What Determines Gold Price?
Why is Gold so expensive? Why can’t we just dig up some more?
The value of gold will depend on its purity and its weight.
Purity is expressed in a couple of ways. In Jewellery it is stated in Carats (spelt Karats in North America) often abbreviated as ‘ct’, 24 carat being pure gold. Weight is usually given in grammes (g). The actual price per gram varies by the minute.
Base metal (usually copper) is added to the gold to make the metal harder, alter its colour or just to make it more affordable. 18 carat is 75% gold, 9 carat is 37.5% gold.
Gold Bullion, which is gold bought for pure investment purposes (such as gold bars and ingots) is usually rated zero to one, so pure gold is classified as above 0.999 (99.9% gold), 9 carat referred to as .375. Gold is often certified and may carry assay marks or Hallmarks.
Why not just dig some more?
Gold has long been a popular choice as an investment. Yet as a metal, gold is too soft for many applications; it is the most malleable metal known. Gold is a good electrical conductor; copper and silver are better and much cheaper, although gold is less prone to corrosion. Yet none of gold’s physical properties justify it’s extremely high cost.
What actually makes it so expensive and desirable?
It’s all to do with rarity. Gold is extremely rare. The total amount of gold mined in the entire history of mankind is less than 170,000 tonnes, about enough to only fill 3 Olympic sized swimming pools. Compare this to the mining of Iron (which is almost 850 million tonnes per year) and aluminium production (just over 30 million tonnes per year) then you can see gold is very scarce.
So gold is a rare, precious, much sought after commodity, as such it commands a high price. 50% of gold is used for jewellery, 40% in bullion (as coins and bars), the rest a variety of industrial and medical applications.
Centuries of Alchemists will vouch for the fact that gold cannot be created from base metal. Gold is a chemical element, atomic number 79 and has the symbol Au (after the Latin name aurum, which means ‘gold’). With the exception of the noble gases, gold is the least reactive element known.
And it’s not that people don’t try to mine more, or that they just look in the wrong place. It’s simply that there’s not a lot of gold on the planet, period. And it’s not exactly in abundance in the entire galaxy.
So where does gold come from? Gold is made when a star collapses and forms a supernova. This is such an exceptional event that in a Galaxy of 100 billion stars, the conditions for making gold only exist for less than one minute every century. So if you have some gold, it has come from a distant star that exploded many billions of years ago. It’s on this planet because that’s where the Earth was spit out from too.
To make matters worse, 99% of all the gold is trapped in the Earth’s core. If we could get all of this gold we could cover the entire Earth with a nice shiny coating about half a metre thick. But this is not going to happen and we get the odd piece of gold thrown out by volcanic action. Many times geologists find gold but it would cost more than it was worth to excavate and separate it from other elements. Even when the layers were richer and more accessible as in the Roman days, miners would need to dig several tons of material just to get one ounce of gold.
Here’s some Gold Items on eBay UK:
eBay USA
On eBay UK: | Gold Sovereign Deluxe Black Storage Cases Choose Design FULL HALF Sovereign £ 15.49 |
 | Royal Mint UK GOLD PROOF SOVEREIGN 1979 to 2025 - Choose your year £ 610.00 |
 | Gold Sovereign Best Value Gold Coin £ 594.27 |
 | 1967 Gold Full Sovereign - Brilliant Uncirculated Condition £ 570.00 |
 | 1917 King George V Full Gold Sovereign High Grade 22k £ 565.00 |
 | 1902 King Edward VII Gold Half Sovereign Coin £ 285.00 |
 | Sovereign 9ct Gold Lady's Watch on 9ct Gold Bracelet. £ 240.00 |
 | 1887 Full Gold Sovereign Queen Victoria Jubilee Head £ 570.00 |
 | George V 1911 Gold Sovereign Full Size Coin £ 700.00 |
 | 1887 Queen Victoria Sovereign, 22c Gold Plated, 8g £ 6.00 |
 | 1910 King Edward VII Full Gold Sovereign 22k Nice Grade £ 565.00 |
 | 2024 Gold Sovereign £ 594.70 |
 | Deluxe red velvet padded sovereign case for 10 full gold sovereign £ 9.99 |
 | 1913 Half Sovereign George V FREE SHIPPING Half Gold Sovereign 22ct £ 280.00 |
 | 2016 Uncirculated 22ct Full Gold Boxed Sovereign Coin £595 £ 595.00 |
 | Bullion Gold Half Sovereign Best Value £ 303.21 |
 | 2003 Royal Mint Queen Elizabeth II Half Sovereign Gold Coin £ 290.00 |
 | 1854 Gold Victoria Full Sovereign - Shield-back. £ 625.00 |
 | 2025 Gold Sovereign 'Last of the Rose Gold' £ 598.22 |
 | 1876 Gold Sovereign - Victoria Young Head - London Mint - Free Postage £ 580.00 |
 | quarter sovereign gold coin £ 190.00 |
 | 9ct gold Sovereign mens watch with 9ct gold bracelet -mint condition £ 985.00 |
![Gold Proof Coin Full Sovereign Royal Mint Uk 1979 To 2024 Choose Your Year [A]](https://i.ebayimg.com/thumbs/images/g/hHgAAOSwHHdl12sO/s-l140.jpg) | Gold Proof Coin Full Sovereign Royal Mint Uk 1979 To 2024 Choose Your Year [A] £ 605.00 |
 | FULL Gold Sovereign Queen Elizabeth 2012 Romanticized St George Dragon sealed £ 550.00 |
 | 2015 Gold Half Sovereign Coin Brilliant Uncirculated £ 325.00 |
 | Gold Sovereign 1894 - Victoria £ 630.00 |
 | 1847 Gold Victoria Full Sovereign - Shield-back. £ 625.00 |
 | Queen Victoria Coin Pack - Gold Sovereign £ 6.99 |
 | 1911 King George V Coronation Full Gold Sovereign 22k £ 565.00 |
 | Queen Elizabeth ii 1962 Full Gold Sovereign Gillick portrait minty unc £ 620.00 |
 | Gulf War Collection Full Gold Sovereign - Boxed Medal Set with COA + FREE SILVER £ 699.00 |
 | 1887M Full Gold Sovereign Queen Victoria Young Head - Melbourne Mint £ 570.00 |
 | 1846 Gold Victoria Full Sovereign - Shield-back - Scarce £ 635.00 |
 | 22ct Gold Victoria 1883 Full Sovereign £ 600.00 |
 | Queen Victoria - 1888M NGC Australia Gold Sovereign AU55 £ 595.00 |
 | 1980 Gold Proof Sovereign NGC Graded QEII - Great coin £ 585.00 |
 | 2025 Gold Half Sovereign - Last of the Rose Gold £ 308.75 |
 | 2004 Gold Half Sovereign Elizabeth £ 290.00 |
 | Vintage Sovereign 9ct gold watch. Ladies. £ 320.00 |
 | 1887 Queen Victoria Sovereign, 22c Gold Plated, Original Size, 8g... £ 5.50 |
