Charting The Price Of Gold... All The Way Back To 1265

Tyler Durden's picture




 

We have often seen requests to show the price of gold going back as long as possible. Tonight we can oblige, with a gold price chart, indexed in 2010 British Pounds, going all the way back to 1265. To the surprise of many, the early 1980s gold price surge is not the only time in history when gold exploded as America's game with inflation was almost lost. It appears that based on the surge in gold back in the late 15th century, there was actually quite a serious need for Columbus to go forth and find a source of gold, because last we checked Ferdinand and Isabella did not have Bernanke's money printers back then. And yes, as Goldman says, there were no ETFs back in the 16th century to draw demand away from the real deal and into make believe exposure.

And more or less the same in (synthetic) USD terms:

0
Your rating: None
 

- advertisements -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Tue, 01/10/2012 - 21:44 | 2052687 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Ain't seen nothing yet bitchez!

Tue, 01/10/2012 - 22:07 | 2052776 CIABS
CIABS's picture

who would i rely on to tell the truth about the price of gold for the last 750 years?  the bank of england and goldman sachs!  the main message of their chart is that the price of gold is on the high side right now.  buy low, sell high, right?

how are they adjusting the paper pound for inflation?  using the price of gold, maybe.  one british pound used to buy, let's see, a pound of silver.  now it takes about 310 paper pounds to buy a pound of silver.  but i'm forgetting to adjust for the price of silver there.  my bad.

Tue, 01/10/2012 - 22:28 | 2052861 masterinchancery
masterinchancery's picture

On the low side, rather.

Tue, 01/10/2012 - 22:31 | 2052873 He_Who Carried ...
He_Who Carried The Sun's picture

It'll surely take out the record again, in about 347 years. Good one, Tylers.

Tue, 01/10/2012 - 23:01 | 2052998 Manthong
Manthong's picture

Well, the gold proponents maintain that over the years an ounce of gold equates to a fine suit..

                                   of armor?

 

Tue, 01/10/2012 - 23:28 | 2053111 SGS
SGS's picture

last 100 years looks like a shit show.

Tue, 01/10/2012 - 23:49 | 2053207 trav7777
trav7777's picture

Britain had periodic gold/silver imbalances.  The historical ratio was an average.

Once the Sterling Bill came to be, they were able to fix the POG worldwide.

Wed, 01/11/2012 - 03:07 | 2053626 Hober Mallow
Hober Mallow's picture

The copies of gold and silver inflated, 
which after the theft were thrown into the lake, 
at the discovery that all is exhausted and dissipated by the debt. 
All scrips and bonds will be wiped out.

Century VIII

Wed, 01/11/2012 - 03:56 | 2053644 NewThor
NewThor's picture

Nostradamus spells it all out.

It's all there in his quatrains,

are you Indiana Jones enough to find it?

It's worth the search,

if you're man enough for the Quest

everyone needs to be ready for

what happens in March.

The Medusine Machine that makes the Markets

doesn't last for foreve,r moneyfuckers.

Vaya Con Dios.

Money was never time.

 

Wed, 01/11/2012 - 09:12 | 2053896 BigJim
BigJim's picture

"The copies of gold and silver inflated"! Whoa! Sounds like the 350:1 leveraged unallocated gold market to me.

And as for "which after the theft were thrown into the lake" - this must surely refer to all the precious-metal boating accidents we ZHer's seem particularly prone to.

Wed, 01/11/2012 - 09:23 | 2053953 BigJim
BigJim's picture

What I'd really like to see is a chart plotting Central Bank's attempts to instill confidence in their paper by talking down gold.

Or a chart plotting the amount of leverage in the unallocated market at any particular moment, depressing the spot price.

Or a plot charting the median wage of a Goldman Sachs employee producing misleading charts vs. the median wage of someone actually producing something of value.

Wed, 01/11/2012 - 03:14 | 2053633 SilverRhino
SilverRhino's picture

Tailored suit yes.  Suit of armor?  in modern times that is around 1.5 to 3 ounces of gold actually.

Before firearms became prevalent having a suit of plate armor was on par with owning a Mercedes.  (30 ounces of Au)

Wed, 01/11/2012 - 09:39 | 2053989 FurQ
FurQ's picture

nice titties

Wed, 01/11/2012 - 12:45 | 2054852 MayIMommaDogFac...
MayIMommaDogFace2theBananaPatch's picture

Those aren't Party Hats?  ^^

Wed, 01/11/2012 - 09:43 | 2054008 rrrr
rrrr's picture

A British pound was equivilant to a pound of sterling. The silver content of sterling is 92.5%.

Tue, 01/10/2012 - 23:33 | 2053137 theman
theman's picture

As alluring as this chart is, it is absolutely worthlees/misleading without complete disclosure of the underlying assumptions and math.  Pretty picture, though.

Wed, 01/11/2012 - 01:57 | 2053554 Oh regional Indian
Oh regional Indian's picture

True. is this in inflation adjusted currency? Has to be, or it's completely without meaning.

ori

Wed, 01/11/2012 - 05:13 | 2053713 Non Passaran
Non Passaran's picture

Why? It could be in bushels of wheat or whatever.

Wed, 01/11/2012 - 07:18 | 2053791 Surly Bear
Surly Bear's picture

Personally, I'd like to see this chart in more meaning terms such as number of ex-wives with their kids or whores per ounce for our banking friends.... Thanks, Tyler.

Tue, 01/10/2012 - 23:41 | 2053170 Gully Foyle
Gully Foyle's picture

How will the new D&D rules affect Gold?

http://ace.mu.nu/

 

Now, the third edition (the previous edition) was popular and the RPG hobby had a huge renaissance during it. Actually a huge bubble and then a huge crash, but for a time, the RPG industry, which is barely a rounding error even in the category of specialty games, actually was making money.

Partly fueling that bubble was an Open License. For the first time, ever, the game was packaged with an open license. Homebrewers and wannabe D&D writers could actually just publish their own stuff for D&D, and it was all perfectly legal. The Open License allowed everyone to use D&D rules in perpetuity. Freely -- no royalties owed.

The theory was that if you could essentially corner the market by doing this, by unleashing a thousand garage game designers to write for your product, and even if you were losing, hypothetically, sales dollars to these "competitors," they really weren't full competitors-- because at the end of the day they were supporting, and generating a need for, your main product, the actual rules.

That part of it worked like the dickens.

But -- there's a downside to granting, to everyone in the world, a super-generous royalty free open license "in perpetuity." When this was first dreamed up, people asked the head of the D&D company, Ryan Dancey, Doesn't this mean people can just publish all your rules under their own covers and charge for it?

Dancey said, "It sure does!" But he didn't think that would be a problem because D&D would always have better production values which result, naturally, from an operation of some scale (at least a much larger scale than a guy in his garage cranking out illustration-free copies of the rules). So the threat of some competitor for the actual rules was pretty minor.

Except.

What happened was that D&D 4th was such a departure from the well-liked (and yet super-clunky) 3rd edition rules that... someone did in fact go ahead and start publishing the rules under the Open License, but it wasn't some guy in his garage. It was a somewhat-established game company, using a lot of the same artists who illustrated the actual D&D products.

And further, the anger over D&D 4 was so great people flocked to support this competitor company, which was actually simply publishing D&D 3rd edition under a different (lame) name, Pathfinder. And I hear that Pathfinder is actually... outselling the actual D&D game it's knocking off. Or at least it's too close for comfort.

Tue, 01/10/2012 - 23:51 | 2053219 trav7777
trav7777's picture

um...some of us like discovered women

Wed, 01/11/2012 - 03:43 | 2053654 NewThor
NewThor's picture

Hey. I played dungeons and dragons when I was younger.

I've spent over 100 hours of my life playing World of Warcraft.

I'll put the quantity of quality women: beautiful, sexy, cute, funny, smart, talented, creative, 

I've spent quality time with up against any man on Zerohedge.

ANY man.

Tarantino is a fucking geek, right?

...but most important, I'm uncanny in a fist fights, bullet battles or super unsecure situations.

Did The Dark Knight make any money?

Comic books are for kids.

If religion outlawed mythology,

where would be a good place to hide it?

Paladin for life.

 

Wed, 01/11/2012 - 03:58 | 2053668 NewThor
NewThor's picture

What is the super power I would wish for?

The ability to heal hearts, souls and minds.

Wed, 01/11/2012 - 09:51 | 2054036 rrrr
rrrr's picture

The ability to heal hearts, souls and minds sounds appealing, but think about what is required. You can't heal these merely by waving a magic wand, that only works in comic books and cheap TV programs. Actually healing someone's mind can take intensive work for many decades. Souls take much longer. And hearts heal by themselves, in fact rather quickly. But a true ability to heal these, believe me, you'd get severe compasion fatigue in less than one month.

Wed, 01/11/2012 - 00:30 | 2053371 HoofHearted
HoofHearted's picture

WTF?

Boy, you ain't from around here, are ya?

Wed, 01/11/2012 - 10:02 | 2054070 Crumbles
Crumbles's picture

Been around Zhedge longer than U, asswipe. Engage brain b4 starting fingers. Still no avatar 'cept that sack 'o shit we see. Descriptive, woot!

Wed, 01/11/2012 - 11:05 | 2054332 gmrpeabody
gmrpeabody's picture

Play nice!

Wed, 01/11/2012 - 01:39 | 2053531 lemonobrien
lemonobrien's picture

depends on the dungeon master.

Wed, 01/11/2012 - 02:19 | 2053575 dark pools of soros
dark pools of soros's picture

the Squid always strikes first

Wed, 01/11/2012 - 03:45 | 2053657 NewThor
NewThor's picture

The REAL Goldman Sachs Vampire Squid is Cthulu.

Duh.

Wed, 01/11/2012 - 08:29 | 2053872 Master Pimp
Master Pimp's picture

Greetings from Greece!ZHedge kicks a$$!

Oh come on guys, the true global / intergalactic eternal currency is energy (and farmland)!!! Wht the heck are u gonna do with gold? Are you reptilians?HAHAHHAH!

Come buy real estate in Greece!

or uranium, or platinum, or some oil related securities!

 

Wed, 01/11/2012 - 12:25 | 2054757 RockyRacoon
RockyRacoon's picture

It's all about perspective.   Here's a nice link from Ed Steer this morning.  The graphic is awesome:

Everything you wanted to know about gold

This graphics-intensive story showed up as a posting over at the wealthwire.com website yesterday. I can't vouch for the accuracy of the figures, but it appears that the author has done his homework.

Reader Tolling Jennings was the first person through the door with this story yesterday...and it's a must read. Use the 'click to enlarge' feature to bring the commentary up to full-screen size once the website has loaded. The link is here.

https://images.angelpub.com/2012/02/12357/big-gold-graphic.jpg

Tue, 01/10/2012 - 21:45 | 2052690 Squishi
Squishi's picture

thunder and lightning.

Wed, 01/11/2012 - 03:46 | 2053658 NewThor
NewThor's picture

Have I mentioned I love thunder, lightning, rain, dogs, horses and beer?

Long live light sound and love!

Tue, 01/10/2012 - 21:46 | 2052693 tmosley
tmosley's picture

From the chart, one can rightly guess that there isn't much room for real gold appreciation.  As suspected, it is a method by which to maintain one's purchasing power in times of crisis.

Tue, 01/10/2012 - 21:57 | 2052729 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

And luckily this crisis is just like the rest since we can run automobiles off of unicorn piss forever!

Tue, 01/10/2012 - 22:14 | 2052802 tmosley
tmosley's picture

There was another crisis just like this one in China during the time frame of this chart, but I doubt the chart reflects worldwide prices, as there was no worldwide market at the time.

I'm not saying "dont buy gold", for fucks sake.  I am saying that one should buy it as wealth preservation, not to build wealth.

Tue, 01/10/2012 - 22:16 | 2052811 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Say what you want.  In real terms it is underpriced.

Tue, 01/10/2012 - 22:33 | 2052878 tmosley
tmosley's picture

What is?  Gold?  How can you value gold?  Gold is a claim on wealth.  It may be able to buy more things in the future, as the fiat structure collapses, but that doesn't mean it is more valuable.  Your wealth isn't growing by owning gold.  Everyone else's is decreasing because they own fiat.  It looks like you have increased your purchasing power, but the reality is that everything else has just gotten cheaper (an important distinction, as this means falling standards of living for all those around you, rather than you simply increasing your standard of living).

Other things, like silver, WILL increase your wealth.  But gold maintains it.  That doesn't mean "don't own gold".  Just the opposite.  You MUST own gold.  But don't expect it to buy you more new goods than it does now (assuming non-desperate sellers).

Imagine an ant staking a claim to some territory on a deflated balloon.  Gold is like having a plot staked out, which grows with the inflation of the balloon.  Owning something like silver is like owning territory on the inflating balloon while also grabbing more besides. 

Tue, 01/10/2012 - 23:16 | 2053068 SgtShaftoe
SgtShaftoe's picture

I mostly agree, however Mises and Hayek even contested that money was not an accurate barometer of "value", and that even "money" could be over / under priced.  It is yet imperfect even as a unit of account in any form.  In gold's situation, one can fairly argue that it's under-priced in terms of things and historical "money" for a number of reasons.  So your same inflating balloon analogy is applicable to gold as well as silver.  Obviously, silver should inflate at a much higher velocity, with some healthy volatility as well.  I'm betting big on silver and gold / miners.  90% of my net worth except for a small rural homestead in the midwest that's been in my family since the indians is riding on that.  From a historical perspective I know I'm positioned right, I just hope I can hold out long enough to see a return without being slashed to death.  When is that wage spiral going to start moving with the prices????????   

Wed, 01/11/2012 - 00:39 | 2053397 Socratic Dog
Socratic Dog's picture

""money" could be over / under priced"

Yeah, that's my problem with the chart.  What is a 2010 pound sterling really worth?

I've been thinking about food prices, and the fact that an ounce of gold will currently buy about 14 years of calories for a man, in the form of 50 pond sacks of corn at retail.  My monthly rent ($2,00) buys more.  There seems to be a serious dislocation here, in that the value of the dollar is seriously overestimated in the price of corn.  Gold I don't know, it may be that an ounce of gold has always bought 14 years of food, but I somehow doubt it. 

The point I'm trying to make is that pricing gold in some arbitrary currency at some arbitrary point of time seems a bit stupid, as currency isn't "real".  It might be better to price that currency by the amount of gold it will buy.  But best would be to price both currency and gold against some real measure of value.  Such as food for a month, for example.  A man's suit?  Too subject to other forces (price of labor, price of wool, availability of mechanisation).  Food is so basic and irreducible that it might suffice as a measure.  Then again, it depends so much on the price of energy that it is probably just as worthless.

Can any of you bright lads help me out here?  What represents a an absolute measure of worth?  Young pussy maybe?

Wed, 01/11/2012 - 03:50 | 2053662 NewThor
NewThor's picture

There is no spoon.

Sometimes I think letting human beings create language is the ultimate

catch 22 of free will.

Too many words rots minds into an unstable insanity.

"The Earth is 4.5 billion years old."

lol. humans are so silly.

There is no time, bitchez.

Wed, 01/11/2012 - 04:49 | 2053697 Blank Reg
Blank Reg's picture

How about a days labor. (unskilled)

Wed, 01/11/2012 - 07:58 | 2053830 Snidley Whipsnae
Snidley Whipsnae's picture

Socratic Dog...

Food isn't a good measure against gold long term because of the 'green revolution'.

The green revolution is, to simplify, the use of modern fertilizers, pesticides, crop rotations, and large farms using large equipment. A couple of hundred years ago an acre of corn would yeild from 2 to 20 bushels. Now an acre of corn yeilds ~ 200 bushels and using far less man hours to get the corn from seed to silo.

At the time of the American Revolution about 97% of Americans worked/lived on farms. Now that picture is reversed and about 5% of Americans work/live on farms.

Most Americans believe that the largest migration of workers in America took place when the dust bowl hit the South West and the people left for California (see Grapes of Wrath, etc), but that is not true.

The largest number of Americans to migrate took place shortly after WW2 when the mechanical cotton picker came into use in the cotton belt and made share croppers and day labor cotton workers redundent. These displaced workers moved to Detroit, Chicago, NY City, and the 'rust belt' in enormous numbers.

So, imo, it's difficult to find an item (commodity or consumable) that has not been made much, much less costly due to advances in technology, scale, and productivity. Even the mining of base and precious metals have been effected ... and, on top of all this we must remember that slave labor is no longer a factor but was a large factor a few hundred years ago. During the Roman occupation of Gaul they used many thousands of slaves to divert large rivers to wash away entire mountains into enormous sluice boxes to get the gold out of the mountains. How does one factor all the changes into the long term price of gold?

Wed, 01/11/2012 - 09:18 | 2053924 BigJim
BigJim's picture

'Worth' (or 'value') is almost entirely subjective... a lot depends on where you and your trading partners are located within Maslow's hierarchy. This is why valuing one particular commodity over a large period of time is very difficult.

I don't think it's possible to produce a meaningful chart like the BoE/Squid's one above. Yes, they've stated it's vs. 2010 GBP, but how do you 'value' GBP, when it was for a time valued in gold, and before that in silver? So it's really the value of gold vs. what? vs. Land? What kind of land - rural, urban? vs. Food? What kind of food? Wheat? Corn? Bread? vs. Clothing? What kind of clothing? workwear? suits? just cloth? vs. Energy? What kind of energy? Wood? Coal? BTU? vs. Labor? What kind of labor? unskilled, artisan, financial? Do we take into account all the price suppressions and subsidies governments have distorted prices with over the years?

Maybe against baskets of goods... but how are they weighted? By the average amount consumed now, or adjusted for period?

This is why I'm deeply suspicious of Squiddly's chart, which shows gold to be historically highly priced... that seems a very convenient conclusion for the main HR department of the world's central banks to come to.

Tue, 01/10/2012 - 23:16 | 2053070 Ura Bonehead
Ura Bonehead's picture

Gold is currency.  Ron Paul and a bunch of bitchez on the Internet says so, so it must be true.  Right?

Tue, 01/10/2012 - 23:18 | 2053081 tmosley
tmosley's picture

No, gold is money.  Gold CAN be currency, but this is not always the case.  For example, it is currently not currency, but 100 years ago, you could buy goods from any shop with gold coins were you so inclined.

Tue, 01/10/2012 - 23:52 | 2053223 AUD
AUD's picture

That depends who you are. Large amounts of gold are turned over every business day just like FX. And before you cry, "but its only paper", so what? FX is only paper too, even ethereal bytes on computers these days.

Tue, 01/10/2012 - 23:45 | 2053190 Gully Foyle
Gully Foyle's picture

tmosley

How many of you have recently tried to buy a new tv, snow blower, or gas with either Gold or Silver?

Wake me when Home Depot accepts Gold or Silver as FULL payment for a Dewalt power tool.

Do NOT follow this link or you will be banned from the site!