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Monday, December 9, 2013

Why do we love gold?

Since time immemorial, gold has fascinated Indians. Indians love gold for its investment value (considering the inherent store value and for being a great hedge against inflation/currency depreciation), its cultural significance, and its symbolic value in terms of its demonstrative effect in the society.

But the question is, why only gold and why not any other metal? An interesting article, published on the BBC Magazine website, attempts to answer this important question.
.... [T]hat leaves just two elements - silver and gold.
Both are scarce but not impossibly rare. Both also have a relatively low melting point, and are therefore easy to turn into coins, ingots or jewellery.
Silver tarnishes - it reacts with minute amounts of sulphur in the air. That's why we place particular value on gold.
It turns out then, that the reason gold is precious is precisely that it is so chemically uninteresting.
Gold's relative inertness means you can create an elaborate golden jaguar and be confident that 1,000 years later it can be found in a museum display case in central London, still in pristine condition.
So what does this process of elemental elimination tell us about what makes a good currency?
Read the complete piece here.

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