Imagine yourself desperately hoping to find a small yellow glint of golden sitting at a stream swirling water in a bowl and dreaming of striking it rich. America has come a long way but gold still retains a prominent place within our global economy now. Following is a comprehensive introduction to goldfrom why it's valuable and how we obtain it the risks and benefits of each strategy, and hints on where beginners should start.

It was also hard to dig gold out of the earth -- and the more difficult something is to get, the higher it is appreciated. Over time, humans began using the metal as a means and accumulate and store wealth. In fact, ancient paper monies were normally backed by gold, together with every printed invoice corresponding to an amount of gold held in a vault someplace for that it could, technically, be traded (this rarely occurred ).

So the link between gold and paper currency has been broken, modern currencies are largely fiat monies. However, the metal is still loved by people. Where does demand for gold come from The demand industry by far is jewelry, which accounts for approximately 50 percent of gold demand. Another 40 percent stems from direct investment such as that used to make medals, bullion, coins, and bars.

It is different than numismatic coins, collectibles that trade based on requirement for the particular type of coin rather than its gold material.) Investors in physical gold comprise people, central banks, and, more recently, exchange-traded funds which purchase gold on behalf of others. Gold is often viewed as a safe-haven investment.

This is one reason that investors have a tendency to push up the price of gold when financial markets are volatile. Because gold is a good conductor of electricity, the rest of the demand for gold comes for use in matters like heat shields, dentistry, and gadgets. What's gold's amount is a commodity which trades based on supply and demand.

The demand for jewellery is steady, though downturns do lead to some reductions in demand from this business. Push its cost higher, when investors are worried about the market and dependent on the rise in need.

How much gold is there Gold is quite abundant in nature but is difficult to extract. By way of example, seawater includes gold -- but in such small quantities it would cost more than the gold will be worthwhile, to extract. So there's a difference between the availability of gold and how much gold there is in the world.

Gold prices or advances in extraction methods can shift that number. Gold has been discovered in amounts that suggest it might be worth extracting if costs rose near undersea vents. Source: Getty Images. How do we get gold.

A miner might actually produce gold for a by-product of its mining efforts. Miners begin by finding a place where they believe gold is located in big enough quantities it can be efficiently obtained. Then agencies and local governments have to grant the company permission to build and operate a mine.

How does gold hold its worth in a recession The answer depends partly on how you put money into gold, however a quick look at gold prices relative to stock prices throughout the bear market of this 2007-2009 recession provides a telling example.

This is the latest example of a substance and protracted stock downturn, but it is also an especially dramatic one since, at the time, there have been very real concerns about the viability of their global financial system. Gold often performs well as investors seek out investments that are safe-haven, when capital markets are in turmoil.