Gold

After being mentioned in many other posts here, I would like to talk about
gold a bit.
I have a friend. He is a certified financial planner, and my advisor. He
is a high school graduating classmate of my wife. He has the longest
running unsyndicated talk show in the United States, being on the air longer
than Rush Limbaugh. He is soon to syndicate if he has not done so by now.
The man knows his stuff.
We were visiting him, and the discussion of gold came up. He said people
would use it as a hedge, but he pointed out its impracticalities.
First, there's the ever present practice of fraud. Just like Josh, the deaf
mute in San Francisco who would take a nickel and coat it with gold, and get
five dollars worth of goods, there would be potential for fraud. And every
transaction would have to test the gold.
How would one receive change from a purchase?
The places that dealt in gold, or took gold as a medium of exchange would
have to set up heavy security, adding cost to an already bloated financial
situation.
People who went to these places for purchases would be marked as having gold
and subject to hijacking.
If society ever got that bad, a person having gold would have to become a
recluse, or just bunker in, and defend his pile with weaponry.
You can't eat gold.
Some of Al's thoughts. I thought he would say what a great way to go.
Steve
Reply to
Steve B
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That is why you only use it to buy a different currency not direct goods unless there is no other currency.
Not hard if you have a set price for gold. You just break it down to the smallest practical amount. At current pricing you could get to dime sized ok. Smaller would be difficult.
Most of them already have a LOT of security
Just the same as pickpockets and frauds are today. No different than if you use any other currency form. There will always be someone who wants to steal what someone else has.
You can't eat most forms of currency that have been used over the years. That is due to wanting a durable currency.
Reply to
Steve W.
--Silver's lots more fun. Plus it's cheap enough to machine these days.. ;-)
Reply to
steamer
I bought silver from 1974 through 1978. I would buy 100 oz bars after returning from weeks or months in the oilfields. Right before the Hunt brothers caused the spike. I did good.
Steve
Reply to
Steve B
Fraud is everywhere, the honest and dishonest soon would get sorted out. Deal with only known honest people.
Real silver and gold coins would work. Gold dust would work too. Or better yet a debit card backed by a deposit of gold.
It happens at the ATM's already.
I guess Bank safe deposit boxes are not on your menu.
Gold has no real value except what you can trade it for with people that want it. Who is better off a man with a billion dollars of gold or a farmer with plenty of food and wants a pound of gold for a pound of food.
As long as someone will accept gold as a payment for goods the gold has value. This is the same with paper money. Money is just an IOU that is as good or bad as the issuer. Tangible goods have real intrinsic value, money does not and neither does gold except for it's use in industry and jewelry. It is shiny colorful and easy to form into jewelry but after that it doesn't do you any good. You can't eat it, it won't keep you warm, it won't keep the rain and snow off your head.
John
Reply to
john
I have about 200 tons of steel in old machinery that is in the process of going to the scrap yard. Most of it was stripped for parts and the parts sold which already paid for the stuff. Now steel scrap is 16.00 per hundred wt. and it's time to scrap it. One thing about heavy steel, it is not likely that someone will break in and haul it off on you.
John
Reply to
john
...
Other coins, made of real silver, real nickel, and real copper, like they used to do before inflationary fiat currency became de rigeur.
And bank notes that are backed up by real money.
Hope This Helps! Rich
Reply to
Rich Grise
Like you, I owned a number of 100 oz silver bars for a while. Silver is an important industrial metal. I never felt a need to own gold at any price, as I always thought of it as not having enough ascertainable value.
i
Reply to
Ignoramus18941
No such a thing as "real money" even exists.
Reply to
PrecisionmachinisT
A great example is the stone money from the island of Yap in the south pacific. The money is made from carved, circular stones of quartz rock found only on another island. So the money represents a significant amount of labor of the person who first created it. You would think it is as "real" as money could be. Large sums are represented by very large, several-ton rocks. These rocks are kept in the center of the village. When one rock changes ownership, it is not moved, it is just announced to everyone that person A is handing it over to person B. In other words, the huge rocks are completely useless except as a trusted method of keeping track of who has provided some good or service. The original person who created the rock would have been more productive if he had done something useful for the village. Then he could have received from the village Chief a note that says he owns one rocks-worth of money. This is beginning to sound familiar, yes? (and, yes, I know it is not exactl;y analogous to what modern economies do).
Another good example is the disastrous effect the gold standard had on the economy of Spain when the Conquistadors brought back all that gold and silver. All it did was create huge inflation that sent their economy into a tailspin that some say they may still be trying to recover from.
The problem with people who want to go back in time is that they forget there are usually good reasons why things changed.
Reply to
anorton
Gold's chief value has shown itself of late. Most likely, readers have taken note that gold is right at $1,500/ounce.
Those that hold gold have retained their buying power, while those that have paper (and even real-estate in many cases) have not. The real issue is the loss of value of the dollar, not the value of gold. It simply reflects downfall of the dollar and other economic systems. They're all nothing short of a pyramid scheme.
There's no shortage of those that have opinions on the value of gold--some of which are valid, some of which are nothing short of insane.
Barring a complete collapse of the world and its economy, those that have means will always place a value in gold. History has proven that to more than anyone's satisfaction, if you're paying attention. Gold has been valued as long as man has known of its existence, several thousand years BC.
Someone made mention of coinage made of gold. Not a good idea, not at all. The value of coins is in the striking----but the value of gold is according to the market price. We aren't on a gold standard any longer, and I expect we will never be on a gold standard again, not ever. Further, a coin the size of a dime would have a value in the vicinity of $200 in keeping with the dollar of today. It clearly is not something one could use in trade, in particular for small purchases.
Gold is a commodity---one that is recognized world wide, and will remain so. Do not judge gold by the mindset of Americans, who, for the most part, don't have a clue. They're too busy worrying about a boob job or a new snow mobile.
Harold
Reply to
Harold & Susan Vordos
If that is true then
what was causing the dollar to increase so much in value from 1980-2001?
Reply to
jim
"Stormin Mormon" fired this volley in news:iua1e5$o1j$ snipped-for-privacy@dont-email.me:
If I recall correctly, it's part of the LDS code of conduct that each family have a year's stores on-hand.
'Seems like that would require a medium-sized barn for the average Mormon family!
LLoyd
Reply to
Lloyd E. Sponenburgh
If the subject is metal but the discussion is not metalworking, could you throw an OT in the heading.
Reply to
Jim Stewart
????
That didn't happen.
Harold
Reply to
Harold & Susan Vordos
Right that is exactly my point. Your claim that gold is measure of the value of dollar is bogus
The value of gold declined from 1980 around $700/oz to $260/oz in 2001 That behavior in the price of gold had little to do with the value of the dollar
And when the price of gold falls off a cliff again that won't have much to do with the value of a dollar at that point in time either
-jim
Reply to
jim
The ploy is that you buy this food at the church store at bloated prices, then buy it again because it doesn't have a very long storage life. I see tons of home storage foods for sale here in Utah at pennies on the dollar, all out of date. That would be like buying a dead dog. But the church loves it, and will sell you a whole new supply. Sorry, the food has to be blessed by the bishop, or it won't save you. Of course, that will cost ya.
Steve
Reply to
Steve B
Sure, Jim.
Steve
Reply to
Steve B
But what could be more metal content than gold.
Oh, well ...........
Steve
Reply to
Steve B

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