Gold is one of the coinage metals and has served as a symbol of wealth and a store of value throughout history. Gold standards have provided a basis for monetary policies. It also has been linked to a variety of symbolisms and ideologies. A total of 165,000 tonnes of gold have been mined in human history, as of 2009. This is roughly equivalent to 5.3 billion troy ounces or, in terms of volume, about 8,500 cubic meters.
Gold has been widely used throughout the world as a vehicle for monetary exchange, either by issuance and recognition of gold coins or other bare metal quantities, or through gold-convertible paper instruments by establishing gold standards in which the total value of issued money is represented in a store of gold reserves. Because of the softness of pure (24k) gold, it is usually alloyed with base metals for use in jewelry. In medieval times, gold was often seen as beneficial for the health. It is also used in electronics and for other industrial purposes.
The price of gold is determined on the open market, by a procedure known as the Gold Fixing in London. Originating in 1919, it provides a twice-daily benchmark figure to the industry. Demand for gold is widely spread around the world. East Asia, the Indian sub-continent and the Middle East accounted for 72% of world demand in 2007. 55% of demand is attributable to just five countries – India, Italy, Turkey, USA and China, each market driven by a different set of socio-economic and cultural factors. The main sources of supply are:
- Mine Production
- Scrap Sales
- Central bank reserve disposals
Of all the precious metals, gold is the most popular as an investment. Investors generally buy gold as a hedge or safe haven against any economic, political, social or currency-based crises. These crises include investment market declines, currency failure, inflation, war and social unrest. Investors also buy gold during times of a bull market in an attempt to gain financially.