subject: The Best Gold Prices Explained How Gold Value Is Calculated By The Industry [print this page] The value of gold is almost entirely linked to the concept of desirability. This is because all the gold that will ever be already exists "" so there are no issues with supply beyond that of hauling gold out of mines. The material will always be seen as comparatively rare "" there are estimated to be a mere 158,000 tonnes of gold in existence on the surface of the earth, with more to be discovered beneath the planet"s surface. This means that the sum total of all the gold ever mined in human history could be piled up in a cube measuring just over 20 metres along each edge.
As a result, gold"s perceived value is very high "" and for this reason the best gold prices are always high ones. The highest prices of all are commanded by what are referred to as "wholesale" amounts of gold. In reality, wholesale gold quantities are prohibitively expensive; so the price actually paid for gold by an investor is slightly higher per ounce than the price he or she would have paid if it had been possible to buy an unrealistic quantity of the metal in one go.
At the recycling end of the spectrum, where scrap gold is sold for cash, the best gold prices are significantly less than those command by the investors ingot. This is a function of the same value calculations as outlined above. In tiny quantities, gold is seen to be less valuable than it would be if the exact same purity were held in large quantities. Again, this is a derivative of its perceived rarity.
The actual rarity of gold is large the perception of its rarity is enhanced by the actions of the IMF (International Monetary Fund) and some of the major world banks. These institutions restrict the sale and movement of gold, a fact that bolsters the perceived value of the metal and so makes it alluring to investors who wish to make safer bets in the wake of the financial disasters of the last five years.
The best gold prices on the investment market were, until around the time of the crash, thought to be staid in comparison to potential yields from shares and speculation. At the moment, though, the basic property of a gold investment that it holds value while the value of currency may go down around it ensures that investors view the metal as a solid property. Their newfound respect for gold has led to a situation whereby gold dealers and scrap gold merchants are able to facilitate the creation of new ingots and bullion coins by buying the metal in scraps from private owners normally in the form of jewellery pieces.
The best gold prices offered by these scrap gold merchants are, as noted, significantly less than the massed value of the gold they collect. They may, though, be analogous to the prices offered by more traditional outlets such as pawn shops. Plus, the real value of a small gold item to someone who may need to raise money quickly is just as tied in with his or her current need as with its actual weight price.
