Have you ever thought what makes gold so valuable compared to other materials like iron and steel? There are numerous factors contributing to that answer, and when put together, there are many reasons as to why it is constantly in demand.
The more significant factors include the fact that gold is corrosion-resistant, that they are both expensive and difficult to extract and of course, the proliferating rate of demand for gold. Due to its low reactivity compared to other metals, oxidation is less likely to occur which effectively labels gold to be “corrosion-resistant”.
Because of this, gold is a very ideal material to create many items we see in our daily lives such as Jewellery and Olympic Medals — which could be worn over and over again and still won’t corrode when in contact with our sweat. This is unlike other metals like iron whereby the reactivity is significantly higher compared to gold, which makes the metal undesirable to use in jewellery production.
Gold is not actually hard to extract. In fact, you can easily find many videos and articles on the internet teaching you how to extract gold. Then, what exactly about the extraction process makes it so expensive? It is the fact that there is a diminishing number of gold mines left in the world.
Furthermore, compared to other materials like aluminium and iron, which constitute 8% and 5% of the Earth’s crust respectively, is in a lot more abundance as compared to gold. The availability of gold is declining and because of the increase in the world’s population, the demand for gold will only go up.
This makes supply hard to meet demand, especially in the long run, and overtime, gold will only appreciate in value as we have a finite source of gold. This demand due to the prestige of gold causes gold to be more and more expensive with each passing year.
As a global store of value, gold can also be used as a form of financial safety net in times of geopolitical and macroeconomic uncertainty as it is seen as a special and valuable commodity. So if you’re looking for a worthy investment, purchasing a few pieces of pure gold is a good way to start.
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