Gold Money
FoundingFather
Posts: 721
After thousands of years, gold is still money. Gold is STILL the store of value people use and flock to when worried. U.S. money and gold coinage is still the most popular and widely held. I admit that I have always been a gold bug, but come on, the facts and record are right there. In my view, the fiat money system the world uses only makes a better case for never forgetting gold as money and never dismissing it as a part of your long-term "investment portfolio." In short, it's hard to dispute the wisdom of keeping U.S. Gold coins in your overall mix. A good case can be made for silver too, which has been money much longer than gold, I believe. However I think most people would agree that Gold is King. I've studied the many forms of owning bullion over the years and it's hard to imagine a well-rounded portfolio not having U.S. Gold coins.
Discuss!
Discuss!
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No argument here.
"The silver is mine and the gold is mine,' declares the LORD GOD Almighty."
exists, because people have confidence, that
it serves that purpose.
Camelot
<< <i>Gold, great stuff for making jewelry, but other than that it doesn't have much use/value in a technologically advanced society. >>
We wouldn't have such an advanced society without gold. Gold is in every electronic device you own.
"Gold, as a store house or reletive real value exists, because people have confidence"
I don't know if I agree with this if you mean it exists just because people have confidence. I think gold as money/store of value has always existed for one larger reason, which is that it has intrinsic value.
<< <i>Gold is in every electronic device you own. >>
paper/wood products are used in everything that you own.
an average citizen when speaking about gold.
it is all the other uses which makes it valueable. mostly
due to its qualities like malleable, ductile, etc...
darn things would be toned and corroded in a few months
in bad conditions.
but most excellent gold will not!
<< <i>Come on guys, everyone knows that gold is nothing but a barbarous relic!
I agree, send all your old Gold over to me and i will get rid of that old relic for you
"The silver is mine and the gold is mine,' declares the LORD GOD Almighty."
<< <i>
<< <i>Gold is in every electronic device you own. >>
paper/wood products are used in everything that you own.
Ahhh, but gold is more resistant to termite attack.
Worry is the interest you pay on a debt you may not owe.
"Paper money eventually returns to its intrinsic value---zero."----Voltaire
"Everything you say should be true, but not everything true should be said."----Voltaire
roadrunner
It was covered in gold foil.
I assume the foil stops some types of space radiation.
The Mysterious Egyptian Magic Coin
Coins in Movies
Coins on Television
a store of value so long as people believe it has value. It is obsolete as money because the
planet can not support 6 billion people without a great deal of interconnectiveness and gold
money can cause this to break down.
The most important characteristic of money when coins were first made in electrum (gold con-
taminated with silver) was that it was percieved to have value so people would accept it in
lieu of bushels of grain or other commodity. Today the most important attribute of money is
that it is stable.
Strictly fiat currencies have the weakness of being easily degraded by politicians who wish to
buy votes but then, politicians always found a way to degrade currency when it was made of
gold also. The best solution is currency which is defined as a share of the wealth of the issuing
authority and is limited in its production by fiat.
you make a fine arguement, but i think you are wrong.
why does gold have to be the only metal used as money?
we have silver, copper, platinum, etc...
we could coin and back a lot of money using a fractional
technique. do we really need 5 billion oz of gold to cover
5 billion dollars? nope. a fraction would do because everyone
will not turn it in at once.
i trust gold more than i trust my government. until then i will
disagree.
edited to add: i know your arguements are parroted by many
other people. they acccept it as fact. yet fiat currency is a baby
compared to honest gold.
It's just a little premature to call both of these experiments a success story. The French Assignats, South Sea Bubble, and the John Law scam would tend to support otherwise.
roadrunner
are all used in industry, chemistry, electronics. However, as a storhouse of
value gold seems to have historically taken the prime position. There are several
reasons for this.
1. Gold is natually found in combination with silver in a compount knwn as electrum.
Such nuggets were standardized roughly and formed the early coinage systems.
2. Like the other mentioned substances, gold is reletively rare.
3. Gold is malliable, pretty to look at together with silver, is easy to work into objects
of art or coinage.
4. All of the above sustances could be used as a storehouse ofvalue, however diamonds
are difficult to grade correctly, platinum is hard to work, silver is bulky. The one thing that makes
gold stand out in 1st position is its ealy use as coinage, ease of storing and general acceptance
by people and nation states as a source of currency backing , monitary restraining influence on the
printing presses and as a storhouse of value
Camelot
<< <i> cladking,
you make a fine arguement, but i think you are wrong.
why does gold have to be the only metal used as money?
we have silver, copper, platinum, etc...
we could coin and back a lot of money using a fractional
technique. do we really need 5 billion oz of gold to cover
5 billion dollars? nope. a fraction would do because everyone
will not turn it in at once.
i trust gold more than i trust my government. until then i will
disagree.
edited to add: i know your arguements are parroted by many
other people. they acccept it as fact. yet fiat currency is a baby
compared to honest gold. >>
Enough said.
One of the gang is already dead, a mere skeleton, because a rock had fallen and shattered his glass chamber. Greed soon begins consuming the others. DeCruz kills Brooks by running him over with the getaway truck, losing control of the vehicle and wrecking it. Consequently Farwell and DeCruz must walk through the desert in summertime, carrying as much gold as they can.
Later, Farwell, who is older and somewhat obese, loses his canteen, and DeCruz forces him to ante up one gold bar for each sip of water. When the "fee" goes up to two bars, Farwell strikes DeCruz with the gold bricks, killing him. Farwell then continues to a highway, lugging the gold he refuses to abandon.
Finally, weak and dehydrated, he collapses. A car drives up and Farwell offers his gold to the couple inside in exchange for water and a ride to the nearest town, but expires a few moments later. As the man gets back into his car to report Farwell's death to the police, he quizzically remarks to his wife, "Funny. He offered me this like it was really worth something." The wife vaguely recalls that it had, indeed been valuable sometime in the distant past. The husband replies, "Sure, until they found a way to manufacture it," and tosses the gold bar away.
The Rip Van Winkle Caper
My posts viewed
since 8/1/6
Camelot
in supply. Production is variable as is consumption. Either of these can change subtlely and
the effects not noticed for many years at which time a currecy crisis would result. Large changes
in supply for any reason would result in large changes in the value of currency. Gold is probably
about the best commodity to use as currency because of the large stockpiles relative consumption,
but still falls far short of being an ideal currency.
Perhaps it would be possible to use grain stocks to back currency but ultimately it would look very
much like fiat currency and still be at the whim of politicians who would change the definition of
the value when he needed to fund his favorite project.
will generally find it politally easier to inflate the money, then take the
opposite bitter medicine of severly curtailing expensis. While the later
may be the more beneficial method, it will generally cause immediate
deflation of the economy, recession and general suffering of the citizens
in general. Thus, Inflating currency and increasing deficits beyond a sustainable level
will always lead to eventual collapse on a nations monetary system. When you debase
National currency, economic and political disaster can not be infinately delayed.
Camelot
<< <i>The Rip Van Winkle Caper >>
I loved that episode.
1969s WCLR-001 counterclash
to the Clankeye, Royal Bard.
Camelot
things with gold. INTERESTING!
WATER WORLD.......I haven't seen that movie since it came out. I watched it last night and extremely
interesting! All the polar regions' ice melted and flooded the earth swallowing up every square inch of land.
Major cities included!
THE KICKER?.....DIRT WAS THE MOST VALUABLE COMMODITY FOR TRADING!
Among other cheap trinkets and plants and pure water. Most everyone had to
recycle their own waste into water and drink it and use it to water whatever plant(s)
they had. A sign of things to come?
Can someone give me an example of fiat that has actually held its value or even lasted?
Forum AdministratorPSA & PSA/DNA ForumModerator@collectors.com | p 800.325.1121 | PSAcard.com
1. It has intrinsic Value
2. It is reletively rare
3. The money is backed to some
degree by precious resources
4.. This is , unfortunately, the most common
thing. Money that while not backed to any significant
degree by precious resources, it is printed in appropriate quantity
in relationship to the GDP. Further a stable curretncy, will
be accompanied by Government income in reasonable balance
to expenditures.
Camelot
<< <i>There is already one of the world's biggest gold investors who has a website where people can pay bills and buy things with gold. >>
That is the one I linked earlier. GoldMoney.com, founded by James Turk.
I wonder what tax implications there are once one makes a 'withdrawal', ie back to their usual bank account (as opposed to using it to buy something which might be a bit harder to track). Does anyone have an account there? Any thoughts about it?
I notice they have added silver as an option as well.
Cathy
Funny-- this is my opinion of paper money.
Rare gold couins have three componants. Face value, metal value
and collector rarity and condition value. Thus Collector grade Gold coinage
is in a different classification then say bullion gold.
Bullion gold is used not to make money , but to protect an absolute purchasing
value. This in 1920 it took the same amount of gold to equal the purchase price of a new car
as it takes today. In effect, you have not made money, you have only protected yourself against
the errosion due to inflation. This is true in general, except for very limited times of unusual volitility
in the value of gold, either up or down., and in periods of internationl price fixing and regulations against
owning gold as was done in when FDR assumed the Presidency.
Camelot
<< <i>I saw Gold Money and thought you meant GoldMoney.com. Fiat bothers me. It never seems to end well. >>
Our current monetary system has been "fiat" for 40+ years now.....uh oh.....Here comes Iwog.....
TorinoCobra71
up till the past 15 years has in fact been well supported by the industrial
and commercial output of the Nation. The debt has long been understated.
When we include the mandated benefits, Federal pensions
Government oblivations such as the FDIC, Pension guarentee, Mortgage guarantee
as well as the annual budgetary
deficites, our degree of fiscal irresponsibility is of a magnitude that is criminal.
Camelot
(People's Daily Online)
Updated: 2006-06-03 13:11
Due to the boom in gold market in the world this year, the individual transactions of gold in China are exceptionally prosperous.
Insiders see two features of the gold price. Firstly, the price keeps soaring, from 500 to more than 700 US dollar per ounce. Secondly the prices fluctuates sharply. Sometimes it rose and fell by 20 US dollar overnight, which brings great chance for investors to make profit.
It is estimated that the average return on investment on gold account with China Construction Bank has reached over 10 percent, and the transaction volume of this year will mount to beyond 10 tons.
"The silver is mine and the gold is mine,' declares the LORD GOD Almighty."
Gold is a base element so it can not be manufactured.
It is highly corrosion resistant, maintains it's sheen and appearance quite well, it is useful in electronics, it is a great conductor of electricity, it is a concentrated (high density) and easily transportable form of wealth, it is malleable, it is rare. It has typically only increased its supply by 2-3% per year at most. It is not believed to be in unlimited supply anywhere......at least not yet. It is widely used in jewelry. It can buy things. It is used as a means of currency, esp in Asia and other foreign nations. Most of all it is desired by nations and Central Banks who store it, trade it, sell, or buy it.
Considering that the Chinese are printing money at the rate of 18%+ per year (with many other nations on their heels), it's not a bad move to keep some of one's assets in PM's.
roadrunner
Of course-- but it still spends for $5.00 anywhere.
Since I've already bought my gold, I'd say YES! everyone should invest in gold now. They should buy and hold and believe that gold is an important part of diversification.
<< <i>like imagine using lousy old silver on connectors.
darn things would be toned and corroded in a few months
in bad conditions.
but most excellent gold will not! >>
By Ambrose Evans-Pritchard (Filed: 05/06/2006)
The world's big money brigade is snapping up gold bullion at eight times the rate originally thought, according to a report by UBS, the world's biggest gold trader.
The huge sums entering precious metals below the radar are likely to help to put a floor under the gold price after the dramatic fall of $112 an ounce in late May - the sharpest correction since the bull market began five years ago.
The Swiss bank said information from its trading floor suggested that funds and investors were allocating 20pc of their commodity portfolios to precious metals.
This is far more than the index tracking funds run by Goldman Sachs, Dow Jones-AIG, and others, typically taken to be a guide to overall investment flows.
UBS said these indexes gave a deeply misleading impression, obscuring a silent shift of funds from oil into gold.
The Goldman Sachs GSCI index, for example, has a gold and silver weighting of just 2.27pc, compared to 73pc for energy.
"If our traders' experience is representative of trends in the wider market, this has very important implications for metals investment," said the bank's gold expert, John Reade.
The UBS gold reports are watched closely by the markets. The Zurich bank is the world's leading gold trader and manages the biggest known stash of private client wealth, surpassing $1,000bn.
The extra volume in gold buying has been channelled through the London Bullion Market Association, eclipsing the Comex futures market in New York usually monitored by speculators for clues.
Gold recovered from lows of $618.50 an ounce last week to end at $637.30 after weak US jobs data renewed fears of a dollar slide.
"The sort of money that is chasing this market higher is not hot money," Ross Norman, director of the BullionDesk.com.
"It is slow steady investment by pension funds and long-term buyers. Anybody who thinks this market is about to head sharply lower is reading it badly," he said.
Mr Norman said there was a chronic dearth of new mine supply across the world due to eco-regulations and a lack of discoveries.
Output in South Africa, the world's biggest supplier, fell to 10.9pc in the first quarter of 2006 despite high prices. The country's production has reached its lowest level since 1923. "It's becoming very hard to get gold out of the ground," he said.
Oil states armed with an estimated current account surplus of $480bn in 2006 are thought to be feeding the "stealth demand" for bullion, led by Russia.
President Vladimir Putin, a frequent critic of dollar hegemony, has ordered the Russian central bank to raise the gold share of foreign reserves from 5pc to 10pc.
Russia's reserves have surged to $237bn - the world's fourth biggest - after rising 61pc in 2004 and 40pc in 2005. With a current account surplus of 10pc of GDP, it must sweep up a big chunk of global gold output just to stop its bullion share of reserves from falling.
In China, monetary committee member Yu Yongding last week issued the most explicit call to date for Beijing to diversify its $875bn reserves into gold to protect against a tumbling dollar. "We need to use some of the reserves to buy other assets such as gold and strategic resources such as oil," he said.
UBS warned that gold may have further to fall, followed by a period of sideways trading before embarking on another powerful upward leg of the bull-market rally.
Mr Reade said the immediate risk was a global economic downturn, dragging gold down in an avalanche sale of all commodities.
But if the global economy turns nasty, gold will ultimately decouple from its base metal cousins and regain its usual role as a safe haven currency and defence against dollar disorder. "The bottom line is liquidation first, haven later," he said.
"The silver is mine and the gold is mine,' declares the LORD GOD Almighty."