Steve GannWhat's So Great About Gold?
March 3rd 2010 05:23
One reason is that since 1971 the dollar is a stand alone currency backed only "by the full faith and credit of the US Government"
The problem? There is no limit to the amount of paper money that can be produced at the whim of the Fed not to mention that paper money is easily counterfeited.
Gold on the other hand is produced only by nature. Thousands of alchemists, who ended up poisoning themselves, can testify to that fact.
But is gold useful beyond the cosmetic look of jewelry? Yes, there are many uses for gold that many people don't realize.
1) The number one use is jewelry of course. Gold is nice to look at and doesn't tarnish easy. Mixed with other alloys it can last a lifetime. Gold has been used for this purpose for over 6,000 years.
2)Perhaps he most important industrial use of gold is in the manufacture of electronics. Solid state electronic devices use very low voltages and currents which are easily interrupted by corrosion or tarnish at the contact points. Gold is a highly efficient conductor that can carry these tiny currents and remain free of corrosion. Electronic components made with gold are highly reliable. Gold is used in connectors, switch and relay contacts, soldered joints, connecting wires and connection strips.
A small amount of gold is used in almost every sophisticated electronic device. This includes: cell phones, calculators, personal digital assistants, global positioning system units and other small electronic devices. Most large electronic appliances such as television sets also contain gold.
One challenge with the use of gold in very small quantities in very small devices is loss of the metal from society. Nearly one billion cell phones are produced each year and most of them contain about fifty cents worth of gold. Their average lifetime is under two years and very few are currently recycled. Although the amount of gold is small in each device, their enormous numbers translate into a lot of unrecycled gold
3)Gold is used in many places in the standard desktop or laptop computer. The rapid and accurate transmission of digital information through the computer and from one component to another requires an efficient and reliable conductor. Gold meets these requirements better than any other metal. The importance of high quality and reliable performance justifies the high cost.
Edge connectors used to mount microprocessor and memory chips onto the motherboard and the plug-and-socket connectors used to attach cables all contain gold. The gold in these components is generally electroplated onto other metals and alloyed with small amounts of nickel or cobalt to increase durability
4) Although porcelain fused with other alloy metals have replaced dental crowns, gold is still used in dentistry today.
5) Gold is also used for surgical equipment and as an injection to test for certain cancers and as a treatment for rheumatoid arthritis.
Other uses for gold include medals, in the space program for conductors in sub zero space, as a building gilding to fight corrosion, and as a stabilizer and color enhancer in glassmaking.
The future looks bright as more uses for gold are found every day. Is this a good time to get in the market? I have heard analysts predictions of 2,000 per ounce within two years. I'm no expert but I would rather own something useful as opposed to a piece of paper.
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