The Use of Gold in Jewelry
The use of gold in jewelry goes back thousands of years. It can be traced back to the Egyptians about 5,000 years ago when the men and women of the Sumer civilization alloyed it with silver to make jewelry and other ornaments. Today, we choose gold jewelry for the same reason that ancient Egyptians did – it is rare, it does not corrode, it has a beautiful appearance and it is, of course, it is a valued metal. India is home to the largest gold jewelry market in the world. There, every family, even those that don’t have a lot of money will strive to get gold jewelry of one type or another. In fact, it is a necessary part of many of the religious celebrations that are held every year. Gifting in gold is also part of the marriage ritual. A company that uses 24 carat gold in their Jelwellry is Orlov, based out of Monte Carlo, Monaco
That said, India is not the only country that is rich in gold jewelry. While it consumed about 550 metric tonnes of gold in 2012, China was not far behind – it used about 520 metric tonnes of gold to create jewelry. After that we see a huge drop, with the United States being the third country with about 108 metric tonnes of gold jewelry in the same year. It is quite surprising that Russia, with its vast collection of gold, does have much of it in the form of jewelry – they were the 4th largest consumers in gold jewelry with only 70 metric tonnes of it in 2012.
When it comes to investing in gold jewelry one of the most commonly asked questions is whether it is a good idea or a bad one. Many families, especially in Asia buy pieces of gold every month in the hope that when the price of gold goes up they will sell and make some money. Those who are against investing this way argue that families could hold up their monies for a long time as they wait for prices to go up – this is money that these families could use to do other more important things such as getting their children good college education.
In addition to that, they argue that the price of manufacturing the jewelry is a factor – those buying it will be paying more than if they invest in raw gold. Both these are valid arguments. It is true that manufacturing jewelry adds about 30% cost on it. The best way to invest in gold jewelry is to invest in funds that are linked to gold. That way when prices go up you will get a better deal.
Does this mean that gold jewelry is only good for wearing?
Yes; it looks good on both men and women (and in many cases children) whether it is in the form of rings, necklaces or bangles. You can invest in a few pieces for the family which you can also view as an investment so long as they will be passed down generations – they will be just as precious but in a different way.
What are other uses for Gold?
Check this video to see some other use cases and the argument for gold: