ALL THAT GLITTERS IS GOLD
Gold-The chemical symbol for gold is Au. Gold¶s atomic number is 79 and its atomic weight is 196.967. Gold melts at 1064.43° Centigrade The specific gravity of gold is 19.3; meaning gold weighs 19.3 times more than an equal volume of water. Percent Gold = European System = Karat System 100 % 91.7 % 75.0 % 58.5 % = = = = 1000 fine 917 fine 750 fine 585 fine 41.6 % = = = = = 24 karat 22 karat 18 karat 14 karat 416 fine = 10 karat
Gold was first discovered as shining, yellow nuggets. "Gold is where you find it," so the saying goes, and gold was first discovered in its natural state, in streams all over the world. No doubt it was the first metal known to early hominids. Gold became a part of every human culture. Its brilliance, natural beauty, and lustre, and its great malleability and resistance to tarnish made it enjoyable to work and play with. Because gold is dispersed widely throughout the geologic world, its discovery occurred to many different groups in many different locales. And nearly everyone Gold was the first metal widely known to our species. When thinking about the historical progress of who found it was impressed with it, we consider the development of iron and copper-working as the greatest contributions to our species' economic and cultural progress - but gold came first. Gold is the easiest of the metals to work. It occurs in a virtually pure and workable state, whereas most other metals tend to be found in orebodies that pose some difficulty in smelting. Gold's early uses were no doubt ornamental, and its brilliance and permanence (it neither corrodes nor tarnishes) linked it to
deities and royalty in early civilizations. Gold has always been powerful stuff. The earliest history of human interaction with gold is long lost to us, but its association with the gods, with immortality, and with wealth itself are common to many cultures throughout the world. The Incas referred to gold as the "tears of the Sun."
Homer, in the "Iliad" and "Odyssey," makes mention of gold as the glory of the immortals and a sign of wealth among ordinary humans. In Genesis 2:10-12, µthe river Pison out of Eden¶, and "the land of Havilah, where there is gold: and the gold of that land is good?" As far back as 3100 B.C., we have evidence of a gold/silver value ratio in the code of Menes, the founder of the first Egyptian dynasty. In this code it is stated that "one part of gold is equal to two and one half parts of silver in value." This is our earliest of a value relationship between gold and silver. In ancient Egypt, around the time of Seti I (1320 B.C.), we find the creation of the first gold treasure map now known to us. Today, in the Turin Museum is a papyrus and fragments known as the "Carte des mines d'or." It pictures gold mines, miners' quarters, road leading to the mines and gold-bearing mountains, and so on. Modern thought is that it portrays the Wadi Fawakhir region in which the El Sid gold mine is located, but the matter is far from settled. Jason and the Argonauts sought the Golden Fleece around 1200 B.C. That Greek myth makes more sense when you realize that the fleece that it refers to is the sheep's fleece used in the recovery of fine placer gold.
Early miners would use water power to propel gold-bearing sand over the hide of a sheep, which would trap the tiny, but heavy, flakes of gold. When the fleece had
absorbed all it could hold, this 'golden fleece' was hung up to dry, and when dry would be beaten gently so that the gold would fall off and be recovered. This primitive form of hydraulic mining began thousands of years ago, and was still being used by some miners as recently as the California gold rush of 1849.
The first use of gold as money occurred around 700 B.C., when Lydian merchants produced the first coins. These were simply stamped lumps of a 63% gold and 27% silver mixture known as 'electrum.' This standardized unit of value no doubt helped Lydian traders in their wide-ranging successes, for by the time of Croesus of Mermnadae, the last King of Lydia (570 -546 B.C.), Lydia had amassed a huge hoard of gold. Today, we still speak of the ultra-wealthy as being 'rich as Croesus.' Early civilizations equated gold with gods and rulers, and gold was sought in their name and dedicated to their glorification. Humans almost intuitively place a high value on gold, equating it with power, beauty, and the cultural elite. And since gold is widely distributed all over the globe, we find this same thinking about gold throughout ancient and modern civilizations everywhere. Gold, beauty, and power have always gone together. Gold in ancient times was made into shrines and idols ("the Golden Calf"), plates, cups, vases and vessels of all kinds, and of course, jewellery for personal adornment.
The "Gold of Troy" treasure hoard excavated in Turkey and dating to the era 2450 2600 B.C., show the range of gold-work from delicate jewellery to a gold gravy boat weighing a full troy pound. This was a time when gold was highly valued, but had not yet become money itself. Rather, it was owned by the powerful and well-connected, or made into objects of worship, or used to decorate sacred locations. Gold has always had value to humans, even before it was money. This is demonstrated by the extraordinary efforts made to obtain it. Prospecting for gold was a worldwide effort going back thousands of years, even before the first money in the form of gold coins appeared about 700 B.C.
In the quest for gold by the Phoenicians, Egyptians, Indians, Hittites, Chinese, and others, prisoners of war were sent to work the mines, as were slaves and criminals. And this happened during a time when gold had no value as 'money,' but was just considered a desirable commodity in and of it. The 'value' of gold was accepted all over the world. Today, as in ancient times, the intrinsic appeal of gold itself has that universal appeal to humans. But how did gold come to be a com Gold, measured out, became money. Gold's beauty, scarcity, unique density (no other metal outside the platinum group is as heavy), and the ease by which it could be melted, formed, and measured made it a natural trading medium. Gold gave rise to the concept of money itself: portable, private, and permanent. Gold (and silver) in standardized coins came to replace barter arrangements, and made trade in the Classic period much easier. Gold was money in ancient Greece. The Greeks mined for gold throughout the Mediterranean and Middle East regions by 550 B.C., and both Plato and Aristotle wrote about gold and had theories about its origins. Gold was associated with water (logical, since most of it was found in streams), and it was supposed that gold was a particularly dense combination of water and sunlight. Their science may have been primitive, but the Greeks learned much about the practicalities of gold mining. By the time of the death of Alexander of Macedon (323 B.C.), the Greeks had mined gold from the Pillars of Hercules (Gibraltar) all the way eastward to Asia Minor and Egypt, and we find traces of their placer mines today. Some of the mines were owned by the state, some were worked privately with a royalty paid to the state. Also, nomads such as the Scythians and Cimmerians worked placer mines all over the region. The surviving Greek gold coinage and Scythian jewellery both show superb artistry. The Roman Empire furthered the quest for gold. The Romans mined gold extensively throughout their empire, and advanced the science of gold-mining considerably. They diverted streams of water to mine hydraulically, and built sluices and the first 'long toms.' They mined underground, also, and introduced waterwheels and the 'roasting' of gold-bearing ores to separate the gold from rock. They were able to more efficiently exploit old mine-sites, and of course their chief labourers were prisoners of war, slaves, and convicts. A monetary standard made the world economy possible. The concept of money, (i.e., gold and silver in standard weight and fineness coins) allowed the World's economies to expand and prosper. During the Classic period of Greek and Roman rule in the western world, gold and silver both flowed to India for spices and to China for silk. At the height of the Empire (A.D. 98-160), Roman gold and silver coins reigned from Britain to North Africa and Egypt. Money had been invented. Its name was goldmoddity, a measurable unit of value?
HISTORY OF GOLD 4000 B.C. A culture, centred in what is today Eastern Europe, begins to use gold to fashion decorative objects. The gold was probably mined in the Transylvanian Alps or the Mount Pangaion area in Thrace. 3000 B.C. The Sumer civilization of southern Iraq uses gold to create a wide range of jewellery, often using sophisticated and varied styles still worn today. 2500 B.C. Gold jewellery is buried in the Tomb of Djer, King of the First Egyptian Dynasty, at Abydos, Egypt. 1500 B.C. The immense gold-bearing regions of Nubia make Egypt a wealthy nation, as gold becomes the recognized standard medium of exchange for international trade. The Shekel, a coin originally weighing 11.3 grams of gold, becomes a standard unit of measure in the Middle East. It contained a naturally occurring alloy called electrum that was approximately two-thirds gold and one-third silver. 1350 B.C. The Babylonians begin to use fire assay to test the purity of gold.
1200 B.C. The Egyptians master the art of beating gold into leaf to extend its use, as well as alloying it with other metals for hardness and colour variations. They also start casting gold using the lost-wax technique that even today is still at the heart of jewellery making. Unshorn sheepskin is used to recover gold dust from river sands on the eastern shores of the Black Sea. After sluicing the sands through the sheepskins, they are dried and shaken out to dislodge the gold particles. The practice is most likely the inspiration for the ³Golden Fleece´, which became one of the folk lore of ³JASON AND THE ARGANAUTS.´ 1091 B.C. Little squares of gold are legalized in China as a form of money.
560 B.C. The first coins made purely from gold are minted in Lydia, a kingdom of Asia Minor. 344 B.C. Alexander the Great crosses the Hellespont with 40,000 men, beginning one of the most extraordinary campaigns in military history and seizing vast quantities of gold from the Persian Empire.
300 B.C. Greeks and Jews of ancient Alexandria begin to practice alchemy, the quest of turning base metals into gold. The search reaches its pinnacle from the late Dark Ages through the Renaissance.
218 B.C.- 202 B.C. During the second Punic War with Carthage, the Romans gain access to the gold mining region of Spain and recover gold through stream gravels and hard rock mining. 58 B.C. After a victorious campaign in Gaul, Julius Caesar brings back enough gold to give 200 coins to each of his soldiers and repay all of Rome¶s debts. 50 B.C. Romans begin issuing a gold coin called the Aureus.
476 A.D. The Goths depose Emperor Romulas Augustus, marking the fall of the Roman Empire. 600 A.D. ±699 A.D. The Byzantine Empire resumes gold mining in central Europe and France, an area untouched since the fall of the Roman Empire. 742 A.D. ±814 A.D. Charlemagne overruns the Avars and plunders their vast quantities of gold, making it possible for him to take control over much of Western Europe. 1066 A.D. With the Norman Conquest, a metallic currency standard is finally reestablished in Great Britain with the introduction of a system of pounds, shillings, and pence. The pound is literally a pound of sterling silver. 1250 A.D. ±1299 A.D. Marco Polo writes of his travels to the Far East, where the ³gold wealth was almost unlimited.´
1284 A.D. Venice introduces the gold Ducat, which soon becomes the most popular coin in the world and remains so for more than five centuries. 1284 A.D. Great Britain issues its first major gold coin, the Florin. This is followed shortly by the Noble, and later by the Angel, Crown, and Guinea. 1377 A.D. Great Britain shifts to a monetary system based on gold and silver.
1511 A.D. King Ferdinand of Spain says to explorers, ³Get gold, humanely if you can, but all hazards, get gold,´ launching massive expeditions to the newly discovered lands of the Western Hemisphere. 1556 A.D. Georgius Agricola publishes De re Metallica, which describes the fire assay of gold during the Middle Ages.
1700 A.D. Gold is discovered in Brazil, which becomes the largest producer of gold by 1720, with nearly two- thirds of the world¶s output. Isaac Newton, as Master of the Mint, fixes the price of gold in Great Britain at 84 shillings, 11 & ½ pence per troy ounce. The Royal Commission composed of Newton, John Locke, and Lord Somers, recommends a recall of all old currency, issuance of new specie with gold/silver ratio of 16-to-1. The gold price thus established in Great Britain lasted for over 200 years. 1744 A.D. The resurgence of gold mining in Russia begins with the discovery of a quartz outcrop in Yekaterinburg. 1787 A.D. First U.S. gold coin is struck by Ephraim Brasher, a goldsmith.
1792 A.D. The Coinage Act places the United States on a bimetallic silver-gold standard, and defines the U.S. dollar as equivalent to 24.75 grains of fine gold and 371.25 grains of fine silver. 1799 A.D. A 17-pound gold nugget is found in Cabarrus County, North Carolina, the first documented gold discovery in the United States. 1803 A.D. Gold is discovered at Little Meadow Creek, North Carolina, sparking the first U.S. gold rush. 1804 A.D. ±1828 A.D. North Carolina supplies all the domestic gold coined by the U.S. Mint in Philadelphia for currency. 1816 A.D. Great Britain officially ties the pound to a specific quantity of gold at which British currency is convertible. 1817 A.D. Britain introduces the Sovereign, a small gold coin valued at one pound sterling 1830 A.D. Heinrich G. Kuhn announces his discovery of the formula for fired-on Glanz (bright) Gold. It makes Meissen gold-decorated china world famous.
1837 A.D. The weight of gold in the U.S. dollar is lessened to 23.22 grains so that one fine troy ounce of gold is valued at $20.67. 1848 A.D. John Marshall finds flakes of gold while building a sawmill for John Sutter near Sacramento, California, triggering the California Gold Rush and hastening the settlement of the American West. 1850 A.D. Edward Hammong Hargraves, returning to Australia from California, predicts he will find gold in his home country in one week. He discovered gold in New South Wales within one week of landing. 1859 A.D. Comstock Lode of gold and silver is struck in Nevada.
1862 A.D. Latin Monetary Union is established setting fineness, weight, size, and denomination of silver and gold coins of France, Italy, Belgium and Switzerland (and Greece in 1868) and obligating all to accept each other¶s current gold and silver coins as full legal tender. 1868 A.D. George Harrison, while digging up stones to build a house, discovers gold in South Africa ± since then, the source of nearly 40% of all gold ever mined. 1873 A.D. As a result of ongoing revisions to minting and coinage laws, silver is eliminated as a standard of value, and the United States goes on an unofficial gold standard. 1887 A.D. A British patent is issued to John Steward MacArthur for the cyanidation process for recovering gold from ore. The process results in a doubling of world gold output over the next twenty years. 1896 A.D. William Jennings Bryan delivers his famous ³Cross of Gold´ speech at the Democratic national convention, urging a return to bimetallism. The speech gains him the party¶s presidential nomination, but he loses in the general election to William McKinley. 1898 A.D. Two prospectors discover gold while fishing in Klondike, Alaska, spawning the last gold rush of the century. 1900 A.D. The Gold Standard Act places the United States officially on the gold standard, committing the United States to maintain a fixed exchange rate in relation to other countries on the gold standard. 1903 A.D. The Engelhard Corporation introduces an organic medium to print gold on surfaces. First used for decoration, the medium becomes the foundation for microcircuit printing technology. 1913 A.D. Federal Reserve Act specifies that Federal Reserve Notes be backed 40% in gold. 1914 A.D. ±1919 A.D. A strict gold standard is suspended by several countries, including United States and Great Britain, during World War I. 1925 A.D. Great Britain returns to a gold bullion standard, with currency redeemable for 400-ounce gold bullion bars but no circulation of gold coins.
1927 A.D. An extensive medical study conducted in France proves gold to be valuable in the treatment of rheumatoid arthritis. 1931 A.D. Great Britain abandons the gold bullion standard.
1933 A.D. To alleviate the banking panic, President Franklin D. Roosevelt prohibits private holdings of all gold coins, bullion, and certificates.
1934 A.D. The Gold Reserve Act of 1934 gives the government the permanent title to all monetary gold and halts the minting of gold coins. It also allows gold certificates to be held only by the Federal Reserve Banks, putting the U.S. on a limited gold bullion standard, under which redemption in gold is restricted to dollars held by foreign central banks and licensed private users. President Roosevelt reduces the dollar by increasing the price of gold to $35 per ounce. 1935 A.D. Western Electric Alloy #1 (69% gold, 25% silver, and 6% platinum) finds universal use in all switching contacts for AT&T telecommunications equipment. 1937 A.D. The bullion depository at Fort Knox, Kentucky, is opened.
1942 A.D. President Franklin D. Roosevelt issues a presidential edict closing all U.S. gold mines. 1944 A.D. The Bretton Woods agreement, ratified by the U.S. Congress in 1945, establishes a gold exchange standard and two new international organizations, the International Monetary Fund (IMF) and the World Bank. The new standard involves setting par values for currencies in terms of gold and the obligation of member countries to convert foreign official holdings of their currencies into gold at these par values. 1945 A.D. Gold- backing of Federal Reserve Notes is reduced by 25.5%
1947 A.D. The first transistor is assembled at AT&T Bell Laboratories. The device uses gold contacts pressed into a germanium surface. 1954 A.D. London gold market, closed early in World War II, reopens.
1960 A.D. AT&T Bell Laboratories is granted the first patent for the invention of the laser. The device uses carefully positioned gold-coated mirrors to maximize infrared reflection into the lasing crystal. The European Rheumatism Council confirms intravenously administered gold is an effective treatment for rheumatoid arthritis. 1961 A.D. Americans are forbidden to own gold abroad as well as at home. The central banks of Belgium, France, Italy, the Netherlands, Switzerland, West Germany, the United Kingdom and the United States form the London Gold Pool and agree to buy and sell at $35.0875 per ounce. 1965 A.D. Col. Edward White makes the first space walk during the Gemini IV mission, using a gold-coated visor to protect his eyes from direct sunlight. Goldcoated visors remain a standard safety feature for astronaut excursions.
1967 A.D. South Africa produces the first Krugerrand. This 1- ounce bullion coin becomes a favourite of individual investors around the world.
1968 A.D. London Gold Market closes for two weeks after a sudden surge in the demand for gold. The governors of the central banks in the gold pool announce they will no longer buy and sell gold in the private market. A two-tier pricing system emerges: official transactions between monetary authorities are to be conducted at an unchanged price of $35 per fine troy ounce, and other transactions are to be conducted at a fluctuating free-market price. U.S. Mint terminates policy of buying gold from and selling gold to those licensed by the U.S. Treasury to hold gold. Gold- backing of Federal Reserve Notes is eliminated. Intel introduces a microchip with 1,024 transistors interconnected with invisibly small gold circuits. 1970 A.D. The charge-coupled device is invented at Bell Telephone Laboratories. First used to record the faint light from stars, the device, which uses gold to collect the electrons generated by light, eventually is used in hundreds of civilian and military devices, including home video cameras. 1971 A.D. On August 15, U.S. terminates all gold sales or purchases, thereby ending conversion of foreign officially held dollars into gold; in December, under the Smithsonian Agreement signed in Washington, U.S. devalues the dollar by raisin g the official dollar price of gold to $38 per fine troy ounce. The colloidal gold marker system is introduced by Amersham Corporation of Illinois. Tiny spheres of gold are used in health research laboratories worldwide to mark or tag specific proteins to reveal their function in the human body for the treatment of disease. 1973 A.D. On February 13, U.S. devalues the dollar again and announces it will raise the official dollar price of gold to $42.22 per fine troy ounce. Dollar-selling continues, and finally all currencies are allowed to ³float´ freely, without regard to the price of gold. By June, the market price in London has risen to more than $120 per ounce. Japan lifts prohibition on imports of gold. 1974 A.D. Americans permitted to own gold, other than just jewellery, as of December 31. 1975 A.D. The U.S. Treasury holds a series of auctions at which is accepts bids for gold in the form of 400-ounce bars. In January, 754,000 troy ounces are sold and another 499,500 more in June. 1975 A.D. Trading in gold for future delivery begins on New York¶s Commodity Exchange and on Chicago¶s International Monetary Market and Board of Trade. The Krugerrand is launched on the U.S. Market.
1976 A.D. The Gold Institute is established to promote the common business interests of the gold industry by providing statistical data and other relevant information to its members, the media, and the public, while also acting as an industry spokesperson.
1976 A.D. IMF sells one-third of its gold holdings, 25 million troy ounces to IMF members at SDR 35/ounce in proportion to members¶ shares of quotas on August 31, 1975, and 25 million troy ounces at a series of public auctions for the benefit of developing member countries. 1978 A.D. Amended IMF articles are adopted, abolishing the official IMF price of gold, gold convertibility and maintenance of gold value obligations; gold is eliminated as a significant instrument in IMF transactions with members; and the IMF is empowered to dispose of its large gold holdings. By Act of Congress, the U.S. abolishes the official price of gold. Member governments are free to buy and sell gold in private markets. 1978 A.D. A weak U.S. dollar propels interest in gold, aided by such events as the U.S. recognition of Communist China, events in Iran and Sino-Vietnamese border disturbances. U.S. Congress passes the American Arts Gold Medallion Act, representing the first official issue of a gold piece for sale to individuals in almost half a century. Japan lifts ban on gold exports, touching off a ³gold rush´ among investors who can sell as well as buy. 1979 A.D. The Canadian 1-ounce Maple Leaf is introduced.
1980 A.D. U.S. Treasury sells 15.8 million troy ounces of gold to strengthen the U.S. trade balance. 1980 A.D. Gold reaches intra-day historic high of $870 on January 21 in New York and by year-end closes at $591. 1981 A.D. Treasury Secretary Donald Regan announces the formation of a Gold Commission ³to assess and make recommendations with regard to the policy of the U.S. government concerning the role of gold in domestic and international monetary systems.´ The first space shuttle is launched, using gold-coated impellers in its liquid hydrogen fuel pump. 1982 A.D. Congress passes Olympic Commemorative Coin Act, which includes issuing the first legal tender U.S. gold coin since 1933. 1982 A.D. U.S. Gold Commission report recommends no new monetary role for gold, but supports a U.S. gold bullion coin. New gold deposits are discovered in North America and Australia.
Canada introduces the fractional Maple Leaf coins in sizes of 1/4 ounce and 1/10 ounce. China introduces the Panda bullion coin.
1986 A.D. The first new gold jewellery alloy of this century, 990- Gold (1% titanium) is introduced to meet the need for an improved durability of 99% pure gold traditionally manufactured in Hong Kong. The very malleable alloy is easily worked into intricate design, but can be converted into a hard, durable alloy by simply heating it in an oven. The American Eagle Gold Bullion Coin is introduced by the U.S. Mint. Treasury resumes purchases of newly mined gold. Goldcorp Australia issues the Nugget gold bullion coin. Gold-coated compact discs are introduced. The gold- coated discs provide perfection of reflective surfaces, eliminate pinholes common to aluminium surfaces, and exclude any possibility of oxidative deterioration of the surfaces. 1987 A.D. British Royal Mint introduces the Britannia Gold Bullion Coin.
World stock markets suffer sharp reversal on October 19; volatile investment markets increase gold trading activity. The World Gold Council is established to sustain and develop demand for the end uses of gold. 1988 A.D. The international media report huge gold purchases by a ³mystery´ buyer, later revealed to be the Japanese government in preparation for the minting of a major commemorative coin. This coin, honouring the sixtieth anniversary of Emperor Hirohito¶s reign, is issued in November. 1989 A.D. 1990 A.D. nation. Austria introduces the Philharmoniker bullion coin. United States becomes the world¶s second largest gold producing
1992 A.D. World Gold Council introduces the Gold Mark as an international identification mark for gold jewellery. 1993 A.D. Germany lifts its value added tax restrictions on financial gold, causing a resurgence of private demand of gold. India and Turkey liberalize their gold markets. 1994 A.D. Russia formally establishes a domestic gold market.
1996 A.D. The Mars Global Surveyor is launched with an on- board gold-coated parabolic telescope-mirror that will generate a detailed map of the entire Martian surface over a two-year period. 1997 A.D. The US Congress passes Taxpayers Relief Act, allowing US Individual Retirement Account holders to buy gold bullion coins and bars for their accounts as long as they are of a fineness equal to, or exceeding, 99.5% percent gold. 1999 A.D. The Euro, a pan-European currency, is introduced, backed by a new European Central Bank holding 15% of its reserves in gold. 2000 A.D. Astronomers at the Keck Observatory in Hawaii use the giant goldcoated mirrors of the most detailed images of Neptune and Uranus ever captured. 2002 A.D. The Gold Institute¶s Board of Directors votes to dissolve the association and consolidate its activities within the National Mining Association, effective January 1, 2003. The decision was made against the backdrop of consolidation in the gold sector and changes in the general business climate. 2004 - Launch of SPDR Gold Shares The market is transformed by an innovative, secure and easy way to access the gold market. Seven years later SPDR exceeds $55bn in assets under management. 2009 - Central banks return to buying In the second quarter of the year, central banks collectively become net purchasers of gold for the first time in two decades. This reflects a combination of slowing sales from European banks and growing purchases by emerging market countries. 2010 - Gold price sustains record highs World currencies are undermined by inflation fears and successive financial crises. The London pm fix achieves 35 separate successive highs in the year to date.
The economic upsurge in the last few years has led to a spike in most commodities and the resultant jump in the price of gold was only to be expected.
India's Love of Gold
The History of the Passion In India, gold is religion. India's love affair with gold is timeless, spanning centuries and millennia. "In India, it always was and still is, much more than just a precious metal. It is part of the fabric of our culture and an inseparable part of our belief system. It is the essence from which the universe was created. In a dark and lifeless universe, the Creator deposited a seed in the waters he had made from his own body. The seed became a golden egg, bright and radiant as the sun. From this cosmic egg of gold was born the incarnation of the Creator Himself - Brahma. From the root word Hrimeaning imperishable, comes Hiranya, the ancient name for gold. Brahma is referred to as Hiranyagarbha - the one born of gold"(1). In Hindu mythology, some of our goddesses are described as golden-hued, the ultimate in beauty. Gold, as the basis of so much purity and beauty, is referred to as the seed of Agni, the God of Fire. Manu the ancient law-giver decreed that golden ornaments should be worn for specific ceremonies and occasions. "Mythological tales tell us how our Gods and Goddesses rode on golden chariots. Gold has always been considered a sacred item in the Hindu way of life and is a must in every religious function, the explanation being that gold is pure having passed through fire in its process of evolution."(2). Over centuries and millennia, gold has become an
inseparable part of the Indian society and fused into the psyche of an Indian. Indians see the metal as a symbol of purity, prosperity and good fortune. Over a few thousands of years, many kings, emperors and dynasties featuring countless wars, conquests and political upheavals have ruled the Indian subcontinent. Different dynasties ruled different parts of India with different monetary systems. Gold acted as a common medium of exchange or store of value across the monetary systems of different kingdoms across the sub-continent. Hence wealth could still be preserved in spite of wars and political turbulence. Gold also helped preserve wealth through natural calamities and disasters and for centuries was the only means of saving in rural India, land being the other main asset of economic value. This has largely helped formulate, or evolve, the Indian sentiment and fanatical passion for gold, which holds true even today. India is estimated to hold more than 26,000 tonnes of gold.
Quiet Progress For the last 20 years, World Gold Council has shown India¶s annual gold consumption fluctuating from 400 to 800 tons. Estimated Indian gold reserves at 25,000-30,000 tons are double of the next largest country ± the USA with 14,000 tons. India has 20% of the world population and also more than 20% of the world¶s above the ground gold. India and the World For much of the last 2000 years of recorded history, India has been the largest buyer of gold. Roman historian, Pliny lamented (some 1800 years ago, how India, the sink of precious metals was draining Rome of gold ± an appellation that resonates even today. In the Indian North West (modern Afghanistan), Greco-Bactrian coins were made (seemingly) from the ³Roman gold coins, which poured into India.´ To ³manage´ this drain of gold, Romans reduced the gold content in coins. Septimus Severus, (193-211 AD) further debased the currency. Roman coins after Septimius Severus are rarely found in India leading to the belief that Indians just
stopped accepting the debased coin ±and Roman coins were melted to make payments in pure gold. In mid 17th century, a Superior of the Capuchin Mission at Isfahan, friar Raphael du Mans wrote (in 1660), an authoritative paper, Estat de la Perse, which was used by the French Minister Jean Baptiste Colbert, to form the French East India Company (1664). This Christian missionary in Iran, Raphael du Mans thought that India is ³where all the money in the Universe is unloaded as if into an abyss.´ Central Asian invaders, looking for slaves and gold, aimed at colonial historians. The Byzantine Empire, successor to the Assyrian-Achmaenid-Macedonian-Roman lineage, similarly found that their reserves of precious metals were µagain, leaked away to India.¶ A significant part of Indian royal treasuries, when these hoards ³fell a prey to European invaders, it was found that the gold coins of the Byzantine Emperors formed no small part of their treasures´ In 1748, Baron de Montesquieu, warned Europeans that « Every nation that ever traded to the Indies, has constantly carried bullion, and brought merchandises in return. « commerce of the Romans to the Indies was very considerable « this commerce was carried on entirely with bullion « They want, therefore, nothing but our bullion, to serve as the medium of value, and for this they give us merchandises in return « that bullion was always carried to the Indies, and never any brought from thence. The Ottomans put restrictions of export gold to Iran, from where gold exports to India were made. Safavid Iran, in turn, put restrictions on gold exports from Iran to India. No help at all. Even today writers resent that despite the³absence of indigenous sources of gold and silver´ the³very favourable export-import balance´ resulted in³inherent strenghth of the Indian economy´. Further, it has been correctly observed that in ³our period the subcontinent drew vast amounts of gold and silver, exceeding previous periods and exceeding all other parts of the contemporary world so far.´ The French traveller Francois Bernier enviously wrote how It should not escape notice that gold and silver, after circulating in every other quarter of the globe, come at length to be absorbed in Hindostan. (From Travels in the Mogul Empire By François Bernier, Irving Brock) Another writes how (loosely, the µgolden goose¶). Their partly successful raids were deemed as invasions by
³in exchange for textiles, spices and other Indian agricultural and industrial products, merchants from across Europe and Asia flooded India¶s bazaar¶s with dinars, tangas, ducats, guilders, reals, francs, rixdollars (reichthalers) and countless other varieties of coins, all of which were minted into rupees. (From The Indian Diaspora in Central Asia and its trade, 1550-1900 By Scott Cameron Levi) Moving away from Central Asia, the general European economy, was simple It was not surprising to find that Ian Fleming, pitted Western fiction¶s best secret agent, James Bond against Auric Goldfinger ± who was smuggling gold out of a declining, post war Britain to India. During various collapses of temporary gold standards in history, Indian gold reserves (usually unwillingly) stabilised world economies. In recent history, Indian gold reserves went out to stabilise the American currency during the Great Depression and the German currency during the post-Wiemar drift. Indian silver reserves broke the Hunt Brothers¶back and their silver gambit in the 1980 s. After (colonial) India¶s accession to the world gold standard in 1898, India, especially during WWI, rapidly built up an export surplus. British reserves of gold started drying up ± in spite of gold export restrictions to India by the USA, Britain and much of the Western world. There was hysteria in popular press and politicians on the subject of India and its appetite for gold. Crash in silver prices During 1800-1900, new mines and increased silver production saw a crash in silver prices. Abundant silver discoveries and mining had flooded the world with silver, depressing prices. Germany¶s move to the gold standard in 1873, released even more silver in the world markets. The Opium trade further released vast amounts of silver from China ± which was opened to µfree trade¶, giving rise to some of the biggest Western fortunes (of the Roosevelt¶s, for instance). With increased silver supplies, US silver coinage was depreciating. Modern restrictions on gold exports to India Between WWI end and the start of the WWII, it was clear that India would not stay a colony for long. Indian independence would happen sooner than later. Between 1920-40, in a series of measures, policy decisions were taken, which made Indian interests subsidiary and inferior to Western interests. Central Bankers from the USA, Britain, France and Germany had many meetings to ³coordinate monetary policy.´ The agenda ± gold flow management between themselves and an obvious understanding - don¶t let Indians get the gold. ). They agreed that Indian demand for
gold had a ³«deflationary effect on global liquidity,´ therefore Indian demand for gold had to be regulated.´ India was paid with inflated and abundant silver stock, instead of gold. This silver was the same silver released by the Pittman Act ± a ³buffer to protect Western gold reserves against the Indian drain «´ Of course, later the British Raj decided to settle Indian debts with promissory notes ± and not even silver. It was this Indian µsacrifice¶ which enabled the recovery of the West.
More currency and less gold
From 1939, (the start of WWII), gold imports into India, the world¶s largest market and also the largest private reserve of gold, were controlled or banned. Not only the largest, but Indian reserves of gold, are also the only significant reserve in the world without a history of war, genocide, slavery or loot, (unlike US, UK, Canada, Australia) or due to nature¶s bounty (unlike South Africa, China, Peru, Ghana, etc.). The first effect of restrictions on gold imports in India was on prices. Indian gold prices, on an average, were 30%-40% higher than international prices. The other thing that happened was that gold imports went underground. Gold imports (illegal), called smuggling, spawned the biggest criminals that India has seen. The common threads in this were, of course, America, drugs, underworld, war, corruption, warlords ± but what made all this possible was Indian appetite for gold. All this was made possible by the Indian hawala system of money exchange. Hawala made money transfers safe, instantaneous, at a low-cost. Traditional Indian ships from a thousand ports in Goa, Maharashtra and Gujarat sailed with this contraband and brought back gold.
Golden Triangle & Golden Crescent The countries comprising these Golden Triangle /Crescent are India¶s neighbours. The Indian underworld transported drugs through India. These drug shipments originated, were acquired, grown and traded from the Golden Crescent and the Golden Triangle. The US eliminated gold ownership restrictions in 1975. India followed. In 1992, India started its first hesitant steps towards legalizing gold imports. By 1995, these import control laws had been diluted to near non-existence. With the dilution of restrictions on gold imports came the abatement in the biggest crime wave in modern history. India. And an end to the greatest crime wave in the modern history.
Metallic gold is used by the alchemists to prepare a liquid that they affirm will restore youth when drunk." -Agricola, De natura fossillium, 1546. In what ways is gold consumed? About 75% of the gold produced in the world's mines goes to jewellery production. This is one meaning of the term "consumption". More surprising are the many ways in which gold actually finds its way into the human body. Gold crowns are still the best. Although rapidly being replaced with less-expensive alternatives, dental amalgams containing high percentages of gold are still desirable as crowns. Gold is a soft metal, and its use in a crown lessens the stress put on the opposing tooth in the act of chewing. Modern porcelain crowns are much more brittle than gold, and are not likely to last the decades that gold crowns can. Gold also has medical uses. An isotope of gold, 198-Au, which has a half-life of 2.7 days, is used in treating some cancers and other diseases, and also as a tracer within the human body. A compound containing gold known as disodium aurothiomalate, is used in an injection as a treatment for arthritis. Auranofin, a complex organic molecule, is used in the treatment of some cases of rheumatoid arthritis. Serve gold at your next party. Gold in the form of extremely fine leaf (a few atoms in thickness) has been added to certain liqueurs from Eastern Europe, such as Goldwasser. This gives the liquid a sparkle in the glass, as the fine bits of gold catch the light as they float suspended. Pure gold leaf has a long tradition in cuisine both in Europe and the Far East. Exotic dishes are given the ultimate exotic presentation, wrapped in 99.9% pure gold leaf so unbelievably thin, that the gold itself is edible. Although consumption of gold is essentially harmless in small amounts, there is a gold toxicity that is known from its use in treating arthritis. Skin rash is the most common result of excessive consumption of gold for medicinal purposes. Gastrointestinal distress can from time to time result from excessive ingestion of gold compounds. A commonly used antidote is Dimercaprol, HSCH2CHSHCH2OH, also called BAL (British Anti-Lewisite). BAL forms a stable complex with gold, rendering it physiologically ineffective and easy to eliminate from the body. Certain people develop a mild rash from wearing gold jewellery, although this phenomenon is not entirely understood today. This dermatitis may be caused by residual radioactivity in the minor alloys in the jewellery. Gold can be harmful in other ways. Of course, the most harmful aspects of gold to humans have nothing to do with actual gold consumption. More dangerous is that
wide range of disorders, known collectively as "gold fever" (see Bogart, Humphrey, "The Treasure of the Sierra Madre."). 1) Jewellery fabrication 2) Industrial applications 3) Governments and central banks 4) Private investors 1) Jewellery fabrication: The largest source of demand is the jewellery industry. In recent years, demand from the jewellery industry alone has exceeded Western mine production. This shortfall has been bridged by supplies from reclaimed jewellery and other industrial scrap, as well as the release of official sector reserves. Gold's workability, unique beauty, and universal appeal make this rare precious metal the favourite of jewellers all over the world. 2) Industrial applications: Besides jewellery, gold has many applications in a variety of industries including aerospace, medicine, electronics and dentistry. The electronics industry needs gold for the manufacture of computers, telephones, televisions, and other equipment. Gold's unique properties provide superior electrical conducting qualities and corrosion resistance, which are required in the manufacture of sophisticated electronic circuitry. In dentistry, gold alloys are popular because they are highly resistant to corrosion and tarnish. For this reason gold alloys are used for crowns, bridges, gold inlays, and partial dentures. 3) Governments and Central banks: The third source of gold demand is governments and central banks that buy gold to increase their official reserves. 4) Private investors: Finally, there are private investors. Depending upon market circumstances, the investment component of demand can vary substantially from year to year.
Acknowledgements²The article has been sourced from many publications and graphs are from gold tracking sites.