Gold is a paradox, useless yet expensive
Bayard1908
Posts: 4,046 ✭✭✭✭
There seems to be a gap in the logic of thinking that gold is valuable. It has almost no utility other than being pretty and shiny.
Centuries ago, man's metal working skills were very limited. Soft metals such as gold and silver were useful for making ornate objects because they could be hammered into shape. I strongly suspect the ease with which gold and silver could be formed into objects is why they were originally valued. Now, we have steel, aluminum, titanium, and plastic which all have better strength to weight ratios than the precious metals. I'd rather eat with stainless steel flatware than have to polish the family silverware. I don't want to carry around a gold laptop or cellphone.
I understand that some people think gold is money. Gold certainly has a history of being used as money; however, shells, feathers, and many other objects have also been used as money throughout history. Gold is only money if there is a social agreement to accept gold as money. In essence, we have to agree that a nearly useless substance is somehow precious. It all strikes me as rather illogical.
Centuries ago, man's metal working skills were very limited. Soft metals such as gold and silver were useful for making ornate objects because they could be hammered into shape. I strongly suspect the ease with which gold and silver could be formed into objects is why they were originally valued. Now, we have steel, aluminum, titanium, and plastic which all have better strength to weight ratios than the precious metals. I'd rather eat with stainless steel flatware than have to polish the family silverware. I don't want to carry around a gold laptop or cellphone.
I understand that some people think gold is money. Gold certainly has a history of being used as money; however, shells, feathers, and many other objects have also been used as money throughout history. Gold is only money if there is a social agreement to accept gold as money. In essence, we have to agree that a nearly useless substance is somehow precious. It all strikes me as rather illogical.
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in the fight don't they.
Gold is on a 4,000+ year winning streak. That is sufficient logic for me.
https://www.pcgs.com/setregistry/gold/liberty-head-2-1-gold-major-sets/liberty-head-2-1-gold-basic-set-circulation-strikes-1840-1907-cac/alltimeset/268163
Knowledge is the enemy of fear
The Dollar is only money if there is a social agreement to accept the Dollar as money. In essence, we have to agree that a nearly useless piece of parchment is somehow precious. It strikes me as illogical.
Now ask yourself - has gold ever broken it's social contract not to be printed or keystroked into existance by trillions of times more than the original agreement called for? Gold has no counterparty risk.
On the other hand, has the government ever broken it's promises or it's social contracts? RE: Social Security, the biggest ponzi scheme of all time. The Dollar is only as good as the promises kept by its creators.
We report. You decide.
I knew it would happen.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Gold still is considered very valuable, just like a suitcase full of $100's, or an e-account with a $1 million balance.
Its still only so because we put this artificial value on it, so its real in that sense. It could have been shinny stones...
But for modern man, its a tangible like gold.
BTW, we use it to put on cake, and tiny bits in astronaut space suite visors, and for electronics. But mostly we just move it and weapons around through the centuries to who has the most power, backed by what ever elusory reasoning of the time.
Gold would make an excellent bullet and sinker replacement as its safer than lead.
<< <i>There seems to be a gap in the logic of thinking that gold is valuable. It has almost no utility other than being pretty and shiny.
Centuries ago, man's metal working skills were very limited. Soft metals such as gold and silver were useful for making ornate objects because they could be hammered into shape. I strongly suspect the ease with which gold and silver could be formed into objects is why they were originally valued. Now, we have steel, aluminum, titanium, and plastic which all have better strength to weight ratios than the precious metals. I'd rather eat with stainless steel flatware than have to polish the family silverware. I don't want to carry around a gold laptop or cellphone.
I understand that some people think gold is money. Gold certainly has a history of being used as money; however, shells, feathers, and many other objects have also been used as money throughout history. Gold is only money if there is a social agreement to accept gold as money. In essence, we have to agree that a nearly useless substance is somehow precious. It all strikes me as rather illogical. >>
<< <i>There seems to be a gap in the logic of thinking that gold is valuable. It has almost no utility other than being pretty and shiny.
>>
This is untrue. Gold has lots of commercial and industrial applications. It has high corrosion resistance, it is highly reflective, it's highly conductive to name just three of the attributes we look for in the 21st century.
However, even discounting these uses, we need something to work as a medium of exchange. It can be whatever we all agree on, but gold has all of the attributes that we want:
Compact
Dense
Attractive
Malleable
Pure
Testable
Unique
And gold is rare in such a way that it requires a significant amount of work, effort, expense, etc. to get to it. Procuring it isn't just a random act of walking around and looking--with very few exceptions since the beginning of our shared history, its distribution and concentration (and our ability to obtain it) is universally commensurate with the effort necessary to obtain it.
All of these things figure into kind of an anthropic principle: It's an ideal, pre-made human-sized, human-scaled store of value and wealth.
--Severian the Lame
Aristotle's Good Money
Nowadays, they should add "counter-party risk" as one of the rows of those charts.
<< <i>It is highly useful in electronics due to conductive nature and resistance to corrosion.
I understand it's also used in the jewelry manufacturing industry.
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
<< <i>It is highly useful in electronics due to conductive nature and resistance to corrosion.
When I was a kid, I saw Julia Child cook with a solid gold skillet. She said it worked better than any skillet she had ever used. The list of uses for gold, much less economically feasible uses, isn't exactly large.
Twilight zone about gold
<< <i>There seems to be a gap in the logic of thinking that gold is valuable. It has almost no utility other than being pretty and shiny.
Centuries ago, man's metal working skills were very limited. Soft metals such as gold and silver were useful for making ornate objects because they could be hammered into shape. I strongly suspect the ease with which gold and silver could be formed into objects is why they were originally valued. Now, we have steel, aluminum, titanium, and plastic which all have better strength to weight ratios than the precious metals. I'd rather eat with stainless steel flatware than have to polish the family silverware. I don't want to carry around a gold laptop or cellphone.
I understand that some people think gold is money. Gold certainly has a history of being used as money; however, shells, feathers, and many other objects have also been used as money throughout history. Gold is only money if there is a social agreement to accept gold as money. In essence, we have to agree that a nearly useless substance is somehow precious. It all strikes me as rather illogical. >>
Someone doesn't know his history.
"“Those who sacrifice liberty for security/safety deserve neither.“(Benjamin Franklin)
"I only golf on days that end in 'Y'" (DE59)
I agree with cohodk that human labor is closer to perfect a currency as there could be...the one flaw is that it can not be stored.
A farmer, soldier and prostitute's units of human labor have been traded all throught civilized history...but they have limits as droughts, peace time and age all have their cycles and this is where gold shines ...as the perfect store of human capital.
Groucho Marx