Why has gold increased in value? Actually, it should be, "Why has the $ decreased in value?" That ounce of gold is the same; it hasn't changed at all. The dollar has just lost over 80% of its 2004 value.
Aristotle identified five characteristics of money. These were durability, portability, divisibility, rarity, and usefulness. The only thing that paper fits on the list is the portability element. But an ounce of gold? All of them are the same. So it's not that gold has increased its value; it's the paper that has lost its value instead.
Why has gold increased in value? Actually, it should be, "Why has the $ decreased in value?" That ounce of gold is the same; it hasn't changed at all. The dollar has just lost over 80% of its 2004 value.
Aristotle identified five characteristics of money. These were durability, portability, divisibility, rarity, and usefulness. The only thing that paper fits on the list is the portability element. But an ounce of gold? All of them are the same. So it's not that gold has increased its value; it's the paper that has lost its value instead.