The high value of gold is driven by three factors: its practical applications, the largely aesthetic desire people have for it and the perceived protection it grants investors as a hedge against currency fluctuations. According to Jerry Bowyer for Forbes magazine, the cash value of all the gold that has so far been extracted amounts to roughly $10 trillion.
According to Bowyer, gold's value relative to the world's currencies rises in relation to how rare it is versus those currencies. As the money supply expands, the exchange value of gold increases. This relationship between the perceived value of gold and the money supply covers the past history of currency expansion, the current state of inflation and expected future monetary trends. The high price of gold is a reaction to the value of money that has already been printed as well as the value of money that speculators foresee being printed in the near future. If further expansion of the money supply seems likely, Bowyer explains that gold is likely to become even more rare in relation to those currencies, driving its value higher still. For example, between 2001 and 2011, the dollar-denominated price of gold increased by a factor of six largely as a result of then-current monetary policies.