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Why Gold? It's useless!!
4

Why Gold? It's useless!!

Why Gold? It's useless!!

(OP)
Didn't know where to start this useless rant but here it goes (and probably explains why I'm an engineer and not a financial guy).

We, engineers, build stuff, value things that are useful and don't mind paying a little extra for something that will outperform cheaper things.

Now, with this financial crisis all I read is BUY GOLD, actual gold coins!! (yes, the buy, put in a chest and bury in your backyard type)

If gold is useless, well, has some very limited applications, why is it that is still considered so valuable?

If you think of it, stuff like diamonds or gems in general.... They are, in a practical useful way, WORTHLESS!! The most expensive things in life are typically the most useless!

What will happen if the economy tumbles further enough that people start now looking for things they actually need instead of treasuring something they can't eat, drink or easily build with?

Gold is practically useless as far as my limited knowledge goes, but it will apparently hold its value.

Could the root of the financial troubles be that they are based on a thing as useless as gold?

Aztecs used to value corn as a currency, Romans salt, etc...
 

<<A good friend will bail you out of jail, but a true friend
will be sitting beside you saying " Damn that was fun!" - Unknown>>

RE: Why Gold? It's useless!!

Or perhaps because we no longer use the gold standard?

Gold is one of those hedges against inflation.... at times like these, whatever the real usefulness or uselessness, when everything else is dropping in value, gold will rise.

If you want proof, go figure why so many governments regulate the sale of gold.... governments never mess with anything that is useless to the people, ergo gold is useful therefore not to be entrusted to the custody of the average voter in any great quantities.

Good buys are Kruger Rands.

Gold of course, does have its uses, rather more today than ever before. In actual fact the very fact that gold is considered so desirable is counter productive to its use in practical applications because it is too expensive.

Of course, if you don't like gold, you can buy lead, very similar in many ways.... if there is any left. Most lead here in the UK appears to have been garnered in during dead of night (from church roofs) and found its way to China.

What else has been going missing? well copper power cables regularly stolen from railways and from temporary power plant installations (one kindergarten had the power cable between it and a portable generator stolen on several occasions. Despite the almost nightly raids the local police appear not to have had any ideas about how to catch anyone.
 

JMW
www.ViscoAnalyser.com
 

RE: Why Gold? It's useless!!

IMO, gold jewelry is useless. Not much gold used on them as before.
Gold is needed for other uses in various industries.
Diamonds have become less useless for jewelry since they can now be grown in chambers. They are used more often in industrial uses because of them being grown.

Bottom line is it's still political because of where natural diamonds and gold are dug up.

Chris
SolidWorks/PDMWorks 08 3.1
AutoCAD 08; CATIA V5
ctopher's home (updated Aug 5, 2008)
ctopher's blog
SolidWorks Legion

RE: Why Gold? It's useless!!

The whole gold thing is a bubble in itself. It will burst soon enough.

V

RE: Why Gold? It's useless!!

Commodities traders say copper is the metal with a Ph.D. in economics.  As copper demand goes, so goes the economy.

Gold is a preserver of wealth.  Minus any cyclic price behavior, an ounce of gold buys the same amount of bread today as it did 3000 years ago.

RE: Why Gold? It's useless!!

(OP)
And 3000 years ago, gold did not have the potential uses technology could give it nowadays... albeit for the price.
So.. the economy is based on a useless product.
jmw: I understand about the  gold standard, but still, that does not give it any practical use or basis other than greed.
Tick: Is it a preserver of wealth just because mankind gave it a value just for the looks? How sustainable could that be in a more practical world?

Gold saw its huge up-value in the American continent when the europeans came. Before it was just an ornament, had some value but only to priests and rulers. the common person couldn't care less.

Copper, silver and other metals have a much broader practical use. Iron, since way back when!!

<<A good friend will bail you out of jail, but a true friend
will be sitting beside you saying " Damn that was fun!" - Unknown>>

RE: Why Gold? It's useless!!

Don't know why, it just does.

Perhaps the scarcity of gold is a built-in anti-counterfeit measure.

RE: Why Gold? It's useless!!

Are you forgetting that gold is shiny and attracts the attention of potential mates better than most other naturally occurring elements or compounds?  Diamonds are similar (perhaps superior) in this capability.  

It is not at all surprising that an engineer would see such features as valueless... but the economists and marketing types seem (once again) to have it right.


 

RE: Why Gold? It's useless!!

I agree with tick - scarcity is the prime reason.  Diamonds aren't really that scare, and their market is controlled to protect their value.
If all of the gold that has ever been mined to date were part of a cube, that cube would fit on a tennis court.  It is easily recognizable, can't be counterfeited, and has universal recognition.

"Good to know you got shoes to wear when you find the floor." - Robert Hunter
 

RE: Why Gold? It's useless!!

and it's hard to counterfeit.   

RE: Why Gold? It's useless!!

I just could not figure out the attraction of gold teeth. In West Virginia it means you can't afford a toothbrush, elsewhere it's an ostentatious grille display.

RE: Why Gold? It's useless!!

(OP)
So.. the economy is/was based on something that is hard to counterfeit, scarce but not to the point to make it unavailable world wide and that has no practical use other than being basis of a monetary system?

I wonder.. You could trade a cow for a sow, a sack of corn and two chickens based on what they would produce or give you in the future.

Now we have something that has an arbitrary value assigned to it, basically a luxury value, and started trading with it and exchanging it for useful products.

That does not make sense.

On top of that, the economies are based on inflation, which means higher money supply with a finite resource as support? More money is supposed to be generated backed on gold, of which there will be no more that there is already. (Except for the american type economies that are based on inexistent money, loans). How can economies grow then? There should also be a finite amount of money. (i.e. all teh money in the world should be good to buy all the gold in the world but not an ounce more, if you were to import it from Jupiter)

And I wonder why we go into recessions/depressions or whatever you call them
 

<<A good friend will bail you out of jail, but a true friend
will be sitting beside you saying " Damn that was fun!" - Unknown>>

RE: Why Gold? It's useless!!

so you're suggesting that the total utility of all objects and devices ever created remains less than or equal to a fixed value, and nothing can be done to create additional value?  
 

RE: Why Gold? It's useless!!

(OP)
If a device gains additional value, it is just worth more gold.

No, what I am suggesting is: that the money supply should be as finite as the gold supply, if the actual value of a currency is based in a hard asset such as gold.

What I am questioning is the actual value assigned to an otherwise useless asset.

Why, if there is another reason than 'visual appeal' is gold so valuable that a currency can be backed by it?

Why not base it on something that can actually provide value, something finite if you will, and not perishable. Lead for instance.

However, I can see that if something actually usefull, such as lead, was given the task gold has, lead would become expensive and its properties would become unattainable due to price.

<<A good friend will bail you out of jail, but a true friend
will be sitting beside you saying " Damn that was fun!" - Unknown>>

RE: Why Gold? It's useless!!

could it not be that we assign a value to an arbitrary object (seashells, for example) so that it can be used as a means to facilitate transactions?  could it not also be that the amount of tender must increase over time if people create ever more value by modifying their surroundings?

 

RE: Why Gold? It's useless!!

I fail to understand why the efficincy of ones recycling processes, and the efficacy of a few miners, should be the controlling parameter for the growth in the world's economy.

Cheers

Greg Locock

SIG:Please see FAQ731-376: Eng-Tips.com Forum Policies for tips on how to make the best use of Eng-Tips.

RE: Why Gold? It's useless!!

Gold is valuable because everyone agrees it is.

RE: Why Gold? It's useless!!

I was working on a job recently where we had to provide reistance to overturning for a structural A-frame.  The frame was to be placed in a very restricted/enclosed area, and client restrictions prevented us using 'normal' holding down arrangements.  The only viable option available to us was to use a counterweight.

But with limited space, steel wasn't dense enough.  We wre looking at 30 tonnes or so.  Ideally 30 tonnes of platinum or tungsten.  But I would have settled for gold.

We dont have any in the UK (Gordon Brown sold it) but I believe you have around 4500 tonnes in fort knox.

So gold is useful for something.

 

RE: Why Gold? It's useless!!

Quote:

ewh (Aerospace) 9 Mar 09 15:54  
If all of the gold that has ever been mined to date were part of a cube, that cube would fit on a tennis court.  

...and 1/3 of it would be sitting in Fort Knox and New York right now?  That doesn't sound right.  A doubles court could fit a cube 36 feet on a side, which would be about 2.5e+10g of gold at room temperature, or 25.5 tonnes (metric tons).  

wiki The United States Bullion Depository holds about 4,603 tons (4,176 metric tonnes) of gold bullion (147.399 million troy ounces[1]). It is second in the United States only to the Federal Reserve Bank of New York's underground vault in Manhattan, which holds about 5,000 metric tonnes of gold in trust for many foreign nations, central banks and official international organizations.

wiki It has been estimated that all the gold in the world that has ever been refined would form a single cube 20 m (66 ft) on a side (equivalent to 8000 m³).  

That'd give about 157,000 tonnes.  
 

RE: Why Gold? It's useless!!

I didn't say that the accounting of it was correct, just that there isn't a whole lot out there.

"Good to know you got shoes to wear when you find the floor." - Robert Hunter
 

RE: Why Gold? It's useless!!

Fort Know, the New York bank, huh? I think my wife must have the next largest reserves.
She loves gold almost more than new shoes.
Its a bugger when we travel because the airport scanners are always going berserk (plus she has a steel pin in her arm which confuses them).

One attraction for gold is portability and saleability.
If you don't like your government then convert everything to something portable and leg it.

Also in this category are diamonds, rare postage stamps etc.

Gordon Brown; yes the signs were there early on that he had the financial acumen of a earthworm when he not only sold the UK's reserves at the bottom of the market, he sold so much as to depress the price still further. Then he devalued everyone's pensions (except government workers e.g. the local councils which is probably why we are expecting a huge hike in rates; not just to keep their pension funds topped up but because their staffing levels has expanded exponentially.)

Now he has done his bit to completely wreck the economy (while blaming the US) and he is now going round saying that he can save the world! Small wonder BHO barely gave him tea (and a couple of bits of tourist junk from the White House souvenir shop) when he came visiting.

JMW
www.ViscoAnalyser.com
 

RE: Why Gold? It's useless!!

jmw,
As far as scarcity, you would probably do better with other gemstones than diamonds.  That is a very controlled market, and the price does not reflect rarity.

"Good to know you got shoes to wear when you find the floor." - Robert Hunter
 

RE: Why Gold? It's useless!!

A little crude, but, gold is just as worthless as breast implants. And valuable for the same reason.

Only gold lasts longer.

RE: Why Gold? It's useless!!



I strongly disagree that gold has no value.

There are some engineering and scientific
reasons for gold's value I'm surprised no one here came up with.

It was originally adopted as a valious metal because of corrosion resistance. It is also easily "coinable" because of its ductility. It was, rationally, the best choice in the old ages for an "exchange token".

It was the only way an artist could execute his/her craft and make it as long-lasting as it was possible with the technique known at the time (and nowadays it's still a good option to do so).

It is, also, beautiful to the eye.


The value of gold rests in its unique metallurgy.

Actually, chosing gold as a "token" is more rational and wise than notes or virtual cyphers into a bank account.

You can't do alchemy with gold, but you can always add fictional cyphers to the account.
 

RE: Why Gold? It's useless!!

Fundamentally, back in the day, a small chunk of gold was easier to carry around and/or store than a sack of grain or salt or whatever.

So you get your sack of 'usefull commodity' exchange it at a point in time and space for some kind of token, or if you like IOU.  

This token is usually made of a durable material.  Gold is a good choice as it's inert, maleable, relatively scarce so unlikely to be excessively duplicated or de-valued & back in the day was actually found in its native form and didnt' need extensive refining etc. ...  The shiny eye candy effect is almost secondary.

Now, at a different point in time & space, you exchange this token back into 'usefull commodity' form.

That, as I understand it is why gold became a measure of wealth.  As to why it still is, I suppose it's a combination of a hange over to generations where it was the 'token' of choice rather than 0 and 1 in computer database/paper notes/base metal tokens/plastic cards with magnetic strips... and the shiny eye candy effect.

KENAT,

Have you reminded yourself of FAQ731-376: Eng-Tips.com Forum Policies recently, or taken a look at posting policies: http://eng-tips.com/market.cfm?

RE: Why Gold? It's useless!!

Related.

There was quite a well thought out and presented insight into the use of metals for money in the recent (and excellent) "The Ascent of Money" by Niall Ferguson, shown first on Channel 4 in the UK.

The relevant bit is the story of Francisco Pizarro finding huge amounts of silver in Peru and shipping it back to Spain to fund a war.  It didn't make Spain any richer, just fuelled rampant inflation.

The silver itself had no intrinsic value.  The fact that more of it was around lowered its value.
 

- Steve

RE: Why Gold? It's useless!!

Gold is also a pretty good electrical conductor of course.

Additionally, basing the financial system on something "useful" could bring it's own troubles, depending on what it is. For example, basing the financial system on silicon used in many electronics seems reasonable today. However, what happens if they start building atomic PCs and the best material is carbon. The usefulness of silicon declines, so the value goes down. I think the "luxury" value of gold (shiny, status symbol, etc) does a decent job of regulation. Not that there may not be better alternatives...

Even something like land, which is finite and certainly has usefulness, has it's drawbacks. I would argue that a productive farmer's field is more useful than a desert. However, what if we have a dust bowl and the farmer's fields in a certain area all become barren? Not much better than the desert then... Or if solar power becomes HUGE, maybe I'd rather have an acre in the Sahara than a farm field in Wisconsin.

No, the more I think about it, the better idea I think it is to have the finicial system based on something useless. At least then the only driving force is an artificial value. Seems easier to control in some ways. And if the demand for gold decreases, it's probably because the economy is going down and people aren't buying luxury items. Seems to follow nicely. Maybe it exaggerates effects somewhat, but it seems like it all balances out and settles nicely given time.


-- MechEng2005

RE: Why Gold? It's useless!!

If you're preparing for the apocalypse, a shotgun and some shells would probably be a better investment than gold.

Commodity gold costs money to store, making it a poor "repository of wealth".  If you buy it retail (so you can store it in a hole in your backyard), you lose a significant chunk of its value on re-sale.

Gold is a commodity, subject to the vaguaries of supply and demand just like all other commodities (including engineering services...).  Unlike diamonds, gold actually does have some supply pressure on its price, since gold ore is measured in ppm gold...  

It does have industrial uses which are not trivial either.  It's so costly though that substitution are usually made, but there are plenty of applications where only gold will do.

Diamonds are worth what, $50/carat or so, without the market controls that create artificial value for them.  Apparently there are people who can grow gem-quality blue diamonds now via vapor deposition, and the Russians alone could reportedly blow away the world market value in diamonds simply by dumping their stores on the market.  

RE: Why Gold? It's useless!!

(OP)
Nah, can't afford a an amount significant enough to make a difference.
 

<<A good friend will bail you out of jail, but a true friend
will be sitting beside you saying " Damn that was fun!" - Unknown>>

RE: Why Gold? It's useless!!

Silver prices tanked quite long ago, when film photography was overtaken by digital.  They are probably more or less stable now...maybe going up slowly over the future, as more products use silver plating for its antimicrobial properties.

RE: Why Gold? It's useless!!

i skimmed through this so i hope this point was not stated...

women like gold.

Men like women.

Enough said.

RE: Why Gold? It's useless!!

Gymmeh, I like it!

But why isn't the converse true? ponder
e.g.

Men like football...

....

.....
thumbsdown

 

JMW
www.ViscoAnalyser.com
 

RE: Why Gold? It's useless!!

I tried to get that across in my 9 Mar 09 15:29 post... but it's good to have a concurring opinion.
 

RE: Why Gold? It's useless!!

"Silver hasn't exactly "tanked".  There was a bubble that burst, but the overall trend is steady."


Interesting spin.  Take a look at 1984 to 2000.  Pre-'84, silver was around $10/oz. or more.  Then it dropped below $6, and stayed around $4 for the next decade and a half.  Only climbed back above 10 in the last few years...

RE: Why Gold? It's useless!!

Gold is used in producing semiconductors.  Diamonds are useful for cutting due to their extreme hardness.  Gold, diamonds, and other precious metals, such as silver, and gems, such as sapphires, have practical use in industry.

In semiconductors, gold doping can reduce minority carrier lifetime, and increase speed.  Gold contacts are not as low a resistance as copper initially, but over time, gold holds up better, i.e. no tarnishing takes place.

Cutting hard metals is best done with diamonds.  In the pre-CD days, when we played vinyl records, we used a diamond stylus to track the groove.

Gold and diamonds have plenty of practical uses.  Why would anyone even suggest otherwise?

Claude

RE: Why Gold? It's useless!!

cabraham,

   A guy I used to know on some electronics bulletin board systems used to rant that wealth comes from the sun, and that gold is nothing but poker chips.  It is not as if you cannot find anything to do with food.

   It is too bad they did not select cat poop as the poker chips.  I have a source of it.  

               JHG

RE: Why Gold? It's useless!!

Try a Google search under "Daniel Hannan you tube" and you will found The Brun has been given a bit of a kicking that has attracted world attention. It's worth noting the reactions.
Dan has something nice to say about Gordon Brown's gold sale.
OK, the you tube vid is here:
http://www.youtube.com/watch?v=94lW6Y4tBXs&eurl=http%3A%2F%2Fwww.spectator.co.uk%2Fcoffeehouse%2F3473051%2Fcan-the-internet-turn-dan-hannans-skewering-of-brown-into-a-story.thtml&feature=player_embedded
 

JMW
www.ViscoAnalyser.com
 

RE: Why Gold? It's useless!!

It's much more difficult to print more gold, than it is money.
However like land and stock, it can also form a bubble.

RE: Why Gold? It's useless!!

On the contrary, gold, as well as the other precious metals that serve a primary purpose of wealth storage, have many industrial uses.  Scarcity and/or cost to extract is where the inherant value lies, IMO.

RE: Why Gold? It's useless!!

It seems you are arguing against the entire monetary system.  I have a much bigger problem with a piece of paper I carry around that is worth less than the piece you may have because my piece has an engraved picture of Lincoln and yours has an engraved picture of Franklin.  Now there is something worth debating.

Saying gold is worthless because it is just shiny is like saying the Internet is crap because all you can find on it is porn.

RE: Why Gold? It's useless!!

Unotec,
Go back a few decades and remember when Nixon devalued the dollar in 72/73 by fully taking the US and by extension the rest of the world off the gold standard and arbitrarily setting a price. What happened?. Oil prices increased as a direct result of the dollar's devaluation and furthered that devaluation. A decade of stagflation. Mortgage rates over 20%. Gold prices increased by 1978 to 20 times its 1972 price falling back to approximately 10 times within months when it collapsed from its high of $800/oz. Also remember when Congress withdrew the Usery Law which limited interest rates that banks could charge; that's when thge highest interest rates were seen on mortagages until Reagan finally broke the back of the inflationary pschology gripping the US and the world.  

The value of money is largely psychological - just like the value of a stock, a home, labor or any other commodity. It's what someone is willing to pay and what another is willing to accept. In 1971 I could have purchased a Shelby Cobra for $1900, by 1974 it was worth $9000, by 1979 - $90,000. Why? Rarity and perceived value. I have learned not to kick myself!  

Rome went nearly bankrupt by sending its gold to China and India for silk, considered by wealthy Romans to be more valuable. India and China would only accept gold as payment. When the gold ran out,no silk for Romans.  
 

RE: Why Gold? It's useless!!

"Perceived value"- that's what it's all about.

It is reported that when the Hittites had iron and the Egyptians had only bronze, the Egyptians sent emissaries to the Hittites to discuss an fair trade weight ratio of iron for gold.

The Hittites reportedly replied that an equal weight of gold would suffice.  Anyone considering a swordfight armed with bronze while the other guy has iron would understand why.

The Hittites would probably agree with what I said earlier- if you're worried about the apocalypse, a shotgun and a big box of shells is probably a better investment than gold.  NONE of this stuff has any value other than what we assign to it- and these values are relatively stable only while we have the rule of law to enforce our mutual "understanding".

 

RE: Why Gold? It's useless!!

2
Gold is difficult to assay.

Not in terms of chemical or physical labs performing the work; but rather in the ability of the common person to determine the purity of the sample they are looking at.

Also, due to significant density (gold is almost lea, remember?) gold is a pain in the rear to carry around for purposes of commerce.  It is difficult to divide, and generally the activity of doing so removes trace value.  (i.e. the kerf thickness of a saw blade, or residue in a crucible)

To counter this problem, people get together and assemble promissory notes that represent certain volumes of gold.  

Now the ability to assess value, make change, and transport value has been greatly simplified.  Print your note on fancy paper, and you have currency.

Currency is worthwhile (and a good thing) provided that something tangible backs it.  For the same reasons that gold is valuable (scarcity), it was useless for a global economy.  Does that same 'tennis court' worth of Gold represent the value of all the world's raw materials, good, and services?  Of course not, unless we fancy backing our currency with denominations in 1/100,000,000,000,000 of an ounce of Gold.

Sometimes, a simple endorsement is all that is needed to give something value.  Elvis' guitar is worth $$$$ because it belonged to Elvis.  In the same manner, the USD used to be worth $$$$ because it represented the American ability to commerce.

Now, it seems, that the value of Americans is inflated in America's mind, and suspect everywhere else.  As an American, this smarts...

...but rest assured, Gold isn't the answer either.  I believe a recognition of the debts we owe, followed by the  hard work and earnest effort of my fellow Americans is the redemption for the dollar we are looking for.
 

RE: Why Gold? It's useless!!

Get some gold coins, so that you can bribe your way out of the country should the civilian militia take over and want to do away with you. Call it plan F (for final), hope it will go up in value and pray that we never go through such an unlikely scenario.

RE: Why Gold? It's useless!!

I hear that in Germany there are now dispensing machines to issue small gold ingots.
Of course, the price is about 30% above the actual gold price but that might be a price some people would be prepared to pay to be able to conserve something of their fortune.
I think, Zotdoc, the scenario you outline has more chance of occuring in the Uk than Germany, though.

JMW
www.ViscoAnalyser.com
 

RE: Why Gold? It's useless!!

rhodie:  don't wish too much or work too hard for the "redemption" of your dollar.  A high dollar gives you yet more license to buy that which others produce, and less incentive or ability for them to buy that which you produce.  A high dollar is a mixed blessing, so saith the Canadian whose dollar rises as yours falls...

RE: Why Gold? It's useless!!

Today is probably the worst time to buy gold.  Everyone knows to buy low and sell high.  If you're buying gold now, you're doing it wrong.  

Also, if the economy should collapse then gold will be useless.  Things of value will then become things you can eat, wear or defend yourself with.

RE: Why Gold? It's useless!!

jmw,
Over 25-years ago you could purchase gold ingots from vending machines at airports in Zurich and Geneva.

RE: Why Gold? It's useless!!

Gold was once very useful because you could go into any saloon and buy beer with it...now THAT is useful. cheers

RE: Why Gold? It's useless!!

You could also buy beer with rabbits (I think the pub changed ownership some years ago and moved over to the microwave-able manufactured meals so fresh rabbits do not longer appeal to the new owners).

PS
1 UK rabbit = 1 beer = ΔAu?

In Oz (where rabbits enjoyed unlimited s*x) and I guess the rabbit population is pretty high I would guess:

"N" Oz (not oz) rabbit = 1 beer = ΔAu? where "N2 is >1
 

JMW
www.ViscoAnalyser.com
 

RE: Why Gold? It's useless!!

Trading rabbits for beer?  I would then have my wife's blessing to imbibe as much as I like!  We go to much effort keeping them out of her spinach and lettuce garden.  I'm becoming thirsty at the mere thought of it!

RE: Why Gold? It's useless!!

The great thing about rabbits is they breed as fast as you cull them so unless you have a truly gargantuan thirst, you should do well.
You just have to persuade your nearest purveyor of beer to add local fresh food to the menu and then encourage him to include rabbit - Lots of nice recipes and especially appropriate to a country pub/restaurant.

Curiously, I had pub lunch the other day near Guildford (UK) and they had kangaroo burgers on the menu. We were forbidden to order this by my niece - I guess they don't eat shoes or pot plants - but that aside, if they can put Australian giant hopping rats on the menu you should have no trouble with rabbit.

(by the way, what is the roo to beer exchange rate in Oz?).

  

JMW
www.ViscoAnalyser.com
 

RE: Why Gold? It's useless!!

I can see it now, a resurgence of hassenpfeffer, yum!  Better known as carrot to the Bugs Bunny generation :>)

RE: Why Gold? It's useless!!

Storage of wealth against the apocalypse???

Go to the hardware store.

1  Drill bits   ( very hard to make )
2  Saw blades
3  Ammunition
4  Caulk
5  Adhesive
6  Tools


All consumables and hard to come by without trade and advanced industry.

Forget gold  ( if you think of apocalypse , or China refusing dollars )

 

RE: Why Gold? It's useless!!

Why the hardware store?
What about the liquor store. Try those little bottles they serve in the airplanes.
 

RE: Why Gold? It's useless!!

In Occupied France during the 1940's, those who sold women's cosmetics enjoyed income while other 'affordable luxuries' went unpurchased.

RE: Why Gold? It's useless!!

I don't think any storage of wealth that isen't easy trade or use isen't a good idea. That's the advantage of liquor.

On the other hand, if you can't transport it easy it creats another risk, such as loss from mother nature.

But being easy to transport makes it easy to steal.

Rhus the advantage of bank or brokerage accounts.

RE: Why Gold? It's useless!!

Hey everyone!

Althrough you all hitted very close to target with its physical properties and role in monetary systems, there is a combination of two elements you are missing:

eye appealing and rarety!

If it wasn't eye appealing, no one would want to wear it as jewelry and if it wasn't rare, it wouldn't be the symbol of wealth and power in ancient civilisations.

and from the symbol it was, it became culture in certain parts of the modern world, India for example.

just shows how much we are emotional being instead of rational ones!!

RE: Why Gold? It's useless!!

Never tarnishes.  Dig up a relic, wash off the mud and it still shines.  Touches on the desire for immortality.

- Steve

RE: Why Gold? It's useless!!

A good point, but a fine wine also has those qualities.

RE: Why Gold? It's useless!!

Gold is the most malleable and ductile of all pure metals. It can be beaten so thin you can see through it.

Gold reflects infrared and visible light as well as radio waves, it is used for the protective coatings on many artificial satellites, in infrared protective faceplates in thermal protection suits, astronaut's helmets, and welding helmets.  

RE: Why Gold? It's useless!!

My old underwear is golden and so thin you can see through it, and it forms a protective barrier from gaseous release for the people around me. That somehow still does not make them attractive, even to females.

RE: Why Gold? It's useless!!

Maurice, you need to rework it into more of a toroid shaped object and cement a shiny rock onto it.  Females, for some reason, will then find it more attractive!

RE: Why Gold? It's useless!!

I tried the old potato trick, but no one told me that the potato goes in front.

RE: Why Gold? It's useless!!

Isen't gold used as a conductor in semiconductors manufacture? So there is a use other than shiney trinkets.

But back to the orignal concern, they do make copper, nickle, silver, and platinum coins (maybe not with a demonition on them). So if you don't like gold, buy some other type of coin.

If your old underwear is golden, then you need to make a trip to a store to replace them.   

RE: Why Gold? It's useless!!

cranky108,

   Gold coins, platinum coins, nickel coins and coins of whatever other material you may think of, are not self-transporting.  Cattle are used as wealth in a few parts of the world.  They are self transporting.

   This could be the start of an interesting robotics project.   

               JHG

RE: Why Gold? It's useless!!

What is this thing with self transporting?

The change pocket in my car is self transporting, so is anything in it.

A cow or robot, or a car cost something to self transport. So why exactly do you want or need it?

Or I guess you could invest in cars, they do have a value, but they generally don't increase in value, and can even be worth less than the metal value.

RE: Why Gold? It's useless!!

Since when is money not self-transporting? You must not be married with children.

RE: Why Gold? It's useless!!


The problem with gold as a money supply is that gold is a commodity. Like all commodities, the value of gold is dependent on the supply of gold and the demand for gold.

Gold is dug up out of the earth and then consumed in industry and for consumer goods. The amount of gold dug up out of the ground varies with the luck of the miner and the money available to find gold. The use in industry varies with the economic outlook.

If you picked a commodity to use as a money, why would you pick gold? You could just as well as another commodity like pork bellies, wheat, or something else.

The only thing interesting about gold is that you can hear the same ads for gold on both the extreme right wing talk shows (m weiner et al) and the middle of the road talk shows (air america). The people that listen to talk radio seem to have little knowledge of economics.


 

RE: Why Gold? It's useless!!

You would have to take care as to what other commodity you chose.  Wheat is great until it gets moldy or eaten by rats.  I don't even want to go into pork bellies.

Before the invention of central currency, localities experienced booming times.  Commodities such as wheat had to be spent before they went bad, and that spending was local.  Municipalities were flush enough to begin the boom in cathedral construction.  When the reigning powers realized that they had no control over the real wealth of their countries, they started introducing "coins of the realm", which gave them the absolute control that they desired.  They were the only ones allowed to "create" such wealth.  Fast forward to today with the Fed, the IMF and the World Bank, and it's easy to see that they aren't going to be willing to give up any of that control without a fight.
So, yes, using commodities for wealth exchange once more may indeed be a better overall solution.

"Good to know you got shoes to wear when you find the floor." - Robert Hunter
 

RE: Why Gold? It's useless!!

It's true that the relitive value of gold depends on supply and demand, like pork bellies. However there are other minerals that also have a value, and somewhat long life.
This becomes an issue on weather to own gold or other things.

After all there isen't enough gold to feed the world demand, so other things with a value must stand in.
Silver comes to mind, as does gems, copper, nickle, and,  platinum.

RE: Why Gold? It's useless!!

I'm with you on that one Maurice.  I swear the stuff just evaporates out of my wallet some days.  At least the oldest two are now gainfully employed and in the process of learning just how laborious it is to "dig gold".

RE: Why Gold? It's useless!!

Of all the money that is in curlation, just how much of it is electronic?

My pay check is electronic. My taxes are paided electronicly. I pay my bills electronicly. Where is the need for paper money? Why do they need to print more money than is being worn out?

At least with gold you don't have to worry about identy theft, but dosen't solve counterfitting.

RE: Why Gold? It's useless!!

Sorry if this has been mentioned, I skimmed this thread and probably missed a bunch---

When I retired I devoted my time to commodities trading, options, uncovered calls, etc.  Mostly gold.  In fact, primarily gold.

A little background...When gold 'took off' in the 80's or so, most of my cohorts bought gold, Krugerrand and such.  Gold topped at <$800 then...I was too poor to get "on the band wagon" as it were...Damn good thing, too.  The bottom fell out of gold in the 90's.

So...Trading options in gold, for me at least, was a good idea in 1998.  Priced in the $200/oz range, gold futures were a very good buy and selling out in '07 at <$800 was even better.  I did not get greedy, made a little profit and I pretty happy about it.  My mates are just now able to sell their "gold" for ~$800, even though the "market" is substantially higher.

Food for thought!

Rod

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