Ad Here  
Jeeto drives M&M forward in LCV market Deming awardees galore! Strategic planning the missing link Kudos to GIM organisers... Jobs - Lost, Changed or Gained Corruption institutionalised; technique perfected Much can be done by us No groundnuts in groundnut oil! An eventful week with VVIPs of Delhi PC please be our Santa Babes In the wood-RBI North block has little clue to curb inflation CAD and the emergency thereof A tale of two Bihar babus Make way for Make in India... Miles to go... Better relations with UK... Why (not) abolish? A blueprint for the future Oh my GOLD BEPS gains traction Reform this licence to…kill Tax evaders’ get out of Jail-Free Card Sustainably developing manufacturing sector… Sowing seeds of hope Babes In the wood-RBI North block has little clue to curb inflation Welcome effort to restore discipline... After all, customer is the king How will it PAN OUT Welcome rains for damaged roads... In the horns of a dilemma Chennai Airport-Ready for a rapid take off... Welcome Measures. Work for 10X Change Technology and economic development should be linked CSR, tech revolution and bank crisis Tryst with GST Pool energy prices South India’s 100 most valuable companies An eco-friendly commute in Mysuru Why throw baby with bath water? Ganesh’s mantras Public investments and welfare will surge MS Installed Need for radical RBI reform 1800 parties registered with EC – Less than 60 contest elections Breaking news or breaking credibility? A gratifying record Focus on agriculture and human resources TN - so much to offer... Rail-road Rajaraman Truce at Kasturi Buildings Land, land everywhere, but... Industry can’t get it from Mars, yet What the big B should offer? You too T M Krishna? A Fine division of responsibilities Need plan over the long term planning They add lustre to Padma Awards Skewed Economic Zones? Little surplus after salaries, subsidies and debt servicing Sardar Sarovar – the seventy year itch It’s raining funds for states. Really? Two welcome measures from the chief minister... When the examiner cheated... The deluge and the several kindly souls The Great Fall Trail-blazing Tamil Nadu Healthy finances of the Chennai Corporation Indian GST – Between extremes… Wanted: decentralised financial system Star of the South Outward ho A historic indirect tax reform Focus on southern TN... Cleansing Indian retail Low profile moves Weaving wealth of western Tamil Nadu ‘Cycle’ rides into the sunset Policy Makers If not Tamil Nadu, where else? Welcome move to widen the tax net… A dual GST that will protect prosperous states Much ado about nothing INDIA keeps its date with destiny Research for survival... Well-administered State BJP can now hasten its thrust for reforms Online not in line with brick and mortar businesses Economy through the month
Oh my GOLD
GOLD gets dug out of the ground in Africa. Then we melt it, dig another hole, bury it again and pay people to stand around guarding it. It has no utility. Anyone watching from Mars would be scratching their head.” – Warren Buffett
IT’S BEEN THE asset that has held its own in recent times. Save real estate, it has actually beaten every
other investment hands down. Yet, who would have ever thought that it would do that. Yes, we are talking about gold, the mesmeric yellow metal.  

Circa 2002, when gold price was inching towards Rs 5000 levels, a colleague of mine breathlessly predicted that gold would touch Rs. 7000 in two years. 

I fancy myself as an intellectual and cannot see life beyond the prism of the stock market. So, I asked,“How?” He responded by saying, “I don’t know ‘how’ but I know it will”. Then for good measure he added, “It’s in its 28 year peak.” 

I responded, tongue firmly in cheek, “Oh it has taken 28 years to reach this level? Why get excited?” He just smiled. 

He invested in gold. I continued to play stock. He is now laughing his way to the bank. And I am writing cover stories. 

Welcome then to the world of gold, the unexpected prima donna of the last decade. It would be instructive to understand the history of the yellow metal, its date with destiny and the reasons as to why it has such a tantalising hold over people, in particular over Indians.  

It would be good to know where the demand comes from, how much is the supply and whether gold would continue its relentless march skywards. Most importantly, we also need to address the question as to whether it is good for us that gold prices go up.  

Let’s explore some ideas and explode some myths.

Golden Idea 1: Why do we date gold

India is no South Africa; we are not awash with gold mines. Yet, Indians love gold and Indians have accumulated gold. By last count this nation held 18,000 tons of gold; that, when our annual production is a piddling 2.2 tons. Yes, we are holding stock that is the equivalent of 8000 years of production. So how did it happen? Read on to some historical nuggets for insight.  

• India was a net exporter of goods for a good part of the last 2000 years. This richness enabled India to import gold.
• In those halcyon days of kings and kingdoms, a gold coin issued by one king was accepted as legal
tender by other kings as well. So gold became an important store of value.
• In times of war you could hide and carry gold with ease. So, citizens were safe from the marauding
armies. Also, in times of crisis gold could be mortgaged.
• The inheritance laws in the Mughal period favoured gold accumulation. Under the law, on a person’s
death, the estate would pass to the legal heir only at the discretion of the State. Little wonder, people
chose to hide their wealth. And there wasn’t a better route than gold.
• In Hindu weddings, gold jewellery is a major component of gifts given to the woman.

1 2 3 4 5 6 7
Author :
Reported On :
Sector :
IE, the business magazine from south was launched in 1968 and pioneered business journalism in south. Through the 45 years IE has been focusing on well-presented and well-researched articles. When giants in the industry stumbled to keep pace with the digital revolution, IE stayed affixed embracing technology.
Read more
Economist Communications Ltd is committed to ensuring that your privacy is protected.
Read more
You agree that your use of this Website and the purchase of the magazine will be governed by these terms and conditions.
Read more
S-15, Industrial Estate,
Chennai - 600 032.
PHONE: +91 44 22501236