... is bad! For Mother Earth.
See this long NYTimes report by Jane Perlez and Kirk Johnson for some seriously bad news about how gold is made.
Much of the problem arises due to two facts: There is a huge demand for gold in Asia -- particularly from India and China. Did you know that for India, gold is the only metal that is consumed in proportion to its population? NYTimes report says that the demand in India grew by a whopping 47 % last year!
The second factor, of course, is that many investors think of gold as a hedge against inflation.
On the supply side, things could be helped if the gold hoarded in the reserves of the US and many European countries is unloaded in the markets (perhaps, over a period of time). I remember the Swiss government did it a few years ago.
Where is the environmental disaster in all this? It arrives in the form of quirks of nature. Gold as such is quite rare. It does occur in its pristine, metallic form; but the early prospectors have already found and exploited the rich sources containing chunks of gold. The gold ores that are being used now are so lean in gold content that
[A]t sites like Yanacocha, one ounce of gold [about 30 grams] is sprinkled in 30 tons of ore. But to get at that ore, many more tons of earth have to be moved, then left as waste. At some mines in Nevada, 100 tons or more of earth have to be excavated for a single ounce of gold ...
Okay, what do you do with so much of stupid rocks and stuff, so that you can find that 'single ounce of gold'? You use a process called heap leaching on mountains of excavated earth:
These new man-made mountains are lined with irrigation hoses that silently trickle millions of gallons of cyanide solution over the rock for years. The cyanide dissolves the gold so it can be separated and smelted.
The cyanide, as we all know, leads to some serious problems. There are some indirect problems, too, that we don't often think about:
But much of those masses of disturbed rock, exposed to the rain and air for the first time, are also the source of mining's multibillion-dollar environmental time bomb. Sulfides in that rock will react with oxygen, making sulfuric acid.
That acid pollutes and it also frees heavy metals like cadmium, lead and mercury, which are harmful to people and fish even at low concentrations. The chain reaction can go on for centuries.
The reporters do give the other side of the story from the miners' point of view but the emphasis, clearly, is on convincing you that heap leaching is bad news.