Loans on Jewelry

19
Mar

When we buy gold where does it come from?

Some of the most common questions that we get when we buy gold is “where does gold come from, why is gold expensive, and how do you calculate how much to pay for gold ?”

Most of the gold that we buy is usually in jewelry form, either rings, earrings, bracelets or necklaces.  Gold however, comes from the earth and needs to be mined before it can be made into jewelry.  It takes quite a lot of work, money and equipment to extract the gold from the ground, and added to the cost of labor to actually make the piece of jewelry and the cost can add up.

gold panning

Humans have been fashioning gold into jewelry for at least 7000 years.  Gold is a rare element in earth and very difficult to find and therefore is very valuable.  The price of gold fluctuates daily based on economic conditions and speculation.  When we buy gold we look to see what the daily spot price of gold is and make a fair offer based on that.  When we are buying gold that is made into jewelry, we also need to account for the purity of the gold.  You can read more about that here.  This gold needs to be refined and purified before it can be made into jewelry.

gold refining

Some countries use gold as a backing for their currency.  In fact the US used the gold standard for many years.  Many times these countries will commission their mint to strike coins in pure gold.  Some very well known examples of this are the US Eagle coins, the South African Krugerrand, and the Canadian Maple leaf.  This is known as bullion, and the coins don’t have value other than the gold weight of the coin.

gold coins

 

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