Nature’s gemstones are so compelling to observe we don’t always think about the precious metals used to hold the finely cut stones in place. But they too are created entirely by nature and unlike many gemstones, they are impossible to recreate in a lab. This is because gems are made up of lots of different elements, but precious metals are elements. Silver, platinum and, more recently, palladium are all popular metals to set jewels into, but none is more desired or famous than gold. It’s often said that all that glitters is not gold, but when it comes to the unique shine, shimmer and texture of gold, it is in a league of its own. Let's take a brief stroll through the history of this remarkable element.
Gold’s chemical symbol is Au, which is derived from its Latin name, Aurum. It is one of the oldest earliest metals to be used by humans, having been initially found in alluvial deposits. Alluvial mining is the sourcing of minerals and metals that have been deposited by forces of nature. This is why it can often be ‘panned for’ in stream beds, where erosion and water flow has deposited small pieces of the element. It can also be mined from rocks and underground veins in much the same way as many gemstones are mined. The deepest mine in the world is a gold mine. The Mponeng gold mine near Johannesburg in South Africa is over 4 kilometres (2.5 miles) deep from ground level, and the journey to the bottom takes over an hour. Gold mining can be traced back to 2,500BC when Egyptians mined it to use in their jewellery. Its malleability (ability to be worked without breaking or cracking) and ductility (ability to be drawn into a thin wire) make it perfect for use in jewellery.
Purity of Gold
Pure gold is known as 24 karat gold, which is 100% gold. These days, it tends to be sold as 23 karat gold in this form (99.9% gold) as it is almost impossible to remove every last imperfection from the metal. But this is rarely used in jewellery in this purity as it is too soft. It is therefore alloyed with other metals to give it more strength. You may be familiar with 9 karat gold, 10 karat gold, 14 karat gold and 18 karat gold, just four of the standards that gold is sold in around the world. Here’s how they break down.
- 9 karat gold = 37.5% purity
- 10 karat gold = 41.7% purity
- 14 karat gold = 58.5% purity
- 18 karat gold = 75% purity
The remainder of the alloy is often made up of other base and precious metals, such as copper, zinc, palladium and silver. Clever use of this process allows the final colour of the gold to be tweaked. For example, white gold is often achieved by adding more palladium to the alloy and rose gold is the result of adding more copper. It’s even possible to create green gold by adding lots of silver and copper. Very rarely, it is also possible to find these colours of gold in the wild, where Mother Nature has mixed the different metals herself. In the UK, gold purity is stamped onto jewellery pieces via a process known as hallmarking, which you can read much more about here.
Price and Value of Gold
Gold is traded in troy ounces, usually in the US dollar currency. Troy ounces weigh more than a standard ounce, with just 12 troy ounces equalling a pound. A troy ounce weighs a little over 31 grams, metrically speaking. When you see the price of gold being quoted, it will be the current price for one troy ounce of pure gold.
The story of the price of gold over Gemporia’s history is quite incredible. On the day we launched - October 8th 2004 - pure gold was around $415 per ounce. Fifteen years later, the price was around $1,000 per ounce higher, having risen particularly quickly between 2007 and 2011 during the global credit crunch. The all-time highest gold cost (at the time of writing) was reached in August 2011 when prices hit over $1,900 per ounce. On the day this is being written (July 23rd 2020) the price is creeping very close to breaking that all-time record, at around $1890 per ounce. This is no doubt a result of the global market uncertainty caused by the Covid-19 pandemic. In the 15 years before Gemporia launched (1989 to 2004), prices had remained remarkably stable at between $300 and $400 per ounce.
Gold has been called “possibly the world’s most stable currency”. Until fairly recently, the value of most currency systems was still based on the amount of gold in the vaults of each country. Because gold can always be melted and re-sold, gold jewellery will always retain an inherent value. Many people feel that gold is a good investment because when times are good, they can wear their beautiful jewellery, but when times are hard, gold prices are generally at their highest. Because gold physically exists, and because we cannot create any more than what is already on the planet, it retains a security in its value that electronic banking and more modern currency systems cannot. The more people that invest in gold, the less there is to buy, and the higher its value becomes.
A total of around 200,000 tonnes of gold is known to exist above ground, which would be around the size of a 21.5-metre cube if it was all collected together. It is believed that 98% of all the gold ever mined is still in circulation too, as gold can be recycled indefinitely. The reason why there is so little heritage jewellery that has survived the centuries is not that gold is not durable, because it is. It’s because very few pieces have survived the various depressions and recessions that have hit civilisation over many centuries. Many gold pieces are converted to cash by being melted down and sold as bullion (gold bars), many of which are eventually re-sold to jewellers and made back into jewellery.
Around half of all mined gold is used in the jewellery industry, with around 40% being held in investments and the remaining 10% being used in industry. The most significant industrial use is in electronic devices as the conductivity, and corrosion-resistant properties of gold make it ideal for use in circuit boards and connectors inside computers. Almost every electronic device in your home, including your mobile phone, will contain a trace amount of gold. It may seem like this should have put the price of electronics through the roof in the last 15 years, but you’d be amazed just how little an amount of gold is needed in each device. Just one gram (0.03 troy ounces) of gold can be beaten into a sheet of one square metre (3.3 x 3.3 feet), measuring only four-millionths of an inch thick. It can be made so thin it becomes transparent, and it can be used in this form to tint glass windows.
Could We Run Out of Gold?
Of course, it is a finite resource like everything, although there is no way of knowing how much more gold still lies underground and what percentage of it is already mined. But there could come a time where the only gold we have is second hand, and if the current investment trend continues - which in turn raises the price - gold could become one of the most challenging and most expensive materials to get hold of on the planet. Interestingly, some scientists believe that the gold we find close to the surface may have been brought to Earth on comets, whereas the gold that has always been on Earth sank to its core while the planet was still forming, far beyond our reach. NASA geologists are also starting to believe that there may be precious metals, including gold, under the surface of the moon. Only time will tell.
There’s no doubt that gold is already one of the most precious and sought after of metals. What better way to own gold than as beautiful pieces of jewellery set with gorgeous gemstones? Follow the link below to find your next gold jewellery piece.
BROWSE GEMPORIA GOLD JEWELLERY