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Gold: The Useful Useless Rock

Updated on June 30, 2016
Michael Tu profile image

I am a hs student who is very interested in a variety of things. These things can be random, so you'll some of my content scattered around.

Another Video from CrashCourse about Money$$$

Gold is a rather ordinary element on the periodic table. But it is 'lucky' in the sense that it fulfills all the requirements necessary for an effective currency, accounting for its value in today's Society.
Gold is a rather ordinary element on the periodic table. But it is 'lucky' in the sense that it fulfills all the requirements necessary for an effective currency, accounting for its value in today's Society.
William McKinley's extremely popular campaign promise was to bring back the gold standard, and while it was opposed by economists and bankers, the people loved him and they loved gold.
William McKinley's extremely popular campaign promise was to bring back the gold standard, and while it was opposed by economists and bankers, the people loved him and they loved gold.
King Midas was a major figure in Greek Mythology, a king whose wish for wealth and lust for power eventually gave him the powers of transmutation. This eventually leads to him turning his own daughter to gold. The story teaches humility.
King Midas was a major figure in Greek Mythology, a king whose wish for wealth and lust for power eventually gave him the powers of transmutation. This eventually leads to him turning his own daughter to gold. The story teaches humility.
The Al Askari Mosque is one of the most important Shi'ite mosques in the world today. Located in Iraq it has become a center of tensions become Sunni and Shi'ite Muslims and was bombed in 2006 and 2007.
The Al Askari Mosque is one of the most important Shi'ite mosques in the world today. Located in Iraq it has become a center of tensions become Sunni and Shi'ite Muslims and was bombed in 2006 and 2007.

The Useful Useless Rock

Gold is a naturally occurring element. I'm sure we've all heard of it, but perhaps not all of us have seen it in person. It can go for more than 1,000$ per ounce today and put into jewelry it gains value. But why is gold 1,000$ per ounce anyway?

Well, usually a thing of value is a thing that lets you live life or lets you live a better life. Look at the most expensive things you own. For a normal person, it would probably be their house or apartment, their car, and their computer or laptop. Now all of these things have basic value, you need a house to live properly, you need a car to get to your job (usually) to make money as well as a slew of other reasons and a laptop helps you with work or leisure. But what does gold do?

Well, let's see... You can't eat gold, well I guess you can sorta... You can't drink or live in gold and it doesn't really help with your job or transportation. The only things we can really do with gold are looking at it and making jewelry with it.

So it is good to look at, who cares? You ask, well, the 5 million citizens of the Byzantine empire might have had something to say about that. Let's take some time for a short history lesson.

The world was at the point where it had many people and nation states that made it so they had more than enough food to feed themselves and people took on more specialized jobs. This made the barter system of economy very, very hard. In Ancient times, I could've exchanged ten pounds of this fish I caught for ten pounds of the wheat you harvested. However in the new world, where jobs were more specialized if I made clothes who didn't need protection and you were a bodyguard who didn't need cloths we couldn't really do business with one another.

This is where currency came into play. Currency is a thing that has been agreed upon ahead of time to have value for other things. The earliest forms of currency were things that had widespread value, like spearheads or a commodity that preserved its value like wine. But only a certain amount of spearheads could be used and made, and only a certain amount of wine could be pressed, so the vast deposits of gold mined for jewelry were opened up for currency. The citizens were conditioned to value gold as a thing that could buy them other things and that they could sell their things for. Now you may be asking: "why gold? You said before that it had no value, so why did they choose it for currency?"

Think about it, in their pure forms, most of the elements on the periodic table are too cumbersome or dangerous to use without the advent of modern technology. We don't value gasses too much since we can't see them, the alkali metals just explode, many of the lanthanides and other more 'modern' elements are radioactive or too hard to find, which leaves the familiar transition metals. Metals like tungsten and titanium, although strong aren't very practical to be smelted down, requiring extremely high temperatures, while metals like iron and nickel were too dull in appearance and rather used for more practical things.

That pretty much just leaves gold and silver as options for value. Silver is too common, so gold took over as a symbol of status and currency. Gold had just the right qualities for being a currency, there was a steady rate of "inflation" with gold being mined almost everywhere and it was a solid use of collateral since gold had such a widespread aesthetic appeal to be used in valuable jewelry.

Gold became so common as a symbol of wealth that it also became synonymous with power and religion as well. The Catholic church adopted large amounts of gold artifacts and ritual talismans into their ceremonies and gold adorned their churches and cathedrals. Islam similarly adorned its mosques with gold and it became one of their principal colors along with green. Gold became the color and metal of gods, kings, and legends.

Gold has been used up until very recently as a global standard of currency. Although the more recent systems that included gold phased gold out of actual circulation, being able to exchange banknotes (paper money) for gold coins is a testament to gold's resilience as a world currency and something that has value for just being what it is. And although not the most economically sound system of value for modern economies, gold's symbolism of wealth and power made it extremely popular with people. (William McKinley won the presidency with the promise to bring back the gold standard.)

Gold' use as a currency and as jewelry over time cemented it as one of the most important metals in the world. So now that you know why and how gold came to be what it is today, we can begin to look at what effect it has had on society.

One of my favorite songs that mentions gold: have a listen

Cheers to Gold!

This limited edition beer mug sold by Japanese company Ginza Tanaka goes for a cool 50,000, a bit of a waste considering the most expensive beer is an extremely rare Cantillon Loerik 1998 that goes for a measly 2,500.
This limited edition beer mug sold by Japanese company Ginza Tanaka goes for a cool 50,000, a bit of a waste considering the most expensive beer is an extremely rare Cantillon Loerik 1998 that goes for a measly 2,500.
This watch sells for 600,000, does it let you time travel? No. does it offer telepathic connection with other rich people? No. Does it make you look filthy rich and proud of it? Yes.
This watch sells for 600,000, does it let you time travel? No. does it offer telepathic connection with other rich people? No. Does it make you look filthy rich and proud of it? Yes.
Warren Buffett started the Buffett foundation with much of his hard earned money. He donated another 2.5 billion when his wife passed away and renamed it for her. A true kind man of charity.
Warren Buffett started the Buffett foundation with much of his hard earned money. He donated another 2.5 billion when his wife passed away and renamed it for her. A true kind man of charity.
Similarly, Bill and Melinda Gates are a good example of riches goes to good use as the Bill and Melinda foundation do a lot of good for the world.
Similarly, Bill and Melinda Gates are a good example of riches goes to good use as the Bill and Melinda foundation do a lot of good for the world.

Modern Day Implications

Gold is still a modern day cultural icon. The Street Rapper's gold chain is the new generation's way of flaunting your money. In the beautifully poetic words of Complex magazine

"get a nice car, but it'll be outdated in a year. Invest in a chain and you'll floss your stacks for waaaayyyy longer"

As you can see, we still value gold for much of the same reasons, for its long term appreciating value and its refusal to be a fashion trend of the past. It's still an item of jewelry, and it's still one of the most important status and wealth symbols in the world, no matter how you say it, gold is still king.

You can put gold on pretty much anything and sell for a couple grand to a cool million more. Take a look at the Apple Watch Edition for example. While by itself the Apple Watch may be a little overprices, while having some good features that have value as we talked about it before, the Apple Watch Edition has a ridiculous 10,000-17,000$ price tag with no improvements to the original and PEOPLE STILL BUY IT.

But, the very fact that people can buy an Apple Watch is no surprise. There are inevitably going to be Rockefellers and Carnegies of our era, and I respect their ability to make amazing amounts of money. In fact, the Apple watch isn't even bad compared to some of the items on this website. I mean a timepiece that is just as good as ,if not worse than a Rolex that costs 550,000$ more just for it being gold is madness.

I talked about how there would be Rockefellers and Carnegies of our era, and there are, Warren Buffet and Bill Gates come to mind immediately, because they not only are rich af plutocrats, but they spend tremendous sums on things that matter, like charity and disease control and education.

Gold, while being important to the world economy as a strong future index and safe investment, has had detrimental effects on society's outlook on wealth. They have changed the end goal of being wealthy from giving back to society and opening up avenues (in real life) for education and advancement to just being able to show people that you are wealthy and have 'beaten them' in the game of life. This has promoted a culture of materialism and self-absorbed shallowness that shuns those who aren't rich or powerful enough to keep up.

Well before I end it off, I'd like to go off on a bit of a rant and say something to the people who do the aforementioned things and recklessly spend (I doubt they'd be reading this however) because they know of no other way of spending your fortune. You have not won the game of life because you will always lose to the Warren Buffets and Bill Gates. They are richer in money and in heart than you will ever be.


© 2016 Michael Tu

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      Howard Schneider 13 months ago from Parsippany, New Jersey

      You have very accurately hit the nail on the head with the subject of value with gold. It really does not have much use to us except for the ascetic, mostly with jewelry. But its history has made it a mystic force in our financial markets. Great Hub, Michael.