What Is The History Of Gold?

Why is Gold so valuable and why do investors love it as an investment asset?

If you take two civilizations from opposite parts of the ancient world, you will find many differences. These cultures will have different languages, religions, beliefs, and traditions.

However, both of these ancient civilizations are likely to have one thing in common – an insatiable appreciation for gold.  Gold has come a long way, and now it has a place in the financial system with offerings like a gold IRA or gold bullion investment.  For all gold IRA questions, the executives at Allegiance Gold can help educate you on the importance of gold and how to diversify your financial portfolio.

Gold’s first use stretches back over 6000 years ago

It is believed that gold was first discovered in freshwater streams. Archaeological records trace back the first use of gold to about 4000 BC. At that time, gold was used for jewelry and for idols or worship. 

Gold as a store of wealth and medium of exchange 

The first evidence of gold as a store of wealth and a medium of exchange took place in ancient Egypt in 1500 BC. The first known gold coin was known as a Shekel, which weighed about 11.3 ounces. This became the standard unit of measure in the Middle East in 1200 BC. The Egyptians discovered that they could alloy gold with other metals to make it stronger and give it various pigmentations.

The first Gold mint 

The first evidence of a gold mint can be found in Lydia, a kingdom in Asia Minor in around 560 BC. The minting of gold continued in the Roman Empire with the Aureus in 50 BC. Gold continued to be used as a standard store of wealth. 

Gold continues as a standard currency in the Middle Ages 

Gold continued to be used as a store of wealth and a medium of exchange in Europe. In 1284, England issued its first gold coin known as the Florian. The most popular gold coin was known as the Ducat and issued by the Republic of Florence. The Ducat remained the world’s top gold coin for five centuries. 

Gold and the New World

Gold became one of the main exports from the New World with thousands of tons of precious metal shipped from South America to Europe. In fact, the export of Gold and Silver made countries like Spain and Portugal among the wealthiest in the world. 

The rise of the gold standard 

The world saw a continued influx of the gold supply as European countries continued to expand around the world. This solidified gold as the standard store of wealth and medium of exchange in just about all major economies. England and Germany officially adopted the gold standard in 1900. From 1871 to 1914, the gold standard kept many national economies stable and enabled trade across borders.

The end of the Gold standard 

Under the gold standard, the money supply was directly tied to the supply of gold. However, this all came to an end during World War 1 when countries decided to suspend the gold standard in order to print money and finance their war operations. 

After the war, international indebtedness skyrocketed which caused continued inflation of paper money. This caused many people to hoard gold to protect their store of wealth. In 1933, U.S. President Franklin D. Roosevelt outlawed the private ownership of gold in response to the continued gold hoarding during the depression.

In 1971, U.S. President Nixon set the price of gold to $38 and ended the exchange of U.S. dollars for gold, decoupling the U.S. dollar from gold. This caused a huge rise in the price of precious metals through the 1970s.

Gold investments today 

Today, gold continues to be seen as a store of wealth by many nations, institutions, and individual investors. The current above the ground supply of gold is 19,000 tons with a total value of around 10 trillion dollars as of May 2021. With gold becoming more and more of a popular option as of late, it will have investors continuing to flock towards the precious metal as a safeguard for the protection of wealth.

Allegiance Gold has been educating investors and retirees on the importance of how a gold IRA can help diversify and preserve wealth.  Gold has become a safe investment in this unsafe world of a global pandemic, all-time high inflation rates, and stock market crashes.  Contact Allegiance Gold today and discover how the precious metal can help you preserve your wealth.  Contact the executives at Allegiance Gold today for a FREE Gold IRA Guide as well!