Gold is well-known for protecting investors and their portfolios. But it can do so much more. Like protect astronauts and their spacecraft.
When we do finally colonize the cosmos, that maiden voyage will be full of gold.
But it won’t serve as a medium of exchange for trade with Martians or denizens of Proxima Centauri b.
Instead, it’ll be part of the spacecraft.
My colleague Jim Rickards — Agora Financial’s go-to guy for tactics on how to use gold in your portfolio — characterizes the yellow metal as a hard asset immune to threats like Vladimir Putin’s 6,000-strong cyber-brigade that seeks to destroy digital assets.
Protection against global threats in an increasingly uncertain world is just another reason to own gold. That’s on top of the traditional insurance it provides against our ever-eroding dollar, the specter of hyperinflation, and the continuing incompetence of U.S. fiscal and monetary authorities.
Gold has also held its value over a period of centuries – proving more durable than other metals, paper currencies, and other financial assets.
For many investors — and for valid, defensible reasons — it’s the ultimate security blanket.
Gold’s use beyond portfolios and adornments is often overlooked. But for a precious metal, it’s spectacularly useful when it comes to industrial applications such as spaceflight.
NASA budgets aren’t what they once were (or even close to what we thought they were). But it’s not extravagance or conspicuous consumption that leads the space agency to protect its assets with gold.
It’s stone-cold practicality. As Robert C. Langley wrote in 1971:
Thin coatings of gold, applied by a variety of techniques, are used extensively for protection against the effects of radiant energy in space exploration. Further applications in space technology appear to be likely, based on the ease with which the intrinsic properties of gold can be utilized to meet a variety of thermal control problems, while the techniques developed may well be of value in the control of radiant energy in industrial applications on Earth.
Gold is endowed with specific properties — including reflectance, durability, conductivity and workability — that make it extremely useful as material for insulation for spacecraft, the instruments that power and support their operations and performance, and gear for the astronauts who travel in them.
It reflects as much infrared radiation as well as any potential replacement metal.
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It reflects as much or more ultraviolet radiation as any potential replacement metal.
It also absorbs substantial amounts of visible light.
It doesn’t rust or tarnish like copper or silver. It’s softer and more malleable than aluminum.
NASA notes that the most obvious use is as part of multilayer insulation (MLI), a “high-performance insulator that uses multiple radiation-heat transfer barriers to retard the flow of energy.”
Such “blankets” are familiar to us because of their use on external segments of the Apollo-era lunar modules.
But gold foil, gold leaf, and gold plating form important layers of protection for critical internal systems that are also susceptible to solar radiation.
Modern satellites use gold-coated Mylar sheets to protect against solar heat.
Gold is also used to coat the visors of astronaut helmets in order to filter out those harmful rays from the sun.
Increasingly complex microelectronic components for telecommunications, optics, and civilian aviation as well as spaceflight also benefit from gold’s unique combination of physical properties.
Advances by privately held Epner Technology Inc. in the late 1990s — spurred by NASA’s requirement for “the ultimate in electroplated reflectivity needed for the Mars Global Surveyor’s Mars Orbiter Laser Altimeter (MOLA)” — made gold a key element in health care instruments as well.
MOLA’s gold-plated telescope mirror will be protected from space elements for decades. And Epner’s proprietary Laser Gold technology is also used to achieve “rapid, accurate results” from at-home thermometers, so parents and kids here on Earth can get more efficient treatment.
Spacecraft and astronauts need protection from heat and radiation just like portfolios and investors need protection from fiscal and monetary threats.
Gold is a wealth preserver in both instances — the function it’s served for thousands of years for European aristocrats, Middle East oil barons, New World industrial titans and central banks. It’s a portfolio stabilizer and generational store of value.
It’s also a substance of interplanetary, interstellar, and intergalactic importance.
“Were we to be directed from Washington when to sow and when to reap, we should soon want bread.”
Editorial Director, Wall Street Daily