The next time you pass the Hotel Alex Johnson here in Rapid City, consider its dimensions. Then imagine all of the gold that has been taken from the Earth in the last 6,000 years melted and molded into a single cube. All of that gold would approximate the dimensions of our iconic local hotel.

"All that glitters is not gold," goes the old saying, but in recent years, gold has been glittering more than at any other time since it reached its previous high in 1980, then fell into a long decline.

For the past four years, gold has climbed steadily: Its year-end prices were $430 an ounce in 2004, $517 in 2005, $638 in 2006 and $838 in 2007.

In early 2008, it spiked above $1,000 for the first time, although it would have to go above $2,200 to reach the same inflation-adjusted price for the $875 it commanded in 1980.

We remember Sir Isaac Newton as the Father of Modern Physics, but he was also the Father of the Gold Standard.

Appointed by King William III as the Master of the Mint in 1699, he used his genius to stop the flagrant printing of paper money in excess of the gold held in the vaults of the Bank of England. Sir Isaac defined the pound as a precise weight of gold and linked the amount of paper currency that could be outstanding to the weight of gold actually in the bank's vault.

Thus, paper money was backed by the "real" money, which was gold.

Newton's system prevailed for well over 200 years, interrupted by an occasional war, and made the British pound the strongest currency, and the base currency, of the world. It financed the British Empire's growth, which came to encompass one-quarter of the globe.

Only in 1931, at the beginning of the Great Depression, did Great Britain leave the gold standard. When the United States also did so two years later, an adviser to President Franklin D. Roosevelt called it "the end of Western civilization as we know it."

Hyperbole, as it turns out, but over the years since, many counties have experienced hyperinflation, where governments ran the printing presses.

The most egregious recent example is Zimbabwe, where inflation is 1 million percent per year. It takes a 50 billion Zimbabwe dollar note just to buy a loaf of bread.

There are several ways to invest in gold. An obvious one is to buy gold coins, of which the South African Kruggerand, the American Eagle, Canadian Maple Leaf, British Brittania and the Chinese Panda are most popular.

Coin shops sell them, as well as the largest banks in some cities.

A second is to buy stocks of companies that mine gold. There are many listed on U.S. markets without having to trade on foreign exchanges. The largest are based in the U.S., Canada, Australia and South Africa.

Their prices tend to rise and fall with the price of gold. Obviously, no one should do so without consulting a broker or financial adviser.

A third way is to buy mutual funds that invest in precious metals or gold specifically. All of the largest mutual fund families, such as Fidelity, Vanguard and others, have such specialized funds.

There are numerous caveats about investing in gold.

If you buy physical gold in the form of coins or bars, it has to be stored, probably in a safe deposit box.

In nearly every state, you will have to pay a sales tax. Gold pays no interest and no dividends. If you buy physical gold or stocks or mutual funds, you must remember that the price can go down as well as up. The recent trends have been strong, but that could change.

Gold frequently has a negative correlation with stocks. That is, if stocks go down, gold goes up, and if stocks go up, gold often goes down.

During the huge bull market in equities in the late 1990s, when the Dow Jones went up 20 percent or more per year for five consecutive years, gold languished.

At the maximum froth for stocks, gold declined from $375 per ounce at the beginning of 1997 to around $250 by the end of 1999. Gold also has a negative correlation with the U.S. dollar: A stronger dollar means weaker gold and vice versa.

Gold should not be regarded as just an investment, but also a hedge, an insurance policy against political turmoil, high inflation and troubles in other assets.

The 21st century is the first century in human memory in which gold has not been a part of the currency of most nations.

But gold is woven into the fabric of history and will remain important, whatever its fluctuations.

No explorer or prospector ever cried, "Thar's paper money in them thar hills!"

John Quinn, a professional investor for 40 years, and a 28-year veteran of Wall Street and Asia, is director and executive officer at National American University's Rapid City campus. Contact him at JQDrBoom@aol.com.