[dawguy]

The circular valuation is the primary reason its valued so highly today. Any article which ignores that isn't doing the topic justice.

Especially because there is a very solid reason the value grew so large to begin with. Prior to the invention of the electric lightbulb gold was far more beautiful than it is today (which was not discussed in the article). In candlelight gold will shimmer and gleam as the flames dance (with the red-orange flames accentuating the gold coloring). With electric lighting, the light provided is so consistent that gold is reflective but isn't any more more beautiful than a shiny steel appliance or clean marble countertop.

The combination of rarity and being the most beautiful material in candlelight made it the perfect material for kings and temples to collect to show off their status. And when the richest people in the world compete to collect something, it makes sense that the price is driven upwards.

In the modern world gold is still collected and stored as a symbol of status and wealth primarily because ancient kings valued it. Even if the driver of why they collected it originally has been greatly diminished.

(The idea behind gold's reflective properties in dim candlelit rooms comes from the book In Praise of Shadows which I would highly recommend)

[jvanderbot]

Its the primary continuation mechanism, sure, but doesn't explain the origin of golds value. That's all I meant. Any commodity has some pricing effect from traders evaluation of its tradability.