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What’s Happening With Gold in 2018?

Is gold still a good investment in modern times? Does it still hold the monetary value it once did? And what, truly, is the purpose of the bright metal that people have fought wars over, anyway? These and other questions about gold investments mean that people are interested in what is happening with gold in 2018. Here are some highlights to this point in the year.

Interest in gold trading is high.

Gold has a stable “floor.” That means that the lower value of gold has been pretty high. The precious metal has seen a high of $1,350 an ounce a couple of times recently and has remained pretty stable at $1,200 to $1,250 an ounce since the last highs in September. It’s highly likely that the upper prices will continue to climb.

Demand for gold is strong globally. In India, the second biggest gold market in the world (behind China), gold surged an astonishing 67% in 2017. Demand for gold bars in China in November was up 40% in just one year. Both of these stats indicate that there is a strong momentum for gold.

From all indicators, gold should have fallen in 2017. It didn’t. What may seem strange is that the value of the dollar is inversely correlated to gold, so as the dollar’s value continues to disintegrate, the cost of gold goes up. Investors are noticing elevated risks in currencies and are looking to gold because it is a stable commodity. As the economy fluctuates, gold becomes a more attractive investment.

Even this early in the year, gold has an appreciable 11.3% gain already. In 2016, gold was up 8.1% and made a great jump to 12.1% in 2017. The market is poised to see even greater gains in 2018.

So what are trends in gold jewelry for 2018?

Gold continues to be the most popular metal for jewelry, even with other options like silver, platinum, and titanium readily available. Some of the most popular trends include big hoop earrings, big cuff bracelets, and styles that include flowers. Of course, engagement and wedding bands are most frequently made in gold, whether yellow, white, or rose.

14k Gold Hoop Earrings

14k gold hoop earrings

Our 2-⅜” Diameter, 14k  Gold Hoop Earrings are a great example of the direction that gold jewelry is trending. These are a beautiful accompaniment to your style, whether dressing up or down. They easily transition from the workplace to a night on the town and keep the wearer fashion-forward.

white gold cuff bracelet

Our White Gold Cuff Bracelet makes a statement with its elegant, smooth simplicity and its plain, polished finish. It’s also available in yellow gold and in a contemporary hammered style as well.

vintage flower signet ring in white gold

vintage flower signet ring in white gold

This Vintage Flower Signet Ring in 14k White Gold features a pair of expertly carved flowers on the sides. The nature-themed design continues around the band, and the face is a smooth canvas for an initial or two.

But what is gold actually for?

In a few words, here’s a brief history of gold. Ancient Egypt was where the history of gold usage actually began, and what they used it for was making jewelry. That was in 3,000 BC, but not until about 560 BC did it become a standard of currency. Merchants were looking for a standardized way to simplify trading, so the stamped gold coin was invented. From that beginning, gold gained significance throughout the world. In 1066, Great Britain determined the value of their money based on the amount of gold or silver it represented. Eventually, the whole world began setting the value of their money based on a gold or silver standard. In 1792, the United States decided to base the value of its currency by a bimetallic standard, which simply means that all money had to be backed by either gold or silver.

But the gold standard did not endure. In 1930, Congress established the Federal Reserve, which began issuing promissory notes (precursors to our modern paper money). Finally, in 1971, the US ceased to back its currency with gold. Today, no country uses a gold standard to place value on its money. In fact, it is the US dollar that sets the value for other countries’ currency. However, with the dollar’s value constantly weakening, President Trump is considering a return to the gold standard. Time will tell if that will happen.

So what is gold good for, if not to back our money? In our modern age, gold still is important in the global economy. Gold has effectually preserved wealth for generations upon generations. As the value of paper money falls, gold not only maintains its market price, but has continued to rise. So if you had $100 in 1970 and converted it to gold (at $35 an ounce), today you would have vastly increased its value. However, had you held onto that $100 in paper money, its value would have decreased significantly.

Gold is a hedge against inflation. As we’ve already said, although the value of paper currencies is declining, gold holds its value. It is true that gold sometimes fluctuates in the short run, but over time, its value continues to increase.

Other uses for gold.

Gold has many uses besides backing currencies. One extremely important use for gold is in space technology. NASA uses gold in their space shuttles and satellites. Temperature stabilization and infrared radiation reflection is achieved with gold, and it is also utilized in circuitry both as a conductor and also as a connector.

One perhaps surprising use of gold is in the making of glass. For some of the same reasons that NASA uses gold, when added to glass not only does it result in a beautiful color, but it helps regulate temperature in buildings.

The only mineral that can be flattened to thousandths of an inch, gold is pressed into thin sheets called gold leaf. Applied to picture frames, furniture, and moulding, it produces gilded pieces that are highly sought after.

Royalty continues to make crowns of gold, and trophies and awards are also fashioned of gold. “The gold standard” refers to the highest quality.

About 80% of mined and recycled gold is used to make jewelry. Gold as jewelry, as we indicated above, is more than 5,000 years old. The largest single demand for gold comes from the desire for beautiful jewelry. In fact, this demand is approximately 43% of the total.

The bottom line.

Gold continues to be a great investment, and gold jewelry is not only a smart way to invest in gold, but garners attention and appreciation wherever and whenever it is worn. You’ll pay more per ounce because of the art that is included in each design, but you also have the wonderful benefit of owning something that takes your breath away.

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