gold

(redirected from aurum)
Also found in: Dictionary, Thesaurus, Medical, Legal, Acronyms, Encyclopedia, Wikipedia.

Gold

A particularly valuable precious metal. Gold is an element with the atomic number 79. It is used for jewelry, electronics and for other purposes. Historically, gold was used in many cultures as the basis for currency, but this is no longer the case. Investments in gold are often used as a hedge against inflation because it tends to maintain its value over time.

gold

a mineral that is used both as an industrial base metal and for ornamental purposes, and is held by governments as part of their stock of INTERNATIONAL RESERVE assets in order to finance balance of payments deficits. Formerly, in the UK and many other countries, gold coins formed the basis of the domestic MONEY SUPPLY, but gold has now been replaced by banknotes and brass and nickel coins as the cash component of the money supply. See BULLION MARKET, WORLD GOLD COUNCIL.

gold

a monetary ASSET that is held by countries as part of their INTERNATIONAL RESERVES and used to finance BALANCE OF PAYMENTS deficits.

Formerly, many countries operated a GOLD STANDARD system under which gold was used as the basis of a country's domestic MONEY SUPPLY as well as being used to finance payments deficits. Gradually, however, the ‘pure’ gold standard gave way to domestic monetary systems based on paper money and other metallic coins and, internationally, the gold-exchange standard in which foreign currencies such as sterling and the American dollar were used alongside gold as reserve assets.

In 1935 the price of gold was ‘fixed’ at $35 per fine ounce by the USA, Britain and France as part of a monetary pact between the three countries. This price was then ‘officially’ adopted by member countries of the INTERNATIONAL MONETARY FUND on its formation in 1947; gold was used as the NUMERAIRE of the Fund's fixed exchange-rate system in setting par values for members’ currencies, and members were required to pay one quarter of their ‘quota subscriptions to the Fund in gold. Gold continued to serve as the linchpin of the IMF system, and its ‘official’ price remained pegged at $35 per ounce, down to 1971, when the Fund's fixed exchange-rate system gave way to floating exchange rates. Countries had, however, found it increasingly difficult to hold the price of gold at the $35 per ounce level as world demand for gold as an industrial metal and for ornamental purposes continued to expand. In 1961 a ‘gold pool’ was set up to regulate dealings in the metal, but in 1968 Fund members bowed to the inevitable and a ‘two-tier’ price structure was established; gold continued to be priced at $35 per ounce for ‘official’ transactions between countries’ central banks and the Fund, while the ‘free’ market price of gold was left to be determined by market forces.

In 1972, gold was dropped as the numeraire of the Fund and replaced by the SPECIAL DRAWING RIGHT unit, the Fund's existing gold holdings were sold off, and members were required to subscribe their quotas in a non-gold form. Outside the Fund, many countries have sold off part of their gold reserves, with the UK being particularly active in 1999, having taken the decision to reduce its gold holdings to around 8% of its total reserves. Overall, gold accounts for only some 0.3% of total international reserves. The market price of gold has fallen substantially over the past decade. In 1989 the price of gold averaged around $850 per ounce. Following UK gold sales in 1999, the price of gold at one point fell as low as $250 per ounce. However, despite the determination of the USA and a number of other major gold holders to put a moratorium on gold sales, the price of gold has remained depressed - currently (April 2005), it is around $430 per ounce.

The attractiveness of gold as a reserve asset is underpinned by the fact that, unlike national paper currencies (which are intrinsically worthless), it has a value in exchange as a commodity related to its use as an industrial base metal and for ornamental purposes. Gold holdings, however, suffer from the disadvantage that, compared with other assets such as STOCKS and SHARES, they yield no interest return.

References in periodicals archive ?
Senior figures within Aurum Asset Management further noted that this partnership would further expand on the company's size, scale, and scope of operations within the gold mining sector.
Since taking the Aurum, I feel like my body has been healing, in reverse order, every skin condition and illness that I have had in my lifetime.
In April, Aurum conducted a private event in Mumbai in collaboration with Trek, showcasing upcoming and current prospects in Dubai's real estate market.
That meant the Michigan team needed to make Aurum energy-efficient.
The disclosure suggested that Citra, the original Skyway concession holder, would continue to own 5 percent of Atlantic Aurum, which SMC agreed to enter in 2011.
Brief: To romance the golden bottle of Aurum and serenade the richness of its fragrance
The Coast to Coast Walk Martin Wainwright (Aurum, pounds 12.99) THE Coast to Coast Walk, extending 192 miles from St Bees in Cumbria to Robin's Hood Bay, was dreamed up by the late Alfred Wainwright who published it in 1973, 18 years before his death.
Aurum Holdings said the launch of exclusive brands such as Canadian Ice and Biba boosted Goldsmiths, while its Watches of Switzerland division benefited from the launch of its new transactional website.
Creaton, Siobhan, A Mobile Fortune: The Life and Times of Denis O'Brien, Aurum, London, 2010, ISBN 9 7818 4513 4525, 314 pp., 14.99 [pounds sterling].
The emergence of South Africa as a health tourism destination has prompted Grand Aurum Marketing in association with Aura Events to announce that the 7th World Health Tourism Congress will be held in Durban, South Africa from October 15 to 17 under the patronage and sponsorship of Kwazulu-Natal Tourism Office.
Sunday September 25 Silly Sundays - Aurum, Aberdeen As part of his global DJ schedule, Dutch Tech-Trance DJ - Hardwell - will be unleashed at Aurum Nightclub.
M2 PHARMA-July 25, 2011-Oxygen Biotherapeutics, Aurum Biosciences seal LoI(C)2011 M2 COMMUNICATIONS