Gold is deeply attached to human civilization and that’s why it has a rich history in different countries, cultures, and traditions. As per studies, the first time gold was used in coins around 800 B.C. and then, after 300 years later, the first pure gold coin came into the existence during the reign of King Croesus of Lydia. Since then, gold played an important role in holding the economy of different cultures and civilizations. When the value of all currencies falls, people can rely on gold always. So, there is a certain value of gold is always there. Whether it is gold for sale or buying it, there are certain reasons to own it. Read on to know more-
History of Gold Holding Its Value
Since ancient times till today, gold has maintained its value than any other type of currencies, like paper notes, coins, etc. At the earliest time, gold was a soft metal and it could’ve melted to make coins. The beautiful color and texture of gold also attract ancient people to use gold coins then. Not only as currency, but gold was used in many scientific types of research at that time.
Gold Works as the Security of the U.S. Dollars
U.S. Dollar is indeed the most reserve currency of the world, but the world has seen a recession in 1998 and 2008 when the value of the U.S. dollar fell, people put their trust in gold as they find it as a mode of security. That raised the price of gold. Since then, the value of gold is only uprising as it tripled between 1998 and 2008 and the price was $1000 for one ounce. From 2008 to 2012, it became $1800 to $1900.
Gold Provides Protection from Deflation
Due to the slow business activity, often the economy goes under huge debt and this situation is known as deflation. It is quite surprising the price of gold goes upward when the value of currencies falls during the deflation. Such a situation happened in 1930, during the Great Depression. Due to this reason, people prefer to invest in gold because they consider it a great way of investment while such a crisis occurs.
Gold Retains Its Value during Geopolitical Uncertainty
Not only during financial uncertainty, but gold can also maintain its value during geopolitical uncertainty. Such a situation is known as ‘crisis commodity’ when people tend to change their dwelling place due to geopolitical unrest in their area. During this time, the price of gold sores, while the other types of currencies fail to maintain their values.
The Demand for Gold Is Increasing
From ancient times, gold is deeply connected with each culture. Countries like India have different uses of gold, including its usage in the jewelry industry. In China, the gold bars are a mode of investment.
So, these are the reasons why owning gold is a great investment in different situations. When the world economy goes down and the currencies fail to maintain its values, gold is there that works as a great investment.