Posted on 06/28/2002 3:00:46 PM PDT by Lazamataz
Well, 'the new spoosman' and many like him have told me for months that the 'fiat' currency is worthless, and gold is the only valuable currency out there. Disregarding for a second the fact that these gold bugs are so ready to part with their gold for those 'worthless fiat notes', I would like to point out that since the height of their caterwalling, Jun 01 2002, gold is down from 326$ an ounce to 314$ an ounce today. That is a 4 percent drop in less than a month.
The 'fiat currency' people are out to lunch. I don't expect gold to do any better than index with inflation in the long run, and today managed to show a savage loss of $5 an ounce.
By adding that phrase "inflation adjusted" you just rendered your whole point obvious nonsense. It was already nonsense but "inflation adjusted" made it glaring. It is of the same order as "If we had some ham we could have some ham and eggs if we had some eggs."
CHECKMATE!!
6990th SS- Okinawa, 1970. I got a fine silk wool suit in Koza City that fits me to this day.
We may all achieve enlightenment.
Would you like to address the point or do you just want to throw around insults?
Gold is an industrial product.. It is also used in many processes. Modern gold production techniques have changed things. Much poorer ores are economical. Production was 400 Metric Tons per year in 1900, 2600 Metric Tons per year in 2000. Think it out for yourself.
Thats 83.5 million new troy ounces of gold per year.
Industrial use of gold is a good part of that. Half the gold ever produced has been produced since 1960.
For a limited time GOLD now under $314 an ounce. No coupons or rebates required - but you have to act fast. Buy gold on someone else's nickel as bank intervention pushes gold lower. Stock up now!
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There are very very few real economists, meaning those who study to discover why people act. Most bright active people, those who go into politics especially, do not study economics and learn nothing about it because it is a boring subject. It is not like sociologyor psychology that can involve one's emotions and give one a sense of being able to change the world. It is not exciting like history and not a tool of power and remuneration like Business. It is boring.
Most of those who study economics in school do so with an idea to use it to manipulate economies in order gain some utopia. Thesee are Keynesians and Monetarists and others. They think to make an economy work at optimum all the time by tinkering with currency and levels of "public" spending but wind up providing excuses for rulers and politicians to raise taxes without having to name it that.
The closest to real theoretical economists are the traditionalist/supply-siders. Politically they can be quite left or quite conservative. They understand how money works, why people choose what they choose.The big government man seeks to remove constraints on an economy as a means of increasing revenues to the government. The conservative sees that removing constraints on the economy allows it to reach its optimum, but both understand how it works.
Real estate speculation sure does. Real property will make you rich. Not very liquid but IMO the best long term investment if you don't mind the headaches.
I'm way too clueless and cautious to "speculate" with anything.
These bank interventions and governmetn interventions only cost the intervening institutions money. In the case of governments that money is yours and mine. They accomplish their intended effects on the gold price always much less then intended and always for miniscule amounts of time. Banks and governments think to sell gold to each other to give a cost free illusion of activity but some of it always dribbles off into the market, to the jewelers of India, otr the Gnomes in China and the institutions lose thereby. And the price of gold next week is the same as it would be were there no intervention.
| Plain and simpler: An ounce of gold during the Roman Empire would buy an nice suit and a pair of shoes. Today, an ounce of gold will buy you a nice suit and a pair of shoes.
You haven't lost a dime, but you haven't made a dime either. In 2000 years, your investment has done squat. Meanwhile, a single penny, invested at a mere 3% interest, would today be worth $472,551,787,558,300,000,000,000.00 You could buy a lot of suits with that kind of money. But why take the risk, right? Better we have one suit for sure than 472 million trillion dollars by investing in the sorts of things that pay 3%. |
Money drives history and ideology.
The problem with using gold for survival is that it has negative value. It is heavy. It won't defend you , and you can't eat it.
If you think of any survival situation, gold is always more of a problem than a solution. Take a sinking ship, for instance. Do you really think that gold will aid your chances of swimming to shore? Or consider a riot/battlefield condition. Will gold aid in your defense, or are other metals such as brass and lead (hint: bullets) more appropriate? Or consider that you are lost in a desert with no water around. Will someone trade their last drop of water for your bags of gold?
Likewise, gold is bad for economic survival. It's very inconvenient to carry around to trade for things, and getting "change" from transactions is problematic. It's difficult to lend out multiple times, so banks soon find that they have little or no financial leverage, too. That fact dries up loans, bringing business cycles to their knees.
Then too, gold is subject to the vagaries of world supply. A new "strike" that finds a plethora of gold can quickly devalue your own gold holdings through no fault of your own.
But the worst thing about gold is that it is an ugly, yellow metal. People are forever trying to trade it for paper currencies just to get rid of the stuff.
Everyone talks about gold as it is valued in Dollars. Even people who claim to like gold go around getting excited if the ugly yellow metal brings in a few more pieces of fiat currency in market trades one day over another.
Why would real gold-bugs care how much paper currency gold could be traded for? Don't real gold bugs disdain paper currencies?
Methinks they doth protest too much.
In reality, gold bugs are simply people who are stuck holding on to an ugly yellow metal, and what they really want is for some new sucker to come along and offer them more precious Dollars for their sickly supply of metal.
the 'fiat' currency is worthlessThey must have been getting their investment information from the 9th Circuit. In God We Trust and all.
Richard W.
The Euro cannot be ignored in discussions about currency.
Gold is more than just an asset. You cannot eat it , you cant make lawn mowers out of it ...Yes - gold is more than just an asset - and has a MULTITUDE of uses including a *starring* role in Electronics!Silver is not so reliable because the industrial uses are far greater
Gold possesses a unique combination of properties that have resulted in its use in a wide range of industrial applications.And this is just the Electronics Industry's use ...These applications in total account for a current consumption of approximately 450 tonnes of gold per annum. The particular properties of gold which make it suitable for use in electronic and electrical applications include its good electrical conductivity, its ability to be cost effectively fabricated into the desired form (high ductility) and excellent corrosion resistance (meaning it does not form tarnish layers even when operating at high temperatures.). Gold's high thermal conductivity ensures rapid dissipation of heat when used for electrical contacts. A number of gold products are manufactured for use in the electronic industry:
- Plating salts
- Wrought gold
- Evaporation wire for semi conductors
- Sputtering targets
- Bonding wires
- Solders and brazing alloys
- Thick film pastes
MORE at: www.gold.org/value/sci_indu/indust_app/electronic_apps.html
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Even plainer and even simpler: If during the reign of Caesar you had invested the price of a nice suit and a pair of shoes in gold, today you would have enough gold to buy a nice suit and a pair of shoes. That's an average return of 0% on your investment for 2000 years.