Do goldbugs do a FAVOR or an INJURY to the US economy?

topstuf

Not talking about the profit on mint bullion sales, but just gold hoarding, investing, collecting, amassing, stashing, etc.
Does the amount of money coming OUT of the regular channels of commerce do more harm than the likelihood that these VERY conservative folks may end up being the source of a "restart" if the debt spiral actually harms the dollar more than it already has?

mrearlygold

To each according to his need

to each according to his ability

RKKay

I don't know about anyone else, but I think Ira and Larry are good for the economy.

HonoluluDude

What "hoarding"? I don't see this hoarding you speak of going on.

Gold has NOTHING to do with "injuring" the economy.
The rising gold price is a symptom, not a cause.

The word "goldbugs" should be replaced with "the Fed"
in your poll question.

BECOKA

I think it is good to diversify. While it is possible for a stock or an economy to go bankrupt, I can't imagine gold ever going down below $200. Just think Enron, My grandmother lost $750,000, pretty much her life savings in this company. Before my granfather died he diversified in multiple energy company's. Generally a good move but after he died leaving everything to my grandmother Enron bought every single one of the companies.

Enough of that dirty company. The point is by diversifying into gold you reduce your risk of losing everything and add a stability factor into your portfolio.

RedTiger

Too bad about the Enron story. However, diversifying means many industry groups, not a bunch of companies in one industry. Times change, and even if there is no wrong doing, one industry can fall on hard times, and in the course of a very few years all those stocks can lose 90% of their value. There are many, many examples of this.

These days, to diversify, some foreign is good too, as are other asset classes, including precious metals.

As for the question, overall it is a modest benefit to have citizens keep some gold. It can be useful to the nation as a whole during times of crisis. Of course, if taken to extremes, it can hurt the economy. However, I think, private gold ownership could go up ten fold and not reach a level of harm.

Steve27

Neither.

cladking

<< <i>Neither. >>



Exactly.

The argument that buying gold injures the econmomy or is "non-productive" is a specious one. This would be equivalent to saying any behavior which doesn't lead to providing food, shelter, or clothing is a waste or that sex not leading to procreation is wasteful or sinful. If there were no people buying gold then what would happen to the value of the gold mining stocks? The world is a very complicated place and the markets are just the sum total of human desires and invention. Gold is no more sinful than jets or cold cream.

roadrunner

The gold price has gone up in response to the weakness in the US dollar, and that's all. Speculative excess comes and goes in all markets and eventually gets washed out each cycle. Now that's "productive."

The amount of gold investment is literally ZERO compared to the size of the stock market and currency markets. To consider that this has any effect because of pulling money out of stocks (ie. "non-productive" investments in your terminology) is absurd. And to call what the FED does to stir speculative investments (housing, bonds, stocks, currency) as "productive" is equally absurb. If one wants to say the excesses in the 1920's and easy credit that lead to the depression were "productive," then I guess what we have today is also productive....and therefore gold is "non-productive." To those that had gold up until 1934 when FDR confiscated it, were probably happy they had held on to it to that point. The founding fathers put their nation's economy into the hands of silver (and gold) because it was anything but "non-productive." It was a brake on the govt's ability to debase the currency. The brake was released in 1913 and then was tossed out of the car completely by 1971.

roadrunner

trozau

The Federal government can print all the money they want. It is not tied at all to gold.

roadrunner

I think if you follow our monetary history you will see gold tend to follow the amount of currency in circulation. What has happened over the last 35 years is the abberation in our history. It's pretty hard to keep the price of gold moving up in the 80's and 90's considering that stocks became an investment vehicle for the masses via 401k's and Central Bank gold sales (10,000-15,000 tons sold). Eventually things will tend to balance out again as the price of gold seeks out the Dow and the dollar.

roadrunner

saintguru

No effect at all. We aren't on a gold standard anymore. When we were gold held by individuals did lessen the backing of the dollar.

This is the problem we had in 1932 when bank failures caused people to demand gold for their deposits. They started expatriating this in mass amounts and it caused a banking crisis that William Woodin and FDR saw as very dangerous, hence the Gold Act of 1933. Individuals turned in billions in gold!

Newb

Gimmee Gold & Silver......all else is a house of cards eventually IMO....

michael

Do goldbugs do a FAVOR or an INJURY to the US economy?


overall a favor

cohodk

GOOD.

The louder I hear the "sky is falling" the more I know the "sun will shine"

Whitby

Folks, this argument is pretty much been around for oh say, a few thousand years. If I understand the poll, the assumption is that Gold or some other commodity would in fact be needed to bolster and/or secure a perceived value or rather confidence in our economy. In that case, the answer is none of the above. The world economy is based on alot more than just a handful of commodities. The average consumer IMO, at this time could not care less about the price of gold. In fact, these assertions just dont hold water in terms of curreny value of the dollar in relation to other currencies. IMO, things like trade deficits, in combination with Oil, politics, planets lining up, my dumb dog, the ugly cats, the CPI and ooops, oh yeah, not dreading retirement because dog food tastes terrible will have a far greater impact on this nations security than commodity brokers telling folks that their whole world will cease because they have alot of gold and want to make bucks. Yes, thats an old story.

If you want, take a long hard look at currencies and ecomies that have collapsed. Odds are, precious metals retained their value, odds are, many other items that are by fiat, PORTABLE WEALTH made the day. Oddly enough, not a soul has yet to mention bartar. Natures dirty little secret.......IMO

mcheath

if i had to choose one.................wait i don't, but to see the results..............well i dont think they hurt or help...........where is the show me the results..........ill take help

streeter

Personally, I like RKKay's reply the best---

I keep a certain percentage of my worth in 'collectibles'...........in the last five years.........a higher percentage of those collectibles have been gold. It could have just as easily been old Coke machines or Corvettes.

Or stamps

mhammerman

The Bank of England has 400 tons of bold bullion stored on site.
Fort Knox...147 million oz. of gold stored on site.

It is doing considerable injury to have to store all that stuff.