The Wall Street Waltz: 90 Visual Perspectives, Illustrated Lessons From Financial Cycles and Trends, Revised and Updated Edition

Chart 69

South African Gold: How Important?

Is South Africa's gold-mining production so terribly important to the world's economy? Lots of folks think so, but you won't if you study this chart carefully. The whole world's gold production isn't very important when you get right down to it. Why? First consider why South Africa is considered important. It produces most of the world's gold and platinum. This chart shows world gold mining production by source from 1950 through to 1983. South Africa's annual production is clearly marked—the light portion on the bottom. The middle section depicts the annual production of all the other Western, free-market/capitalistic economies. The darkest section, on top, represents the production of the communist bloc.

At first glance, it may seem that South African production has become a bigger percentage of the world's total over the last 35 years. But looks are deceiving, because the vertical scale starts at 10, not 0. South Africa's share of the gold market did rise between 1960 and 1972, but then fell back to 48 percent—about where it was in 1950. On the other hand, the communists have made big inroads into gold. In 1950 they produced about 10 percent of the world's gold, and by 1983 were producing about 29 percent (13 divided by 45). Meanwhile, back at the ranch, the free-market economies, including the United States, have dropped from producing 46 percent of the world's gold to only 22 percent. So, South Africa has kept its share while the ...