Gold surges to new high above $1,200

[BigDH01]

Thousands of years of history of gold being used as currency compared to stone wheels ? Be serious.

And in the thousands of years before that it was wheat and copper and ivory and livestock, etc, etc.

And if you actually experience hyperinflation, then many things could become stores of value. In Zimbabwe, schools have started to demand payment in cows and goats.

You seriously think that gold will lose all its value ? Making gold is about as likely as someone finding the philosophers stone .

Or as likely as walking on the moon was to ancient Romans or manufacturing diamonds was to African diamond traders, right?

People may be fickle, but in over two thousand years I never heard of any report of someone turning down gold.

And surely this means that gold has been the universal store of value for everyone and every time in those two thousand years, right?

Gold has properties that other metals do not and is used for many things besides jewelry.

And the other metals I mentioned have no use-value?

 

[Modelworks]

And in the thousands of years before that it was wheat and copper and ivory and livestock, etc, etc.

Gold has been around as long as copper, they both tend to be found in the same mines.

And surely this means that gold has been the universal store of value for everyone and every time in those two thousand years, right?

Yes it was universal. There was not a time in history when gold did not have value even among the most primitive of people when it was valued for its color alone. Artifacts from 4000BC have been found made of gold. That is a pretty good track record for something to remain valuable.

And the other metals I mentioned have no use-value?

Gold has properties that make it unique among metals and hard to replace . To say that another metal can just replace it is like saying hydrogen can replace oxygen.

 

[BigDH01]

Gold has been around as long as copper, they both tend to be found in the same mines.

And they've both been used as stores of value. It hasn't stopped copper from being strongly devalued.

Yes it was universal. There was not a time in history when gold did not have value even among the most primitive of people when it was valued for its color alone. Artifacts from 4000BC have been found made of gold. That is a pretty good track record for something to remain valuable.

A pretty bold statement to make, and your conclusion doesn't follow your observation. Thousands of years from now, people will dig up glass from my kitchen cabinets. It doesn't mean glass is particularly valuable today or that it is my store of value. There's a difference between having value (nearly everything I own has some value) and being a society's store of value.

Gold has properties that make it unique among metals and hard to replace . To say that another metal can just replace it is like saying hydrogen can replace oxygen.

The only particularly unique thing about gold, in the sense of it having unique value as currency, is how people perceive it. There are metals that are more rare and more valuable (as measured by the USD). If you are describing use-value, then the metals I mentioned earlier also have unique properties among metal. I'm not sure why gold would be more or better unique.

 

[Dissipate]

So what?

I'm not invested in MM (except for my extreme liquidity fund which is less than 2% of my portfolio). As far as my investment choices, I'm up 400% over the last 15 months, 60% since the beginning of the year. If you want proof you can look at my marketocracy account, which is public, which mirrors my own portfolio.

You may think gold is a great investment, but it isn't. Betting on the failure of society is stupid and assumes a static mindset with only one scenario. That alone is ridiculous and limiting but is unsurprising coming from somebody so ridiculously tunnel visioned and intellectually limited, like most ron paul bots and doomsdayers.

You know, Warren Buffet's father was the same way. Thought the democrats were going to destroy the country and the dollar. He bought gold, put flour in the attic, and helped his brother (buffet's uncle) buy a rural farm for the eventual collapse.

His father did pretty well in life but wasn't the world's richest man. Perhaps you should learn something.

Least of all do I want to be a 'doomsdayer'. I would much rather use my money to start a business, invest, advance my career, and a whole other host of things. Problem is that there are these people called politicians, bankers and their associates who together control probably at least 90% of the total wealth. Their actions are diametrically opposed to me accomplishing the above. Lapdogs like you want people like me to not only take a 50%+ total tax rate up the fucking rump, be subjected to a massive number of idiotic regulations, toss all hope of collecting social security or medicare out the window (eliminating any hope of any 'easy' retirement), but then be happy about it and go out and create jobs. Could I do it? Possibly. Some like Warren Buffet certainly have, but that was decades ago when the debt levels were much lower. Hence, my plans now actually include potentially leaving the country for some place that isn't as far along on the path of the toilet bowl flush.

 

[StageLeft]

Reasonably, yes, gold will always have value, but if you have US cash right now it will have value, too. And if it doesn't it means that the currency has exploded in which case are you likely to have enough gold to make any difference at all? And if the currency has exploded those in debt with fixed rates (home "owners" and those with car payments) will laugh all the way to the bank with their wheelbarrows of cash, so if you are truly concerned about inflation you should be getting indebted on fixed-rate debts.

 

[Acanthus]

If you want metals that will appreciate, i would go with craptons of Lithium.

If you want elements that will appreciate, i would go with Helium.

 

[bamacre]

In other words, gold only has value because of peoples' perceptions of it.

That's true about almost everything.

 

[BigDH01]

That's true about almost everything.

True, which is why I have difficulties pointing to something and saying that it will definitely be the thing to own if this other thing has lost all value.

 

[bamacre]

True, which is why I have difficulties pointing to something and saying that it will definitely be the thing to own if this other thing has lost all value.

I don't think that's what he's saying. Gold is overall more of an insurance policy than an investment. I don't think anyone is out there telling people to put all their money in gold bullion. In the long run gold isn't going to pay off as much as other investments, sure, but in the long run, gold is a safer bet. Lower return, but less risk. In shorter periods of time, this might not be the case. Look at it this way, suppose you dug up a treasure chest that was 100 years old. Would you rather it be filled with gold, or US currency? I think right now, people who are buying gold are looking at all the monetary inflation that has occurred and speculating there will be more to come. And not just in the US, but globally.

 

[BigDH01]

I don't think that's what he's saying. Gold is overall more of an insurance policy than an investment. I don't think anyone is out there telling people to put all their money in gold bullion. In the long run gold isn't going to pay off as much as other investments, sure, but in the long run, gold is a safer bet.

This is only true if you believe that people won't lose faith in it, decide that another precious metal, gem, etc, etc is a better value store, or that a new large supply of gold will ever be found. Much of gold's value is derived from people's faith, and as I said before, people are fickle.

In a truly dismal economic scenario in which traditional investments tanked and our modern economy collapsed, I can't imagine gold being that value store. Chiefly, in my community, there simply isn't enough of it to make it a practicable currency (at least without reducing its purity, but then you run into the same inflation issue). Would people still accept gold? Maybe, but if people are trading goats, wheat, property, gems, why do I need to insure myself with gold? Who knows what any future exchange rate will be between goats and gold, diamonds and gold, etc, etc. In some hypothetical doomsday future, I may be better off now buying property or pure aluminum.

Lower return, but less risk. In shorter periods of time, this might not be the case.

It's not the case because gold is traded like any other commodity. It's no more a value store than wheat, silver, copper, oil, etc. I can only imagine that people like owning gold more than the rest because they picture a hypothetical doomsday scenario like the one I imagined above.

Look at it this way, suppose you dug up a treasure chest that was 100 years old. Would you rather it be filled with gold, or US currency?

Irrelevant question. I don't spend my time digging up treasure chests, I spend my time trying to maximize current and future wealth. If I was smart, or in your example, if the person burying the chest was smart, I'd invest the money instead of converting it to gold and burying it in the ground.

I think right now, people who are buying gold are looking at all the monetary inflation that has occurred and speculating there will be more to come. And not just in the US, but globally.

Which I think is a bit odd.

http://www.infomine.com/investment/...uoz,caluminum.xusd.ulb,ccopper.xusd.uoz#chart

If I really wanted to hedge myself against a weaker dollar using precious metals, I really could've done it with several. I actually would've done better buying platinum low. Given this history and how closely prices have tracked in the past, I'd say gold is a bit overvalued currently.

Of course, I could also do it using any number of investment vehicles or assets. Frankly, I'm not too concerned about global inflation (as long as my wages increase too, of course ) as I'm not sitting on a pile of old cash. And given that it's going to be a global phenomena, exchange rates shouldn't change too much. I'll still be buying relatively cheap Chinese crap and overpriced American grills .

That's if this period of rampant global inflation happens at all.

 

[Modelworks]

And they've both been used as stores of value. It hasn't stopped copper from being strongly devalued.

The percentage of gold in the world vs copper is one of the reasons gold is worth more than copper. Copper isn't cheaper because people don't value it as much as they did, but because there is more of it. Unless you know a geologist somewhere that is sitting on a major find the supply of gold in the earth is running out.

A pretty bold statement to make, and your conclusion doesn't follow your observation. Thousands of years from now, people will dig up glass from my kitchen cabinets. It doesn't mean glass is particularly valuable today or that it is my store of value. There's a difference between having value (nearly everything I own has some value) and being a society's store of value.

Nothing bold about it. History proves gold has always had value. I can't say what some hypothetical future holds .

The only particularly unique thing about gold, in the sense of it having unique value as currency, is how people perceive it. There are metals that are more rare and more valuable (as measured by the USD). If you are describing use-value, then the metals I mentioned earlier also have unique properties among metal. I'm not sure why gold would be more or better unique.

Everything has value based on how people perceive it. Gold is unique in its uses because of the properties of the element. The closest thing that could replace gold in manufacturing is probably silver, but it lacks a lot of the properties that make gold unique.

I would not recommend gold to someone as a way to get rich. I like it because it is a carefree investment. Something that can be bought , put in a safe place and forgotten about. I don't need to watch stocks or care about the worlds finances. The odds that it will become worthless are next to zero.

 

[Modelworks]

Would people still accept gold? Maybe, but if people are trading goats, wheat, property, gems, why do I need to insure myself with gold? Who knows what any future exchange rate will be between goats and gold, diamonds and gold, etc, etc. In some hypothetical doomsday future, I may be better off now buying property or pure aluminum.

Yes they would still accept gold. The reason is the same reason it was accepted before when people still traded goats and food on the barter system.

It's not the case because gold is traded like any other commodity. It's no more a value store than wheat, silver, copper, oil, etc. I can only imagine that people like owning gold more than the rest because they picture a hypothetical doomsday scenario like the one I imagined above.

Gold is rare , that is what makes it valuable. In your scenario people would use gold to represent a lot of food that is to be traded with someone 50 miles away. The same reason it was done centuries ago. It works in lieu of other forms of currency and since it is rare cannot be easily duplicated. Aluminum, copper, and other items are easily obtained . There would be no way to insure that the copper I gave you was representative of the value of the food or if it was just a copper pipe I melted down.

Irrelevant question. I don't spend my time digging up treasure chests, I spend my time trying to maximize current and future wealth. If I was smart, or in your example, if the person burying the chest was smart, I'd invest the money instead of converting it to gold and burying it in the ground.

If people during the time of treasure chests had invested their money they would be broke now as nothing from that era survived financially except empires.

If I really wanted to hedge myself against a weaker dollar using precious metals, I really could've done it with several. I actually would've done better buying platinum low. Given this history and how closely prices have tracked in the past, I'd say gold is a bit overvalued currently.

If I were trying to bet against the dollar I would do a lot of other things and none of them are investments in metals, but that isn't the reason I do it. I do it because I like it.

 

[BigDH01]

The percentage of gold in the world vs copper is one of the reasons gold is worth more than copper. Copper isn't cheaper because people don't value it as much as they did, but because there is more of it. Unless you know a geologist somewhere that is sitting on a major find the supply of gold in the earth is running out.

And there are metals more rare than gold, but I wouldn't recommend any of them as a store of value.

Nothing bold about it. History proves gold has always had value. I can't say what some hypothetical future holds .

Although you are betting on it.

Everything has value based on how people perceive it. Gold is unique in its uses because of the properties of the element. The closest thing that could replace gold in manufacturing is probably silver, but it lacks a lot of the properties that make gold unique.

But there are plenty of metals that are unique. Why should gold be any better as a store of value?

I would not recommend gold to someone as a way to get rich. I like it because it is a carefree investment. Something that can be bought , put in a safe place and forgotten about. I don't need to watch stocks or care about the worlds finances. The odds that it will become worthless are next to zero.

I can do much the same by buying index funds and get a higher return.

 

[BigDH01]

Yes they would still accept gold. The reason is the same reason it was accepted before when people still traded goats and food on the barter system.

Anything of value can be traded, the question is whether or not gold will always be the currency of choice. That's a logical leap.

Gold is rare , that is what makes it valuable. In your scenario people would use gold to represent a lot of food that is to be traded with someone 50 miles away. The same reason it was done centuries ago. It works in lieu of other forms of currency and since it is rare cannot be easily duplicated. Aluminum, copper, and other items are easily obtained . There would be no way to insure that the copper I gave you was representative of the value of the food or if it was just a copper pipe I melted down.

There are metals out there more rare than gold. Why don't you purchase those?

If people during the time of treasure chests had invested their money they would be broke now as nothing from that era survived financially except empires.

I could've purchased land and title. And if we have to worry about wealth, in the form of investments, being confiscated due to regime change, then we must also consider the confiscation of gold. There is certainly a precedent for it.

If I were trying to bet against the dollar I would do a lot of other things and none of them are investments in metals, but that isn't the reason I do it. I do it because I like it.

Then be my guest.

 

[JSt0rm]

you guys bring up a good point. A piece of paper saying you own gold wont be worth anything if the world goes to shit. Shotgun shells, gasoline, canned dog food and black leather will be more valuable then gold.

 

[Modelworks]

There are metals out there more rare than gold. Why don't you purchase those?

No other metal has the same history as being used for currency.

 

[Modelworks]

you guys bring up a good point. A piece of paper saying you own gold wont be worth anything if the world goes to shit. Shotgun shells, gasoline, canned dog food and black leather will be more valuable then gold.

I would never buy gold that I could not keep myself. If I wanted to put my money somewhere in exchange for a piece of paper I would use a bank.

 

[Jadow]

Gold rules period. I'm planning on picking up a few more ounces on the next dip.

I'd rather have real gold than an ETF with a bunch of funny money and computers behind the scenes.

 

[Zebo]

I know even less about the price of gold than I do about the stock market but I do know it's good to diversify. My dad thinks gold is going $5000 and up so he's hoarding but he makes me look like Polly Anna plus he can afford to take more risks than I can. I have a few ounces and about 120 lbs of silver that's it. I am opening a restaurant or another liquor store with cash. I am still buying working interests in O&G wells at auction. I still hold 3 lots ready to build. Makes no sense to me to let money just sit in safe while producing nothing. No potential cash flow. No income. Not to mention if a recover happens you're on the out with gold big time.

I also have guns, ammo, night vision, gear and combat training for a real SHTF scenario, good for nighttime hog hunting even when shit is cool like now.
Try to stay in shape, good if SHTF or not.
Keep a stock of basics in attic. Have 3 pairs of leather boots for every member of family. Food for a year and so on.
Live with a stocked pond and rural.

Diversify. I'll never be rich but I'll never be caught off guard either.