why are precious metals the backing of the worlds entire economic system and what makes them precious?
468237
The value of precious metals, as well as gems, are based on their rarity. It may seem like there is a lot of gold all around us, but the amount of gold available on the earth is finite. Other metals, like platinum or even rarer. Gold has always been precious because it does not tarnish or rust. \n  The world's economic system no longer relies on just precious metals. If it were, it would be a disaster. During WWII, dollars were issued not on what they were actually worth in gold, but what the were promised to be worth... and we know how governmental promises work. Then other governments issued their money based on what our money was worth... pretty soon all money was going to be worthless.  Now each country's economic system is based on all its assets, including industry and natural resources. That is why money values fluctuate so much every day.
516115
Robert Kiyosaki says it's because the dollar has lost so much value.  The only thing worth anything is real estate and commodities like gold, oil, etc.\n\nI read an article that it has something to do with the chinese super-rich buying up a lot of gold things.\n\nAnd then, there's always the popular stuff about it being the safest place to hedge against global turmoil.  So, maybe people are afraid of civilization collapsing soon.
160870
Common Sense Answers:\n1. Money controls the World. It practically owns it.\n2. An ambitious, capitalist society that understands that its survival depends on its people understanding how things work--most importantly, money\n3. To become aware that our position in society is all about our bank accounts; the circle of life isn't birds and bees, its producers and consumers. We study it to get ahead in life because the more we know about something, the greater control we have over it.
535520
Why does this question keep coming up?\n\nCurrencies have different values because economies have different sizes. The U.S. economy is millions of times the size of that say of Namibia. So the U.S. dollar, backed by prosperity of an industrialized super power has much more value then the currency of a small, impoverished nation with few resources, no industry and little if any fiscal policy.\n\nThe actual value of each currency against others is set my market forces. Supply and demand. Who wants to buy more of what. But the actual buying power of a currency has to do with its stability, the financial strength of the nation that issues it and its worldwide demand.
879661
The gold and diamond bearing Earth of Africa influences trade also its Northern fruitful savanahs are a reason its great population of animals and beasts also attract zoos. A bounty for smugglers and hunters is Africa. It is also rich in oil, herbal medicines snd vegetation. Logging also occurs there
1102521
Absolutely not.  If the government confiscated every ounce of gold in the entire world, gold would be worth $5000 an ounce.  No government today can say that its currency is backed by any such standard, nor has our government been capable of doing so for at least 60 years.
710554
They are both commodities which do not directly affect each other.  Although, if the price of crude grows to a high dollar amount, it may stunt growth and slow spending in the market there by lowering stock prices (making gold a more attractive investment option).  Same goes for if oil drops, the economy will most likely prosper and gold won't be as attractive (i.e. the 90's).
662445
The best way to own a precious metal is through a diversified metals fund, like the Franklin Gold & Precious Metals Fund or the Evergreen Precious Metals Fund. Another way is through a diversifed commodity fund, like the DWS Scudder Commodity Security Fund.\n\nAs for buying the bullion itself, good luck, you will never find a dealer that will give you it's true worth when it's time to sell, and anyway, why would near 30-year highs be a buying signal to you anyway?  Are you insane?\n\nBetter to buy a diversifed series of properly asset allocated high-quality, low expense mutual funds. That's how you should be investing, not jumping on some hot fad like metals.  Gold and other precious metals should only ever make up 5-10% of your overall portfolio, depending on your risk tolerance.  They are a good diversifer and an inflation hedge, not a way to get rich quick.\n\nHope this helps!
1025240
The interesting thing about the global economy is that pertains to the entire world and all of its countries. The global economy must be healthy in order for nations to prosper economically, also, the economy can't exist without money - thus we must have enough fair trade to let less wealthy nations get involved in exportation. The idea of fair trade is definitely one of the most essential issues when discussing the global economy because of the monopolization that certain countries having on certain items, this only pushes the less wealthy countries to the side and lessens the chances of their possibly prosperity. The global economy should be fair. Fair for everyone in order to get a bunch of money. That's what life is all about, getting money. MONEY=HAPPINESS.
18351
No -- most countries do not have a gold standard.  Currencies are mostly valued based on the amount a country exports -- and also comparing this to the amount that a country imports.\n\nSuppose that Japan suddenly created a new high-demand export.  Say, personal flying cars.  Then, people would want to buy those flying cars, and to do so, they would need Yen.  So all the american importers with dollar and european importers with euroes would go to the currency market to exchange their currency for yen so they could import the flying cars to sell in their own countries.  And the people selling Yen would see a great demand for their limited supply, and they would sell the yen to the highest bidder.  This would make the Yen cost more in terms of dollars or euroes, which is good for the yen's valuation (and all this had nothing to do with gold).\n\nLikewise, if Japan suddently wanted to importa a lot of stuff, they'd have to exchange their Yen for other currencies, and this desire to "sell" yen would cause Yen to lose value.\n\nSo overall, the more a country produces that other countries want to buy, the higher its currency is valued.  The more a country wants to buy stuff from other countries, the lower its currency is valued.
425123
They do indeed contain valuable minerals, some much more valuable than gold.  To set up any kind of large-scale mining operation would cost trillions of dollars using modern technologies, though.  So I don't think it would be worth the cost.  In 100 years, we may very well have off-world mining operations, depending on what technologies develop.
353633
No.  Gold is a good investment and considered a hedge against inflation.  Right now, gold, silver, oil, copper, and other precious metals are all hitting new multiyear highs.  Seems that demand has overtaken supply on the global scale.  Next couple of years look good for all the metals.  Then of course, corporate America and others like the Germans and Chinese will overbuild new mines and the world ecomony will slow its growth and prices will retreat again.  Its the old supply and demand story but to answer your question right now it looks like a good investment.
579819
Material things are of no importance to me...but the world does not agree.\n\nI would trade all of my material things for eternal love and happiness...but you can't buy those things, and in today's society, the availability sux, so it is very hard to find, most has already been grabbed up.
288858
Gold started out as valuable in ancient days because it made durable, pretty looking jewelry.  Because it was rare, kings and rich people used gold jewelry, etc as a status symbol.  People then found it made a good money for expensive purchases. You can easily carry gold coins around, and the cost is easily calculated by weight.  Once it became money, even more people wanted it, pushing its value up even more.  \n\nNow that we are off the gold standard, gold still holds its allure as a rare substance, due to its history.  Also, gold has a clear value per ounce and is easily exchangeable.  When you buy many other rare things like diamonds, its hard to know exactly what they're worth.  You have to be an expert in the field to evaluate them.\n\nHowever, over the long run, gold is a very volatile investment, and there's no guarantee it will go up in the future.  It is now selling for less than it was in 1980.
15523
The higher the number the more gold, percentage wise\n\nGold is a precious metal that has been valued by people since ancient times. People use gold for coins, jewelry, ornaments, and many industrial purposes. Until recently, gold reserves formed the basis of world monetary systems. \n\nGold is a very soft metal when it is pure (24 Kt. is pure gold). Gold is the most malleable (hammerable) and ductile (able to be made into wire) metal. Gold is usually alloyed (mixed with other metals, often silver and copper) to make it less expensive and harder. The scientific abbreviation of gold is Au. \n\nThe purity of gold jewelry is measured in karats. Some countries hallmark gold with a three-digit number that indicates the parts per thousand of gold. In this system, "750" means 750/1000 gold (equal to 18K); "500" means 500/1000 gold (equal to 12K).\n\nTherefore 14K is better.
694901
As one of my finance professors so clearly stated it... "In God We Trust".  It is on every piece of paper and coin in the US.  There is no backing or "gold standard" of the almighty dollar anymore.  It is really just a highly accepted form of trade for a common tool for bartering.
864657
Gold  = MONEY $$$$$$\n\nEveryone is VERY fond of money. \nSo I don't think that there's a huge difference about which parts of the world would like it more or less.