One of the earliest and most valued metals known to man, gold for centuries has been sought after and held, especially during problematic economic times like those we face right now. Today some 90 percent of the world’s gold is found in only four countries: South Africa, the former Soviet Union, the United States, and Canada. South Africa has dominated world gold production for many years and accounts for about 50 percent of the total world supply. The former Soviet Union comes in second and accounts for 32 percent. The United States follows with 6 percent, and Canada provides 3 percent of the world’s new gold ore. The rest of the world combined produces about 9 percent of the new gold ore.
The total yield, however, has been incredibly small. Unlike other such commodities, because of hoarding and stockpiling, each year’s production is a very small part of the available supply. An estimated two-thirds of all the gold on earth has already been mined. Only about 88,000 tons have been extracted from the earth in all of recorded history. It is this scarcity, along with gold’s beauty, durability, and compactness that has made it the ideal standard in precious metal value and utility.
Worldwide liquidity is perhaps the most amazing feature of gold and helps to account for its stability as the standard against which other metals and currencies are often measured. Although its value may fluctuate, history proves its buying power. Gold has been the most coveted metal in the world and the single most trusted international medium of exchange for thousands of years. Trade between countries frequently is based on gold’s value, and as we have already observed it is the world’s most reliable medium of exchange and support for paper currency. While paper currencies have been devalued, eroded by inflation, and become virtually worthless, gold has maintained its purchasing power. During tough economic times, people have turned to gold for both profit and protection.