Gold has proven itself to be a good long-term store of wealth during deep crisis. When everyone is in a panic, the price of gold shoots up. But why is gold so important? Besides being a valuable, precious metal, gold has many other uses. Gold might be ubiquitously used in electronics, and not so much in industry it is fundamentally the most useful precious metal in human society. It has a number of properties that a lot of metals don’t have. As more uses are discovered the demand for gold rises. You may not be able to eat gold or use it to buy anything the same way you would use actual currency but gold has many more uses. It’s the one precious metal that is both practical and valuable to human society.
The one thing that makes gold valuable is its rarity. The precious metal has to be mined out of the earth and then processed. So far, it is estimated that about 160,000 tonnes of gold have been extracted out of the earth. The fact that mining operations are still ongoing and new discoveries are being made in various parts of the world, there is no telling if this is the most gold we will ever get to mine. Currently, gold is being mined at about 2,600 tonne per year. The supply of above-ground gold is expanding at about 1.6% per year. The above ground sock of gold is expected to increase to 205,000 tonnes by 2025. The aggregate un-mined reserve below ground that is still to be brought up by mining companies is estimated to be around 50,000. People buy and sell gold bullion for various reasons but whatever those reasons are, the recycling of gold keeps the balance somewhat arresting the total depletion of this precious metal.
How is all that gold used?
95% of the world’s gold is held as a store of wealth in vaults or as jewellery. The rest goes into electronics and a very small number goes into dentistry. Gold is not an infinite resources. The inability of gold to artificially expand in response to some economic catastrophe makes gold a more reliable store of purchasing power than the dollar or any other currency in the world. Gold is appreciated for its unique quality, its rarity, and the demand for gold causes a multiplication of gold’s purchasing power.
It has become relatively easy for anyone to buy and sell gold bullion especially coins which are smaller, portable and collectable. Whilst buying gold is great, there are good reasons why you might want to sell any gold coins you may have.
Reasons to sell gold bullion
Owning gold or keeping old bullion can be taxing. You have to ensure that it is safely stored.
You have to take out insurance on it which can be expensive. Dealers charge a good premium price for hold bullion. If you have gold coins that are collectable, you can get an even better price for the gold bullion coins you have to sell. Gold bullion has larger liquidation spreads than gold jewellery for instance.