From the re-discovered mines of a gold-rich empire lost in the Sahara Desert to the secretive trading rooms of the London Bullion Market, the greatest gold rush in history—today’s!—has sent the precious metal cascading into the public consciousness as never before. A 10-year bull run that picked up speed from the fear and panic of the financial crisis made gold one of the best-known asset prices in the world. In his forthcoming book, Gold: The Race for the World’s Most Seductive Metal (Simon & Schuster), Matthew Hart chronicled his travels through the feverish domain of the gold hunters and met some of the world’s greatest precious-metals buccaneers.
Where does the desire for gold come from? The oldest gold artifacts date back 6,000 years. Unearthed by accident in 1972 in the town of Varna, Bulgaria, near the Black Sea coast, when a backhoe operator digging a foundation struck a Neolithic tomb, the treasure includes a miniature breastplate, tiny, exquisitely fashioned antelope with curled horns, and a delicately curling helix, like a snippet of gold ribbon. All perfectly useless. Why did people make them? In The Golden Constant, a classic study that tracked gold’s purchasing power through time, the University of California, Berkeley, economist Roy Jastram confessed to a “nagging feeling that something deeper than conscious thought, not an instinct but perhaps a race-memory,” was behind our attachment to gold. In other words, we loved it because we always had.
Two years ago I set off into the gold world, at a time when the gold price was smashing records. Bullion trades were flying around in London like one-ton chunks of hail. Sixty centuries after our distant ancestors had hammered out their ravishing little objects, we, their descendants, staggered through a tempest of assets, a world immeasurably richer than the one glimpsed at Varna. I had written about gold and diamonds on and off for 30 years but had never seen a fever like the one then sending drillers out to ransack the planet for gold. On assignment for Vanity Fair, and to write a book, I set out to take its pulse.
THE FIX
Every weekday morning at 10:30, a bullion dealer in the precious-metals trading room of HSBC Bank in London picks up the phone and punches in to a special line. The dedicated line connects him to four other bankers—the members of a powerful and self-policing group called the London Gold Fixing. They set one of the best-known asset prices on earth: the price of gold.
Keep reading Trading in Gold: The Secretive Dealings of One of the World’s Richest Industries | Vanity Fair.
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