The Gold Commodity Market: Worldwide Gold Mining Operations, Environmental Pollution, and the Illegal Practices of Gold Trading
Anthony Ambrosius Aurelius
“In China, after the Communist Revolution, Chairman Mao Zedong made owning gold illegal. When the ban was lifted in 2004, a floodgate of demand opened up as nations with a burgeoning middle class are now observing a large upward swing in the purchase and ownership of gold as a commodity, for its esthetic beauty (e.g. jewelry) but also as a financial commodity (e.g. bullion). Younger generations in China tend to view gold as a lifestyle statement. China recently surpassed India becoming the world’s largest consumer of gold products in 2014. To meet the growing demand of the gold market in China and around the world, each year, the gold industry mines more gold than it collectively did the year prior, which as of 2019 is enough to fill 70 locomotive freight cars to their maximum capacity.
The top 500’ – 1000’ of nearly every location upon Earth has been explored for gold which is why mining operations require drilling and blasting ever deeper into the Earth to continue meeting the insatiable demand for gold worldwide, a practice which is becoming increasingly unsustainable. It is this scarcity which keeps gold a valuable commodity as scarcity has remained constant yet demand has increased.
It was once possible to obtain 30 grams of gold per every 1 tonne of ore mined, but as of 2019, mining operations are only able to extract 0.5 grams of gold per every 1 tonne of ore mined. Because there are fewer grams per tonne, miners must excavate more ore to compensate which is why gold mines around the world are growing increasingly larger and mining operations are digging increasingly deeper.
In vaults throughout the city of London, England, the world’s largest banks hold a total of 600,000, gold bars, holding gold for other nations by acting as a secure, European central bank of sorts due to the fact that England is a highly stable country in terms of political consistency, policy, and procedure. Because of this, London is the world hub for gold trade.
The open market dictates the price of gold, but daily a small group of bankers, sets an influential benchmark price using a method devised a century ago. In this model, 5 top executives meet with”