Gold has been around for more than 5,000 years and has been cherished by many. Individuals, civilizations, and royalty have found a love for gold due to its inherent value and its pristine beauty. Throughout the years many countries have used gold for trading purposes as well as for legal tender. Gold is prominent in jewelry, industry and used often artistically. Gold has and probably always will be a store of value. Look at the US Liberty gold coins as an example, minted as late as 1907 at $20 for almost an ounce of gold and that coin today is worth more than $1,600 on the low end.
Gold is very valuable due to its rarity and high demand. When something is of great value and has a high demand it is usually rare. I will give you a couple examples to show you the rarity of gold. One, more steel is poured around the world in one hour than the amount of gold that has been poured in all the years it has been mined. Two, if you were to put all the gold from around the world into the Washington Monument it would only make up about 1/9th of its mass.
Recently there has been a huge demand for gold due to the economic crisis here and abroad; we have seen the same thing occur in past years. When there is a high demand for gold its price increases. This is a basic economic rule. Gold is not something that can be massed produced so its supply is limited. Because of its limited supply its value increases much quicker than those things that have an unlimited supply. Gold continues to be put onto the market annually through mining, but the production of gold has already hit its peak. It used to be that a mining company could take out 12 grams of gold from 1 ton of ore, now it is around 3 grams per 1 ton of ore. Every gram of gold is now harder to extract from the ground than the previous gram.
Gold has held value since the moment it was discovered. I believe that gold will always hold value and will never become worthless. In fact gold has never been worthless in 5,000 years! Gold was the first real money that we ever had and in fact even the United States used gold as money from 1795 to 1971. Gold is indestructible and cannot be mass produced like the dollar. With the dollar being printed at alarming rates gold has proven to be unshakeable over the year last 10 years, unlike thousands of other currencies that have failed. So you can see that Gold is an obvious option for a store of value.
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