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Gold Is Valuable Due to “Extreme Rarity” – Must See CNN Video

- Gold's value is due to exceptional rarity: Only 0.00000002% of earth's crust is gold
- Gold's allure and psychology behind it are steeped in history and human psychology

- Gold's colour and texture appeals to basic human survival instincts
- Gold's sheen resembles water and "humans need water in order to survive" 

- Gold remains a sign of wealth but today is also a sign of prudence

Editor Mark O'Byrne

 
Source: Colorscope via CNN

Why do we love gold?

There are so many given reasons. From its presence throughout history, to its role as money, to its status as a symbol of wealth. But what is the psychology behind the human race's ever-present love for gold? How did it begin, why has it survived for so long?

CNN's Colourscope series has recently addressed this question in 'The psychology of gold and why it has that allure' video which is well worth a watch.

Who would have thought that the material we seek to gift to our love ones, store in vaults or even use in medical products first grabbed our attention because of its texture glistening like water? Or, that at its most basic level of attraction we are motivated by its colour?

The following article covers these points and more as it takes us through gold's psychological impact on humanity, throughout history.

The article is of interest even to those who are familiar with the economic reasons as to why we invest in gold and hold it in such high financial regard. Most interestingly, our love for gold comes down to a very basic fact: the colour and its role as a material are intertwined.

You can read the article below and watch the accompanying video here.

When you think of the color gold, images of grandeur and extravagance are likely to come to mind.
 
For millennia, the metal has adorned crowns and hilts of swords. It has been used to enhance paintings and ornaments to increase their value.
 
In some cultures, gold is a predominant feature of festivals and celebrations. In Eastern cultures, the metal is an integral part of auspicious occasions like marriages and festivals by way of gifts and sacred rituals. Gold also features heavily on the attires of brides and grooms throughout South Asia.
 
Humans' fascination with gold is as old as time itself. The scarce material has a certain appeal to it.
 
Empires have flourished by possessing gold, wars have been fought to control regions harboring rich deposits of the metal and treasure hunters and explorers have spent a lifetime in search of it.
But were they fascinated by the metal or its color? The two can be hard to distinguish, said Peter Oakley from the Royal College of Arts in the UK. There is crossover between gold as a material and gold as a color, he said.
 
"The two feed off each other. The idea of gold as a color is intimately connected with our idea of gold as a material," he explained. So, when we think of it as a color, we unconsciously relate to the precious metal -- which in turn conjures images of wealth and success.

'Excrement of the gods'

 

In the book "Gold: Nature and Culture," art historian Rebecca Zorach and filmmaker and critic Michael Phillips Jr. write that in the Andean region, "the sharp, eye-catching visual effects of shine, gleam, glint, glitter, glow, and strong colors were all considered the phenomena of sacredness."
 
That led to the metal being associated with a shining, otherworldly character attributed to the gods in the religions of many different cultures. "Some of these were bodily associations," the authors write.
 
The Aztecs described gold as the "excrement of the gods," while the Incas thought of it as the "sweat of the sun." In ancient Egypt, gold was considered the "flesh of the gods." Across cultures, it was a sacred material.
 
The book goes on to illustrate the importance of gold in health and medicine. Chinese alchemists believed that drinking potable gold in the form of elixirs, eating from gold plates and using gold utensils helped attain longevity.
 
"Before the 20th century, gold was used to treat conditions as varied as syphilis, heart disease, smallpox and melancholia," the book notes.
 
Today, gold compounds are still thought to have some anti-inflammatory effects.
 

Attracting the eye

 

The incorruptible nature of gold has an otherworldly allure to it and the reflective quality of the metal gives the impression that it glows from the inside, said Oakley.
When viewed by candlelight, gilded medieval manuscripts, statues and icons in the Eastern Orthodox Church exuded a transcendental quality, glowing as if they were illuminated from the inside.
 
"The color gold causes the eye to move because of the glistening and seemingly moveable surface, similar to the way water moves," said Leatrice Eiseman, executive director of Pantone Color Institute. "Human eyes are always attracted to any surface that has that glistening or undulating movement. This is because humans need water in order to survive."
The origin of gold is closely tied to the sun, adds Eiseman. "Gold is connected to all things that grow and thrive as the sun enables that growth."

Evoking emotion

 

Human vision can discriminate millions of colors, but it can discriminate trillions of chromatures -- colored textures, said Donald Hoffman, professor of cognitive science at University of California, Irvine.
 
"It is the chromature that targets the human emotions more specifically than uniform color patches," he said.
 
Hoffman believes the reason chromatures can target human emotions more specifically than uniform color patches is that they contain far more information than color patches.
 
He demonstrated the concept with two pictures -- a section of brown grizzly bear fur and the same brown color in plain background. When looking at the chromature, our mind can immediately grasp that we are looking at a bear, he explained.
 
"Evolution would have more success training the emotional system to be wary of the bear fur chromature than to be wary of the uniform color patch of the same average color."
Similarly, when we look at a gold ring versus a standard patch of uniform color, we see interesting highlights on the ring because the metal is highly reflective.
 
"Companies are using genetic algorithms to evolve chromatures and target specific emotions they want people to experience with respect to their product or brand. It turns out to be quite powerful," he adds. For example, "A company might, for instance, want to convey the idea that their product is soft and warm. Then we would start with closeup images of patches of soft things, such as the fur of a rabbit and the down of a goose, and warm things, such as glowing embers of charcoal or a warm sunset," Hoffman explained.
 
The same could be applied to evoke emotions linked to gold -- how does it make you feel?

A sign of success

 

In ancient Rome and medieval Europe, sumptuary laws prohibited people from wearing too much gold -- or not wearing it at all unless they were from a noble family.
 
Gold leaf has been used liberally in artwork which hinted at the status of the patron who commissioned it.
 
All societies value gold and investing in gold has survived for centuries through marketing -- even glorified.
 
"(Gold) carries with it the messaging that you should own it. It is a learned, conditioned response," said Eiseman -- but not so much that it becomes tacky, she adds.
In popular culture, musicians flaunt their gold bling. The underlying message being that they are good at what they do and have amassed a lot of wealth. "In a lot of cultures, the word for money derives from the word for gold. In China, the ideogram for money is the ideogram for gold," Oakley said.
Gold continues to be featured heavily in religion and religious rituals alike. It decorates the papal regalia, spires, domes and minarets of temples, churches, monasteries and mosques worldwide.
Golden trophies like Olympic medals, the Nobel Prize, Oscars and Emmys are presented to people who display a unique talent. "The idea is the prize made of a rare material is given to people with display talent as rare as the material," said Sally Augustin, an environmental and design psychologist.
Psychologically, this results in gold being a color of motivation and achievement.
People have achieved financial freedom with gold throughout history and the prudent one's are doing so today.

News and Commentary

Gold slips on firmer equities, dollar amid Fed chair speculation (Reuters.com)

Investors Are Dumping This Silver ETF at the Fastest Pace Since 2011 (Bloomberg.com)

U.S. Stocks on Record Run After Strong Earnings (Bloomberg.com)

Bitcoin Retreats as Another Cryptocurrency Offshoot Appears (Bloomberg.com)

Noble Group's Next Battle Will Be Over $3 Billion Debt Pile (Bloomberg.com)

U.S. jury finds ex-HSBC executive guilty of fraud in $3.5 billion currency trade (Reuters.com)


Source: Bloomberg

Here's Why Bitcoin Won't Replace Gold So Easily (Forbes.com)

Americans Have More Debt Than Ever — Creating An Economic Trap (BusinessInsider.com)

Here Is The IMF's Global Financial Crash Scenario (ZeroHedge.com)

Politicians and Unfolding Pensions Disaster - Are You Infuriated Yet? (GoldSeek.com)

History Of Gold and Silver Flows From South America to Medieval Europe and Today (LMBA.org)

Gold Prices (LBMA AM)

25 Oct: USD 1,273.00, GBP 964.81 & EUR 1,081.67 per ounce
24 Oct: USD 1,278.30, GBP 970.36 & EUR 1,087.32 per ounce
23 Oct: USD 1,275.25, GBP 967.79 & EUR 1,085.62 per ounce
20 Oct: USD 1,280.25, GBP 974.27 & EUR 1,084.76 per ounce
20 Oct: USD 1,280.25, GBP 974.27 & EUR 1,084.76 per ounce
19 Oct: USD 1,283.40, GBP 975.64 & EUR 1,087.42 per ounce
18 Oct: USD 1,280.65, GBP 972.53 & EUR 1,090.47 per ounce

Silver Prices (LBMA)

25 Oct: USD 16.89, GBP 12.75 & EUR 14.34 per ounce
24 Oct: USD 17.04, GBP 12.92 & EUR 14.49 per ounce
23 Oct: USD 17.00, GBP 12.90 & EUR 14.47 per ounce
20 Oct: USD 17.08, GBP 12.96 & EUR 14.46 per ounce
20 Oct: USD 17.08, GBP 12.96 & EUR 14.46 per ounce
19 Oct: USD 17.03, GBP 12.93 & EUR 14.40 per ounce
18 Oct: USD 16.95, GBP 12.86 & EUR 14.42 per ounce


Recent Market Updates

- Gold Is Better Store of Value Than Bitcoin – Goldman Sachs
- Next Wall Street Crash Looms? Lessons On Anniversary Of 1987 Crash
- Key Charts: Gold is Cheap and US Recession May Be Closer Than Think
- Gold Up 74% Since Last Market Peak 10 Years Ago
- How Gold Bullion Protects From Conflict And War
- Silver Bullion Prices Set to Soar
- Brexit UK Vulnerable As Gold Bar Exports Distort UK Trade Figures
- Puerto Rico Without Electricity, Wifi, ATMs Shows Importance of Cash, Gold and Silver
- U.S. Mint Gold Coin Sales and VIX Point To Increased Market Volatility and Higher Gold
- Global Outlook – Mad, Mad, Mad, MAD World: News in Charts
- Young Guns of Gold Podcast – ‘The Everything Bubble’
- London House Prices Are Falling – Time to Buckle Up
- Perth Mint Gold Coins Sales Double In September

Important Guides

For your perusal, below are our most popular guides in 2017:

Essential Guide To Storing Gold In Switzerland

Essential Guide To Storing Gold In Singapore

Essential Guide to Tax Free Gold Sovereigns (UK)

Please share our research with family, friends and colleagues who you think would benefit from being informed by it.