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<p>[QUOTE=&quot;Cloudsweeper99, post: 1183364, member: 3011&quot;]There are a variety of factors.&nbsp; For many of the uses in the link, gold has no close substitute that performs at the same level. It costs more to produce an ounce of gold than a sheet of paper.&nbsp; It is highly preferred as jewelry compared to, say, zinc or iron.&nbsp; It doesn&#039;t rust or corrode.&nbsp; I think you are way underestimating gold as a means to store wealth.&nbsp; History has demonstrated that there are few really good ways to do this [and fewer all the time].&nbsp; In the end, the price is set by supply and demand.&nbsp; The total cost to explore, find, raise capital for infrustructure, mine, and refine gold is significant -- probably on the order of $1000+ per ounce [it is very energy intensive] and probably won&#039;t sell below the cost of production for long under almost any circumstances.&nbsp; If the folks who own gold could not see any value premium to, say, copper or aluminium then they would dump it for much less.&nbsp; If folks looking for a metal investment didn&#039;t think gold was superior in any way to, say, steel then they would just have a few tons delivered and kept in their garage.&nbsp; But gold is inert, dense, soft, relatively rare, a good conductor of electricity, beautiful, can be drawn into thin wire or hammered into incredibly thin sheets.&nbsp; It&#039;s a very special material and therefore commands a premium price that makes it a good store of value.</p><p><br /></p><p>I find it amusing that some threads at CoinTalk claim that there is very little gold in the world, so it is not suitable as money.&nbsp; Others claim there is so much gold in the world, it isn&#039;t rare enough to be valuable.&nbsp; </p><p><br /></p><p>In the end, it boils down to comfort.&nbsp; If you believe you understand and like gold, you may want to own it.&nbsp; If you don&#039;t understand or like it, or think it is overpriced, it is probably not a suitable holding.[/QUOTE]</p><p><br /></p>

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