1. Says you. Human history says otherwise. 2. Our financial system says otherwise as well: Like no other commodity, gold actually offers an interest rate, just like the dollar, or pound, or euro, or any other currency. This rate is called the Gold Forward Offered Rate(GOFO). Central banks, who hold MONEY in their vaults, not commodities, actually lease their reserves out for interest income. Gold also trades against every currency in crosses, like all currencies trade against eachother, even though it is settled in dollars. Again, gold has all the characteristics of money, because it is the only pure form of money in existence. And it is the only form of money that has last the test of time, and human incompetence.
According to the Bible, 350 loaves. Today, after 3,000 years, a loaf of bread costs $2.2 according to the CPI. Or 622 loaves per one ounce of gold. On the surface, instead of retaining its value, it would seem that gold has actually increased its value by 1 fold.(buys twice as much bread now) In reality, bread is artificially cheaper in modern times due to government subsidies to farmers, so that food can be affordable. Either way, proof that gold has retained its value for thousands upon thousands of years. On the other hand, can you name a fiat currency in existence older than 100 years? 50 years?
This is some magical thinking. Why is gold the only pure form of money? Because it's durable, divisible, portable, and preserves value? What's so great about that? Many commodities have those attributes. The dollar does all those things until the US government falls, and is easily convertible to other fiat currencies when it does fall so that value is preserved in paper money so long as civilization has a functional economy (that is to say, that civilization exists at all). The thing that is pure about gold is that it is NOT money -- it's a half-step up from barter, the first step away from trading your extra goat for 2 bushels of wheat. It was something you could fall back on because you couldn't have a functional paper money system. Now, you can. It's global and digitized and robust.
What ever you are implying, a study in reality will likely surprise you with what a government bankruptcy actually looks like. A recent example, Iceland's bankruptcy in 2008-2011. Banking reform came after, as wells national debt restructuring. The prime minister stepped down. Members of their Secretary of Finance were actually arrested. The stock market declined by over 90%. So on and so forth. But these are all financial casualties. Farms didn't all of a sudden burn to the ground. There was no zombie apocalypse. People didn't suddenly start eating eachother, or even shooting eachother. Life went on. People lost fortunes, but life went on. Even the Weimar Republic, one of the most spectacular cases of government failure, where the currency devalued by 10,000 fold in a year, with foreign troops occupying their industrialized regions to repay debts in goods as opposed to worthless paper, even that ended with an issuance of a new currency. Backed by gold of course. This vision of a post-apocalypse society hoarding bullets and fresh water is just fantasy. The only thing that will change hands in vast quantities will be wealth. Something you will be able to hang onto if it is stored in a secure vehicle.
Another key attribute of money would be scarcity. The reason why sea shells went out of favor. This is why commodities like copper and iron make bad money. There is too abundant, and will run into the same issues of devaluation as fiat. With that in mind, please enlighten me on all the other commodities with the attributes of money. Not sure if this is serious. The US dollar does not preserve value, by a long shot. It has lost about 98% of its value since its inception. And this is without a government failure. Just business as usual. I'd continue this debate, but unfortunately, your understanding of gold and our monetary system is so rudimentary, based on these comments, that I'm not sure where to even begin. Let me just end by saying that while our currency is truly global and digitized, it is anything but robust. Digitization only means what used to be work of legions of printing presses, today can be accomplished by a simple stroke of the keyboard. And globalization only means that what before used to isolated cases of human negligence, is today the first time in human history a global coordinated race to the bottom of the well. Devaluation of this magnitude as never been seen in history, and we are the lucky ones who will bear witness to its fruits. Good luck to you.
you've also had this argument here (or maybe it was in the D&D) when gold was much lower as well :grin:
Is this your problem -- inflation? Yes, a dollar today is worth more than a dollar tomorrow, something which is more or less by design and widely recognized as in the best interest of the economy. But, not good as a vehicle for saving, you say, with which I agree. You can't bury it in the yard. There's no true saving of wealth, just like you can't save work; it needs to be put to work, invested to make more money. But you can store it in gold you say. Gold has the advantage of being efficient in its storage costs because small amounts carry a high market value (though it still costs something to store). And, controlling for market volatility, it keeps its purchasing power, or at least has in the past. But, how do control for that volatility? For the individual, you enter the market at a price, and then depending on what happens from there, you're either a winner or a loser. Even if gold breaks even as a commodity, the buyers do not -- they either win or lose depending on when they got in and when they got out. And, it can be a little or a lot. So you don't lose on inflation, but you can lose on speculation -- and do, half the time. It's more sustainable for a country or company that can buy gold in many increments and approach something like an average price. But then you have to wonder what they're doing it for. A company can make more by investing in their business or in the stock market. A country could too, or if they don't think it's appropriate to have investment income, they can cut taxes instead of buying gold. They could keep a gold reserve (which they do), or a oil reserve (which they do), or of Euros, Yen, etc (all of which they do). But, enough gold to undergird the dollar? Why would they want so much wealth sitting idle?
This thread is Gold. GOLD i tell ya. PS. I had no idea OP was Glen Beck. Who knew? Perhaps this is the big news we've all been waiting for?
Uh, are you claiming that if it wasn't for government subsidies, the price of bread is roughly the same 2000 years ago compared to its value today?
Of course not. But its value in relation to gold would be more similar to back then, 350:1. Because agricultural efficiency/mining efficiency/human efficiency in most capacities have advanced at roughly the same rate.
Do you guys really think anyone gives a **** about a few gun touting conservatives buying gold? No, the buyers of gold aren't the kookoos or the conspiracy theorists. They are irrelevant. As it turns out, they will benefit greatly from owning gold, but that is more of a broken clock being right twice a day phenomena. No. What you should really pay attention to though is the actions of our Eastern masters. As global power and wealth shifts in that direction in this century, what they do will be highly influential to the world of tomorrow. With China set to consume over 1,000 tonnes this year, that will be nearly half of total world production going to one country. Most societies begin with sound money, and then through time it is corrupted and degenerated by human greed, like clockwork. In ours, you are viewed as a nut today if you so much as discuss gold, as seen by plenty of comments in here. In the East today, you are a nut if you do not own some. Speaks volumes to the stages our respective societies are at.
