History of Gold

Gold investing is critical for serious investors because it is one of the oldest types of investments. Further, it has steadily outperformed most other investments over the past 10 years. According to the Northwest Territorial Mint, "From gold's first discovery, it has symbolized wealth and guaranteed power. Gold has caused obsession in men and nations, destroyed some cultures..." and given power to others.

According to the National Mining Association, an Eastern European group used gold in 4000 BC as a decoration. Between 560 and 547 BC, King Croesus of Lydia was the first to use pure gold coins in what is now Turkey, but gold coinage goes back to the Egyptians in 2000 BC. Gold has been found in the tombs of ancient Egyptian leaders. It was also used in Ancient Rome as money.

The Chavin, who lived in what is now Peru during 900 - 200 BC, pounded their gold into sheets.

In 1511 AD, King Ferdinand of Spain told his explorers, "Get gold, humanely if you can, but at all hazards, get gold." In 1531, European conquistador Francisco Pizarro invaded Peru. He captured and held for ransom Atahualpa, head of the Incas. The Incas reportedly paid 8 tons of gold, but Pizarro had Atahualpa executed anyway.

In 1792, the American Founders fixed the value of the dollar at 0.051 ounce of gold. It stayed at that value until 1837, when it was revalued to $20.67 for one ounce of gold.

Franklin D. Roosevelt seized private gold in 1933 and made it illegal to own. Roosevelt set the price of gold at $35 an ounce in 1934, and it stayed there until 1971.

On January 1, 1975, it became legal for Americans to buy and own gold once more, a change from the previous 42 years. It hit a 20th century high at $850 an ounce on January 21, 1980, and today it is six and a half times what it was worth in 1975.

24-karat gold broke US$1200 per ounce on December 2, 2009, a record high. At the time of this writing, gold was at $1136 an ounce. It has risen over four times in value in the last ten years.

Anytime there is a gold rush, gold becomes a wildly popular investment of time and small amounts of money. In 1690, gold was discovered in the region Ouro Prêto of Brazil and a gold rush ensued. Some 400,000 Portuguese raced to the area. In the 19th Century, there were big gold rushes in the U.S., Australia, South Africa, Brazil, and Canada.