Harald Seiz: The value of gold over the centuries

STUTTGART, Germany - Aug. 18, 2016 - PRLog -- Gold and Inflation

A common myth is that gold has held a steady value over time. In actuality, gold prices have actually been fairly volatile throughout history. While an ounce of gold seldom dipped below a value of $600, (when adjusted for inflation) it often was worth substantially more.

One reason for inflation in gold prices is gold's scarcity. In the course of human history, only around 171,000 tons of gold have been mined; in contrast, millions of pounds of iron ore are still mined each year. Consequently, as economies shrink and expand, they are still chasing a small and relatively static supply of gold.

Gold Over the Centuries

The Greeks and Romans

The Greeks and Romans had higher gold values than we do today. Its scarcity during these historical periods led to gold prices nearly 13 times higher than today's prices. There were many factors that caused gold to fluctuate during ancient times, including wars, rising wages, as well as exploration and trading with other cultures.

Around this time, coins were also established as the primary method of currency, but the weight, as well as the metal content of the coins, fluctuated under different emperors. Augustus tried to set up Rome's first "gold standard" in 30 BC, but Nero changes the weight and composition of the denarius (the Roman coin) less than a century later.

The Middle Ages

Inflation continued its erratic path after the Greeks and Romans. During this period, rulers would deflate gold-based currencies to fund wars and exploration. Large amounts of depopulation resulting from famine and war also had massive deflationary effects during this time period.

Modern Times

Despite the chaos wrought by the two World Wars, gold prices remained stable in the early 20th century. The value of an ounce of gold only shifted by about fifteen dollars between 1910 to 1940.

However, in the late '60s, the price of gold began to fluctuate more rapidly, due to a system that allowed gold to fluctuate among private traders, but remain at a fixed value in banks. Prices increased heavily into the '70s, stabilized in the '80s and '90s, and recently reached an all-time peak in 2012.

About the Author:

Harald Seiz is the founder and CEO of Karatbars International GmbH and in his senior position is committed to the national and global expansion of the company.

Harald Seiz has been working independently in the financial sector since the early 1980s. After completing his apprenticeship in the insurance and property industry, Harald Seiz worked with several companies as an independent adviser. Even at this time, Mr. Seiz laid the foundation for successful entrepreneurship. In the mid-1990s his company recorded revenue of more than EUR 60 million. Since 2011 he has led and coordinated Karatbars International in terms of his customers completely in line with his credo: secure people's future through capital-formation.

Mr. Harald Seiz lives and works in Stuttgart and regularly takes part as a speaker at high-quality national and international industry events. http://www.harald-seiz.de and https://karatbars.com