what about the cleansing of bacteria? You know what hits all those points???
    SILVER!!! Sorry, I love silver and hate gold

  11. In "Garden of Evil" (1954) starring Gary Cooper, Susan Hayward, and Richard Widmark, the movie ends with this famous line: "I guess if the earth were made of gold, men would die for a handful of dirt."

  12. dude, u forgot to say it's an excellent electric conductor, so now a days can be found in most/all electronics and high amounts of it in high definition audio gear… and also, photo voltaic cells are based of spectroscopic properties of gold…

  13. A very intelligent man once taught me, "cost and worth are two different things". I think this is a perfect example showcasing just that.

  14. I wish it was still like that… 2 pieces of silver = to 1 piece or half that of the silver in gold. Means i could take these 2 cheap silver necklaces worth like $40 and get a gold chain worth $400. I know cause ive had 2 of the exact same necklaces. 1 silver and 1 gold. Silver one was $20 and gold one was $400.

  15. "why were African and pan American areas completely stripped of their wealth and left in destitute and unstable climates?" Closes sharpie

  16. Obviously the flying spaghetti monster created all the gold from decomposing. His extremely long spaghetti arms and legs were made of liquid gold.

  17. 3:28 Uhh, I hate to break it to ya but I don't thing the 5th protrusion from the horse's body is a "leg" when they talk about a 5 legged horse…

  18. What about the asteroid made mostly out of gold, with a little bit of platinum, iron, and nickel? It's been discovered by NASA this month.

  19. I remember reading the opposite about the egyptians, that silver was worth much more than gold, they actually used gold to strech the silver making electrum.

  20. I think you guys should put bloopers at the end of your videos. I know y'all have to mess up speaking sometimes. It would be a nice breath of fresh air from some of your more heavier videos.

  21. 3:49 … Who the heck made and approved these unit conversions???

    190,040 metric tons is not equal to 190,000,000 but 190,040,000. It's literally a factor of 1000 between these units.

    Also, what's up with the inconsistent rounding of these numbers?

    – The kilo (it's actually kilograms, by the way) number is rounded to only 2 significant digits ( 19 x 10⁷), the nearest 100 millionth.
    – The metric tons number is rounded to the nearest 10th.
    – The pounds number? Is that even rounded?

    This conversion isn't even correct.
    Rounded to the nearest integer, 190,040 metric tons is approximately 418,966,483 pounds.

    So where does the 418,878,298 come from? Well it's what you get if you convert the rounded 190,000,000 kilogram number instead of the far less rounded 190,040 metric tons number and round this down to the nearest integer.

     —–
    Either way around, sure this is such a unspecific number that however way you do it, you'll still most likely be within margin of error for sure—which is precisely why you should be consistent with your rounding and not just throw out arbitrary numbers like 418878298.

    This isn't hard, it's like literally one of the first things they teach you in middle school physics classes.

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