The Price of Gold

On February 5th, 2009, the United States dollar price for one ounce of gold was $904.20. If you go back 10 years, one ounce of gold was priced at $252.00. Gold may increase its value or it may decrease, but most likely, gold will be more expensive in the near future. The cost of gold could increase as our currency is being deflated, or when we begin to experience more inflation or super-inflation. Some people believe that gold is an insurance against economic uncertainty, and gold's value is not dependent on other economic conditions.

There are various ways to buy gold. You can purchase gold coins, bullions, jewelry, stocks, or interests in a gold mine. If you have gold coins or jewelry, the gold in these products are mixed with alloys, such as copper, because gold is a soft metal and too delicate for ordinary use without being fortified with stronger metals. The content of the gold in coins or jewelry is measured in carats (K). Pure gold would be regarded are 24K. Jewelry, coins, or other gold products are usually labeled with the amount of gold in it. Common purity values are 18K, 14K, and 10K. This allows them to retain the look of gold, but be strong enough to hold up to everyday use.

While the price of gold and any gold item is determined on the open market, there is a system known as Gold Fixing which assigns a daily value for gold. Started in London in 1919, five member companies of the London Bullion Market Association set the daily going rate.