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112-496: The area was believed to be rich in gold deposits, which led an Egyptian military expedition under the leadership of Ismail bin Muhammad Ali, son of Wali Muhammad Ali into the area (1820–1823) in part determine the truth of this belief, as well as to capture some 30,000 inhabitants to be slaves. He was accompanied by Frédéric Cailliaud , George Waddington , and George Bethune English , all of whom later wrote accounts of

224-399: A fault . Water often lubricates faults, filling in fractures and jogs. About 10 kilometres (6.2 mi) below the surface, under very high temperatures and pressures, the water carries high concentrations of carbon dioxide, silica, and gold. During an earthquake, the fault jog suddenly opens wider. The water inside the void instantly vaporizes, flashing to steam and forcing silica, which forms

336-531: A wealth effect . Additionally, international interest rate differentials affect exchange rates and consequently US exports and imports . Consumption, investment and net exports are all important components of aggegate demand. Stimulating or suppressing the overall demand for goods and services in the economy will tend to increase respectively diminish inflation. The concrete implementation mechanism used to adjust short-term interest rates differs from central bank to central bank. The "policy rate" itself, i.e.

448-556: A central bank purchases private sector assets to improve liquidity and improve access to credit. Signaling can be used to lower market expectations for lower interest rates in the future. For example, during the credit crisis of 2008, the US Federal Reserve indicated rates would be low for an "extended period", and the Bank of Canada made a "conditional commitment" to keep rates at the lower bound of 25 basis points (0.25%) until

560-415: A check on the growth of the money supply. The People's Bank of China retains (and uses) more powers over reserves because the yuan that it manages is a non- convertible currency . Loan activity by banks plays a fundamental role in determining the money supply. The central-bank money after aggregate settlement – "final money" – can take only one of two forms: The currency component of the money supply

672-483: A dilute solution of gold(III) chloride or chlorauric acid . Unlike sulfur, phosphorus reacts directly with gold at elevated temperatures to produce gold phosphide (Au 2 P 3 ). Gold readily dissolves in mercury at room temperature to form an amalgam , and forms alloys with many other metals at higher temperatures. These alloys can be produced to modify the hardness and other metallurgical properties, to control melting point or to create exotic colors. Gold

784-477: A fixed price in terms of the base currency. The gold standard might be regarded as a special case of "fixed exchange rate" policy, or as a special type of commodity price level targeting. However, the policies required to maintain the gold standard might be harmful to employment and general economic activity and probably exacerbated the Great Depression in the 1930s in many countries, leading eventually to

896-579: A gold-from-seawater swindle in the United States in the 1890s, as did an English fraudster in the early 1900s. Fritz Haber did research on the extraction of gold from sea water in an effort to help pay Germany 's reparations following World War I . Based on the published values of 2 to 64 ppb of gold in seawater, a commercially successful extraction seemed possible. After analysis of 4,000 water samples yielding an average of 0.004 ppb, it became clear that extraction would not be possible, and he ended

1008-830: A golden hue to metallic caesium . Common colored gold alloys include the distinctive eighteen-karat rose gold created by the addition of copper. Alloys containing palladium or nickel are also important in commercial jewelry as these produce white gold alloys. Fourteen-karat gold-copper alloy is nearly identical in color to certain bronze alloys, and both may be used to produce police and other badges . Fourteen- and eighteen-karat gold alloys with silver alone appear greenish-yellow and are referred to as green gold . Blue gold can be made by alloying with iron , and purple gold can be made by alloying with aluminium . Less commonly, addition of manganese , indium , and other elements can produce more unusual colors of gold for various applications. Colloidal gold , used by electron-microscopists,

1120-567: A large alluvial deposit. The mines at Roşia Montană in Transylvania were also very large, and until very recently, still mined by opencast methods. They also exploited smaller deposits in Britain , such as placer and hard-rock deposits at Dolaucothi . The various methods they used are well described by Pliny the Elder in his encyclopedia Naturalis Historia written towards the end of

1232-411: A minimum ratio of the value of the securities to the amount borrowed. Central banks often have requirements for the quality of assets that may be held by financial institutions; these requirements may act as a limit on the amount of risk and leverage created by the financial system. These requirements may be direct, such as requiring certain assets to bear certain minimum credit ratings , or indirect, by

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1344-462: A novel type of metal-halide perovskite material consisting of Au and Au cations in its crystal structure has been found. It has been shown to be unexpectedly stable at normal conditions. Gold pentafluoride , along with its derivative anion, AuF − 6 , and its difluorine complex , gold heptafluoride , is the sole example of gold(V), the highest verified oxidation state. Some gold compounds exhibit aurophilic bonding , which describes

1456-753: A regional fixed exchange rate system via the European Monetary System , leading eventually to the Economic and Monetary Union of the European Union and the introduction of the currency euro . Monetarist economists long contended that the money-supply growth could affect the macroeconomy. These included Milton Friedman who early in his career advocated that government budget deficits during recessions be financed in equal amount by money creation to help to stimulate aggregate demand for production. Later he advocated simply increasing

1568-401: A sheet of 1 square metre (11 sq ft), and an avoirdupois ounce into 28 square metres (300 sq ft). Gold leaf can be beaten thin enough to become semi-transparent. The transmitted light appears greenish-blue because gold strongly reflects yellow and red. Such semi-transparent sheets also strongly reflect infrared light, making them useful as infrared (radiant heat) shields in

1680-674: A simple method called the Taylor rule , according to which central banks adjust their policy interest rate in response to changes in the inflation rate and the output gap . The rule was proposed by John B. Taylor of Stanford University . Under this policy approach, the official target is to keep inflation , under a particular definition such as the Consumer Price Index , within a desired range. Thus, while other monetary regimes usually also have as their ultimate goal to control inflation, they go about it in an indirect way, whereas

1792-520: A solution of Au(OH) 3 in concentrated H 2 SO 4 produces red crystals of gold(II) sulfate , Au 2 (SO 4 ) 2 . Originally thought to be a mixed-valence compound, it has been shown to contain Au 4+ 2 cations, analogous to the better-known mercury(I) ion, Hg 2+ 2 . A gold(II) complex, the tetraxenonogold(II) cation, which contains xenon as a ligand, occurs in [AuXe 4 ](Sb 2 F 11 ) 2 . In September 2023,

1904-501: A think tank attached to the Prime minister's office. Some have envisaged the use of what Milton Friedman once called " helicopter money " whereby the central bank would make direct transfers to citizens in order to lift inflation up to the central bank's intended target. Such policy option could be particularly effective at the zero lower bound. Central banks typically use a nominal anchor to pin down expectations of private agents about

2016-470: Is Au with a half-life of 2.27 days. Gold's least stable isomer is Au with a half-life of only 7 ns. Au has three decay paths: β decay, isomeric transition , and alpha decay. No other isomer or isotope of gold has three decay paths. The possible production of gold from a more common element, such as lead , has long been a subject of human inquiry, and the ancient and medieval discipline of alchemy often focused on it; however,

2128-696: Is Au , which decays by proton emission with a half-life of 30 μs. Most of gold's radioisotopes with atomic masses below 197 decay by some combination of proton emission , α decay , and β decay . The exceptions are Au , which decays by electron capture, and Au , which decays most often by electron capture (93%) with a minor β decay path (7%). All of gold's radioisotopes with atomic masses above 197 decay by β decay. At least 32 nuclear isomers have also been characterized, ranging in atomic mass from 170 to 200. Within that range, only Au , Au , Au , Au , and Au do not have isomers. Gold's most stable isomer

2240-417: Is a chemical element with the chemical symbol Au (from Latin aurum ) and atomic number 79. In its pure form, it is a bright , slightly orange-yellow, dense, soft, malleable , and ductile metal . Chemically, gold is a transition metal , a group 11 element , and one of the noble metals . It is one of the least reactive chemical elements, being the second-lowest in the reactivity series . It

2352-443: Is also applying a form of dual rate policy. To influence the money supply, some central banks may require that some or all foreign exchange receipts (generally from exports) be exchanged for the local currency. The rate that is used to purchase local currency may be market-based or arbitrarily set by the bank. This tool is generally used in countries with non-convertible currencies or partially convertible currencies. The recipient of

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2464-648: Is also known, an example of a mixed-valence complex . Gold does not react with oxygen at any temperature and, up to 100 °C, is resistant to attack from ozone: Au + O 2 ⟶ ( no reaction ) {\displaystyle {\ce {Au + O2 ->}}({\text{no reaction}})} Au + O 3 → t < 100 ∘ C ( no reaction ) {\displaystyle {\ce {Au{}+O3->[{} \atop {t<100^{\circ }{\text{C}}}]}}({\text{no reaction}})} Some free halogens react to form

2576-520: Is also used in infrared shielding, the production of colored glass , gold leafing , and tooth restoration . Certain gold salts are still used as anti-inflammatory agents in medicine. Gold is the most malleable of all metals. It can be drawn into a wire of single-atom width, and then stretched considerably before it breaks. Such nanowires distort via the formation, reorientation, and migration of dislocations and crystal twins without noticeable hardening. A single gram of gold can be beaten into

2688-427: Is always richer at the exposed surface of gold-bearing veins, owing to the oxidation of accompanying minerals followed by weathering; and by washing of the dust into streams and rivers, where it collects and can be welded by water action to form nuggets. Gold sometimes occurs combined with tellurium as the minerals calaverite , krennerite , nagyagite , petzite and sylvanite (see telluride minerals ), and as

2800-466: Is an active and debated research area, drawing on fields like monetary economics as well as other subfields within macroeconomics . Monetary policy has evolved over the centuries, along with the development of a money economy. Historians, economists, anthropologists and numismatics do not agree on the origins of money. In the West the common point of view is that coins were first used in ancient Lydia in

2912-517: Is attributed to wind-blown dust or rivers. At 10 parts per quadrillion, the Earth's oceans would hold 15,000 tonnes of gold. These figures are three orders of magnitude less than reported in the literature prior to 1988, indicating contamination problems with the earlier data. A number of people have claimed to be able to economically recover gold from sea water , but they were either mistaken or acted in an intentional deception. Prescott Jernegan ran

3024-454: Is far smaller than the deposit component. Currency, bank reserves and institutional loan agreements together make up the monetary base, called M1, M2 and M3 . The Federal Reserve Bank stopped publishing M3 and counting it as part of the money supply in 2006. Central banks can directly or indirectly influence the allocation of bank lending in certain sectors of the economy by applying quotas, limits or differentiated interest rates. This allows

3136-470: Is found in ores in rock formed from the Precambrian time onward. It most often occurs as a native metal , typically in a metal solid solution with silver (i.e. as a gold/silver alloy ). Such alloys usually have a silver content of 8–10%. Electrum is elemental gold with more than 20% silver, and is commonly known as white gold . Electrum's color runs from golden-silvery to silvery, dependent upon

3248-411: Is important for modern central banks. Historically, bank reserves have formed only a small fraction of deposits , a system called fractional-reserve banking . Banks would hold only a small percentage of their assets in the form of cash reserves as insurance against bank runs. Over time this process has been regulated and insured by central banks. Such legal reserve requirements were introduced in

3360-455: Is important, it is defined and regulated by the Bank for International Settlements , and central banks in practice generally do not apply stricter rules. Expansionary policy occurs when a monetary authority uses its instruments to stimulate the economy. An expansionary policy decreases short-term interest rates, affecting broader financial conditions to encourage spending on goods and services, in turn leading to increased employment. By affecting

3472-472: Is most often called the oldest since this treasure is the largest and most diverse. Gold artifacts probably made their first appearance in Ancient Egypt at the very beginning of the pre-dynastic period, at the end of the fifth millennium BC and the start of the fourth, and smelting was developed during the course of the 4th millennium; gold artifacts appear in the archeology of Lower Mesopotamia during

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3584-542: Is now questioned. The gold-bearing Witwatersrand rocks were laid down between 700 and 950 million years before the Vredefort impact. These gold-bearing rocks had furthermore been covered by a thick layer of Ventersdorp lavas and the Transvaal Supergroup of rocks before the meteor struck, and thus the gold did not actually arrive in the asteroid/meteorite. What the Vredefort impact achieved, however,

3696-427: Is red if the particles are small; larger particles of colloidal gold are blue. Gold has only one stable isotope , Au , which is also its only naturally occurring isotope, so gold is both a mononuclidic and monoisotopic element . Thirty-six radioisotopes have been synthesized, ranging in atomic mass from 169 to 205. The most stable of these is Au with a half-life of 186.1 days. The least stable

3808-553: Is resistant to most acids, though it does dissolve in aqua regia (a mixture of nitric acid and hydrochloric acid ), forming a soluble tetrachloroaurate anion . Gold is insoluble in nitric acid alone, which dissolves silver and base metals , a property long used to refine gold and confirm the presence of gold in metallic substances, giving rise to the term ' acid test '. Gold dissolves in alkaline solutions of cyanide , which are used in mining and electroplating . Gold also dissolves in mercury , forming amalgam alloys, and as

3920-484: Is similarly unaffected by most bases. It does not react with aqueous , solid , or molten sodium or potassium hydroxide . It does however, react with sodium or potassium cyanide under alkaline conditions when oxygen is present to form soluble complexes. Common oxidation states of gold include +1 (gold(I) or aurous compounds) and +3 (gold(III) or auric compounds). Gold ions in solution are readily reduced and precipitated as metal by adding any other metal as

4032-483: Is solid under standard conditions . Gold often occurs in free elemental ( native state ), as nuggets or grains, in rocks , veins , and alluvial deposits . It occurs in a solid solution series with the native element silver (as in electrum ), naturally alloyed with other metals like copper and palladium , and mineral inclusions such as within pyrite . Less commonly, it occurs in minerals as gold compounds, often with tellurium ( gold tellurides ). Gold

4144-419: Is that the central bank tries to adjust interest rates in order to steer the country's inflation rate towards the official target instead of following indirect objectives like exchange rate stability or money supply growth, the purpose of which is normally also ultimately to obtain low and stable inflation. The strategy was generally considered to work well, and central banks in most developed countries have over

4256-589: Is the soluble form of gold encountered in mining. The binary gold halides , such as AuCl , form zigzag polymeric chains, again featuring linear coordination at Au. Most drugs based on gold are Au(I) derivatives. Au(III) (referred to as auric) is a common oxidation state, and is illustrated by gold(III) chloride , Au 2 Cl 6 . The gold atom centers in Au(III) complexes, like other d compounds, are typically square planar , with chemical bonds that have both covalent and ionic character. Gold(I,III) chloride

4368-657: Is thought to have been delivered to Earth by asteroid impacts during the Late Heavy Bombardment , about 4 billion years ago. Gold which is reachable by humans has, in one case, been associated with a particular asteroid impact. The asteroid that formed Vredefort impact structure 2.020 billion years ago is often credited with seeding the Witwatersrand basin in South Africa with the richest gold deposits on earth. However, this scenario

4480-511: Is thought to have been produced in supernova nucleosynthesis , and from the collision of neutron stars , and to have been present in the dust from which the Solar System formed. Traditionally, gold in the universe is thought to have formed by the r-process (rapid neutron capture) in supernova nucleosynthesis , but more recently it has been suggested that gold and other elements heavier than iron may also be produced in quantity by

4592-416: Is unaffected by most acids. It does not react with hydrofluoric , hydrochloric , hydrobromic , hydriodic , sulfuric , or nitric acid . It does react with selenic acid , and is dissolved by aqua regia , a 1:3 mixture of nitric acid and hydrochloric acid . Nitric acid oxidizes the metal to +3 ions, but only in minute amounts, typically undetectable in the pure acid because of the chemical equilibrium of

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4704-666: The Chu (state) circulated the Ying Yuan , one kind of square gold coin. In Roman metallurgy , new methods for extracting gold on a large scale were developed by introducing hydraulic mining methods, especially in Hispania from 25 BC onwards and in Dacia from 106 AD onwards. One of their largest mines was at Las Medulas in León , where seven long aqueducts enabled them to sluice most of

4816-602: The Old Testament , starting with Genesis 2:11 (at Havilah ), the story of the golden calf , and many parts of the temple including the Menorah and the golden altar. In the New Testament , it is included with the gifts of the magi in the first chapters of Matthew. The Book of Revelation 21:21 describes the city of New Jerusalem as having streets "made of pure gold, clear as crystal". Exploitation of gold in

4928-658: The Varna Necropolis near Lake Varna and the Black Sea coast, thought to be the earliest "well-dated" finding of gold artifacts in history. Several prehistoric Bulgarian finds are considered no less old – the golden treasures of Hotnitsa, Durankulak , artifacts from the Kurgan settlement of Yunatsite near Pazardzhik , the golden treasure Sakar, as well as beads and gold jewelry found in the Kurgan settlement of Provadia – Solnitsata ("salt pit"). However, Varna gold

5040-534: The exchange rate , it may also stimulate net export . Contractionary policy works in the opposite direction: Increasing interest rates will depress borrowing and spending by consumers and businesses, dampening inflationary pressure in the economy together with employment. For most central banks in advanced economies, their main monetary policy instrument is a short-term interest rate. For monetary policy frameworks operating under an exchange rate anchor, adjusting interest rates are, together with direct intervention in

5152-646: The foreign exchange market (i.e. open market operations), important tools to maintain the desired exchange rate. For central banks targeting inflation directly, adjusting interest rates are crucial for the monetary transmission mechanism which ultimately affects inflation. Changes in the central banks' policy rates normally affect the interest rates that banks and other lenders charge on loans to firms and households, which will in turn impact private investment and consumption . Interest rate changes also affect asset prices like stock prices and house prices , which again influence households' consumption decisions through

5264-410: The gold standard , exchange rate targets , money supply targets, and since the 1990s direct official inflation targets . In addition, economic researchers have proposed variants or alternatives like price level targeting (some times described as an inflation target with a memory ) or nominal income targeting . Empirically, some researchers suggest that central banks' policies can be described by

5376-497: The monetary transmission mechanism , and are also an important determinant of the exchange rate. Other policy tools include communication strategies like forward guidance and in some countries the setting of reserve requirements . Monetary policy is often referred to as being either expansionary (stimulating economic activity and consequently employment and inflation) or contractionary (dampening economic activity, hence decreasing employment and inflation). Monetary policy affects

5488-587: The output gap . This option has been increasingly discussed since March 2016 after the ECB's president Mario Draghi said he found the concept "very interesting". The idea was also promoted by prominent former central bankers Stanley Fischer and Philipp Hildebrand in a paper published by BlackRock , and in France by economists Philippe Martin and Xavier Ragot from the French Council for Economic Analysis,

5600-470: The reducing agent . The added metal is oxidized and dissolves, allowing the gold to be displaced from solution and be recovered as a solid precipitate. Less common oxidation states of gold include −1, +2, and +5. The −1 oxidation state occurs in aurides, compounds containing the Au anion . Caesium auride (CsAu), for example, crystallizes in the caesium chloride motif; rubidium, potassium, and tetramethylammonium aurides are also known. Gold has

5712-588: The 19th century as an attempt to reduce the risk of banks overextending themselves and suffering from bank runs , as this could lead to knock-on effects on other overextended banks. A number of central banks have since abolished their reserve requirements over the last few decades, beginning with the Reserve Bank of New Zealand in 1985 and continuing with the Federal Reserve in 2020. For the respective banking systems, bank capital requirements provide

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5824-442: The 8th century BCE, whereas some date the origins to ancient China . The earliest predecessors to monetary policy seem to be those of debasement , where the government would melt coins down and mix them with cheaper metals. The practice was widespread in the late Roman Empire , but reached its perfection in western Europe in the late Middle Ages . For many centuries there were only two forms of monetary policy: altering coinage or

5936-415: The Federal Reserve among others). As an example of how this functions, the Bank of Canada sets a target overnight rate , and a band of plus or minus 0.25%. Qualified banks borrow from each other within this band, but never above or below, because the central bank will always lend to them at the top of the band, and take deposits at the bottom of the band; in principle, the capacity to borrow and lend at

6048-746: The International Monetary Fund registered that 45 economies used inflation targeting as their monetary policy framework. In addition, the Federal Reserve and the European Central Bank are generally considered to follow a strategy very close to inflation targeting, even though they do not officially label themselves as inflation targeters. Inflation targeting thus has become the world's dominant monetary policy framework. However, critics contend that there are unintended consequences to this approach such as fueling

6160-431: The central bank lending to counter-parties only when security of a certain quality is pledged as collateral . Other forms of monetary policy, particularly used when interest rates are at or near 0% and there are concerns about deflation or deflation is occurring, are referred to as unconventional monetary policy . These include credit easing , quantitative easing , forward guidance , and signalling . In credit easing,

6272-556: The central bank to control both the quantity of lending and its allocation towards certain strategic sectors of the economy, for example to support the national industrial policy, or to environmental investment such as housing renovation. The Bank of Japan used to apply such policy ("window guidance") between 1962 and 1991. The Banque de France also widely used credit guidance during the post-war period of 1948 until 1973 . The European Central Bank's ongoing TLTROs operations can also be described as form of credit guidance insofar as

6384-413: The central bank, the central monetary authority can create a band (or "corridor") within which market interbank short-term interest rates will typically move. Depending on the specific details, the resulting specific market interest rate may either be created by open market operations by the central bank (a so-called "corridor system") or in practice equal the administered rate (a "floor system", practised by

6496-485: The central banks of all G7 member countries can be said to follow an inflation target, including the European Central Bank and the Federal Reserve , who have adopted the main elements of inflation targeting without officially calling themselves inflation targeters. In emerging countries fixed exchange rate regimes are still the most common monetary policy. The instruments available to central banks for conducting monetary policy vary from country to country, depending on

6608-1409: The corresponding gold halides. Gold is strongly attacked by fluorine at dull-red heat to form gold(III) fluoride AuF 3 . Powdered gold reacts with chlorine at 180 °C to form gold(III) chloride AuCl 3 . Gold reacts with bromine at 140 °C to form a combination of gold(III) bromide AuBr 3 and gold(I) bromide AuBr, but reacts very slowly with iodine to form gold(I) iodide AuI: 2 Au + 3 F 2 → Δ 2 AuF 3 {\displaystyle {\ce {2Au{}+3F2->[{} \atop \Delta ]2AuF3}}} 2 Au + 3 Cl 2 → Δ 2 AuCl 3 {\displaystyle {\ce {2Au{}+3Cl2->[{} \atop \Delta ]2AuCl3}}} 2 Au + 2 Br 2 → Δ AuBr 3 + AuBr {\displaystyle {\ce {2Au{}+2Br2->[{} \atop \Delta ]AuBr3{}+AuBr}}} 2 Au + I 2 → Δ 2 AuI {\displaystyle {\ce {2Au{}+I2->[{} \atop \Delta ]2AuI}}} Gold does not react with sulfur directly, but gold(III) sulfide can be made by passing hydrogen sulfide through

6720-441: The country's stage of development, institutional structure and political system. The main monetary policy instruments available to central banks are interest rate policy , i.e. setting (administered) interest rates directly, open market operations , forward guidance and other communication activities, bank reserve requirements , and re-lending and re-discount (including using the term repurchase market. While capital adequacy

6832-438: The country's stage of development, institutional structure, tradition and political system. Interest rate targeting is generally the primary tool, being obtained either directly via administratively changing the central bank's own interest rates or indirectly via open market operations . Interest rates affect general economic activity and consequently employment and inflation via a number of different channels, known collectively as

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6944-405: The currency value in terms of gold or silver, and the price of the local currency in terms of foreign currencies. This official price could be enforced by law, even if it varied from the market price. Paper money originated from promissory notes termed " jiaozi " in 7th-century China . Jiaozi did not replace metallic currency, and were used alongside the copper coins. The succeeding Yuan dynasty

7056-608: The demise of the gold standards and efforts to create a more adequate monetary framework internationally after World War II . Nowadays the gold standard is no longer used by any country. In 1944, the Bretton Woods system was established, which created the International Monetary Fund and introduced a fixed exchange rate system linking the currencies of most industrialized nations to the US dollar, which as

7168-424: The densest element, osmium , is 22.588 ± 0.015 g/cm . Whereas most metals are gray or silvery white, gold is slightly reddish-yellow. This color is determined by the frequency of plasma oscillations among the metal's valence electrons, in the ultraviolet range for most metals but in the visible range for gold due to relativistic effects affecting the orbitals around gold atoms. Similar effects impart

7280-479: The duration that the interest rate target is kept constant will vary between months and years. This interest rate target is usually reviewed on a monthly or quarterly basis by a policy committee. Changes to the interest rate target are made in response to various market indicators in an attempt to forecast economic trends and in so doing keep the market on track towards achieving the defined inflation target. The inflation targeting approach to monetary policy approach

7392-689: The early 4th millennium. As of 1990, gold artifacts found at the Wadi Qana cave cemetery of the 4th millennium BC in West Bank were the earliest from the Levant. Gold artifacts such as the golden hats and the Nebra disk appeared in Central Europe from the 2nd millennium BC Bronze Age . The oldest known map of a gold mine was drawn in the 19th Dynasty of Ancient Egypt (1320–1200 BC), whereas

7504-541: The economy through financial channels like interest rates, exchange rates and prices of financial assets . This is in contrast to fiscal policy , which relies on changes in taxation and government spending as methods for a government to manage business cycle phenomena such as recessions . In developed countries , monetary policy is generally formed separately from fiscal policy, modern central banks in developed economies being independent of direct government control and directives. How best to conduct monetary policy

7616-440: The end of the second quarter of 2010. Further similar monetary policy proposals include the idea of helicopter money whereby central banks would create money without assets as counterpart in their balance sheet. The money created could be distributed directly to the population as a citizen's dividend. Virtues of such money shocks include the decrease of household risk aversion and the increase in demand, boosting both inflation and

7728-501: The entire economy, in no small part because of appreciation for the marginal revolution in economics, which demonstrated that people would change their decisions based on changes in their opportunity costs . The establishment of national banks by industrializing nations was associated then with the desire to maintain the currency's relationship to the gold standard , and to trade in a narrow currency band with other gold-backed currencies. To accomplish this end, central banks as part of

7840-416: The expedition. Pasha Mohammad Ali later organized Fazogli into a number of sheikhdoms to govern its inhabitants. Later geologists who surveyed the area for gold included Josef von Russegger . 11°17′N 34°46′E  /  11.283°N 34.767°E  / 11.283; 34.767 This Sudan location article is a stub . You can help Misplaced Pages by expanding it . Gold Gold

7952-427: The extremes of the band are unlimited. The target rates are generally short-term rates. The actual rate that borrowers and lenders receive on the market will depend on (perceived) credit risk, maturity and other factors. For example, a central bank might set a target rate for overnight lending of 4.5%, but rates for (equivalent risk) five-year bonds might be 5%, 4.75%, or, in cases of inverted yield curves , even below

8064-618: The first century AD. Monetary policy Heterodox Monetary policy is the policy adopted by the monetary authority of a nation to affect monetary and other financial conditions to accomplish broader objectives like high employment and price stability (normally interpreted as a low and stable rate of inflation ). Further purposes of a monetary policy may be to contribute to economic stability or to maintain predictable exchange rates with other currencies . Today most central banks in developed countries conduct their monetary policy within an inflation targeting framework, whereas

8176-591: The first written reference to gold was recorded in the 12th Dynasty around 1900 BC. Egyptian hieroglyphs from as early as 2600 BC describe gold, which King Tushratta of the Mitanni claimed was "more plentiful than dirt" in Egypt. Egypt and especially Nubia had the resources to make them major gold-producing areas for much of history. One of the earliest known maps, known as the Turin Papyrus Map , shows

8288-403: The gold acts simply as a solute, this is not a chemical reaction . A relatively rare element, gold is a precious metal that has been used for coinage , jewelry , and other works of art throughout recorded history . In the past, a gold standard was often implemented as a monetary policy . Gold coins ceased to be minted as a circulating currency in the 1930s, and the world gold standard

8400-421: The gold standard began setting the interest rates that they charged both their own borrowers and other banks which required money for liquidity. The maintenance of a gold standard required almost monthly adjustments of interest rates. The gold standard is a system by which the price of the national currency is fixed vis-a-vis the value of gold, and is kept constant by the government's promise to buy or sell gold at

8512-563: The highest electron affinity of any metal, at 222.8 kJ/mol, making Au a stable species, analogous to the halides . Gold also has a –1 oxidation state in covalent complexes with the group 4 transition metals, such as in titanium tetraauride and the analogous zirconium and hafnium compounds. These chemicals are expected to form gold-bridged dimers in a manner similar to titanium(IV) hydride . Gold(II) compounds are usually diamagnetic with Au–Au bonds such as [ Au(CH 2 ) 2 P(C 6 H 5 ) 2 ] 2 Cl 2 . The evaporation of

8624-431: The increase in housing prices and contributing to wealth inequalities by supporting higher equity values. This policy is based on maintaining a fixed exchange rate with a foreign currency. There are varying degrees of fixed exchange rates, which can be ranked in relation to how rigid the fixed exchange rate is with the anchor nation. Under a system of fiat fixed rates, the local government or monetary authority declares

8736-428: The inflation targeting employs a more direct approach. The inflation target is achieved through periodic adjustments to the central bank interest rate target. In addition, clear communication to the public about the central bank's actions and future expectations are an essential part of the strategy, in itself influencing inflation expectations which are considered crucial for actual inflation developments. Typically

8848-481: The level of interest rate ultimately paid by banks is differentiated according to the volume of lending made by commercial banks at the end of the maintenance period. If commercial banks achieve a certain lending performance threshold, they get a discount interest rate, that is lower than the standard key interest rate. For this reason, some economists have described the TLTROs as a "dual interest rates" policy . China

8960-440: The level of interest rates, the exchange rate and/or the money supply in an economy. Open market operations can influence interest rates by expanding or contracting the monetary base , which consists of currency in circulation and banks' reserves on deposit at the central bank. Each time a central bank buys securities (such as a government bond or treasury bill), it in effect creates money . The central bank exchanges money for

9072-414: The local currency may be allowed to freely dispose of the funds, required to hold the funds with the central bank for some period of time, or allowed to use the funds subject to certain restrictions. In other cases, the ability to hold or use the foreign exchange may be otherwise limited. In this method, money supply is increased by the central bank when it purchases the foreign currency by issuing (selling)

9184-476: The local currency. The central bank may subsequently reduce the money supply by various means, including selling bonds or foreign exchange interventions. In some countries, central banks may have other tools that work indirectly to limit lending practices and otherwise restrict or regulate capital markets. For example, a central bank may regulate margin lending , whereby individuals or companies may borrow against pledged securities. The margin requirement establishes

9296-409: The main interest rate which the central bank uses to communicate its policy, may be either an administered rate (i.e. set directly by the central bank) or a market interest rate which the central bank influences only indirectly. By setting administered rates that commercial banks and possibly other financial institutions will receive for their deposits in the central bank, respectively pay for loans from

9408-547: The mineral quartz, and gold out of the fluids and onto nearby surfaces. The world's oceans contain gold. Measured concentrations of gold in the Atlantic and Northeast Pacific are 50–150 femtomol /L or 10–30 parts per quadrillion (about 10–30 g/km ). In general, gold concentrations for south Atlantic and central Pacific samples are the same (~50 femtomol/L) but less certain. Mediterranean deep waters contain slightly higher concentrations of gold (100–150 femtomol/L), which

9520-426: The monetary policies of most developing countries' central banks target some kind of a fixed exchange rate system . A third monetary policy strategy, targeting the money supply , was widely followed during the 1980s, but has diminished in popularity since then, though it is still the official strategy in a number of emerging economies . The tools of monetary policy vary from central bank to central bank, depending on

9632-464: The monetary supply at a low, constant rate, as the best way of maintaining low inflation and stable production growth. During the 1970s inflation rose in many countries caused by the 1970s energy crisis , and several central banks turned to a money supply target in an attempt to reduce inflation. However, when U.S. Federal Reserve Chairman Paul Volcker tried this policy, starting in October 1979, it

9744-411: The noble metals, it still forms many diverse compounds. The oxidation state of gold in its compounds ranges from −1 to +5, but Au(I) and Au(III) dominate its chemistry. Au(I), referred to as the aurous ion, is the most common oxidation state with soft ligands such as thioethers , thiolates , and organophosphines . Au(I) compounds are typically linear. A good example is Au(CN) − 2 , which

9856-449: The nominal price level or its path or about what the central bank might do with respect to achieving that path. A nominal anchor is a variable that is thought to bear a stable relationship to the price level or the rate of inflation over some period of time. The adoption of a nominal anchor is intended to stabilize inflation expectations, which may, in turn, help stabilize actual inflation. Nominal variables historically used as anchors include

9968-497: The only currency in the system would be directly convertible to gold. During the following decades the system secured stable exchange rates internationally, but the system broke down during the 1970s when the dollar increasingly came to be viewed as overvalued. In 1971, the dollar's convertibility into gold was suspended. Attempts to revive the fixed exchange rates failed, and by 1973 the major currencies began to float against each other. In Europe, various attempts were made to establish

10080-576: The plan of a gold mine in Nubia together with indications of the local geology . The primitive working methods are described by both Strabo and Diodorus Siculus , and included fire-setting . Large mines were also present across the Red Sea in what is now Saudi Arabia . Gold is mentioned in the Amarna letters numbered 19 and 26 from around the 14th century BC. Gold is mentioned frequently in

10192-405: The printing of paper money . Interest rates , while now thought of as part of monetary authority , were not generally coordinated with the other forms of monetary policy during this time. Monetary policy was considered as an executive decision, and was generally implemented by the authority with seigniorage (the power to coin). With the advent of larger trading networks came the ability to define

10304-464: The project. The earliest recorded metal employed by humans appears to be gold, which can be found free or " native ". Small amounts of natural gold have been found in Spanish caves used during the late Paleolithic period, c.  40,000 BC . The oldest gold artifacts in the world are from Bulgaria and are dating back to the 5th millennium BC (4,600 BC to 4,200 BC), such as those found in

10416-690: The r-process in the collision of neutron stars . In both cases, satellite spectrometers at first only indirectly detected the resulting gold. However, in August 2017, the spectroscopic signatures of heavy elements, including gold, were observed by electromagnetic observatories in the GW170817 neutron star merger event, after gravitational wave detectors confirmed the event as a neutron star merger. Current astrophysical models suggest that this single neutron star merger event generated between 3 and 13 Earth masses of gold. This amount, along with estimations of

10528-620: The rare bismuthide maldonite ( Au 2 Bi ) and antimonide aurostibite ( AuSb 2 ). Gold also occurs in rare alloys with copper , lead , and mercury : the minerals auricupride ( Cu 3 Au ), novodneprite ( AuPb 3 ) and weishanite ( (Au,Ag) 3 Hg 2 ). A 2004 research paper suggests that microbes can sometimes play an important role in forming gold deposits, transporting and precipitating gold to form grains and nuggets that collect in alluvial deposits. A 2013 study has claimed water in faults vaporizes during an earthquake, depositing gold. When an earthquake strikes, it moves along

10640-420: The rate of occurrence of these neutron star merger events, suggests that such mergers may produce enough gold to account for most of the abundance of this element in the universe. Because the Earth was molten when it was formed , almost all of the gold present in the early Earth probably sank into the planetary core . Therefore, as hypothesized in one model, most of the gold in the Earth's crust and mantle

10752-935: The reaction. However, the ions are removed from the equilibrium by hydrochloric acid, forming AuCl − 4 ions, or chloroauric acid , thereby enabling further oxidation: 2 Au + 6 H 2 SeO 4 → 200 ∘ C Au 2 ( SeO 4 ) 3 + 3 H 2 SeO 3 + 3 H 2 O {\displaystyle {\ce {2Au{}+6H2SeO4->[{} \atop {200^{\circ }{\text{C}}}]Au2(SeO4)3{}+3H2SeO3{}+3H2O}}} Au + 4 HCl + HNO 3 ⟶ HAuCl 4 + NO ↑ + 2 H 2 O {\displaystyle {\ce {Au{}+4HCl{}+HNO3->HAuCl4{}+NO\uparrow +2H2O}}} Gold

10864-473: The rest of the gold on Earth is thought to have been incorporated into the planet since its very beginning, as planetesimals formed the mantle . In 2017, an international group of scientists established that gold "came to the Earth's surface from the deepest regions of our planet", the mantle, as evidenced by their findings at Deseado Massif in the Argentinian Patagonia . On Earth, gold

10976-486: The same result and showing that the isotopes of gold produced by it were all radioactive . In 1980, Glenn Seaborg transmuted several thousand atoms of bismuth into gold at the Lawrence Berkeley Laboratory. Gold can be manufactured in a nuclear reactor, but doing so is highly impractical and would cost far more than the value of the gold that is produced. Although gold is the most noble of

11088-522: The security, increasing the monetary base while lowering the supply of the specific security. Conversely, selling of securities by the central bank reduces the monetary base. Open market operations usually take the form of: Forward guidance is a communication practice whereby the central bank announces its forecasts and future intentions to influence market expectations of future levels of interest rates . As expectations formation are an important ingredient in actual inflation changes, credible communication

11200-424: The short-term rate. Many central banks have one primary "headline" rate that is quoted as the "central bank rate". In practice, they will have other tools and rates that are used, but only one that is rigorously targeted and enforced. A typical central bank consequently has several interest rates or monetary policy tools it can use to influence markets. Through open market operations , a central bank may influence

11312-486: The silver content. The more silver, the lower the specific gravity . Native gold occurs as very small to microscopic particles embedded in rock, often together with quartz or sulfide minerals such as " fool's gold ", which is a pyrite . These are called lode deposits. The metal in a native state is also found in the form of free flakes, grains or larger nuggets that have been eroded from rocks and end up in alluvial deposits called placer deposits . Such free gold

11424-450: The south-east corner of the Black Sea is said to date from the time of Midas , and this gold was important in the establishment of what is probably the world's earliest coinage in Lydia around 610 BC. The legend of the golden fleece dating from eighth century BCE may refer to the use of fleeces to trap gold dust from placer deposits in the ancient world. From the 6th or 5th century BC,

11536-436: The tendency of gold ions to interact at distances that are too long to be a conventional Au–Au bond but shorter than van der Waals bonding . The interaction is estimated to be comparable in strength to that of a hydrogen bond . Well-defined cluster compounds are numerous. In some cases, gold has a fractional oxidation state. A representative example is the octahedral species {Au( P(C 6 H 5 ) 3 )} 2+ 6 . Gold

11648-403: The transmutation of the chemical elements did not become possible until the understanding of nuclear physics in the 20th century. The first synthesis of gold was conducted by Japanese physicist Hantaro Nagaoka , who synthesized gold from mercury in 1924 by neutron bombardment. An American team, working without knowledge of Nagaoka's prior study, conducted the same experiment in 1941, achieving

11760-417: The visors of heat-resistant suits and in sun visors for spacesuits . Gold is a good conductor of heat and electricity . Gold has a density of 19.3 g/cm , almost identical to that of tungsten at 19.25 g/cm ; as such, tungsten has been used in the counterfeiting of gold bars , such as by plating a tungsten bar with gold. By comparison, the density of lead is 11.34 g/cm , and that of

11872-457: The years adapted a similar strategy. The Global Financial Crisis of 2008 sparked controversy over the use and flexibility of the inflation targeting employed. Many economists argued that the actual inflation targets decided upon were set too low by many monetary regimes. During the crisis, many inflation-anchoring countries reached the lower bound of zero rates, resulting in inflation rates decreasing to almost zero or even deflation. As of 2023,

11984-787: Was abandoned for a fiat currency system after the Nixon shock measures of 1971. In 2020, the world's largest gold producer was China, followed by Russia and Australia. As of 2020 , a total of around 201,296 tonnes of gold exist above ground. This is equal to a cube, with each side measuring roughly 21.7 meters (71 ft). The world's consumption of new gold produced is about 50% in jewelry, 40% in investments , and 10% in industry . Gold's high malleability, ductility, resistance to corrosion and most other chemical reactions, as well as conductivity of electricity have led to its continued use in corrosion-resistant electrical connectors in all types of computerized devices (its chief industrial use). Gold

12096-422: Was found to be impractical, because of the unstable relationship between monetary aggregates and other macroeconomic variables, and similar results prevailed in other countries. Even Milton Friedman later acknowledged that direct money supplying was less successful than he had hoped. In 1990, New Zealand as the first country ever adopted an official inflation target as the basis of its monetary policy. The idea

12208-608: Was pioneered in New Zealand. Since 1990, an increasing number of countries have switched to inflation targeting as its monetary policy framework. It is used in, among other countries, Australia , Brazil , Canada , Chile , Colombia , the Czech Republic , Hungary , Japan , New Zealand , Norway , Iceland , India , Philippines , Poland , Sweden , South Africa , Turkey , and the United Kingdom . In 2022,

12320-517: Was the first government to use paper currency as the predominant circulating medium. In the later course of the dynasty, facing massive shortages of specie to fund war and maintain their rule, they began printing paper money without restrictions, resulting in hyperinflation . With the creation of the Bank of England in 1694, which was granted the authority to print notes backed by gold, the idea of monetary policy as independent of executive action began to be established. The purpose of monetary policy

12432-621: Was to distort the Witwatersrand basin in such a way that the gold-bearing rocks were brought to the present erosion surface in Johannesburg , on the Witwatersrand , just inside the rim of the original 300 km (190 mi) diameter crater caused by the meteor strike. The discovery of the deposit in 1886 launched the Witwatersrand Gold Rush . Some 22% of all the gold that is ascertained to exist today on Earth has been extracted from these Witwatersrand rocks. Much of

12544-450: Was to maintain the value of the coinage, print notes which would trade at par to specie, and prevent coins from leaving circulation. During the period 1870–1920, the industrialized nations established central banking systems, with one of the last being the Federal Reserve in 1913. By this time the role of the central bank as the " lender of last resort " was established. It was also increasingly understood that interest rates had an effect on

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